Exhibit 1.1
EXECUTION VERSION
MERCADOLIBRE,
INC.
2.25% Convertible Senior Notes Due 2019
Purchase Agreement
June 24, 2014
GOLDMAN, SACHS & CO.
DEUTSCHE BANK SECURITIES INC.
J.P. MORGAN SECURITIES LLC
As Representatives of the
several Initial Purchasers
listed
in Schedule 1 hereto
c/o
Goldman, Sachs & Co.
200 West Street
New York, New York 10282
Deutsche Bank Securities Inc.
60
Wall Street, 2nd Floor
New York, New York 10005
J.P. Morgan Securities LLC
383
Madison Avenue
New York, New York 10179
Ladies and Gentlemen:
MercadoLibre, Inc., a
Delaware corporation (the “Company”), proposes to issue and sell to the several initial purchasers listed in Schedule 1 hereto (the “Initial Purchasers”), for whom you are acting as representatives (the
“Representatives”), $300,000,000 principal amount of its 2.25% Convertible Senior Notes due 2019 (the “Firm Securities”) and, at the option of the Initial Purchasers, up to an additional $30,000,000 principal amount of its 2.25%
Convertible Senior Notes due 2019 (the “Option Securities”) if and to the extent that the Initial Purchasers shall have determined to exercise the option to purchase such 2.25% Convertible Senior Notes due 2019 granted to the Initial
Purchasers in Section 2 hereof. The Firm Securities and the Option Securities are herein referred to as the “Securities.” The Securities will be convertible into shares (the “Underlying Securities”) of common stock of the
Company, par value $ 0.001 per share (the “Common Stock”). The Securities will be issued pursuant to an Indenture to be dated as of June 30, 2014 (the “Indenture”), between the Company and Wilmington Trust, National
Association, as trustee (the “Trustee”). In connection with the offering and sale of the Securities by the Company pursuant to the terms of this Agreement, the Company is entering into capped call transactions with one or more of the
Initial Purchasers or affiliates thereof pursuant to a confirmation letter, dated as of the date hereof, subject to an agreement in the form of the ISDA 2002 Master Agreement (the “Capped Call Documents”).
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The Company hereby confirms its agreement with the several Initial Purchasers concerning the
purchase and sale of the Securities, as follows:
1. The Securities will be sold to the Initial Purchasers without being registered under
the Securities Act of 1933, as amended (the “Securities Act”), in reliance upon an exemption therefrom. The Company has prepared a preliminary offering memorandum dated June 23, 2014 (the “Preliminary Offering
Memorandum”) and will prepare an offering memorandum dated the date hereof (the “Offering Memorandum”) setting forth information concerning the Company and the Securities. Copies of the Preliminary Offering Memorandum have been, and
copies of the Offering Memorandum will be, delivered by the Company to the Initial Purchasers pursuant to the terms of this purchase agreement (this “Agreement”). The Company hereby confirms that it has authorized the use of the
Preliminary Offering Memorandum, the other Time of Sale Information (as defined below) and the Offering Memorandum in connection with the offering and resale of the Securities by the Initial Purchasers in the manner contemplated by this Agreement.
References herein to the Preliminary Offering Memorandum, the Time of Sale Information and the Offering Memorandum shall be deemed to refer to and include any document incorporated by reference therein and any reference to “amend,”
“amendment” or “supplement” with respect to the Preliminary Offering Memorandum and the Offering Memorandum shall be deemed to refer to and include any documents filed after such date and incorporated by reference therein.
At or prior to 8:00 p.m. (New York City time) on the date of this Agreement (the “Time of Sale”), the Company had prepared the
following information (collectively, the “Time of Sale Information”): the Preliminary Offering Memorandum, as supplemented and amended by the written communications listed on Annex A hereto.
2. Purchase and Resale of the Securities by the Initial Purchasers. (a) The Company agrees to issue and sell the Firm Securities to the
several Initial Purchasers as provided in this Agreement, and each Initial Purchaser, on the basis of the representations, warranties and agreements set forth herein and subject to the conditions set forth herein, agrees, severally and not jointly,
to purchase from the Company the respective principal amount of Firm Securities set forth opposite such Initial Purchaser’s name in Schedule 1 hereto at a price equal to 97.75% of the principal amount thereof (the “Purchase Price”)
plus accrued interest, if any, from June 30, 2014 to the Closing Date (as defined below).
In addition, the Company agrees to issue
and sell the Option Securities to the several Initial Purchasers as provided in this Agreement, and the Initial Purchasers, on the basis of the representations, warranties and agreements set forth herein and subject to the conditions set forth
herein, shall have the option to purchase, severally and not jointly, from the Company the Option Securities at the Purchase Price plus accrued interest, if any, from June 30, 2014 to the date of payment and delivery, solely to cover
overallotments.
If any Option Securities are to be purchased, the principal amount of Option Securities to be purchased by each Initial
Purchaser shall be the principal amount of Option Securities which bears the same ratio to the aggregate principal amount of Option Securities being purchased as the principal amount of Firm Securities set forth opposite the name of such Initial
Purchaser in Schedule 1 hereto (or such amount increased as set forth in Section 10 hereof) bears to the
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aggregate principal amount of Firm Securities being purchased from the Company by the several Initial Purchasers, subject, however, to such adjustments to eliminate Securities in denominations
other than $1,000 as the Representatives in their sole discretion shall make.
The Initial Purchasers may exercise the option to purchase
the Option Securities at any time in whole, or from time to time in part, on or before the thirteenth day from and including the Closing Date, by written notice from the Representatives to the Company. Such notice shall set forth the aggregate
principal amount of Option Securities plus accrued interest as to which the option is being exercised and the date and time when the Option Securities are to be delivered and paid for which may be the same date and time as the Closing Date (as
hereinafter defined) but shall not be earlier than the Closing Date nor later than the thirteenth day from and including the Closing Date (unless such time and date are postponed in accordance with the provisions of Section 10 hereof). Any such
notice shall be given at least two business days prior to the date and time of delivery specified therein.
(b) The Company understands
that the Initial Purchasers intend to offer the Securities for resale on the terms set forth in the Time of Sale Information. Each Initial Purchaser, severally and not jointly, represents, warrants and agrees that:
(i) it is a qualified institutional buyer within the meaning of Rule 144A under the Securities Act (a “QIB”) and
an accredited investor within the meaning of Rule 501(a) of Regulation D under the Securities Act (“Regulation D”);
(ii) it has not solicited offers for, or offered or sold, and will not solicit offers for, or offer or sell, the Securities by
means of any form of general solicitation or general advertising within the meaning of Rule 502(c) of Regulation D or in any manner involving a public offering within the meaning of Section 4(a)(2) of the Securities Act; and
(iii) it has not solicited offers for, or offered or sold, and will not solicit offers for, or offer or sell, the Securities as
part of the initial offering except to persons whom it reasonably believes to be QIBs in transactions pursuant to Rule 144A under the Securities Act (“Rule 144A”) and in connection with each such sale, it has taken or will take
reasonable steps to ensure that the purchaser of the Securities is aware that such sale is being made in reliance on Rule 144A.
(c)
Each Initial Purchaser acknowledges and agrees that the Company and, for purposes of the opinions to be delivered to the Initial Purchasers pursuant to Sections 6(e) and 6(f), counsel for the Company and counsel for the Initial Purchasers,
respectively, may rely upon the accuracy of the representations and warranties of the Initial Purchasers, and compliance by the Initial Purchasers with their agreements, contained in paragraph (b) above, and each Initial Purchaser hereby
consents to such reliance.
(d) The Company acknowledges and agrees that the Initial Purchasers may offer and sell Securities to or
through any affiliate of an Initial Purchaser and that any such affiliate may offer and sell Securities purchased by it to or through any Initial Purchaser.
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(e) Payment for the Securities shall be made by wire transfer in immediately available funds to
the account specified by the Company to the Representatives in the case of the Firm Securities, at the offices of Cleary Gottlieb Steen and Hamilton LLP, One Liberty Plaza, New York, NY 10006 at 10:00 A.M. New York City time on June 30,
2014, or at such other time or place on the same or such other date, not later than the fifth business day thereafter, as the Representatives and the Company may agree upon in writing or, in the case of the Option Securities, on the date and at the
time and place specified by the Representatives in the written notice of the Initial Purchasers’ election to purchase such Option Securities. The time and date of such payment for the Firm Securities is referred to herein as the “Closing
Date” and the time and date for such payment for the Option Securities, if other than the Closing Date, is herein referred to as the “Additional Closing Date.”
Payment for the Securities to be purchased on the Closing Date or the Additional Closing Date, as the case may be, shall be made against
delivery to the nominee of The Depository Trust Company (“DTC”), for the respective accounts of the several Initial Purchasers of the Securities to be purchased on such date of one or more global notes representing the Securities
(collectively, the “Global Note”), with any transfer taxes payable in connection with the sale of such Securities duly paid by the Company. The Global Note will be made available for inspection by the Representatives at the office set
forth above not later than 1:00 P.M., New York City time, on the business day prior to the Closing Date or the Additional Closing Date, as the case may be.
(f) The Company acknowledges and agrees that each Initial Purchaser is acting solely in the capacity of an arm’s length contractual
counterparty to the Company with respect to the offering of Securities contemplated hereby (including in connection with determining the terms of the offering) and not as a financial advisor or a fiduciary to, or an agent of, the Company or any
other person. Additionally, neither the Representatives nor any other Initial Purchaser is advising the Company or any other person as to any legal, tax, investment, accounting or regulatory matters in any jurisdiction. The Company shall consult
with its own advisors concerning such matters and shall be responsible for making its own independent investigation and appraisal of the transactions contemplated hereby, and neither the Representatives nor any other Initial Purchaser shall have any
responsibility or liability to the Company with respect thereto. Any review by the Representatives or any Initial Purchaser of the Company, the transactions contemplated hereby or other matters relating to such transactions will be performed solely
for the benefit of the Representatives or such Initial Purchaser and shall not be on behalf of the Company or any other person.
3.
Representations and Warranties of the Company
. The Company represents and warrants to each Initial Purchaser that:
(a)
Preliminary Offering Memorandum.
The Preliminary Offering Memorandum, as of its date, did not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading; provided that the Company makes no representation and warranty with respect to any statements or omissions made in reliance upon and in conformity with information relating to any Initial
Purchaser furnished to the Company in writing by such Initial Purchaser through the Representatives expressly for use in any Preliminary Offering Memorandum, it being understood and agreed that the only such information furnished by any Initial
Purchaser consists of the information described as such in Section 7(b) hereof.
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(b)
Time of Sale Information
. The Time of Sale Information, at the Time of Sale,
did not, and at the Closing Date and as of the Additional Closing Date, as the case may be, will not, contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading; provided that the Company makes no representation and warranty with respect to any statements or omissions made in reliance upon and in conformity with information relating to any Initial
Purchaser furnished to the Company in writing by such Initial Purchaser through the Representatives expressly for use in such Time of Sale Information, it being understood and agreed that the only such information furnished by any Initial Purchaser
consists of the information described as such in Section 7(b) hereof. No statement of material fact included in the Offering Memorandum has been omitted from the Time of Sale Information and no statement of material fact included in the Time of
Sale Information that is required to be included in the Offering Memorandum has been omitted therefrom.
(c)
Additional Written
Communications.
Other than the Preliminary Offering Memorandum and the Offering Memorandum, the Company (including its agents and representatives, other than the Initial Purchasers in their capacity as such) has not made, used, prepared,
authorized, approved or referred to and will not prepare, make, use, authorize, approve or refer to any “written communication” (as defined in Rule 405 under the Securities Act) that constitutes an offer to sell or solicitation of an
offer to buy the Securities (each such communication by the Company or its agents and representatives (other than a communication referred to in clauses (i), (ii) and (iii) below) an “Issuer Written Communication”) other
than (i) the Preliminary Offering Memorandum, (ii) the Offering Memorandum, (iii) the documents listed on Annex A hereto, including a term sheet substantially in the form of Annex B hereto, which constitute part of the Time of
Sale Information, and (iv) each electronic road show and any other written communications approved in advance by the Representatives. Each such Issuer Written Communication does not conflict with the information contained in the Time of Sale
Information, and when taken together with the Time of Sale Information, did not, and at the Closing Date and as of the Additional Closing Date, as the case may be, will not, contain any untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that the Company makes no representation and warranty with respect to any statements or omissions made in
each such Issuer Written Communication in reliance upon and in conformity with information relating to any Initial Purchaser furnished to the Company in writing by such Initial Purchaser through the Representatives expressly for use in such Issuer
Written Communication, it being understood and agreed that the only such information furnished by any Initial Purchaser consists of the information described as such in Section 7(b) hereof.
(d)
Offering Memorandum
. As of the date of the Offering Memorandum and of any amendment or supplement thereto and as of the Closing
Date and as of the Additional Closing Date, as the case may be, the Offering Memorandum does not and will not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading; provided that the Company makes no representation and warranty with respect to any statements
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or omissions made in reliance upon and in conformity with information relating to any Initial Purchaser furnished to the Company in writing by such Initial Purchaser through the Representatives
expressly for use in the Offering Memorandum and any amendment or supplement thereto, it being understood and agreed that the only such information furnished by any Initial Purchaser consists of the information described as such in Section 7(b)
hereof.
(e)
Incorporated Documents.
The documents incorporated by reference in the Offering Memorandum or the Time of Sale
Information, when filed with the Commission conformed or will conform, as the case may be, in all material respects to the requirements of the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission
thereunder (collectively, the “Exchange Act”) and such documents did not and will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(f)
Financial Statements.
The consolidated financial
statements and the related notes thereto of the Company and its consolidated subsidiaries included or incorporated by reference in the Time of Sale Information and the Offering Memorandum present fairly the financial position of the Company and its
consolidated subsidiaries as of the dates indicated and the results of their operations and the changes in their cash flows for the periods specified; such consolidated financial statements have been prepared in conformity with U.S. generally
accepted accounting principles applied on a consistent basis throughout the periods covered thereby; and the other financial information included or incorporated by reference in the Time of Sale Information and the Offering Memorandum has been
derived from the accounting records of the Company and its consolidated subsidiaries and presents fairly the information shown thereby.
(g)
No Material Adverse Change.
Since the date of the most recent consolidated financial statements of the Company included or
incorporated by reference in the Time of Sale Information and the Offering Memorandum, (i) there has not been any material change in the capital stock, long-term debt, notes payable or current portion of long-term debt of the Company or any of
its subsidiaries, or any dividend or distribution of any kind declared, set aside for payment, paid or made by the Company on any class of capital stock, or any material adverse change, or any development involving a prospective material adverse
change, in or affecting the business, properties, management, financial position, stockholders’ equity, results of operations or prospects of the Company and its subsidiaries taken as a whole; (ii) neither the Company nor any of its
subsidiaries has entered into any transaction or agreement that is material to the Company and its subsidiaries taken as a whole or incurred any liability or obligation, direct or contingent, that is material to the Company and its subsidiaries
taken as a whole, except in each case as otherwise disclosed in the Time of Sale Information and the Offering Memorandum.
(h)
Organization and Good Standing
. The Company and each of its subsidiaries have been duly organized and are validly existing and in good standing under the laws of their respective jurisdictions of organization, are duly qualified to do
business and are in good standing in each jurisdiction in which their respective ownership or lease of property or the conduct of their respective businesses requires such qualification, and have all power and authority necessary to own or hold
their respective properties and to conduct the businesses in which they are engaged, except where the failure to be so qualified or in good standing or have such power or authority would not, individually or in the aggregate, have a material adverse
effect on the
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business, properties, management, financial position, stockholders’ equity, results of operations or prospects of the Company and its subsidiaries taken as a whole or on the performance by
the Company of its obligations under the Transaction Documents (a “Material Adverse Effect”). The Company does not own or control, directly or indirectly, any corporation, association or other entity other than the subsidiaries listed in
Schedule 2 to this Agreement.
(i)
Capitalization.
The Company has an authorized capitalization as set forth in the
Time of Sale Information and the Offering Memorandum under the heading “Capitalization”; all the outstanding shares of capital stock of the Company have been duly and validly authorized and issued and are fully paid and non-assessable and
are not subject to any pre-emptive or similar rights; except as described in or expressly contemplated by the Time of Sale Information and the Offering Memorandum, there are no outstanding rights (including, without limitation,
pre-emptive
rights), warrants or options to acquire, or instruments convertible into or exchangeable for, any shares of capital stock or other equity interest in the Company or any of its subsidiaries, or any
contract, commitment, agreement, understanding or arrangement of any kind relating to the issuance of any capital stock of the Company or any such subsidiary, any such convertible or exchangeable securities or any such rights, warrants or options;
the capital stock of the Company conforms in all material respects to the description thereof contained in the Time of Sale Information and the Offering Memorandum; and all the outstanding shares of capital stock or other equity interests of each
subsidiary owned, directly or indirectly, by the Company have been duly and validly authorized and issued, are fully paid and non-assessable and are owned directly or indirectly by the Company, free and clear of any lien, charge, encumbrance,
security interest, restriction on voting or transfer or any other claim of any third party.
(j)
Due Authorization.
The Company has full right, power and authority to execute and deliver this Agreement, the Indenture, the Securities and the Capped Call Documents (collectively, the “Transaction Documents”) and to perform its obligations hereunder and
thereunder; and all action required to be taken for the due and proper authorization, execution and delivery by it of each of the Transaction Documents and the consummation by it of the transactions contemplated thereby or by the Time of Sale
Information and the Offering Memorandum has been duly and validly taken.
(k)
The Indenture
. The Indenture has been
duly authorized by the Company and, when duly executed and delivered in accordance with its terms by each of the parties thereto, will constitute a valid and legally binding agreement of the Company enforceable against the Company in accordance with
its terms, except as enforceability may be limited by applicable bankruptcy, insolvency or similar laws affecting creditors’ rights generally or by equitable principles relating to enforceability (collectively, the “Enforceability
Exceptions”).
(l)
Purchase Agreement
. This Agreement has been duly authorized, executed and delivered by the Company.
(m)
The Securities.
The Securities to be issued and sold by the Company hereunder have been duly authorized by the Company
and, when duly executed, authenticated, issued and delivered as provided in the Indenture and paid for as provided herein, will be duly and validly issued and outstanding and will constitute valid and legally binding obligations of the Company
enforceable against the Company in accordance with their terms, subject to the Enforceability Exceptions, and will be entitled to the benefits of the Indenture.
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(n)
The Underlying Securities
. Upon issuance and delivery of the Securities in
accordance with this Agreement and the Indenture, the Securities will be convertible at the option of the holder thereof into shares of the Underlying Securities in accordance the terms of the Securities; the Underlying Securities reserved for
issuance upon conversion of the Securities have been duly authorized and reserved and, when issued upon conversion of the Securities in accordance with the terms of the Securities, will be validly issued, fully paid and non-assessable, and the
issuance of the Underlying Securities will not be subject to any preemptive or similar rights.
(o)
Other Transaction
Documents.
Each of the Capped Call Documents has been duly authorized, executed and delivered by the Company and constitutes a valid and legally binding agreement of the Company enforceable against the Company in accordance with its terms,
subject to the Enforceability Exceptions.
(p)
Descriptions of the Transaction Documents.
Each Transaction Document
conforms in all material respects to the description thereof contained in the Time of Sale Information and the Offering Memorandum.
(q)
No Violation or Default.
Neither the Company nor any of its subsidiaries is (i) in violation of its charter or
by-laws
(including
estatutos sociales
and
estatutos sociais
) or similar constitutive or organizational documents; (ii) in default, and no event has occurred that, with notice or lapse of time or
both, would constitute such a default, in the due performance or observance of any term, covenant or condition contained in any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or any of its
subsidiaries is a party or by which the Company or any of its subsidiaries is bound or to which any of the property or assets of the Company or any of its subsidiaries is subject; or (iii) in violation of any law or statute or any judgment,
order, rule or regulation of any court or arbitrator or governmental or regulatory authority, except, in the case of clauses (ii) and (iii) above, for any such default or violation that would not, individually or in the aggregate, have a
Material Adverse Effect.
(r)
No Conflicts.
The execution, delivery and performance by the Company of each of the
Transaction Documents, the issuance and sale of the Securities (including the issuance of the Underlying Securities upon conversion thereof) and the consummation of the transactions contemplated by the Transaction Documents or the Time of Sale
Information and the Offering Memorandum will not (i) conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any of its subsidiaries pursuant to, any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or any of its subsidiaries is a party or by
which the Company or any of its subsidiaries is bound or to which any of the property or assets of the Company or any of its subsidiaries is subject, (ii) result in any violation of the provisions of the charter or by-laws (including
estatutos sociales
and
estatutos sociais
) or similar constitutive or organizational documents of the Company or any of its subsidiaries or (iii) result in the violation of any law or statute or any judgment, order, rule or
regulation of any court or arbitrator or governmental or regulatory authority.
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(s)
No Consents Required.
No consent, approval, authorization, order, registration
or qualification of or with any court or arbitrator or governmental or regulatory authority is required for the execution, delivery and performance by the Company of each of the Transaction Documents, the issuance and sale of the Securities
(including the issuance of the Underlying Securities upon conversion thereof) and the consummation of the transactions contemplated by the Transaction Documents or the Time of Sale Information and the Offering Memorandum, except for such consents,
approvals, authorizations, orders and registrations or qualifications as may be required under applicable state securities laws in connection with the purchase and resale of the Securities by the Initial Purchasers.
(t)
Legal Proceedings.
Except as described in the Time of Sale Information and the Offering Memorandum, there are no legal,
governmental or regulatory investigations, actions, suits or proceedings pending to which the Company or any of its subsidiaries is or may be a party or to which any property of the Company or any of its subsidiaries is or may be the subject that,
individually or in the aggregate, if determined adversely to the Company or any of its subsidiaries, could reasonably be expected to have a Material Adverse Effect; no such investigations, actions, suits or proceedings are, to the knowledge of the
Company, threatened or contemplated by any governmental or regulatory authority or threatened by others.
(u)
Independent
Accountants
. Deloitte & Co. S.A., who have certified certain consolidated financial statements of the Company and its subsidiaries are an independent registered public accounting firm with respect to the Company and its subsidiaries
within the applicable rules and regulations adopted by the Commission and the Public Company Accounting Oversight Board (United States) and as required by the Securities Act.
(v)
Title to Real and Personal Property.
The Company and its subsidiaries have good and marketable title in fee simple (in the
case of real property) to, or have valid rights to lease or otherwise use, all items of real and personal property that are material to the respective businesses of the Company and its subsidiaries, in each case free and clear of all liens,
encumbrances, claims and defects and imperfections of title except those that (i) do not materially interfere with the use made and proposed to be made of such property by the Company and its subsidiaries or, (ii) could not reasonably be
expected, individually or in the aggregate, to have a Material Adverse Effect.
(w)
Intellectual Property.
Except as
disclosed in the Time of Sale Information and the Offering Memorandum: (i) the Company and its subsidiaries own or possess adequate rights to use all material uniform resource locators (URLs), patents, patent applications, trademarks, service
marks, trade names, trademark registrations, service mark registrations, copyrights, licenses, inventions and know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures)
material for the conduct of their respective businesses as they are currently conducted (collectively, “Intellectual Property”); (ii) there are no third parties who have established or, to the Company’s knowledge, will be able to
establish rights to any Intellectual Property, except for, and to the extent of, the ownership rights of the owners of the Intellectual Property which the Time of Sale Information and Offering Memorandum disclose is licensed to the Company;
(iii) to the Company’s
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knowledge, there is no infringement by third parties of any Intellectual Property; (iv) to the Company’s knowledge, there is no pending or threatened action, suit, proceeding or claim
by others challenging the Company’s or its subsidiaries’ rights in or to any Intellectual Property, and the Company or any of its subsidiaries is unaware of any facts which could form a reasonable basis for any such action, suit,
proceeding or claim; (v) to the Company’s knowledge, there is no pending or threatened action, suit, proceeding or claim by others challenging the validity, enforceability or scope of any Intellectual Property, and the Company or any of
its subsidiaries is unaware of any facts which could form a reasonable basis for any such action, suit, proceeding or claim; (vi) to the Company’s knowledge, there is no pending or threatened action, suit, proceeding or claim by others
that the Company or any of its subsidiaries infringes, misappropriates or otherwise violates any patent, trademark, trade name, service mark, copyright, trade secret or other proprietary rights of others, and the Company or any of its subsidiaries
is unaware of any facts which could form a reasonable basis for any such action, suit, proceeding or claim; (vii) to the best of the Company’s knowledge, the Company and its subsidiaries have complied in all material respects with the
terms of any agreement pursuant to which Intellectual Property has been licensed to the Company or any of its subsidiaries, and all such agreements that are material for the conduct of their respective businesses as they are currently conducted are
in full force and effect; and (viii) to the best of the Company’s knowledge, there is no patent or patent application that contains claims that interfere with the issued or pending claims of any of the Intellectual Property or that
challenges the validity, enforceability or scope of any of the Intellectual Property except, in each case, as would not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect.
(x)
No Undisclosed Relationships.
To the best of the Company’s knowledge, no relationship, direct or indirect, exists
between or among the Company or any of its subsidiaries, on the one hand, and the directors, officers, stockholders, customers or suppliers of the Company or any of its subsidiaries, on the other, that is required by the Securities Act to be
described in a registration statement to be filed with the Commission and that is not so described in the Time of Sale Information and the Offering Memorandum.
(y)
Investment Company Act.
The Company is not and, after giving effect to the offering and sale of the Securities and the
application of the proceeds thereof as described in the Time of Sale Information and the Offering Memorandum, will not be required to register as an “investment company” or an entity “controlled” by an “investment
company” within the meaning of the Investment Company Act of 1940, as amended, and the rules and regulations of the Commission thereunder (collectively, the “Investment Company Act”).
(z)
Taxes.
Except as described in the Time of Sale Information and the Offering Memorandum, the Company and its subsidiaries
have paid all material federal, state, local and foreign taxes and filed all material tax returns required to be paid or filed through the date hereof except for any taxes (i) for which an extension has been obtained or (ii) which are
being contested in good faith and by appropriate proceedings (provided adequate reserves have been provided for such taxes); and except as otherwise disclosed in the Time of Sale Information and the Offering Memorandum, there is no material tax
deficiency that has been, or could reasonably be expected to be, asserted against the Company or any of its subsidiaries or any of their respective properties or assets.
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(aa)
Licenses and Permits.
The Company and its subsidiaries possess all licenses,
certificates, permits and other authorizations issued by, and have made all declarations and filings with, the appropriate federal, state, local or foreign governmental or regulatory authorities that are necessary for the ownership or lease of their
respective properties or the conduct of their respective businesses as described in the Time of Sale Information and the Offering Memorandum, except where the failure to possess or make the same would not, individually or in the aggregate, have a
Material Adverse Effect; and except as described in the Time of Sale Information and the Offering Memorandum, neither the Company nor any of its subsidiaries has received notice of any revocation or modification of any such license, certificate,
permit or authorization or has any reason to believe that any such license, certificate, permit or authorization will not be renewed in the ordinary course.
(bb)
No Labor Disputes.
Neither the Company nor any of its subsidiaries is engaged in any illegal labor practice, except as
would not, individually or in the aggregate, have a Material Adverse Effect. No labor disturbance by or dispute with employees of the Company or any of its subsidiaries exists or, to the knowledge of the Company, is contemplated or threatened and
the Company is not aware of any existing or imminent labor disturbance by, or dispute with, the employees of any of its or its subsidiaries’ principal suppliers, contractors or customers, except as would not, individually or in the aggregate,
have a Material Adverse Effect.
(cc)
Compliance With Environmental Laws.
(i) The Company and its subsidiaries
(x) are in compliance with any and all applicable federal, state, local and foreign laws, rules, regulations, requirements, decisions and orders relating to the protection of human health and safety, the environment or hazardous or toxic
substances or wastes, pollutants or contaminants (collectively, “Environmental Laws”); (y) have received and are in compliance with all permits, licenses, certificates or other authorizations or approvals required of them under
applicable Environmental Laws to conduct their respective businesses; and (z) have not received notice of any actual or potential liability for the investigation or remediation of any disposal or release of hazardous or toxic substances or
wastes, pollutants or contaminants, and (ii) there are no costs or liabilities associated with Environmental Laws of or relating to the Company or its subsidiaries, except in the case of each of (x) and (y) above, for any such failure
to comply, or failure to receive required permits, licenses or approvals, or cost or liability as would not, individually or in the aggregate, have a Material Adverse Effect.
(dd) [Reserved.]
(ee)
Disclosure Controls
. The Company and its subsidiaries maintain an effective system of “disclosure controls and procedures” (as defined in
Rule 13a-15(e)
of the Exchange Act) that is
designed to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Commission’s rules
and forms, including controls and procedures designed to ensure that such information is accumulated and communicated to the Company’s management as appropriate to allow timely decisions regarding required disclosure. The Company and its
subsidiaries have carried out evaluations of the effectiveness of their disclosure controls and procedures as required by
Rule 13a-15
of the Exchange Act.
11
(ff)
Accounting Controls.
The Company and its subsidiaries maintain systems of
“internal control over financial reporting” (as defined in
Rule 13a-15(f)
of the Exchange Act) that comply with the requirements of the Exchange Act and have been designed by, or under the
supervision of, their respective principal executive and principal financial officers, or persons performing similar functions, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted accounting principles, including, but not limited to internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance
with management’s general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles and to maintain asset
accountability; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences and (v) interactive data in eXtensible Business Reporting Language included or incorporated by reference in the Time of Sale Information and the Offering Memorandum fairly presents the
information called for in all material respects and is prepared in accordance with the Commission’s rules and guidelines applicable thereto. Except as disclosed in the Time of Sale Information and the Offering Memorandum, there are no material
weaknesses in the Company’s internal controls. The Company’s auditors and the Audit Committee of the Board of Directors of the Company have been advised of: (i) all significant deficiencies and material weaknesses in the design or
operation of internal controls over financial reporting which are reasonably likely to adversely affect the Company’s ability to record, process, summarize and report financial information; and (ii) any fraud, whether or not material, that
involves management or other employees who have a significant role in the Company’s internal controls over financial reporting.
(gg)
eXtensible Business Reporting Language.
The interactive data in eXtensible Business Reporting Language included or
incorporated by reference in the Time of Sale Information and the Offering Memorandum fairly presents the information called for in all material respects and has been prepared in accordance with the Commission’s rules and guidelines applicable
thereto.
(hh)
Insurance.
The Company and its subsidiaries have insurance against such losses and risks as the
Company reasonably believes is prudent for companies engaged in similar business in similar industries; all policies of insurance insuring the Company or any of its subsidiaries or their respective businesses, assets, directors and officers and
employees are in full force and effect; the Company and its subsidiaries are in compliance with the terms of such policies and instruments; there are no claims by the Company or any of its subsidiaries under any such policy or instrument as to which
any insurance company is denying liability or defending under a reservation of rights clause; neither the Company nor any such subsidiary has been refused any insurance coverage sought or applied for; and neither the Company nor any of its
subsidiaries has (i) received notice from any insurer or agent of such insurer that capital improvements or other expenditures are required or necessary to be made in order to continue such insurance or (ii) any reason to believe that it
will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage at reasonable cost from similar insurers as may be necessary to continue its business except, in each case, as would not
reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect.
12
(ii)
No Unlawful Payments.
Neither the Company nor any of its subsidiaries, nor any
director, officer or employee of the Company or any of its subsidiaries nor, to the knowledge of the Company, any agent, affiliate or other person associated with or acting on behalf of the Company or any of its subsidiaries has (i) used any
corporate funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political activity; (ii) made or taken an act in furtherance of an offer, promise or authorization of any direct or indirect unlawful
payment or benefit to any foreign or domestic government official or employee, including of any government-owned or controlled entity or of a public international organization, or any person acting in an official capacity for or on behalf of any of
the foregoing, or any political party or party official or candidate for political office; (iii) violated or is in violation of any provision of the Foreign Corrupt Practices Act of 1977, as amended, or any applicable law or regulation
implementing the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions, or any other applicable anti-bribery or anti-corruption law; or (iv) made, offered, agreed, requested or taken an act in
furtherance of any unlawful bribe or other unlawful benefit, including, without limitation, any rebate, payoff, influence payment, kickback or other unlawful or improper payment or benefit. The Company and its subsidiaries have instituted, maintain
and enforce, policies and procedures designed to promote and ensure compliance with all applicable anti-bribery and anti-corruption laws.
(jj)
Compliance with Anti-Money Laundering Laws
. The operations of the Company and its subsidiaries are and have been conducted
at all times in compliance with applicable financial recordkeeping and reporting requirements, including those of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the applicable money laundering statutes of all
jurisdictions where the Company or any of its subsidiaries conducts business, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency
(collectively, the “Anti-Money Laundering Laws”), and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with respect to the
Anti-Money Laundering Laws is pending or, to the knowledge of the Company, threatened.
(kk)
No Conflicts with Sanctions
Laws
. Neither the Company nor any of its subsidiaries, directors, officers or employees, nor, to the knowledge of the Company, any agent, affiliate or other person associated with or acting on behalf of the Company or any of its subsidiaries is
currently the subject or the target of any sanctions administered or enforced by the U.S. government, (including, without limitation, the Office of Foreign Assets Control of the U.S. Department of the Treasury (“
OFAC
”) or the U.S.
Department of State and including, without limitation, the designation as a “specially designated national” or “blocked person”), the United Nations Security Council (“
UNSC
”), the European Union, Her
Majesty’s Treasury (“
HMT
”), or other relevant sanctions authority (collectively, “
Sanctions
”), nor is the Company or any of its subsidiaries located, organized or resident in a country or territory that is the
subject or target of Sanctions, including, without limitation, Cuba, Iran, North Korea, Sudan and Syria (each, a “
Sanctioned Country
”); and the Company will not directly or indirectly use the proceeds of the offering of the
Securities hereunder, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity (i) to fund or facilitate any activities of or business with any person that, at the time of
such funding or facilitation, is the subject or target of Sanctions, (ii) to fund or facilitate any activities of or business in any Sanctioned Country or (iii) in any other manner that will result in a violation by any person
13
(including any person participating in the transaction, whether as underwriter, initial purchaser, advisor, investor or otherwise) of Sanctions. For the past five years, the Company and its
subsidiaries have not knowingly engaged in and are not now knowingly engaged in any dealings or transactions with any person that at the time of the dealing or transaction is or was the subject or the target of Sanctions or with any Sanctioned
Country.
(ll)
Rule 144A Eligibility
. On the Closing Date, the Securities will not be of the same class as securities
listed on a national securities exchange registered under Section 6 of the Exchange Act or quoted in an automated inter-dealer quotation system; and each of the Time of Sale Information, as of the Time of Sale, and the Offering Memorandum, as
of its date, contains or will contain all the information that, if requested by a prospective purchaser of the Securities, would be required to be provided to such prospective purchaser pursuant to Rule 144A(d)(4) under the Securities Act.
(mm)
No Integration
. Neither the Company nor any of its affiliates (as defined in Rule 501(b) of
Regulation D) has, directly or through any agent, sold, offered for sale, solicited offers to buy or otherwise negotiated in respect of, any security (as defined in the Securities Act), that is or will be integrated with the sale of the
Securities in a manner that would require registration of the Securities under the Securities Act.
(nn)
No General
Solicitation or Directed Selling Efforts
. None of the Company or any of its affiliates or any other person acting on its or their behalf (other than the Initial Purchasers, as to which no representation is made) has solicited offers for, or
offered or sold, the Securities by means of any form of general solicitation or general advertising within the meaning of Rule 502(c) of Regulation D or in any manner involving a public offering within the meaning of Section 4(a)(2)
of the Securities Act.
(oo)
Securities Law Exemptions
. Assuming the accuracy of the representations and warranties
of the Initial Purchasers contained in Section 2(b) and their compliance with their agreements set forth therein, it is not necessary, in connection with the issuance and sale of the Securities to the Initial Purchasers and the offer, resale
and delivery of the Securities by the Initial Purchasers in the manner contemplated by this Agreement, the Time of Sale Information and the Offering Memorandum, to register the Securities under the Securities Act or to qualify the Indenture under
the Trust Indenture Act.
(pp)
No Stabilization.
The Company has not taken, directly or indirectly, any action
designed to or that could reasonably be expected to cause or result in any stabilization or manipulation of the price of the Securities (provided that the Company expresses no opinion regarding any actions taken by the Initial Purchasers in this
regard).
(qq)
Margin Rules
. Neither the issuance, sale and delivery of the Securities nor the application of the
proceeds thereof by the Company as described in the Time of Sale Information and the Offering Memorandum will violate Regulation T, U or X of the Board of Governors of the Federal Reserve System or any other regulation of such Board of
Governors.
(rr)
Forward-Looking Statements.
No forward-looking statement (within the meaning of Section 27A of
the Securities Act and Section 21E of the Exchange Act) contained in the Time of Sale Information and the Offering Memorandum has been made or reaffirmed without a reasonable basis or has been disclosed other than in good faith.
14
(ss)
Statistical and Market Data.
Nothing has come to the attention of the Company
that has caused the Company to believe that the statistical and market-related data included or incorporated by reference in the Time of Sale Information and the Offering Memorandum is not based on or derived from sources that are reliable and
accurate in all material respects.
(tt)
Sarbanes-Oxley Act
. There is and has been no failure on the part of the
Company or any of the Company’s directors or officers, in their capacities as such, to comply with any provision of the Sarbanes-Oxley Act of 2002, as amended and the rules and regulations promulgated in connection therewith (the
“Sarbanes-Oxley
Act”), including Section 402 related to loans and Sections 302 and 906 related to certifications.
(uu)
No Ratings.
There are no securities or preferred stock of or guaranteed by the Company or any of its subsidiaries that are
rated by a “nationally recognized statistical rating organization,” as such term is defined in Section 3(a)(62) in the Exchange Act.
(vv)
Stamp Taxes
. Except for any net income, capital gains or franchise taxes imposed on the Initial Purchasers by Brazil,
Argentina, Venezuela or Mexico or any political subdivision or taxing authority thereof or therein as a result of any present or former connection (other than any connection resulting from the transactions contemplated by the Transaction Documents)
between the Initial Purchasers or any subsequent purchasers of the Securities and the jurisdiction imposing such tax, no stamp duties or other issuance or transfer taxes are payable by or on behalf of the Initial Purchasers in Brazil, Argentina,
Venezuela, Mexico, the United States or any political subdivision or taxing authority thereof solely in connection with (A) the execution, delivery and performance of the Transaction Documents, (B) the issuance and delivery of the
Securities in the manner contemplated by this Agreement and the Offering Memorandum or (C) the sale and delivery by the Initial Purchasers of the Securities as contemplated herein and in the Offering Memorandum (other than any sales and
deliveries of Securities to subsequent purchasers with a present or former connection to such jurisdictions, for which we express no opinion).
(ww)
Valid Choice of Law
. The choice of laws of the State of New York as the governing law of the Transaction Documents is a
valid choice of law under the laws of Brazil, Argentina, Venezuela and Mexico and will be honored by the courts of these countries, provided, that in the case of Argentina, such laws do not contravene public policy and provided, further, that the
decision of a foreign court complies with the requirements of Section 517 of the National Code of Civil and Commercial Procedure of Argentina; the Company has the power to submit, and pursuant to Section 18 of this Agreement has legally,
validly, effectively and irrevocably submitted, to the jurisdiction of any federal or state court in the State of New York, County of New York; and service of process effected in the manner set forth in this Agreement, assuming validity under the
laws of the State of New York, will be effective, under the laws of Brazil, Argentina, Venezuela and Mexico to confer valid personal jurisdiction over the Company, provided that, in the case of Argentina, the summons are served by a court officer.
(xx)
No Immunity
. The Company and its obligations under the Transaction Documents are subject to suit, and neither the
Company nor any of its properties or assets has any right of
15
immunity, on any grounds, from any action, suit or proceeding, from the giving of any relief in any action, suit or proceeding, from set-off or counter claim, from the jurisdiction of any
Brazilian, Argentinean, Venezuelan, Mexican or U.S. federal or New York state court, as the case may be, from service of process, attachment upon or prior to judgment, or attachment in aid of execution of judgment, or from execution of a judgment,
or from other legal process or proceeding for the giving of any relief or for the enforcement of a judgment, in any such court, with respect to its obligations, liabilities or any other matter arising out of or relating to the Transaction Documents.
(yy)
No Restrictions on Subsidiaries
. Except as described in the Time of Sale Information and the Offering Memorandum, no
subsidiary of the Company is currently prohibited, directly or indirectly, under any agreement or other instrument to which it is a party or is subject, from paying any dividends to the Company, from making any other distribution on such
subsidiary’s capital stock, from repaying to the Company any loans or advances to such subsidiary from the Company or from transferring any of such subsidiary’s properties or assets to the Company or any other subsidiary of the Company.
(zz)
No Requirement to File or Record
. To ensure the legality, validity, enforcement or admissibility into evidence
in a legal or administrative proceeding in Brazil, Argentina, Venezuela or Mexico of this Agreement, it is not necessary that this Agreement be filed or recorded with any governmental or regulatory authority or court or that any registration tax,
stamp duty or similar tax be paid on or in respect of this Agreement other than court costs (including without limitation, filing fees and deposits to guarantee judgment required by a court in Brazil, Argentina, Venezuela or Mexico).
(aaa) Exchange Controls. Except as otherwise disclosed in the Time of Sale Information and the Offering Memorandum, no exchange control
authorization or any other authorization, approval, consent or license of any governmental or regulatory authority or court in Brazil, Argentina, Venezuela or Mexico is required for the payment of any amounts payable to the Initial Purchasers under
this Agreement, except that, in the case of Argentina, such payment can only be made by an Argentine resident (x) if such Argentine resident has funds that are freely available outside of Argentina in order to satisfy such payment obligation or
(y) to the extent that Argentine law allows the payment in question; and all such payments made to the Initial Purchasers will not be subject to income, withholding or other taxes under laws and regulations of Brazil, Argentina, Venezuela or
Mexico, respectively, or any political subdivision or taxing authority thereof or therein and will otherwise be free and clear of any other tax, duty, withholding or deduction in Brazil, Argentina, Venezuela or Mexico, respectively, or any political
subdivision or taxing authority thereof or therein and without the necessity of obtaining any governmental authorization in Brazil, Argentina, Venezuela or Mexico, respectively, or any political subdivision or taxing authority thereof or therein.
(bbb)
No Broker’s Fees.
Neither the Company nor any of its subsidiaries is a party to any contract, agreement or
understanding with any person (other than this Agreement) that would give rise to a valid claim against the Company or any of its subsidiaries or any Initial Purchaser for a brokerage commission, finder’s fee or like payment in connection with
the offering and sale of the Securities.
16
4.
Further Agreements of the Company
. The Company covenants and agrees with each Initial
Purchaser that:
(a)
Delivery of Copies.
The Company will deliver to the Initial Purchasers as many copies of the
Preliminary Offering Memorandum, any other Time of Sale Information, any Issuer Written Communication and the Offering Memorandum (including all amendments and supplements thereto) as the Representatives may reasonably request.
(b)
Offering Memorandum, Amendments or Supplements
. Before finalizing the Offering Memorandum or making or distributing any
amendment or supplement to any of the Time of Sale Information or the Offering Memorandum or filing with the Commission any document that will be incorporated by reference therein, the Company will furnish to the Representatives and counsel for the
Initial Purchasers a copy of the proposed Offering Memorandum or such amendment or supplement or document to be incorporated by reference therein for review, and will not distribute any such proposed Offering Memorandum, amendment or supplement or
file any such document with the Commission to which the Representatives reasonably object.
(c)
Additional Written
Communications.
Before making, preparing, using, authorizing, approving or referring to any Issuer Written Communication, the Company will furnish to the Representatives and counsel for the Initial Purchasers a copy of such written communication
for review and will not make, prepare, use, authorize, approve or refer to any such written communication to which the Representatives reasonably object.
(d)
Notice to the Representatives.
The Company will advise the Representatives promptly, and confirm such advice in writing,
(i) of the issuance by any governmental or regulatory authority of any order preventing or suspending the use of any of the Time of Sale Information, any Issuer Written Communication or the Offering Memorandum or the initiation or threatening
of any proceeding for that purpose; (ii) of the occurrence or development of any event at any time prior to the completion of the initial offering of the Securities as a result of which any of the Time of Sale Information, any Issuer Written
Communication or the Offering Memorandum as then amended or supplemented would include any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances
existing when such Time of Sale Information, Issuer Written Communication or the Offering Memorandum is delivered to a purchaser, not misleading; and (iii) of the receipt by the Company of any notice with respect to any suspension of the
qualification of the Securities for offer and sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; and the Company will use its reasonable best efforts to prevent the issuance of any such order preventing or
suspending the use of any of the Time of Sale Information, any Issuer Written Communication or the Offering Memorandum or suspending any such qualification of the Securities and, if any such order is issued, will use its reasonable best efforts to
obtain as soon as possible the withdrawal thereof.
(e)
Ongoing Compliance of the Offering Memorandum and Time of Sale
Information
. (1) If at any time prior to the completion of the initial offering of the Securities (i) any event or development shall occur or condition shall exist as a result of which the Offering Memorandum as then amended or
supplemented would include any untrue statement of a material fact or omit to
17
state any material fact necessary in order to make the statements therein, in the light of the circumstances existing when the Offering Memorandum is delivered to a purchaser, not misleading or
(ii) it is necessary to amend or supplement the Offering Memorandum to comply with law, the Company will immediately notify the Initial Purchasers thereof and forthwith prepare and, subject to paragraph (b) above, furnish to the Initial
Purchasers such amendments or supplements to the Offering Memorandum (or any document to be filed with the Commission and incorporated by reference therein) as may be necessary so that the statements in the Offering Memorandum as so amended or
supplemented (or including such document to be incorporated by reference therein) will not, in the light of the circumstances existing when the Offering Memorandum is delivered to a purchaser, be misleading or so that the Offering Memorandum will
comply with law and (2) if at any time prior to the Closing Date (i) any event or development shall occur or condition shall exist as a result of which any of the Time of Sale Information as then amended or supplemented would include any
untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading or (ii) it is necessary to amend or
supplement any of the Time of Sale Information to comply with law, the Company will immediately notify the Initial Purchasers thereof and forthwith prepare and, subject to paragraph (b) above, furnish to the Initial Purchasers such amendments
or supplements to any of the Time of Sale Information (or any document to be filed with the Commission and incorporated by reference therein) as may be necessary so that the statements in any of the Time of Sale Information as so amended or
supplemented will not, in light of the circumstances under which they were made, be misleading.
(f)
Blue Sky Compliance.
The Company will qualify the Securities for offer and sale under the securities or Blue Sky laws of such jurisdictions as the Representatives shall reasonably request and will continue such qualifications in effect so long as required for the
offering and resale of the Securities provided that the Company shall not be required to (i) qualify as a foreign corporation or other entity or as a dealer in securities in any such jurisdiction where it would not otherwise be required to so
qualify, (ii) file any general consent to service of process in any such jurisdiction or (iii) subject itself to taxation in any such jurisdiction if it is not otherwise so subject.
(g)
Clear Market
. For a period of 90 days after the date of this Agreement, the Company will not (i) offer, pledge, sell, contract
to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, or otherwise transfer or dispose of, directly or indirectly, or file with the Commission a registration
statement under the Securities Act relating to, any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock, or publicly disclose the intention to make any offer, sale, pledge disposition or filing,
or (ii) enter into any swap or other agreement that transfers, in whole or in part, any of the economic consequences of ownership of the Common Stock or any such other securities, whether any such transaction described in clause (i) or
(ii) above is to be settled by delivery of Common Stock or such other securities, in cash or otherwise, without the prior written consent of the Representatives, other than (A) the Securities to be sold hereunder, (B) issuances of
shares of Common Stock upon the conversion of any Securities, (C) the issuance by the Company of any shares of Common Stock upon the exercise of any option or warrant or the conversion of a security outstanding on the date of this Agreement or
under any employee benefit plans existing on the date of this Agreement, in each case, as
18
described in the Time of Sale Information and the Offering Memorandum and the documents incorporated by reference therein, (D) the vesting of or removal or lapse of restrictions on
restricted stock or other awards under existing employee benefits plans or agreements in accordance with the terms of such plans or agreements, (E) the issuance by the Company of any options, restricted stock and other awards granted under, or
any shares of Common Stock of the Company issued upon the exercise of options granted under, existing employee benefits plans described in the Time of Sale Information and the Offering Memorandum and the documents incorporated by reference therein,
(F) the filing by the Company of any registration statement on Form S-8 or a successor form thereto in respect of securities offered pursuant to the terms of existing employee benefits plans or agreements, (G) issuances of options,
restricted stock units or other awards to newly hired employees, provided such awards do not vest or are not exercisable during such 90-day period, and (H) the entry into of the capped call transactions described in the Time of Sale Information
and the Offering Memorandum and the Company’s performance thereunder, including the settlement or termination of such capped call transactions.
(h)
Use of Proceeds.
The Company will apply the net proceeds from the sale of the Securities as described in the Time of Sale
Information and the Offering Memorandum under the heading “Use of Proceeds”.
(i)
No Stabilization.
The
Company will not take, directly or indirectly, any action designed to or that could reasonably be expected to cause or result in any stabilization or manipulation of the price of the Securities and will not take any action prohibited by Regulation M
under the Exchange Act in connection with the distribution of the Securities contemplated hereby (provided that the Company is not undertaking any responsibility regarding any actions taken by the Initial Purchasers in this regard).
(j)
Underlying Securities
. The Company will reserve and keep available at all times, free of pre-emptive rights, shares of
Common Stock for the purpose of enabling the Company to satisfy all obligations to issue the Underlying Securities upon conversion of the Securities. The Company will use its reasonable best efforts to cause the Underlying Securities to be listed on
the Nasdaq Global Select Market (the “Exchange”).
(k)
Supplying Information
. While the Securities remain
outstanding and are “restricted securities” within the meaning of Rule 144(a)(3) under the Securities Act, the Company will, during any period in which the Company is not subject to and in compliance with Section 13 or 15(d) of
the Exchange Act, furnish to holders of the Securities, prospective purchasers of the Securities designated by such holders and securities analysts, in each case upon request, the information required to be delivered pursuant to Rule 144A(d)(4)
under the Securities Act.
(l)
DTC
. The Company will assist the Initial Purchasers in arranging for the Securities to
be eligible for clearance and settlement through DTC.
(m)
No Resales by the Company
. During the period from the
Closing Date until one year after the Closing Date or the Additional Closing Date, if applicable, the Company will not, and will not permit any of its affiliates (as defined in Rule 144 under the Securities Act) to, resell any of the Securities
that have been acquired by any of them, except for Securities purchased by the Company or any of its affiliates and resold in a transaction registered under the Securities Act.
19
(n)
No Integration
. Neither the Company nor any of its affiliates (as defined in
Rule 501(b) of Regulation D) will, directly or through any agent, sell, offer for sale, solicit offers to buy or otherwise negotiate in respect of, any security (as defined in the Securities Act), that is or will be integrated with the sale of
the Securities in a manner that would require registration of the Securities under the Securities Act.
(o)
No General
Solicitation or Directed Selling Efforts
. None of the Company or any of its affiliates or any other person acting on its or their behalf (other than the Initial Purchasers, as to which no covenant is given) will solicit offers for, or offer
or sell, the Securities by means of any form of general solicitation or general advertising within the meaning of Rule 502(c) of Regulation D or in any manner involving a public offering within the meaning of Section 4(a)(2) of the
Securities Act.
5.
Certain Agreements of the Initial Purchasers
. Each Initial Purchaser hereby represents and agrees that
it has not and will not use, authorize use of, refer to, or participate in the planning for use of, any written communication that constitutes an offer to sell or the solicitation of an offer to buy the Securities other than (i) the Preliminary
Offering Memorandum and the Offering Memorandum, (ii) a written communication that contains no “issuer information” (as defined in Rule 433(h)(2) under the Securities Act) that was not included (including through incorporation by
reference) in the Preliminary Offering Memorandum or the Offering Memorandum, (iii) any written communication listed on Annex A or prepared pursuant to Section 4(c) above (including any electronic road show), (iv) any written
communication prepared by such Initial Purchaser and approved by the Company in advance in writing or (v) any written communication relating to or that contains the terms of the Securities and/or other information that was included (including
through incorporation by reference) in the Preliminary Offering Memorandum or the Offering Memorandum.
6.
Conditions of Initial
Purchasers’ Obligations
. The obligation of each Initial Purchaser to purchase the Firm Securities on the Closing Date or the Option Securities on the Additional Closing Date, as the case may be as provided herein is subject to the
performance by the Company of its covenants and other obligations hereunder and to the following additional conditions:
(a)
Representations and Warranties.
The representations and warranties of the Company contained herein shall be true and correct on the date hereof and on and as of the Closing Date or the Additional Closing Date, as the case may be; and the
statements of the Company and its officers made in any certificates delivered pursuant to this Agreement shall be true and correct on and as of the Closing Date or the Additional Closing Date, as the case may be.
(b)
No Material Adverse Change
. No event or condition of a type described in Section 3(g) hereof shall have occurred or shall
exist, which event or condition is not described in the Time of Sale Information (excluding any amendment or supplement thereto) and the Offering Memorandum (excluding any amendment or supplement thereto) and the effect of which in the judgment of
the Representatives makes it impracticable or inadvisable to proceed with the
20
offering, sale or delivery of the Securities on the Closing Date or the Additional Closing Date, as the case may be, on the terms and in the manner contemplated by this Agreement, the Time of
Sale Information and the Offering Memorandum.
(c)
Officers’ Certificate.
The Representatives shall have received on
and as of the Closing Date or the Additional Closing Date, as the case may be, a certificate of the chief financial officer or chief accounting officer of the Company and one additional senior executive officer of the Company who is satisfactory to
the Representatives (i) confirming that such officers have carefully reviewed the Time of Sale Information and the Offering Memorandum and, to the knowledge of such officers, the representations set forth in Sections 3(b) and 3(d) hereof
are true and correct, (ii) confirming that the other representations and warranties of the Company in this Agreement are true and correct and that the Company has complied with all agreements and satisfied all conditions on its part to be
performed or satisfied hereunder at or prior to such Closing Date and (iii) to the effect set forth in paragraph (b) above.
(d)
Comfort Letters.
On the date of this Agreement and on the Closing Date or the Additional Closing Date, as the case may be,
Deloitte & Co. S.A. shall have furnished to the Representatives, at the request of the Company, letters, dated the respective dates of delivery thereof and addressed to the Initial Purchasers, in form and substance reasonably satisfactory
to the Representatives, containing statements and information of the type customarily included in accountants’ “comfort letters” to underwriters with respect to the consolidated financial statements and certain financial information
contained or incorporated by reference in the Time of Sale Information and the Offering Memorandum; provided, that the letter delivered on the Closing Date or the Additional Closing Date, as the case may be shall use a
“cut-off”
date no more than three business days prior to such Closing Date or such Additional Closing Date, as the case may be.
(e)
Opinions and
10b-5
Statements of Counsel for the Company.
Davis Polk &
Wardwell LLP, counsel for the Company, shall have furnished to the Representatives, at the request of the Company, their written opinion and
10b-5
statement, dated the Closing Date or the Additional Closing
Date, as the case may be, and addressed to the Initial Purchasers, in form and substance reasonably satisfactory to the Representatives, to the effect set forth in Annex C and Annex D hereto. The Company shall have furnished to the Representatives
written opinions of internal counsel for the Company with regard to the laws of each of Brazil, Argentina and Venezuela, in each case dated the Closing Date or the Additional Closing Date, as the case may be, and addressed to the to the Initial
Purchasers, in form and substance reasonably satisfactory to the Representatives, to the effect set forth in Annex E hereto.
(f)
Opinion and
10b-5
Statement of Counsel for the Initial Purchasers.
The
Representatives shall have received on and as of the Closing Date or the Additional Closing Date, as the case may be, an opinion and
10b-5
statement of Cleary Gottlieb Steen & Hamilton LLP, counsel
for the Initial Purchasers, with respect to such matters as the Representatives may reasonably request, and such counsel shall have received such documents and information as they may reasonably request to enable them to pass upon such matters.
(g)
No Legal Impediment to Issuance
. No action shall have been taken and no statute, rule, regulation or order shall have been
enacted, adopted or issued by any federal, state or foreign
21
governmental or regulatory authority that would, as of the Closing Date or the Additional Closing Date, as the case may be, prevent the issuance or sale of the Securities; and no injunction or
order of any federal, state or foreign court shall have been issued that would, as of the Closing Date or the Additional Closing Date, as the case may be, prevent the issuance or sale of the Securities.
(h)
Good Standing
. The Representatives shall have received on and as of the Closing Date or the Additional Closing Date, as the
case may be, satisfactory evidence of the good standing of the Company in its jurisdiction of organization, in writing or any standard form of telecommunication from the appropriate governmental authorities of such jurisdiction.
(i)
DTC
. The Securities shall be eligible for clearance and settlement through DTC.
(j)
Exchange Listing.
An application for the listing of the Underlying Securities shall have been submitted to the Exchange.
(k)
Lock-up Agreements
. The “lock-up” agreements, each substantially in the form of Exhibit A hereto,
executed by each of the officers and directors of the Company relating to sales and certain other dispositions of shares of Common Stock or certain other securities, delivered to you on or before the date hereof, shall be in full force and effect on
the Closing Date or Additional Closing Date, as the case may be.
(l)
Additional Documents.
On or prior to the
Closing Date or the Additional Closing Date, as the case may be, the Company shall have furnished to the Representatives such further certificates and documents as the Representatives may reasonably request.
All opinions, letters, certificates and evidence mentioned above or elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory to counsel for the Initial Purchasers.
7.
Indemnification and Contribution
.
(a)
Indemnification of the Initial Purchasers
. The Company agrees to indemnify and hold
harmless each Initial Purchaser, its affiliates, directors and officers and each person, if any, who controls such Initial Purchaser within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, from and against
any and all losses, claims, damages and liabilities (including, without limitation, legal fees and other expenses incurred in connection with any suit, action or proceeding or any claim asserted, as such fees and expenses are incurred), joint or
several, that arise out of, or are based upon, any untrue statement or alleged untrue statement of a material fact contained in the Preliminary Offering Memorandum, any of the other Time of Sale Information, any Issuer Written Communication, any
road show as defined in Rule 433(h) under the Securities Act (a “road show”) or the Offering Memorandum (or any amendment or supplement thereto) or any omission or alleged omission to state therein a material fact necessary in order
to make the statements therein, in light of the circumstances under which they were made, not misleading, in each case except insofar as such losses, claims, damages or liabilities arise out of, or are based upon, any untrue statement or omission or
alleged untrue statement or omission made in reliance upon and in conformity with any information relating to any Initial Purchaser furnished to the Company in writing by such Initial Purchaser through the Representatives expressly for use therein,
it being understood and agreed that the only such
22
information furnished by any Initial Purchaser consists of the information described as such in subsection (b) below. The Company further agrees to reimburse any stamp tax payable upon
presentation for enforcement of this Agreement.
(b)
Indemnification of the Company.
Each Initial Purchaser agrees, severally and
not jointly, to indemnify and hold harmless the Company, its directors, its officers and each person, if any, who controls the Company within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act to the same
extent as the indemnity set forth in paragraph (a) above, but only with respect to any losses, claims, damages or liabilities that arise out of, or are based upon, any untrue statement or omission or alleged untrue statement or omission made in
reliance upon and in conformity with any information relating to such Initial Purchaser furnished to the Company in writing by such Initial Purchaser through the Representatives expressly for use in the Preliminary Offering Memorandum, any of the
other Time of Sale Information (including any of the other Time of Sale Information that has subsequently been amended), any Issuer Written Communication, any road show or the Offering Memorandum (or any amendment or supplement thereto), it being
understood and agreed upon that the only such information furnished by any Initial Purchaser consists of the following information in the Offering Memorandum furnished on behalf of each Initial Purchaser: the information contained in the first
sentence in the second paragraph and the fourth sentence in the third paragraph under “Plan of Distribution—New Issue of Notes” and the fifth sentence in the first paragraph under “Plan of Distribution—Price Stabilization
and Short Positions; Repurchases of Common Stock.”
(c)
Notice and Procedures
. If any suit, action, proceeding (including any
governmental or regulatory investigation), claim or demand shall be brought or asserted against any person before a competent authority in respect of which indemnification may be sought pursuant to either paragraph (a) or (b) above, such
person (the “Indemnified Person”) shall promptly notify the person against whom such indemnification may be sought (the “Indemnifying Person”) in writing;
provided
that the failure to notify the Indemnifying Person shall
not relieve it from any liability that it may have under paragraph (a) or (b) above except to the extent that it has been materially prejudiced (through the forfeiture of substantive rights or defenses) by such failure; and
provided
,
further
, that the failure to notify the Indemnifying Person shall not relieve it from any liability that it may have to an Indemnified Person otherwise than under paragraph (a) or (b) above. If any such proceeding
shall be brought or asserted against an Indemnified Person and it shall have notified the Indemnifying Person thereof, the Indemnifying Person shall retain counsel reasonably satisfactory to the Indemnified Person (who shall not, without the consent
of the Indemnified Person, be counsel to the Indemnifying Person) to represent the Indemnified Person in such proceeding and shall pay the fees and expenses of such counsel related to such proceeding, as incurred. In any such proceeding, any
Indemnified Person shall have the right to retain its own counsel, but the reasonable fees and expenses of such counsel shall be at the expense of such Indemnified Person unless (i) the Indemnifying Person and the Indemnified Person shall have
mutually agreed to the contrary; (ii) the Indemnifying Person has failed within a reasonable time to retain counsel reasonably satisfactory to the Indemnified Person; (iii) the Indemnified Person shall have reasonably concluded that there
may be legal defenses available to it that are different from or in addition to those available to the Indemnifying Person; or (iv) the named parties in any such proceeding (including any impleaded parties) include both the Indemnifying Person
and the Indemnified Person and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interest between them. It is
23
understood and agreed that the Indemnifying Person shall not, in connection with any proceeding or related proceeding in the same jurisdiction, be liable for the reasonable fees and expenses of
more than one separate firm (in addition to any local counsel) for all Indemnified Persons, and that all such fees and expenses shall be paid or reimbursed as they are incurred. Any such separate firm for any Initial Purchaser, its affiliates,
directors and officers and any control persons of such Initial Purchaser shall be designated in writing by the Representatives and any such separate firm for the Company, its directors, its officers and any control persons of the Company shall be
designated in writing by the Company. The Indemnifying Person shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the
Indemnifying Person agrees to indemnify each Indemnified Person from and against any loss or liability by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time an Indemnified Person shall have requested that
an Indemnifying Person reimburse the Indemnified Person for fees and expenses of counsel as contemplated by this paragraph, the Indemnifying Person shall be liable for any settlement of any proceeding effected without its written consent if
(i) such settlement is entered into more than 30 days after receipt by the Indemnifying Person of such request and (ii) the Indemnifying Person shall not have reimbursed the Indemnified Person in accordance with such request prior to
the date of such settlement. No Indemnifying Person shall, without the written consent of the Indemnified Person, effect any settlement of any pending or threatened proceeding in respect of which any Indemnified Person is or could have been a party
and indemnification could have been sought hereunder by such Indemnified Person, unless such settlement (x) includes an unconditional release of such Indemnified Person, in form and substance reasonably satisfactory to such Indemnified Person,
from all liability on claims that are the subject matter of such proceeding and (y) does not include any statement as to or any admission of fault, culpability or a failure to act by or on behalf of any Indemnified Person.
(d)
Contribution.
If the indemnification provided for in paragraphs (a) or (b) above is unavailable to an Indemnified
Person or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then each Indemnifying Person under such paragraph, in lieu of indemnifying such Indemnified Person thereunder, shall contribute to the amount paid
or payable by such Indemnified Person as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative benefits received by the Company, on the one hand, and the Initial Purchasers, on
the other, from the offering of the Securities or (ii) if the allocation provided by clause (i) is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause
(i) but also the relative fault of the Company, on the one hand, and the Initial Purchasers, on the other, in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities, as well as any other
relevant equitable considerations. The relative benefits received by the Company, on the one hand, and the Initial Purchasers, on the other, shall be deemed to be in the same respective proportions as the net proceeds (before deducting expenses)
received by the Company from the sale of the Securities and the total discounts and commissions received by the Initial Purchasers in connection therewith, as provided in this Agreement, bear to the aggregate offering price of the Securities. The
relative fault of the Company, on the one hand, and the Initial Purchasers, on the other, shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the Company or by the Initial Purchasers and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.
24
(e)
Limitation on Liability.
The Company and the Initial Purchasers agree that it
would not be just and equitable if contribution pursuant to this Section 7 were determined by
pro
rata
allocation (even if the Initial Purchasers were treated as one entity for such purpose) or by any other method of
allocation that does not take account of the equitable considerations referred to in paragraph (d) above. The amount paid or payable by an Indemnified Person as a result of the losses, claims, damages and liabilities referred to in
paragraph (d) above shall be deemed to include, subject to the limitations set forth above, any legal or other expenses incurred by such Indemnified Person in connection with any such action or claim. Notwithstanding the provisions of this
Section 7, in no event shall an Initial Purchaser be required to contribute any amount in excess of the amount by which the total discounts and commissions received by such Initial Purchaser with respect to the offering of the Securities
exceeds the amount of any damages that such Initial Purchaser has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Initial Purchasers’ obligations to contribute pursuant to this Section 7
are several in proportion to their respective purchase obligations hereunder and not joint.
(f)
Non-Exclusive
Remedies.
The remedies provided for in this Section 7 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any Indemnified Person at law or in equity.
8.
Effectiveness of Agreement
. This Agreement shall become effective upon the execution and delivery hereof by the parties hereto.
9.
Termination
. This Agreement may be terminated in the absolute discretion of the Representatives, by notice to the Company, if after
the execution and delivery of this Agreement and prior to the Closing Date or, in the case of the Option Securities, prior to the Additional Closing Date (i) trading generally shall have been suspended or materially limited on or by any of the
New York Stock Exchange or The Nasdaq Global Select Market; (ii) trading of any securities issued or guaranteed by the Company shall have been suspended on any exchange or in any over-the-counter market; (iii) a general moratorium on
commercial banking activities shall have been declared by federal or New York State authorities; or (iv) there shall have occurred any outbreak or escalation of hostilities or any change in financial markets or any calamity or crisis, either
within or outside the United States, that, in the judgment of the Representatives, is material and adverse and makes it impracticable or inadvisable to proceed with the offering, sale or delivery of the Securities on the Closing Date or the
Additional Closing Date, as the case may be, on the terms and in the manner contemplated by this Agreement, the Time of Sale Information and the Offering Memorandum.
10.
Defaulting Initial Purchaser
. (a) If, on the Closing Date or the Additional Closing Date, as the case may be, any Initial
Purchaser defaults on its obligation to purchase the Securities that it has agreed to purchase hereunder on such date, the non-defaulting Initial Purchasers may in their discretion arrange for the purchase of such Securities by other persons
25
satisfactory to the Company on the terms contained in this Agreement. If, within 36 hours after any such default by any Initial Purchaser, the
non-defaulting
Initial Purchasers do not arrange for the purchase of such Securities, then the Company shall be entitled to a further period of 36 hours within which to procure other persons satisfactory to
the non-defaulting Initial Purchasers to purchase such Securities on such terms. If other persons become obligated or agree to purchase the Securities of a defaulting Initial Purchaser, either the
non-defaulting
Initial Purchasers or the Company may postpone the Closing Date or the Additional Closing Date, as the case may be, for up to five full business days in order to effect any changes that in the
opinion of counsel for the Company or counsel for the Initial Purchasers may be necessary in the Time of Sale Information, the Offering Memorandum or in any other document or arrangement, and the Company agrees to promptly prepare any amendment or
supplement to the Time of Sale Information or the Offering Memorandum that effects any such changes. As used in this Agreement, the term “Initial Purchaser” includes, for all purposes of this Agreement unless the context otherwise
requires, any person not listed in Schedule 1 hereto that, pursuant to this Section 10, purchases Securities that a defaulting Initial Purchaser agreed but failed to purchase.
(b) If, after giving effect to any arrangements for the purchase of the Securities of a defaulting Initial Purchaser or Initial Purchasers by
the non-defaulting Initial Purchasers and the Company as provided in paragraph (a) above, the aggregate number of Securities that remain unpurchased on the Closing Date or the Additional Closing Date, as the case may be does not exceed
one-eleventh of the aggregate number of Securities to be purchased on such date, then the Company shall have the right to require each non-defaulting Initial Purchaser to purchase the number of Securities that such Initial Purchaser agreed to
purchase hereunder on such date plus such Initial Purchaser’s pro rata share (based on the number of Securities that such Initial Purchaser agreed to purchase on such date) of the Securities of such defaulting Initial Purchaser or Initial
Purchasers for which such arrangements have not been made.
(c) If, after giving effect to any arrangements for the purchase of the
Securities of a defaulting Initial Purchaser or Initial Purchasers by the non-defaulting Initial Purchasers and the Company as provided in paragraph (a) above, the aggregate number of Securities that remain unpurchased on the Closing Date or
the Additional Closing Date, as the case may be, exceeds one-eleventh of the aggregate principal amount of Securities to be purchased on such date, or if the Company shall not exercise the right described in paragraph (b) above, then this
Agreement or, with respect to any Additional Closing Date, the obligation of the Initial Purchasers to purchase Securities on the Additional Closing Date, as the case may be, shall terminate without liability on the part of the non-defaulting
Initial Purchasers. Any termination of this Agreement pursuant to this Section 10 shall be without liability on the part of the Company, except that the Company will continue to be liable for the payment of expenses as set forth in
Section 11 hereof and except that the provisions of Section 7 hereof shall not terminate and shall remain in effect.
(d)
Nothing contained herein shall relieve a defaulting Initial Purchaser of any liability it may have to the Company or any non-defaulting Initial Purchaser for damages caused by its default.
11.
Payment of Expenses
.
(a) Whether or not the transactions contemplated by this Agreement are consummated or this
Agreement is terminated, the Company will pay or cause to be paid all costs and expenses incident to the performance of its obligations hereunder, including
26
without limitation, (i) the costs incident to the authorization, issuance, sale, preparation and delivery of the Securities and any taxes payable in that connection; (ii) the costs
incident to the preparation and printing of the Preliminary Offering Memorandum, any other Time of Sale Information, any Issuer Written Communication and the Offering Memorandum (including any amendments and supplements thereto) and the distribution
thereof; (iii) the costs of reproducing and distributing each of the Transaction Documents; (iv) the fees and expenses of the Company’s counsel and independent accountants; (v) the fees and expenses incurred in connection with
the registration or qualification and determination of eligibility for investment of the Securities under the laws of such jurisdictions as the Representatives may reasonably designate and the preparation, printing and distribution of a Blue Sky
Memorandum (including the related fees and expenses of counsel for the Initial Purchasers); (vi) any fees charged by rating agencies for rating the Securities; (vii) the fees and expenses of the Trustee and any paying agent (including
related fees and expenses of any counsel to such parties); (viii) all expenses and application fees incurred in connection with the approval of the Securities for book-entry transfer by DTC; (ix) all expenses incurred by the Company in
connection with any “road show” presentation to potential investors; and (x) all expenses and application fees related to the listing of the Underlying Securities on the Exchange.
(b) If (i) this Agreement is terminated pursuant to Section 9(ii) the Company for any reason fails to tender the Securities for
delivery to the Initial Purchasers, or (iii) the Initial Purchasers decline to purchase the Securities for any reason pursuant to Section 6 of this Agreement, the Company agrees to reimburse the Initial Purchasers for all out-of-pocket
costs and expenses (including the fees and expenses of their counsel) reasonably incurred by the Initial Purchasers in connection with this Agreement and the offering contemplated hereby.
12.
Persons Entitled to Benefit of Agreement
. This Agreement shall inure to the benefit of and be binding upon the parties hereto and
their respective successors and the officers and directors and any controlling persons referred to in Section 7 hereof. Nothing in this Agreement is intended or shall be construed to give any other person any legal or equitable right, remedy or
claim under or in respect of this Agreement or any provision contained herein. No purchaser of Securities from any Initial Purchaser shall be deemed to be a successor merely by reason of such purchase.
13.
Survival
. The respective indemnities, rights of contribution, representations, warranties and agreements of the Company and the
Initial Purchasers contained in this Agreement or made by or on behalf of the Company or the Initial Purchasers pursuant to this Agreement or any certificate delivered pursuant hereto shall survive the delivery of and payment for the Securities and
shall remain in full force and effect, regardless of any termination of this Agreement or any investigation made by or on behalf of the Company or the Initial Purchasers.
14.
Certain Defined Terms
. For purposes of this Agreement, (a) except where otherwise expressly provided, the term
“affiliate” has the meaning set forth in Rule 405 under the Securities Act; (b) the term “business day” means any day other than a day on which banks are permitted or required to be closed in New York City; and
(c) the term “subsidiary” has the meaning set forth in Rule 405 under the Securities Act.
27
15.
Compliance with USA Patriot Act
. In accordance with the requirements of the USA
Patriot Act (Title III of Pub.
L. 107-56
(signed into law October 26, 2001)), the Initial Purchasers are required to obtain, verify and record information that identifies their respective clients,
including the Company, which information may include the name and address of their respective clients, as well as other information that will allow the Initial Purchasers to properly identify their respective clients.
16.
Miscellaneous
. (a)
Notices.
All notices and other communications hereunder shall be in writing and shall be deemed to
have been duly given if mailed or transmitted and confirmed by any standard form of telecommunication. Notices to the Initial Purchasers shall be given to the Representatives c/o (a) Goldman, Sachs & Co., 200 West Street, New York, New
York 10282, Attention: Registration Department, (b) Deutsche Bank Securities Inc., 60 Wall Street, 2nd Floor, New York, N.Y. 10005, Attention: Equity Capital Markets – Syndicate Desk (fax: 212-797-9344), with a copy to Deutsche Bank
Securities Inc., 60 Wall Street, 36th Floor, New York, N.Y. 10005, Attention: General Counsel (fax: 212-797-4564) and (c) J.P. Morgan Securities LLC, 383 Madison Avenue, New York, New York 10179 (fax:
(212) 622-8358);
Attention: Equity Syndicate Desk. Notices to the Company shall be given to it at MercadoLibre, Inc., Arias 3751, 7
th
Floor, Buenos
Aires, C1430CRG, Argentina, Attention: General Counsel.
(b)
Governing Law
. This Agreement and any claim, controversy or dispute
arising under or related to this Agreement shall be governed by and construed in accordance with the laws of the State of New York.
(c)
Currency
. Each reference in this Agreement to U.S. dollars (the “relevant currency”), including by use of the symbol “$,” is of the essence. To the fullest extent permitted by law, the obligation of the Company in respect
of any amount due under this Agreement will, notwithstanding any payment in any other currency (whether pursuant to a judgment or otherwise), be discharged only to the extent of the amount in the relevant currency that the party entitled to receive
such payment may, in accordance with its normal procedures, purchase with the sum paid in such other currency (after any premium and costs of exchange) on the business day immediately following the day on which such party receives such payment. If
the amount in the relevant currency that may be so purchased for any reason falls short of the amount originally due, the Company will pay such additional amounts, in the relevant currency, as may be necessary to compensate for the shortfall. Any
obligation of the Company not discharged by such payment will, to the fullest extent permitted by applicable law, be due as a separate and independent obligation and, until discharged as provided herein, will continue in full force and effect.
(d)
Waiver of Immunity
. To the extent that the Company has or hereafter may acquire any immunity (sovereign or otherwise) from any
legal action, suit or proceeding, from jurisdiction of any court or from set-off or any legal process (whether service or notice, attachment in aid or otherwise) with respect to itself or any of its property, the Company hereby irrevocably waives
and agrees not to plead or claim such immunity in respect of its obligations under this Agreement to the fullest extent permitted by applicable law.
(e)
Jurisdiction and Waiver of Jury Trial
. The Company agrees that any suit, action or proceeding against the Company brought by any
Initial Purchaser, the directors, officers,
28
employees, affiliates and agents of any Initial Purchaser, or by any person who controls any Initial Purchaser within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act, arising out of or based upon this Agreement or the transactions contemplated hereby may be instituted in any U.S. federal or state court in the Borough of Manhattan, The City of New York, and waives any objection which it may now
or hereafter have to the laying of venue of any such proceeding, and irrevocably submits to the non-exclusive jurisdiction of such courts in any suit, action or proceeding. Notwithstanding the foregoing, any action arising out of or based upon this
Agreement may be instituted by any Initial Purchaser, the directors, officers, employees, affiliates and agents of any Initial Purchaser, or by any person who controls any Initial Purchaser within the meaning of Section 15 of the Securities Act
or Section 20 of the Exchange Act, in any other court of competent jurisdiction. The parties hereto each hereby waive any right to trial by jury in any action, proceeding or counterclaim arising out of or relating to this Agreement.
(f)
Counterparts
. This Agreement may be signed in counterparts (which may include counterparts delivered by any standard form of
telecommunication), each of which shall be an original and all of which together shall constitute one and the same instrument.
(g)
Amendments or Waivers
. No amendment or waiver of any provision of this Agreement, nor any consent or approval to any departure therefrom, shall in any event be effective unless the same shall be in writing and signed by the parties hereto.
(h)
Headings
. The headings herein are included for convenience of reference only and are not intended to be part of, or to affect
the meaning or interpretation of, this Agreement.
(i)
Xtract Research LLC
. The Company hereby agrees that the Initial Purchasers
may provide copies of the Preliminary Offering Memorandum and the Final Offering Memorandum relating to the offering of the Securities and any other agreements or documents relating thereto, including, without limitation, trust indentures, to Xtract
Research LLC (“Xtract”) following the completion of the offering for inclusion in an online research service sponsored by Xtract, access to which is restricted to “qualified institutional buyers” as defined in Rule 144A
under the Securities Act.
29
If the foregoing is in accordance with your understanding, please indicate your acceptance of
this Agreement by signing in the space provided below.
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Very truly yours,
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MERCADOLIBRE, INC.
|
|
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By
|
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/s/ Pedro Arnt
|
|
|
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Title:
|
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Chief Financial Officer
|
Accepted: As of the date first written above
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GOLDMAN, SACHS & CO.
|
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DEUTSCHE BANK SECURITIES INC.
|
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J.P. MORGAN SECURITIES LLC
|
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Acting severally on behalf of themselves and the several Initial Purchasers listed in Schedule 1 hereto.
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By:
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Goldman, Sachs & Co.
|
|
|
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By:
|
|
/s/ Daniel M. Young
|
|
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Name:
|
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Daniel M. Young
|
|
|
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Title:
|
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Managing Director
|
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|
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By:
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Deutsche Bank Securities Inc.
|
|
|
|
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By:
|
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/s/ Andrew Yaeger
|
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Name:
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Andrew Yaeger
|
|
|
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Title:
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Managing Director
|
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By:
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/s/ Faiz Khan
|
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Name:
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Faiz Khan
|
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Title:
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Director
|
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By:
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J.P. Morgan Securities LLC
|
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By:
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/S/ Santosh Sreenivasan
|
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Name:
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Santosh Sreenivasan
|
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|
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Title:
|
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Managing Director
|
30
EXECUTION VERSION
Schedule 1
|
|
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|
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Initial Purchaser
|
|
Principal Amount
|
|
|
|
|
|
Goldman, Sachs & Co.
|
|
$
|
77,778,000
|
|
|
Deutsche Bank Securities Inc.
|
|
|
77,778,000
|
|
|
J.P. Morgan Securities LLC
|
|
|
77,778,000
|
|
|
Citigroup Global Markets Inc.
|
|
|
40,000,000
|
|
|
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
|
|
|
26,666,000
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
300,000,000
|
|
|
|
|
|
|
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Sch 1-1
Schedule 2
Subsidiaries
MercadoLibre S.R.L.
Neosur S.A.
DeRemate.com de Argentina S.A.
Ibazar.com Atividades de Internet Ltda. (formerly MercadoPago Representações Ltda. Untill december 9th, 2008)
MercadoLivre.com Atividades de Internet Ltda.
MercadoPago.com
Representações Ltda.
eBazar.com.br Ltda.
MercadoEnvios Servicos de Logistica Ltda.
MercadoLibre Chile
Ltda.
MercadoPago S.A.
DeRemate.com Chile S.A.
Meli Inversiones SpA
VMK S.A.
MercadoLibre Colombia Ltda.
MercadoPago Colombia S.A.
MercadoLibre Costa Rica S.R.L.
MercadoLibre Ecuador Cía.
Ltda.
Meli Participaciones, S.L.
MercadoLibre, S.deR.L. de
C.V.
DeRemate.com de Mexico S.deR.L. de C.V.
PSGAC
Prestadora de Servicios Gerenciales, Administrativos y Comerciales S. de R.L. de C.V.
Interactivos y Digitales México S.A. de C.V.
AP Clasificados, S.de R.L. de C.V.
Inmobiliaria Web Chile, S de
RL de CV
Inmuebles Online SAPI de CV
MercadoLibre S.A.
(antes MercadoLibre Zonamerica S.A.)
Meli Uruguay S.R.L.
Tikleral S.A.
Deremate.com de Uruguay S.A.
Hammer.com, LLC
Lista Pop LLC
Servicios Administrativos y Comerciales LLC
MercadoPago, LLC
Autopark, LLC
Autopark Classifieds, LLC
Marketplace Investments, LLC
Meli Technology, Inc.
Classifieds LLC (previously named CMG Classified Media Group Inc.)
Meli Real State, LLC
Brick.com, LLC
MercadoLibre Venezuela, S.R.L.
Meli Clasificados MLV S.R.L.
Grupo Veneclasificados C.A.
MercadoLibre Peru S.R.L.
Sch 2-1
EXECUTION VERSION
Annex A
Time of Sale Information
Term sheet
containing the terms of the Securities, substantially in the form of Annex B.
Ann A-1
Annex B
Pricing Term Sheet
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PRICING TERM SHEET
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STRICTLY CONFIDENTIAL
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DATED JUNE 24, 2014
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MERCADOLIBRE, INC.
$300,000,000 2.25% CONVERTIBLE SENIOR NOTES DUE 2019
The information in this pricing term sheet supplements MercadoLibre, Inc.’s preliminary offering memorandum, dated June 23, 2014 (the
“Preliminary Offering Memorandum”), and supersedes the information in the Preliminary Offering Memorandum to the extent inconsistent with the information in the Preliminary Offering Memorandum. In all other respects, this term sheet is
qualified in its entirety by reference to the Preliminary Offering Memorandum, including all documents incorporated by reference therein. References to “we,” “our” and “us” refer to MercadoLibre, Inc. and not to its
consolidated subsidiaries. Terms used in this term sheet but not defined in this term sheet have the respective meanings set forth in the Preliminary Offering Memorandum. All references to dollar amounts are references to U.S. dollars.
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Issuer:
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MercadoLibre, Inc.
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Ticker/Exchange for Common Stock:
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“MELI”/The NASDAQ Global Select Market.
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Securities:
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2.25% Convertible Senior Notes due 2019 (the “notes”).
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Principal Amount:
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$300,000,000.
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Over-allotment Option:
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$30,000,000.
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Denominations:
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$1,000 and multiples of $1,000 in excess thereof.
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Ranking:
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Senior unsecured.
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Maturity:
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July 1, 2019, unless earlier repurchased or converted.
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No Redemption:
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We may not redeem the notes prior to the maturity date, and no “sinking fund” is provided for the notes.
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Fundamental Change:
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If we undergo a “fundamental change” (as defined in the Preliminary Offering Memorandum under the caption “Description of Notes—Fundamental Change Permits Holders to Require us to Repurchase Notes”) prior to
the maturity date of the notes, subject to certain conditions, holders may require us to repurchase for cash all or part of their notes in principal amounts of $1,000 or a multiple thereof. The fundamental change repurchase price will be equal to
100% of the principal amount of the notes to be repurchased,
plus
any accrued and unpaid interest to, but excluding, the fundamental change repurchase date.
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Interest and Interest Payment Dates:
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2.25% per year.
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Interest will accrue from June 30, 2014 and will be payable semiannually in arrears on January 1 and July 1 of each year, beginning on January 1, 2015.
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Ann B-1
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Interest Record Dates:
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December 15 and June 15 of each year, immediately preceding the corresponding January 1 or July 1 interest payment date, as the case may be.
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Issue Price:
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100% of principal, plus accrued interest, if any, from June 30, 2014.
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Last Reported Sale Price of Our Common Stock on the NASDAQ Global Select Market on June 24, 2014:
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$91.65 per share.
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Initial Conversion Rate:
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7.9353 shares of common stock per $1,000 principal amount of the notes, subject to adjustment.
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Initial Conversion Price:
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Approximately $126.02 per share of common stock, subject to adjustment.
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Conversion Premium:
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Approximately 37.5% above the last reported sale price of our common stock on the NASDAQ Global Select Market on June 24, 2014.
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Settlement Method:
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Cash, shares of our common stock or a combination of cash and shares of our common stock, at our election, as described in the Preliminary Offering Memorandum.
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Joint Book-Running Managers:
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Goldman, Sachs & Co.
Deutsche Bank
Securities Inc.
J.P. Morgan Securities LLC
Merrill Lynch,
Pierce, Fenner & Smith
Incorporated
Citigroup Global Markets Inc.
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Pricing Date:
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June 24, 2014.
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Trade Date:
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June 25, 2014.
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Expected Settlement Date:
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June 30, 2014.
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CUSIP Number (144A):
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58733R AA0.
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ISIN (144A):
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US58733RAA05.
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Listing:
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None.
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Capped Call Transactions:
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In connection with the pricing of the notes, we entered into capped call transactions with one or more of the initial purchasers or their
respective affiliates (the “option counterparties”). If the initial purchasers exercise their over-allotment option, we expect to enter into additional capped call transactions with the option counterparties.
The capped call transactions are expected generally to reduce the potential dilution upon
conversion of the notes and/or offset any cash payments we are required to make in excess of the principal amount of any converted notes, as the case may be, in the event that the market price per share of our common stock, as measured under the
terms of the capped call transactions, is greater than the strike price of the capped call transactions, which initially corresponds to the initial conversion price of the notes and is subject to anti-dilution adjustments substantially similar to
those applicable to the conversion rate of the notes. If, however, the market price per share of our common stock, as measured under the
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Ann B-2
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terms of the capped call transactions, exceeds the cap price of the capped call transactions, there would nevertheless be dilution and/or there would not be an offset of such potential cash payments, in each case, upon conversion of
the notes to the extent that such market price exceeds the cap price of the capped call transactions. The cap price will initially be 70% above the last reported sale price of our common stock on the NASDAQ Global Select Market on June 24, 2014
and is subject to customary anti-dilution adjustments.
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Use of Proceeds:
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We estimate that the proceeds from this offering will be approximately $292 million (or approximately $322 million if the initial purchasers exercise their over-allotment option in full), after deducting fees and estimated expenses.
We intend to use approximately $17.9 million of the net proceeds from this offering to pay the cost of the capped call transactions. We intend to use the remainder of the net proceeds from this offering for general corporate purposes.
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If the initial purchasers exercise their over-allotment option, we expect to use a portion of the net proceeds from the sale of the additional notes to enter into additional capped call transactions with the option counterparties
and for general corporate purposes.
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Ann B-3
Increase in Conversion Rate upon Conversion upon a Make-Whole Fundamental Change
Holders who convert their notes in connection with a make-whole fundamental change occurring prior to the maturity date of the notes may be entitled to an
increase in the conversion rate for the notes so surrendered for conversion.
The following table sets forth the number of additional shares by which the
conversion rate for the notes will be increased per $1,000 principal amount of notes for each stock price and effective date set forth below:
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Stock Price
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Effective Date
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$91.65
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$100.00
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$112.00
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$126.02
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$140.00
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$155.00
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$170.00
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$185.00
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$200.00
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$220.00
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$260.00
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$300.00
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June 30, 2014
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2.9757
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2.4883
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1.9163
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1.4291
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1.0756
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0.7968
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0.5908
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0.4366
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0.3200
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0.2067
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0.0733
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0.0132
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July 1, 2015
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2.9757
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2.5675
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1.9578
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1.4425
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1.0721
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0.7830
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0.5720
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0.4159
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0.2995
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0.1881
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0.0608
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0.0073
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July 1, 2016
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2.9757
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2.6029
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1.9526
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1.4092
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1.0244
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0.7294
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0.5181
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0.3652
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0.2537
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0.1500
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0.0382
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0.0000
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July 1, 2017
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2.9757
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2.5409
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1.8501
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1.2847
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0.8952
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0.6066
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0.4080
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0.2704
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0.1746
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0.0910
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0.0130
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0.0000
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July 1, 2018
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2.9757
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2.3393
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1.5871
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0.9972
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0.6176
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0.3605
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0.2024
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0.1061
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0.0485
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0.0087
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0.0000
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0.0000
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July 1, 2019
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2.9757
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2.0647
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0.9932
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0.0000
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0.0000
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0.0000
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0.0000
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0.0000
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0.0000
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0.0000
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0.0000
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0.0000
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The exact stock prices and effective dates may not be set forth in the table above, in which case:
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•
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If the stock price is between two stock prices in the table or the effective date is between two effective dates in the table, the number of additional shares by which the conversion rate for the notes will be increased
will be determined by a straight-line interpolation between the number of additional shares set forth for the higher and lower stock prices and the earlier and later effective dates, as applicable, based on a 365-day year.
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If the stock price is greater than $300.00 per share (subject to adjustment in the same manner as the stock prices set forth in the column headings of the table above), no additional shares will be added to the
conversion rate.
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If the stock price is less than $91.65 per share (subject to adjustment in the same manner as the stock prices set forth in the column headings of the table above), no additional shares will be added to the conversion
rate.
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Notwithstanding the foregoing, in no event will the conversion rate per $1,000 principal amount of notes exceed 10.9110 shares of
common stock, subject to adjustment in the same manner as the conversion rate as set forth in the Preliminary Offering Memorandum under the caption “Description of Notes—Conversion Rights—Conversion Rate Adjustments.”
[
Remainder of Page Intentionally Blank
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Ann B-4
This communication is intended for the sole use of the person to whom it is provided by the sender. This material is confidential and is for your
information only and is not intended to be used by anyone other than you. This information does not purport to be a complete description of the notes or the offering. This communication does not constitute an offer to sell or the solicitation of an
offer to buy any notes in any jurisdiction to any person to whom it is unlawful to make such offer or solicitation in such jurisdiction.
The notes
and the common stock issuable upon conversion of the notes, if any, have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), or any state securities laws, and may not be offered or sold within the
United States or any other jurisdiction, except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and any other applicable securities laws. The notes are being offered and sold
only to qualified institutional buyers (as defined in Rule 144A under the Securities Act).
The notes and any shares of common stock issuable upon
conversion of the notes are not transferable except in accordance with the restrictions described under “Transfer Restrictions” in the Preliminary Offering Memorandum.
A copy of the Preliminary Offering Memorandum for the offering of the notes may be obtained by contacting (i) Goldman, Sachs & Co.,
Attention: Prospectus Department, 200 West Street, New York, NY 10282, by telephone at (866) 471-2526, or by emailing prospectus-ny@ny.email.gs.com, (ii) Deutsche Bank Securities Inc., Attention: Prospectus Group, 60 Wall Street,
New York, NY 10005-2836, by telephone at (800) 503-4611 or by emailing
prospectus.CPDG@db.com
, (iii) J.P. Morgan Securities LLC, c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717 by telephone at
(866) 803-9204, (iv) BofA Merrill Lynch by telephone at (866) 500-5408 or (v) Citigroup Global Markets Inc., c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717 by telephone at (800) 831-9146 or
by emailing
prospectus@citi.com
.
Any legends, disclaimers or other notices that may appear below are not applicable to this communication
and should be disregarded. Such legends, disclaimers or other notices have been automatically generated as a result of this communication having been sent via Bloomberg or another system.
Ann B-5
Annex C
Form of Opinion of Counsel for the Company
June [
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], 2014
GOLDMAN, SACHS & CO.
DEUTSCHE BANK SECURITIES INC.
J.P. MORGAN SECURITIES LLC
As Representatives of the
several Initial Purchasers listed
in Schedule 1 to the
Purchase Agreement
c/o Goldman, Sachs & Co.
200 West Street
New York, New
York 10282
Deutsche Bank Securities Inc.
60 Wall Street, 2nd Floor
New
York, New York 10005
J.P. Morgan Securities LLC
383 Madison Avenue
New York, New
York 10179
Ladies and Gentlemen:
We have acted as special
counsel for MercadoLibre, Inc., a Delaware corporation (the “Company”), in connection with the Purchase Agreement dated June 24, 2014 (the “Purchase Agreement”) with you and the other several Initial Purchasers named in
Schedule I thereto under which you and such other Initial Purchasers have severally agreed to purchase from the Company $[300] million aggregate principal amount of its 2.25% convertible senior notes due 2019 (the “Securities”). [The
Securities include $[30] million aggregate principal amount of the Company’s 2.25% convertible senior notes to be purchased pursuant to the
over-allotment
option provided for by the Purchase Agreement).]
1
The Securities are to be issued pursuant to the provisions of the Indenture dated as of June 30, 2014 (the “Indenture”) between the Company and Wilmington Trust, National Association,
as trustee, and are convertible on the terms set forth in the Indenture into cash and/or shares of common stock, $0.001 par value per share (the “Underlying Securities”), of the Company.
In connection with the offering and sale of the Securities, the Company has entered into capped call transactions with certain of the Initial Purchasers or
affiliates thereof pursuant to confirmation letters, each dated as of June 24, 2014, subject to an agreement in the form of the ISDA 2002 Master Agreement (the “Capped Call Documents”).
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Sentence to be included, and aggregate principal amount updated accordingly, should over-allotment option be settled at closing.
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Ann C-1
We have examined originals or copies of such documents, corporate records, certificates of public officials and
other instruments as we have deemed necessary or advisable for the purpose of rendering this opinion.
We have also participated in the preparation of the
preliminary offering memorandum dated June 23, 2014, and the final offering memorandum dated June 24, 2014, other than the documents incorporated by reference therein (the “Incorporated Documents”), relating to the Securities and
have reviewed the Incorporated Documents. The final offering memorandum, including the Incorporated Documents, is hereinafter referred to as the “Final Memorandum.”
In rendering the opinions expressed herein, we have, without independent inquiry or investigation, assumed that (i) all documents submitted to us as
originals are authentic and complete, (ii) all documents submitted to us as copies conform to authentic, complete originals, (iii) all documents filed with or submitted to the Securities and Exchange Commission through its Electronic Data
Gathering, Analysis and Retrieval (“EDGAR”) system (except for required EDGAR formatting changes) conform to the versions of such documents reviewed by us prior to such formatting, (iv) all signatures on all documents that we reviewed
are genuine, (v) all natural persons executing documents had and have the legal capacity to do so, (vi) all statements in certificates of public officials and officers of the Company that we reviewed were and are accurate and
(vii) all representations made by the Company as to matters of fact in the documents that we reviewed were and are accurate.
Based upon the
foregoing, and subject to the additional assumptions and qualifications set forth below, we are of the opinion that:
1. The Company is
validly existing as a corporation in good standing under the laws of the State of Delaware, and the Company has corporate power and authority to issue the Securities, to enter into the Purchase Agreement and the Capped Call Documents and to perform
its obligations thereunder.
2. The Purchase Agreement has been duly authorized, executed and delivered by the Company.
3. The Securities have been duly authorized and when executed and authenticated in accordance with the provisions of the Indenture and
delivered to and paid for by the Initial Purchasers pursuant to the Purchase Agreement, will be valid and binding obligations of the Company, enforceable in accordance with their terms, subject to applicable bankruptcy, insolvency and similar laws
affecting creditors’ rights generally, concepts of reasonableness and equitable principles of general applicability (including, without limitation, that (A) we express no opinion as to the (w) enforceability of any waiver of rights
under any usury or stay law, (x) effect of fraudulent conveyance, fraudulent transfer or similar provision of applicable law on the conclusions expressed above, (y) validity, legally binding effect or enforceability of any provision in the
Securities that requires or relates to adjustments to the conversion rate at a rate or in an amount that a court would determine in the circumstances under applicable law to be
Ann C-2
commercially unreasonable or a penalty or forfeiture or (z) validity, legally binding effect or enforceability of any provision that permits holders to collect any portion of stated
principal amount upon acceleration of the Securities to the extent determined to constitute unearned interest in an amount a court would determine in the circumstances under applicable law to be commercially unreasonable or a penalty or forfeiture
and (B) if any portion of the amount payable on the Securities upon an acceleration in a bankruptcy, insolvency or similar proceeding is determined to be unearned interest, a court could disallow recovery of any such portion) and will be
entitled to the benefits of the Indenture pursuant to which such Securities are to be issued.
4. The Underlying Securities initially
issuable upon conversion of the Securities have been duly authorized and reserved and, when issued upon conversion of the Securities in accordance with the terms of the Securities, will be validly issued, fully paid and
non-assessable,
and will not be subject to any preemptive or similar rights under the Amended and Restated Certificate of Incorporation of the Company or Amended and Restated By laws of the Company or the General
Corporation Law of the State of Delaware.
5. The Indenture has been duly authorized, executed and delivered by the Company, and the
Indenture is a valid and binding agreement of, the Company, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency and similar laws affecting creditors’ rights generally, concepts of reasonableness and equitable
principles of general applicability (including, without limitation that (A) we express no opinion as to the (w) enforceability of any waiver of rights under any usury or stay law, (x) effect of fraudulent conveyance, fraudulent
transfer or similar provision of applicable law on the conclusions expressed above, (y) validity, legally binding effect or enforceability of Section [
—
] of the Indenture or any related
provision in the Securities that requires or relates to adjustments to the conversion rate at a rate or in an amount that a court would determine in the circumstances under applicable law to be commercially unreasonable or a penalty or forfeiture or
(z) validity, legally binding effect or enforceability of any provision that permits holders to collect any portion of stated principal amount upon acceleration of the Securities to the extent determined to constitute unearned interest in an
amount a court would determine in the circumstances under applicable law to be commercially unreasonable or a penalty or forfeiture and (B) if any portion of the amount payable on the Securities upon an acceleration in a bankruptcy, insolvency
or similar proceeding is determined to be unearned interest, a court could disallow recovery of any such portion).
6. The Capped Call
Documents have been duly authorized, executed and delivered by the Company, and the Capped Call Documents are valid and binding agreements of the Company, enforceable in accordance with their terms, subject to applicable bankruptcy, insolvency and
similar laws affecting creditors’ rights generally, concepts of reasonableness and equitable principles of general applicability.
7.
It is not necessary in connection with the offer, sale and delivery of the Securities to the Initial Purchasers under the Purchase Agreement or in connection with the initial resale of such Securities by the Initial Purchasers in the manner
contemplated by the Purchase Agreement and the Final Memorandum to register the Securities under the Securities Act of 1933, as amended, or to qualify the Indenture under the Trust Indenture Act of 1939, as amended, it being understood that no
opinion is expressed as to any subsequent offer or resale of any Security or Underlying Security.
Ann C-3
8. The Company is not, and after giving effect to the offering and sale of the Securities and the
application of the proceeds thereof as described in the Final Memorandum will not be, required to register as an “investment company” as such term is defined in the Investment Company Act of 1940, as amended.
9. The execution and delivery by the Company of, and the performance by the Company of its obligations under, each of the Indenture, the
Securities, the Purchase Agreement and the Capped Call Documents (collectively, the “Documents”) will not contravene (i) any provision of the laws of the State of New York or any federal law of the United States of America that in our
experience is normally applicable to general business corporations in relation to transactions of the type contemplated by the Documents, or the General Corporation Law of the State of Delaware provided that we express no opinion as to federal or
state securities laws, (ii) the Amended and Restated Certificate of Incorporation of the Company or Amended and Restated By laws of the Company, or (iii) any agreement that is specified in Annex A hereto.
10. No consent, approval, authorization, or order of, or qualification with, any governmental body or agency under the laws of the State of
New York or any federal law of the United States of America that in our experience is normally applicable to general business corporations in relation to transactions of the type contemplated by the Documents, or the General Corporation Law of the
State of Delaware is required for the execution, delivery and performance by the Company of its respective obligations under the Documents, except such as may be required under federal or state securities or Blue Sky laws as to which we express no
opinion in this paragraph.
We have considered the statements included in the Final Memorandum under the caption “Description of Notes,”
“Description of the Capped Call Transactions” and “Description of Capital Stock” insofar as they summarize provisions of the Documents, the Amended and Restated Certificate of Incorporation of the Company or Amended and Restated
By laws of the Company. In our opinion, such statements fairly summarize these provisions in all material respects. The statements included in the Final Memorandum under the caption “Certain U.S. Federal Income Tax Considerations,” insofar
as they purport to describe provisions of U.S. federal income tax laws or legal conclusions with respect thereto, in our opinion fairly and accurately summarize the matters referred to therein in all material respects.
In rendering the opinions in paragraphs (2) through (6) above, we have assumed that each party to the Documents has been duly incorporated and is
validly existing and in good standing under the laws of the jurisdiction of its organization (other than as expressly covered above in respect of the Company). In addition, we have assumed that (i) the execution, delivery and performance by
each party thereto of each Document to which it is a party, (a) are within its corporate powers, (b) do not contravene, or constitute a default under, the certificate of incorporation or bylaws or other constitutive documents of such
party, (c) require no action by or in respect of, or filing with, any governmental body, agency or official and (d) do not contravene, or constitute a default under, any provision of applicable law or regulation or any judgment,
injunction, order or decree or any agreement or other instrument binding upon such party, provided that we make no such assumption to the extent that we have specifically opined as to such matters with respect to the Company, and (ii) each
Document (other than the Purchase Agreement) is a valid, binding and enforceable agreement of each party thereto (other than as expressly covered above in respect of the Company).
Ann C-4
In rendering the opinions set forth in paragraph (7) above, we have assumed the accuracy of, and compliance
with, the representations, warranties and covenants of the Company and the Initial Purchasers in the Purchase Agreement relating to the offering and the initial resale of the Securities.
We are members of the Bar of the State of New York, and the foregoing opinion is limited to the laws of the State of New York, the federal laws of the United
States of America and the General Corporation Law of the State of Delaware, except that we express no opinion as to any law, rule or regulation that is applicable to the Company, the Documents or such transactions solely because such law, rule or
regulation is part of a regulatory regime applicable to any party to any of the Documents or any of its affiliates due to the specific assets or business of such party or such affiliate.
This opinion is delivered solely to you and the other several Initial Purchasers in connection with the Purchase Agreement. This opinion may not be relied
upon by you or the other several Initial Purchasers for any other purpose or relied upon by any other person (including any person acquiring Securities from the several Initial Purchasers) or furnished to any other person without our prior written
consent.
Very truly yours,
Ann C-5
Annex A
Second Amended and Restated Registration Rights Agreement, dated September 24, 2001, by and among the Company and the investors named therein.
2001 Management Incentive Bonus Plan of the Company, effective as of September 24, 2001
Amended and Restated 1999 Stock Option and Restricted Stock Plan of the Company, effective as of May 5, 2000
2009 Equity Compensation Plan of the Company, effective as of June 10, 2009
2008 Long Term Retention Program of the Company, effective as of January 1, 2008 and amended and Restated effective as of January 1, 2013
2009 Long Term Retention Program of the Company, effective as of January 1, 2009 and amended and Restated effective as of January 1, 2013
2010 Long Term Retention Program of the Company, effective as of January 1, 2010 and amended and Restated effective as of January 1, 2013
2011 Long Term Retention Program of the Company, effective as of January 1, 2011 and amended and Restated effective as of January 1, 2013
2012 Long Term Retention Program of the Company, effective as of January 1, 2012 and amended and Restated effective as of January 1, 2013
2013 Long Term Retention Program of the Company, effective as of January 1, 2013
2014 Long Term Retention Program of the Company, effective as of January 1, 2014
Ann C-6
Annex D
Form of 10b-5 Statement of Counsel for the Company
June [
—
], 2014
GOLDMAN, SACHS & CO.
DEUTSCHE BANK SECURITIES INC.
J.P. MORGAN SECURITIES LLC
As Representatives of the
several Initial Purchasers listed
in Schedule 1 to the
Purchase Agreement
c/o Goldman, Sachs & Co.
200 West Street
New York, New
York 10282
Deutsche Bank Securities Inc.
60 Wall Street, 2nd Floor
New
York, New York 10005
J.P. Morgan Securities LLC
383 Madison Avenue
New York, New
York 10179
Ladies and Gentlemen:
We have acted as special
counsel for MercadoLibre, Inc. a Delaware corporation (the “Company”), in connection with the Purchase Agreement dated June 24, 2014 (the “Purchase Agreement”) with you and the other several Initial Purchasers named in
Schedule I thereto under which you and such other Initial Purchasers have severally agreed to purchase from the Company $[300] million aggregate principal amount of its 2.25% convertible senior notes due 2019 (the “Securities”). [The
Securities include $[30] million aggregate principal amount of the Company’s 2.25% convertible senior notes due 2019 to be purchased pursuant to the over allotment option provided for by the Purchase Agreement.]
2
We have participated in the preparation of the preliminary offering memorandum dated June 23, 2014
(the “Preliminary Offering Memorandum”) and the final offering memorandum dated June 24, 2014, other than the documents incorporated by reference therein (the “Incorporated Documents”), relating to the Securities, and have
reviewed the Incorporated Documents. The final offering memorandum, including the Incorporated Documents, is hereinafter referred to as the “Final Memorandum.” The Preliminary Offering Memorandum, including the Incorporated Documents,
together with the pricing term sheet attached as Annex B to the Purchase Agreement, is hereinafter referred to as the “Disclosure Package.”
|
2
|
Sentence to be included, and aggregate principal amount updated accordingly, should over-allotment option be settled at closing.
|
Ann D-1
We have, without independent inquiry or investigation, assumed that all documents filed with or submitted to the
Securities and Exchange Commission through its Electronic Data Gathering, Analysis and Retrieval (“EDGAR”) system (except for required EDGAR formatting changes) conform to the versions of such documents reviewed by us prior to such
formatting.
The primary purpose of our professional engagement was not to establish or confirm factual matters or financial, accounting or quantitative
information. Furthermore, many determinations involved in the preparation of the Final Memorandum and the Disclosure Package are of a wholly or partially non-legal character or relate to legal matters outside the scope of our opinion separately
delivered to you today in respect of certain matters under the laws of the State of New York, the federal laws of the United States of America and the General Corporation Law of the State of Delaware. As a result, we are not passing upon, and do not
assume any responsibility for, the accuracy, completeness or fairness of the statements contained in the Final Memorandum or the Disclosure Package, and we have not ourselves checked the accuracy, completeness or fairness of, or otherwise verified,
the information furnished in such documents (except to the extent expressly set forth in our opinion letter separately delivered to you today as to statements included in the Final Memorandum under the caption “Description of Notes,”
“Description of the Capped Call Transactions,” “Description of Capital Stock” and “Certain U.S. Federal Income Tax Considerations”). However, in the course of our acting as counsel to the Company in connection with the
preparation of the Final Memorandum and the Disclosure Package, we have generally reviewed and discussed with your representatives and your counsel, and with certain officers and employees of, and independent public accountants for, the Company the
information furnished, whether or not subject to our check and verification. We have also reviewed and relied upon certain corporate records and documents, letters from counsel and accountants and oral and written statements of officers and other
representatives of the Company and others as to the existence and consequence of certain factual and other matters.
On the basis of the information
gained in the course of the performance of the services rendered above, but without independent check or verification except as stated above, nothing has come to our attention that causes us to believe that:
(a) at [
—
]:[
—
] A/P.M. New York City
time on the date of the Purchase Agreement, the Disclosure Package contained any untrue statement of a material fact or omitted to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which
they were made, not misleading, or
(b) the Final Memorandum as of its date or as of the date hereof contained or contains any untrue
statement of a material fact or omitted or omits to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.
In providing this letter to you and the other several Initial Purchasers, we have not been called to pass upon, and we express no view regarding, the
financial statements or financial schedules or other financial or accounting data included in the Disclosure Package or the Final Memorandum. In addition, we express no view as to the conveyance of the Disclosure Package or the information contained
therein to investors.
Ann D-2
This letter is delivered solely to you and the other several Initial Purchasers in connection with the Purchase
Agreement. This letter may not be relied upon by you or the other several Initial Purchasers for any other purpose or relied upon by any other person (including any person acquiring Securities from the several Initial Purchasers) or furnished to any
other person without our prior written consent.
Very truly yours,
Ann D-3
Annex E
Form of Foreign Local Counsel Opinion
(1) Each of the [Brazilian][Argentine][Venezuelan] subsidiaries has been duly organized and is validly existing and in good standing under the
laws of its jurisdiction of organization, is duly qualified to do business and is in good standing in each jurisdiction in which its ownership or lease of property or the conduct of its business requires such qualification, and has the power and
authority necessary to own or hold its property and to conduct the business in which it is engaged as described in the Time of Sale Information and the Offering Memorandum, except where the failure to be so qualified or have such power or authority
would not, individually or in the aggregate, have a Material Adverse Effect.
(2) All the outstanding shares of capital stock or other
equity interests of each [Brazilian][Argentine][Venezuelan] subsidiary, have been duly and validly authorized and issued, are fully paid and non-assessable (except for directors’ qualifying shares [
for Brazilian opinion:
and other than
as described herein]) and are owned directly or indirectly by the Company except as otherwise described in the Time of Sale Information and the Offering Memorandum. [
For Brazilian opinion:
The capital stock of iBazar.com Atividades de
Internet Ltda. is R$ 19,002,000.00 (nineteen million two thousand reals), divided in 19,002,000 million quotas at the par value of R$ 1,00 (one real) each, from which 15,700,180 are fully paid and non-assessable, while 3,301,820 shall be paid
until August 20, 2017.]
(3) To the best of my knowledge, none of the Company and the [Brazilian][Argentine][Venezuelan] subsidiaries
are (i) in violation of the provisions of its charter or by-laws or similar organizational documents, (ii) in default, and no event has occurred that, with notice or lapse of time or both, would constitute such a default, in the due
performance or observance of any term, covenant or condition contained in any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which it is a party or by which it is bound or to which any of its property or
assets is subject except as otherwise described in the Time of Sale Information and the Offering Memorandum; or (iii) except as described in the Time of Sale Information and the Offering Memorandum, in any violation of any law or statute
or any judgment, order or regulation of any court or arbitrator or governmental or regulatory authority; except in the case of clause (ii) for any such default or violation that would not, individually or in the aggregate, have a Material
Adverse Effect.
(4) The execution, delivery and performance by the Company of each of the Transaction Documents, the compliance by the
Company with the terms thereof, the issuance and sale of the Securities being delivered on the Closing Date or the Additional Closing Date, as the case may be, (including the issuance of the Underlying Securities upon conversion thereof) and the
consummation of the transactions contemplated by the Transaction Documents or the Time of Sale Information and the Offering Memorandum will not (i) conflict with or result in a breach or violation of any of the terms or provisions of, or
constitute a default under, or result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Company or the [Brazilian][Argentine][Venezuelan] subsidiaries pursuant to, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which the Company or any of the [Brazilian][Argentine][Venezuelan] subsidiaries is a party or by which the Company or any of the [Brazilian][Argentine][Venezuelan] subsidiaries is bound or to
which any
Ann E-1
of the property or assets of the Company or any of the [Brazilian][Argentine][Venezuelan] subsidiaries is subject, (ii) result in any violation of the provisions of the charter or by-laws or
similar organizational documents of the Company or any of the [Brazilian][Argentine] [Venezuelan] subsidiaries or (iii) result in the violation of any law or statute or any judgment, order or regulation of any court or arbitrator or
governmental or regulatory authority, except, in the case of clauses (i) and (iii) above, for such conflict, breach or violation that would not, individually or in the aggregate, have a Material Adverse Effect.
(5) No consent, approval, authorization, order, registration or qualification of or with any court or arbitrator or governmental or regulatory
authority in [Brazil][Argentina][Venezuela] is required for the execution, delivery and performance by the Company of each of the Transaction Documents, the compliance by the Company with the terms thereof, the issuance and sale of the Securities
being delivered on the Closing Date or the Additional Closing Date, as the case may be, (including the issuance of the Underlying Securities upon conversion thereof) and the consummation of the transactions contemplated by the Transaction Documents
or the Time of Sale Information and the Offering Memorandum, except (i) for such consents, approvals, authorizations, orders and registrations or qualifications as may be required by applicable state securities laws in connection with the
purchase and distribution of the Securities by the Initial Purchasers, or (ii) where any failure to obtain such consent, approval, authorization, order, registration or qualification would not, individually or in the aggregate, have a Material
Adverse Effect.
(6) To the best of my knowledge, except as described in the Time of Sale Information and the Offering Memorandum, there
are no legal, governmental or regulatory investigations, actions, suits or proceedings pending to which the Company or any of the [Brazilian] [Argentine][Venezuelan] subsidiaries is or may be a party or to which any property of the Company or any of
the [Brazilian][Argentine][Venezuelan] subsidiaries is or may be the subject which, individually or in the aggregate, if determined adversely to the Company or any of the [Brazilian][Argentine][Venezuelan] subsidiaries, could reasonably be expected
to have a Material Adverse Effect; and to the best of my knowledge, no such investigations, actions, suits or proceedings are threatened or contemplated by any governmental or regulatory authority or threatened by others.
(7) The descriptions in the Time of Sale Information and the Offering Memorandum of [Brazilian][Argentine][Venezuelan] statutes, legal,
governmental and regulatory proceedings and contracts and other documents to the extent that they constitute summaries of matters of [Brazilian][Argentine][Venezuelan] law or regulation or legal conclusions, provide a fair summary of such matters in
all material respects.
(8) Except as described in the Time of Sale Information and the Offering Memorandum, to the best of my knowledge
(i) each of the [Brazilian][Argentine][Venezuelan] subsidiaries owns, possesses or has obtained all licenses, permits, certificates, consents, orders, approvals and other authorizations from, and has made all declarations and filings with, all
governmental authorities (including foreign regulatory agencies), all self-regulatory organizations and all courts and other tribunals, domestic or foreign, necessary to own or lease, as the case may be, and to operate its properties and to carry on
its business as conducted as of the date hereof; (ii) none of the Company or the [Brazilian][Argentine][Venezuelan] subsidiaries
Ann E-2
has received any actual notice of any proceeding relating to revocation or modification of any such license, permit, certificate, consent, order, approval or other authorization; and
(iii) each of the Company and the [Brazilian][Argentine] [Venezuelan] subsidiaries of the Company is in compliance with all laws and regulations relating to the conduct of its business as conducted as of the date of the Offering Memorandum,
except in the case of clauses (i), (ii) and (iii) above, where the failure to own, possess or obtain, or receipt of any notice, or failure to comply with such laws or regulations, as the case may be, would not, individually or in the
aggregate, have a Material Adverse Effect.
(9) Except as disclosed in the Time of Sale Information and the Offering Memorandum,
(i) each of the Company and any of its [Brazilian][Argentine][Venezuelan] subsidiaries owns or possesses adequate rights to use all material uniform resource locators (URLs), patents, patent applications, trademarks, service marks, trade names
and, in each case, applications for registration and registrations thereof, copyrights, licenses, inventions and know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or
procedures) necessary for the conduct of their respective businesses as they are currently conducted (collectively, “Intellectual Property”); provided that Intellectual Property shall not include any pending trademark applications;
(ii) to the best of my knowledge, there are no third parties who have or will be able to establish rights to any Intellectual Property, except for, and to the extent of, the ownership rights of the owners of the Intellectual Property which each
of the Time of Sale Information and the Offering Memorandum disclose is licensed to the Company or any of its [Brazilian][Argentine][Venezuelan] subsidiaries; (iii) to the best of my knowledge, there is no infringement by third parties of any
Intellectual Property; (iv) to the best of my knowledge, there is no pending or threatened action, suit, proceeding or claim by others challenging the Company or any of its [Brazilian][Argentine][Venezuelan] subsidiaries’ rights in or to
any Intellectual Property, and none of the Company or any of its [Brazilian] [Argentine][Venezuelan] subsidiaries is aware of any facts which could form a reasonable basis for any such action, suit, proceeding or claim; (v) to the best of my
knowledge, there is no pending or threatened action, suit, proceeding or claim by others challenging the validity, enforceability or scope of any Intellectual Property, and none of the Company or any of its [Brazilian][Argentine][Venezuelan]
subsidiaries is aware of any facts which could form a reasonable basis for any such action, suit, proceeding or claim; (vi) to the best of my knowledge, there is no pending or threatened action, suit, proceeding or claim by others that the
Company or any of its [Brazilian][Argentine][Venezuelan] subsidiaries infringes, misappropriates or otherwise violates any patent, trademark, trade name, service mark, copyright, trade secret or other proprietary rights of others, and none of the
Company or any of its [Brazilian] [Argentine][Venezuelan] subsidiaries is aware of any facts which could form a reasonable basis for any such action, suit, proceeding or claim; (vii) each of the Company and its [Brazilian]
[Argentine][Venezuelan] subsidiaries has complied with the terms of any agreement pursuant to which Intellectual Property has been licensed to the Company or its [Brazilian][Argentine] [Venezuelan] subsidiaries, as the case may be, and all such
agreements are in full force and effect, except where the failure of such agreement to be in full force or effect would not give rise to a Material Adverse Effect; and (viii) except, in each case, as would not reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect, there is no patent or patent application that contains claims that interfere with the issued or pending claims of any of the Intellectual Property or that challenges the validity,
enforceability or scope of any of the Intellectual Property.
Ann E-3
(10) There is no stamp or other issuance or transfer taxes or duties or other similar fees or
charges required to be paid by or on behalf of the Initial Purchasers in connection with the execution, delivery and enforcement of the Agreement or the offer or sale by the Company of the Securities under [Brazilian][Argentine][Venezuelan] law.
(11) Except with respect to a person that is otherwise required to pay tax under [Brazilian][Argentine][Venezuelan] law, there is under
[Brazilian][Argentine][Venezuelan] law no tax, duty or other similar fee or charge (including VAT or any stamp tax) imposed by any means on the acquisition of, disposition of, holding of or receipt of payments (including deemed payments) on or with
respect to, the Securities or the Underlying Securities.
(12) [
For Brazilian opinion:
The choice of laws of the State of New York
as the governing law of the Agreement is a valid choice of law under the laws of Brazil and will be honored by the courts of this country, provided that such laws do not infringe public policy and provided further that the foreign court decision
complies with the requirements set forth by regulations on the application of Brazilian law (
“Lei de Introdução das Normas do Direito Brasileiro”
) among any other applicable regulations; and service of process effected
in the manner set forth in the Agreement, assuming validity under the laws of the State of New York, will be effective, insofar as Brazilian laws are concerned, to confer valid personal jurisdiction over the Company.] [
For Argentine opinion:
The choice of laws of the State of New York as the governing law of the Agreement is a valid choice of law under the laws of Argentina and will be honored by the courts of this country, provided that: (i) such laws do not infringe public policy
and provided further that (ii) the applicable laws of the State of New York are entered into evidence in accordance with Argentine law.] [
For Venezuelan opinion:
The choice of laws of the State of New York as the governing law of the
Agreement is a valid choice of law under the laws of Venezuela and will be honored by the courts of this country, provided that such laws do not infringe public policy and provided further that the foreign court decision complies with the
requirements set forth by applicable regulations in Venezuela; and service of process effected in the manner set forth in the Agreement, assuming validity under the laws of the State of New York, will be effective, insofar as Venezuelan laws are
concerned, to confer valid personal jurisdiction over the Company.]
(13) [
For Argentine opinion:
A final and conclusive judgment
in respect of the Agreement obtained in any court of the State of New York, will be recognized by, and be enforceable against, the Argentine subsidiaries without reconsideration of the merits thereof: (a) in the courts of Argentina or any
political subdivision according to local procedural laws; and (b) in the courts of the City of Buenos Aires or any Argentine federal court, provided that the following requirements set forth by the National Code of Civil and Commercial
Procedures (and/or any applicable regulations) are met: (i) the defendant is personally served with the summons and, in accordance with due process of law is granted opportunity to exercise a defense against the foreign action (considering that
service of process by mail, telex or facsimile will not be considered due service of process under the laws of Argentina); (ii) the judgment is valid in the jurisdiction where rendered and must bear the
Apostille
or be legalized before
the competent Consul of Argentina and before the Argentine Ministry of Foreign Relations, as applicable; (iii) the judgment does not violate the principles of public policy of Argentine law; and (iv) the judgment is not contrary to a prior
or simultaneous judgment of an Argentine court on the same matter.]
Ann E-4
(14) The Company and its obligations under the Agreement are subject to suit, and neither the
Company, nor any of its properties or assets has any right of immunity, on any grounds, from any action, suit or proceeding, from the giving of any relief in any action, suit or proceeding, from set-off or counter claim, from the jurisdiction of any
[Brazilian] [Argentine] [Venezuelan] court, as the case may be, from service of process, attachment upon or prior to judgment, or attachment in aid of execution of judgment, or from execution of a judgment, or from other legal process or proceeding
for the giving of any relief or for the enforcement of a judgment, in any such court, with respect to its obligations, liabilities or any other matter arising out of or relating to the Agreement
.
(15) [
For Brazilian/Venezuelan opinion:
To ensure the legality, validity, enforcement or admissibility into evidence in a legal or
administrative proceeding in [Brazil] [Venezuela] of the Agreement, it is not necessary that the Agreement be filed or recorded with any governmental or regulatory authority or court or that any registration tax, stamp duty or similar tax be paid on
or in respect of the Agreement other than court costs (including without limitation, filing fees and deposits to guarantee judgment required by a court in [Brazil] [Venezuela].] [
For Argentine opinion:
To ensure the legality, validity,
enforcement or admissibility into evidence in a legal or administrative proceeding in Argentina of the Agreement, it is not necessary that the Agreement be filed or recorded with any governmental or regulatory authority or court or that any
registration tax, stamp duty or similar tax be paid on or in respect of the Agreement other than court costs (including without limitation, filing fees and deposits to guarantee judgment required by a court in Argentina, provided, however, that in
order to enforce the Agreement in Argentina: (i) the Agreement or any document in any language other than Spanish must be officially translated into Spanish by an Argentine Spanish public translator, and the translation certified by the
Argentine Translators’ Public Association prior to their submission for consideration of any Argentine authority or their admission as evidence in any Argentine court, and any public document granted in any country other than Argentina, must be
duly legalized before the competent Argentine Consulate and before the Argentine Ministry of Foreign Relations, or if such country is part of the Convention Abolishing the Requirement of Legalization for Foreign Public Documents adopted at The Hague
on October 5, 1961, must bear the
Apostille
contemplated in such convention; (ii) certain mandatory mediation procedures need to be accomplished prior to the initiation of lawsuits in the City of Buenos Aires, Argentina, with the
exception, among others, of a few proceedings (including the enforcement in Argentina of a judgment obtained outside Argentina); (iii) a court tax is applicable to actions brought before courts sitting in the City of Buenos Aires; and
(iv) in the event the court where the documents are filed consider they have any effects in Argentina, they may eventually impose a stamp tax on those documents upon presentation of those documents for enforcement.]
(16) [
For Argentine opinion:
No exchange control authorization or any other authorization, approval, consent or license of any
governmental or regulatory authority or court in Argentina is required for the payment of any amounts payable to the Initial Purchasers under the Agreement, and all such payments made to the Initial Purchasers will not be subject to income,
withholding or other taxes under laws and regulations of Argentina or any political subdivision or taxing authority thereof or therein and will otherwise be free and clear of any other tax, duty, withholding or deduction in Argentina, or any
political subdivision or taxing authority thereof or therein and without the necessity of obtaining any governmental authorization in Argentina or any political subdivision or taxing authority thereof or therein.]
Ann E-5
We undertake no responsibility to notify any addressee of this opinion of any change in the laws of [Brazil]
[Argentina] [Venezuela] after the date of this opinion. This opinion is rendered solely for use by the addressee hereof (and, if authorized by the addressee hereof, by its professional advisers, auditors and regulators, its affiliates and their
professional advisers, auditors and regulators) in connection with the transaction described herein and may not be relied upon by any other person for any other purpose without our prior written consent, provided that you may disclose the contents
hereof to any regulatory or supervisory authority having jurisdiction over you.
Ann E-6
Exhibit 4.1
EXECUTION VERSION
MERCADOLIBRE, INC.
AND
WILMINGTON TRUST, NATIONAL ASSOCIATION
as Trustee
INDENTURE
Dated as of June 30, 2014
2.25% Convertible Senior Notes due 2019
TABLE OF CONTENTS
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P
AGE
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ARTICLE 1
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D
EFINITIONS
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Section 1.01.
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Definitions
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1
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Section 1.02.
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References to Interest
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12
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ARTICLE 2
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I
SSUE
, D
ESCRIPTION
, E
XECUTION
, R
EGISTRATION
AND
E
XCHANGE
OF
N
OTES
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Section 2.01.
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Designation and Amount
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12
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Section 2.02.
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Form of Notes
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12
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Section 2.03.
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Date and Denomination of Notes; Payments of Interest and Defaulted Amounts
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13
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Section 2.04.
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Execution, Authentication and Delivery of Notes
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14
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Section 2.05.
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Exchange and Registration of Transfer of Notes; Restrictions on Transfer; Depositary
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15
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Section 2.06.
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Mutilated, Destroyed, Lost or Stolen Notes
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21
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Section 2.07.
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Temporary Notes
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22
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Section 2.08.
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Cancellation of Notes Paid, Converted, Etc
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22
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Section 2.09.
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CUSIP Numbers
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22
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Section 2.10.
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Additional Notes; Repurchases
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22
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ARTICLE 3
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S
ATISFACTION
AND
D
ISCHARGE
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Section 3.01.
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Satisfaction and Discharge
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23
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ARTICLE 4
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P
ARTICULAR
C
OVENANTS
OF
THE
C
OMPANY
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Section 4.01.
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Payment of Principal and Interest
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23
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Section 4.02.
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Maintenance of Office or Agency
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24
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Section 4.03.
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Appointments to Fill Vacancies in Trustee’s Office
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24
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Section 4.04.
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Provisions as to Paying Agent
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24
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Section 4.05.
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Existence
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26
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Section 4.06.
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Rule 144A Information Requirement and Annual Reports
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26
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Section 4.07.
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Stay, Extension and Usury Laws
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27
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Section 4.08.
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Compliance Certificate; Statements as to Defaults
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28
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Section 4.09.
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Further Instruments and Acts
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28
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i
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ARTICLE 5
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L
ISTS
OF
H
OLDERS
AND
R
EPORTS
BY
THE
C
OMPANY
AND
THE
T
RUSTEE
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Section 5.01.
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Lists of Holders
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28
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Section 5.02.
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Preservation and Disclosure of Lists
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28
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ARTICLE 6
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D
EFAULTS
AND
R
EMEDIES
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Section 6.01.
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Events of Default
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28
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Section 6.02.
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Acceleration; Rescission and Annulment
|
|
|
30
|
|
|
Section 6.03.
|
|
Additional Interest
|
|
|
31
|
|
|
Section 6.04.
|
|
Payments of Notes on Default; Suit Therefor
|
|
|
31
|
|
|
Section 6.05.
|
|
Application of Monies Collected by Trustee
|
|
|
33
|
|
|
Section 6.06.
|
|
Proceedings by Holders
|
|
|
33
|
|
|
Section 6.07.
|
|
Proceedings by Trustee
|
|
|
34
|
|
|
Section 6.08.
|
|
Remedies Cumulative and Continuing
|
|
|
34
|
|
|
Section 6.09.
|
|
Direction of Proceedings and Waiver of Defaults by Majority of Holders
|
|
|
35
|
|
|
Section 6.10.
|
|
Notice of Defaults
|
|
|
35
|
|
|
Section 6.11.
|
|
Undertaking to Pay Costs
|
|
|
36
|
|
|
|
|
ARTICLE 7
|
|
|
C
ONCERNING
THE
T
RUSTEE
|
|
|
|
|
|
|
Section 7.01.
|
|
Duties and Responsibilities of Trustee
|
|
|
36
|
|
|
Section 7.02.
|
|
Reliance on Documents, Opinions, Etc
|
|
|
38
|
|
|
Section 7.03.
|
|
No Responsibility for Recitals, Etc
|
|
|
39
|
|
|
Section 7.04.
|
|
Trustee, Paying Agents, Conversion Agents, Bid Solicitation Agent or Note Registrar May Own Notes
|
|
|
39
|
|
|
Section 7.05.
|
|
Monies and Shares of Common Stock to Be Held in Trust
|
|
|
39
|
|
|
Section 7.06.
|
|
Compensation and Expenses of Trustee
|
|
|
39
|
|
|
Section 7.07.
|
|
Officers’ Certificate as Evidence
|
|
|
40
|
|
|
Section 7.08.
|
|
Eligibility of Trustee
|
|
|
41
|
|
|
Section 7.09.
|
|
Resignation or Removal of Trustee
|
|
|
41
|
|
|
Section 7.10.
|
|
Acceptance by Successor Trustee
|
|
|
42
|
|
|
Section 7.11.
|
|
Succession by Merger, Etc
|
|
|
42
|
|
|
Section 7.12.
|
|
Trustee’s Application for Instructions from the Company
|
|
|
43
|
|
|
|
|
ARTICLE 8
|
|
|
C
ONCERNING
THE
H
OLDERS
|
|
|
|
|
|
|
Section 8.01.
|
|
Action by Holders
|
|
|
43
|
|
|
Section 8.02.
|
|
Proof of Execution by Holders
|
|
|
44
|
|
|
Section 8.03.
|
|
Who Are Deemed Absolute Owners
|
|
|
44
|
|
|
Section 8.04.
|
|
Company-Owned Notes Disregarded
|
|
|
44
|
|
|
Section 8.05.
|
|
Revocation of Consents; Future Holders Bound
|
|
|
45
|
|
ii
|
|
|
|
|
|
|
|
|
ARTICLE 9
|
|
|
H
OLDERS
’ M
EETINGS
|
|
|
|
|
|
|
Section 9.01.
|
|
Purpose of Meetings
|
|
|
45
|
|
|
Section 9.02.
|
|
Call of Meetings by Trustee
|
|
|
45
|
|
|
Section 9.03.
|
|
Call of Meetings by Company or Holders
|
|
|
46
|
|
|
Section 9.04.
|
|
Qualifications for Voting
|
|
|
46
|
|
|
Section 9.05.
|
|
Regulations
|
|
|
46
|
|
|
Section 9.06.
|
|
Voting
|
|
|
47
|
|
|
Section 9.07.
|
|
No Delay of Rights by Meeting
|
|
|
47
|
|
|
|
|
ARTICLE 10
|
|
|
S
UPPLEMENTAL
I
NDENTURES
|
|
|
|
|
|
|
Section 10.01.
|
|
Supplemental Indentures Without Consent of Holders
|
|
|
47
|
|
|
Section 10.02.
|
|
Supplemental Indentures with Consent of Holders
|
|
|
48
|
|
|
Section 10.03.
|
|
Effect of Supplemental Indentures
|
|
|
49
|
|
|
Section 10.04.
|
|
Notation on Notes
|
|
|
49
|
|
|
Section 10.05.
|
|
Evidence of Compliance of Supplemental Indenture to Be Furnished Trustee
|
|
|
50
|
|
|
|
|
ARTICLE 11
|
|
|
C
ONSOLIDATION
, M
ERGER
, S
ALE
, C
ONVEYANCE
AND
L
EASE
|
|
|
|
|
|
|
Section 11.01.
|
|
Company May Consolidate, Etc. on Certain Terms
|
|
|
50
|
|
|
Section 11.02.
|
|
Successor Corporation to Be Substituted
|
|
|
50
|
|
|
Section 11.03.
|
|
Opinion of Counsel to Be Given to Trustee
|
|
|
51
|
|
|
|
|
ARTICLE 12
|
|
|
I
MMUNITY
OF
I
NCORPORATORS
, S
TOCKHOLDERS
, O
FFICERS
AND
D
IRECTORS
|
|
|
|
|
|
|
Section 12.01.
|
|
Indenture and Notes Solely Corporate Obligations
|
|
|
51
|
|
|
|
|
ARTICLE 13
|
|
|
[I
NTENTIONALLY
O
MITTED
]
|
|
|
|
|
ARTICLE 14
|
|
|
C
ONVERSION
OF
N
OTES
|
|
|
|
|
|
|
Section 14.01.
|
|
Conversion Privilege
|
|
|
52
|
|
|
Section 14.02.
|
|
Conversion Procedure; Settlement Upon Conversion.
|
|
|
55
|
|
|
Section 14.03.
|
|
Increased Conversion Rate Applicable to Certain Notes Surrendered in Connection with Make-Whole Fundamental Changes
|
|
|
59
|
|
|
Section 14.04.
|
|
Adjustment of Conversion Rate
|
|
|
61
|
|
|
Section 14.05.
|
|
Adjustments of Prices
|
|
|
71
|
|
|
Section 14.06.
|
|
Shares to Be Fully Paid
|
|
|
71
|
|
|
Section 14.07.
|
|
Effect of Recapitalizations, Reclassifications and Changes of the Common Stock
|
|
|
71
|
|
iii
|
|
|
|
|
|
|
|
|
Section 14.08.
|
|
Certain Covenants
|
|
|
74
|
|
|
Section 14.09.
|
|
Responsibility of Trustee
|
|
|
74
|
|
|
Section 14.10.
|
|
Notice to Holders Prior to Certain Actions
|
|
|
75
|
|
|
Section 14.11.
|
|
Stockholder Rights Plans
|
|
|
75
|
|
|
Section 14.12.
|
|
Limit on Issuance of Shares of Common Stock Upon Conversion
|
|
|
75
|
|
|
Section 14.13.
|
|
Exchange in Lieu of Conversion
|
|
|
76
|
|
|
|
|
ARTICLE 15
|
|
|
R
EPURCHASE
OF
N
OTES
AT
O
PTION
OF
H
OLDERS
|
|
|
|
|
|
|
Section 15.01.
|
|
[Intentionally Omitted]
|
|
|
77
|
|
|
Section 15.02.
|
|
Repurchase at Option of Holders Upon a Fundamental Change
|
|
|
77
|
|
|
Section 15.03.
|
|
Withdrawal of Fundamental Change Repurchase Notice
|
|
|
79
|
|
|
Section 15.04.
|
|
Deposit of Fundamental Change Repurchase Price
|
|
|
79
|
|
|
Section 15.05.
|
|
Covenant to Comply with Applicable Laws Upon Repurchase of Notes
|
|
|
80
|
|
|
|
|
ARTICLE 16
|
|
|
N
O
R
EDEMPTION
|
|
|
|
|
|
|
Section 16.01.
|
|
No Redemption
|
|
|
81
|
|
|
|
|
ARTICLE 17
|
|
|
M
ISCELLANEOUS
P
ROVISIONS
|
|
|
|
|
|
|
Section 17.01.
|
|
Provisions Binding on Company’s Successors
|
|
|
81
|
|
|
Section 17.02.
|
|
Official Acts by Successor Corporation
|
|
|
81
|
|
|
Section 17.03.
|
|
Addresses for Notices, Etc
|
|
|
81
|
|
|
Section 17.04.
|
|
Governing Law; Jurisdiction
|
|
|
82
|
|
|
Section 17.05.
|
|
Evidence of Compliance with Conditions Precedent; Certificates and Opinions of Counsel to Trustee
|
|
|
82
|
|
|
Section 17.06.
|
|
Legal Holidays
|
|
|
83
|
|
|
Section 17.07.
|
|
No Security Interest Created
|
|
|
83
|
|
|
Section 17.08.
|
|
Benefits of Indenture
|
|
|
83
|
|
|
Section 17.09.
|
|
Table of Contents, Headings, Etc
|
|
|
83
|
|
|
Section 17.10.
|
|
Authenticating Agent
|
|
|
83
|
|
|
Section 17.11.
|
|
Execution in Counterparts
|
|
|
84
|
|
|
Section 17.12.
|
|
Severability
|
|
|
84
|
|
|
Section 17.13.
|
|
Waiver of Jury Trial
|
|
|
84
|
|
|
Section 17.14.
|
|
Force Majeure
|
|
|
84
|
|
|
Section 17.15
.
|
|
Calculations
|
|
|
85
|
|
|
Section 17.16.
|
|
USA PATRIOT Act
|
|
|
85
|
|
EXHIBIT
|
|
|
|
|
|
|
|
|
Exhibit A
|
|
Form of Note
|
|
|
A-1
|
|
iv
INDENTURE dated as of June 30, 2014 between MercadoLibre, Inc., a Delaware
corporation, as issuer (the “
Company
,” as more fully set forth in Section 1.01) and Wilmington Trust, National Association, a national banking association, as trustee (the “
Trustee
,” as more fully set forth in
Section 1.01).
W I T N E S S E T H:
WHEREAS, for its lawful corporate purposes, the Company has duly authorized the issuance of its 2.25% Convertible Senior Notes due 2019
(the “
Notes
”), initially in an aggregate principal amount not to exceed $330,000,000, and in order to provide the terms and conditions upon which the Notes are to be authenticated, issued and delivered, the Company has duly
authorized the execution and delivery of this Indenture; and
WHEREAS, the Form of Note, the certificate of authentication to be
borne by each Note, the Form of Notice of Conversion, the Form of Fundamental Change Repurchase Notice and the Form of Assignment and Transfer to be borne by the Notes are to be substantially in the forms hereinafter provided; and
WHEREAS, all acts and things necessary to make the Notes, when executed by the Company and authenticated and delivered by the Trustee or a
duly authorized authenticating agent, as in this Indenture provided, the valid, binding and legal obligations of the Company, and this Indenture a valid agreement according to its terms, have been done and performed, and the execution of this
Indenture and the issuance hereunder of the Notes have in all respects been duly authorized.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
That in order to declare the terms and conditions upon which the Notes are, and are to be, authenticated, issued and delivered, and in
consideration of the premises and of the purchase and acceptance of the Notes by the Holders thereof, the Company covenants and agrees with the Trustee for the equal and proportionate benefit of the respective Holders from time to time of the Notes
(except as otherwise provided in this agreement), as follows:
ARTICLE 1
D
EFINITIONS
Section 1.01.
Definitions
. The terms defined in this Section 1.01 (except as herein otherwise expressly provided or unless the
context otherwise requires) for all purposes of this Indenture and of any indenture supplemental hereto shall have the respective meanings specified in this Section 1.01. The words “herein,” “hereof,” “hereunder” and
words of similar import refer to this Indenture as a whole and not to any particular Article, Section or other subdivision. The terms defined in this Article include the plural as well as the singular.
“
Additional Interest
” means all amounts, if any, payable pursuant to Section
4.06(d), Section 4.06(e) and Section 6.03, as applicable.
“
Additional Shares
” shall have the meaning specified in
Section 14.03(a).
“
Affiliate
” of any specified Person means any other Person directly or indirectly controlling or
controlled by or under direct or indirect common control with such specified Person. For the purposes of this definition, “control,” when used with respect to any specified Person means the power to direct or cause the direction of the
management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the
foregoing.
“
Bid Solicitation Agent
” means the Company or the Person appointed by the Company to solicit bids for the
Trading Price of the Notes in accordance with Section 14.01(b)(i). The Trustee shall initially act as the Bid Solicitation Agent.
“
Board of Directors
” means the board of directors of the Company or a committee of such board duly authorized to act for it
hereunder.
“
Board Resolution
” means a copy of a resolution certified by the Secretary or an Assistant Secretary of the
Company 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.
“
Business Day
” means, with respect to any Note, any day other than a Saturday, a Sunday or a day on which the Federal Reserve
Bank of New York or banking institutions in Buenos Aires are authorized or required by law or executive order to close or be closed.
“
Capital Stock
” means, for any entity, any and all shares, interests, rights to purchase, warrants, options, participations
or other equivalents of or interests in (however designated) stock issued by that entity.
“
Cash Settlement
” shall have
the meaning specified in Section 14.02(a).
“
Clause A Distribution
” shall have the meaning specified in Section 14.04(c).
“
Clause B Distribution
” shall have the meaning specified in Section 14.04(c).
“
Clause C Distribution
” shall have the meaning specified in Section 14.04(c).
“
close of business
” means 5:00 p.m. (New York City time).
“
Combination Settlement
” shall have the meaning specified in Section 14.02(a).
“
Commission
” means the U.S. Securities and Exchange Commission.
“
Common Equity
” of any Person means Capital Stock of such Person that is generally entitled (a) to vote in the election
of directors of such Person or (b) if such Person is not a corporation, to vote or otherwise participate in the selection of the governing body, partners, managers or others that will control the management or policies of such Person.
2
“
Common Stock
” means the common stock of the Company, par value $0.001 per
share, at the date of this Indenture, subject to Section 14.07.
“
Company
” shall have the meaning specified in the first
paragraph of this Indenture, and subject to the provisions of Article 11, shall include its successors and assigns.
“
Company
Order
” means a written order of the Company, signed by (a) the Company’s Chief Executive Officer, President, Chief Financial Officer, Chief Accounting Officer, Vice President – Investor Relations or General Counsel and
(b) any such other Officer designated in clause (a) of this definition or the Company’s Treasurer or Assistant Treasurer or Secretary or any Assistant Secretary, and delivered to the Trustee.
“
Conversion Agent
” shall have the meaning specified in Section 4.02.
“
Conversion Date
” shall have the meaning specified in Section 14.02(c).
“
Conversion Obligation
” shall have the meaning specified in Section 14.01(a).
“
Conversion Price
” means as of any time, $1,000,
divided by
the Conversion Rate as of such time.
“
Conversion Rate
” shall have the meaning specified in Section 14.01(a).
“
Corporate Trust Office
” means the designated office of the Trustee at which at any time its corporate trust business shall
be administered, which office at the date hereof is located at 1100 N. Market Street, Wilmington, Delaware 19890, Attention: MercadoLibre, Inc. Administrator, or such other address as the Trustee may designate from time to time by notice to the
Holders and the Company, or the designated 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).
“
Custodian
” means the Trustee, as custodian for The Depository Trust Company, with respect to the Global Notes, or any
successor entity appointed by the Company as custodian for the Depositary under this Indenture.
“
Daily Conversion Value
”
means, for each of the 50 consecutive Trading Days during the Observation Period, 2.0% of the product of (a) the Conversion Rate on such Trading Day and (b) the Daily VWAP for such Trading Day.
“
Daily Measurement Value
” means the Specified Dollar Amount (if any),
divided by
50.
3
“
Daily Settlement Amount
,” for each of the 50 consecutive Trading Days
during the Observation Period, shall consist of:
(a) cash in an amount equal to the lesser of (i) the Daily
Measurement Value and (ii) the Daily Conversion Value on such Trading Day; and
(b) if the Daily Conversion Value on
such Trading Day exceeds the Daily Measurement Value, a number of shares of Common Stock equal to (i) the difference between the Daily Conversion Value and the Daily Measurement Value,
divided by
(ii) the Daily VWAP for such Trading
Day.
“
Daily VWAP
” means, for each of the 50 consecutive Trading Days during the relevant Observation Period, the per
share volume-weighted average price as displayed under the heading “Bloomberg VWAP” on Bloomberg page “MELI.Q <equity> AQR” (or its equivalent successor if such page is not available) in respect of the period from the
scheduled open of trading until the scheduled close of trading of the primary trading session on such Trading Day (or if such volume-weighted average price is unavailable or in the Company’s commercially reasonable judgment is manifestly
incorrect, the market value of one share of the Common Stock on such Trading Day determined, using a volume-weighted average method, by a nationally recognized independent investment banking firm retained for this purpose by the Company). The
“
Daily VWAP
” shall be determined without regard to after-hours trading or any other trading outside of the regular trading session trading hours.
“
Default
” means any event that is, or after notice or passage of time, or both, would be, an Event of Default.
“
Defaulted Amounts
” means any amounts on any Note (including, without limitation, the Fundamental Change Repurchase Price,
principal and interest) that are payable but are not punctually paid or duly provided for.
“
Depositary
” means, with
respect to each Global Note, the Person specified in Section 2.05(c) as the Depositary with respect to such Notes, until a successor shall have been appointed and become such pursuant to the applicable provisions of this Indenture, and thereafter,
“
Depositary
” shall mean or include such successor.
“
Distributed Property
” shall have the meaning
specified in Section 14.04(c).
“
Effective Date
” shall have the meaning specified in Section 14.03(c), except that, as
used in Section 14.04 and Section 14.05, “
Effective Date
” means the first date on which shares of the Common Stock trade on the applicable exchange or in the applicable market, regular way, reflecting the relevant share split or
share combination, as applicable.
“
Event of Default
” shall have the meaning specified in Section 6.01.
“
Ex-Dividend Date
” means the first date on which shares of the Common Stock trade on the applicable exchange or in the
applicable market, regular way, without the right to receive the issuance, dividend or distribution in question, from the Company or, if applicable, from the seller of Common Stock on such exchange or market (in the form of due bills or otherwise)
as determined by such exchange or market.
4
“
Exchange Act
” means the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.
“
Form of Assignment and Transfer
” means the “Form of Assignment and
Transfer” attached as Attachment 3 to the Form of Note attached hereto as Exhibit A.
“
Form of Fundamental Change Repurchase
Notice
” means the “Form of Fundamental Change Repurchase Notice” attached as Attachment 2 to the Form of Note attached hereto as Exhibit A.
“
Form of Note
” means the “Form of Note” attached hereto as Exhibit A.
“
Form of Notice of Conversion
” means the “Form of Notice of Conversion” attached as Attachment 1 to the Form of
Note attached hereto as Exhibit A.
“
Fundamental Change
” shall be deemed to have occurred at the time after the Notes are
originally issued if any of the following occurs:
(a) except in connection with a transaction described in clause
(b) below, a “person” or “group” within the meaning of Section 13(d) of the Exchange Act, other than the Company, its Wholly Owned Subsidiaries and the employee benefit plans of the Company and its Wholly Owned
Subsidiaries, files a Schedule TO or any schedule, form or report under the Exchange Act disclosing that such person or group has become the direct or indirect “beneficial owner,” as defined in Rule 13d-3 under the Exchange Act, of the
Company’s Common Equity representing more than 50% of the voting power of the Company’s Common Equity;
(b) the
consummation of (A) any recapitalization, reclassification or change of the Common Stock (other than changes resulting from a subdivision or combination) as a result of which the Common Stock would be converted into, or exchanged for, stock,
other securities, other property or assets; (B) any share exchange, consolidation or merger of the Company pursuant to which the Common Stock will be converted into cash, securities or other property or assets; or (C) any sale, lease or
other transfer in one transaction or a series of transactions of all or substantially all of the consolidated assets of the Company and its Subsidiaries, taken as a whole, to any Person other than one of the Company’s Wholly Owned Subsidiaries;
provided, however
, that a transaction described in clause (B) in which the holders of all classes of the Company’s Common Equity immediately prior to such transaction own, directly or indirectly, more than 50% of all classes of
Common Equity of the continuing or surviving corporation or transferee or the parent thereof immediately after such transaction in substantially the same proportions as such ownership immediately prior to such transaction shall not be a Fundamental
Change pursuant to this clause (b);
(c) the stockholders of the Company approve any plan or proposal for the liquidation
or dissolution of the Company; or
(d) the Common Stock (or other common stock underlying the Notes) ceases to be listed or
quoted on any of The New York Stock Exchange, The NASDAQ Global Select Market or The NASDAQ Global Market (or any of their respective successors);
5
provided
,
however
, that a transaction or transactions described in clause (b) of this
definition shall not constitute a Fundamental Change, if at least 90% of the consideration received or to be received by the common stockholders of the Company, excluding cash payments for fractional shares, in connection with such transaction or
transactions consists of shares of common stock that are listed or quoted on any of The New York Stock Exchange, The NASDAQ Global Select Market or The NASDAQ Global Market (or any of their respective successors) or will be so listed or quoted when
issued or exchanged in connection with such transaction or transactions and as a result of such transaction or transactions the Notes become convertible into such consideration, excluding cash payments for fractional shares (subject to the
provisions of Section 14.02(a)).
“
Fundamental Change Company Notice
” shall have the meaning specified in Section
15.02(c).
“
Fundamental Change Repurchase Date
” shall have the meaning specified in Section 15.02(a).
“
Fundamental Change Repurchase Notice
” shall have the meaning specified in Section 15.02(b)(i).
“
Fundamental Change Repurchase Price
” shall have the meaning specified in Section 15.02(a).
“
Global Note
” shall have the meaning specified in Section 2.05(b).
“
Holder
,” as applied to any Note, or other similar terms (but excluding the term “beneficial holder”), means any
Person in whose name at the time a particular Note is registered on the Note Register.
“
Indenture
” means this instrument
as originally executed or, if amended or supplemented as herein provided, as so amended or supplemented.
“
Initial Dividend
Threshold
” shall have the meaning specified in Section 14.04(d).
“
Interest Payment Date
” means each
January 1 and July 1 of each year, beginning on January 1, 2015.
“
Last Reported Sale Price
” of the Common
Stock on any date means the closing sale price per share (or if no closing sale price is reported, the average of the bid and ask prices or, if more than one in either case, the average of the average bid and the average ask prices) on that date as
reported in composite transactions for the principal U.S. national or regional securities exchange on which the Common Stock is traded. If the Common Stock is not listed for trading on a U.S. national or regional securities exchange on the relevant
date, the “
Last Reported Sale Price
” shall be the last quoted bid price for the Common Stock in the over-the-counter market on
6
the relevant date as reported by OTC Markets Group Inc. or a similar organization. If the Common Stock is not so quoted, the “
Last Reported Sale Price
” shall be the average of
the mid-point of the last bid and ask prices for the Common Stock on the relevant date from each of at least three nationally recognized independent investment banking firms selected by the Company for this purpose.
“
Make-Whole Fundamental Change
” means any transaction or event that constitutes a Fundamental Change (as defined above and
determined after giving effect to any exceptions to or exclusions from such definition, but without regard to the
proviso
in clause (b) of the definition thereof).
“
Market Disruption Event
” means, for the purposes of determining amounts due upon conversion (a) a failure by the
primary U.S. national or regional securities exchange or market on which the Common Stock is listed or admitted for trading to open for trading during its regular trading session or (b) the occurrence or existence prior to 1:00 p.m., New York
City time, on any Scheduled Trading Day for the Common Stock for more than one half-hour period in the aggregate during regular trading hours of any suspension or limitation imposed on trading (by reason of movements in price exceeding limits
permitted by the relevant stock exchange or otherwise) in the Common Stock or in any options contracts or futures contracts relating to the Common Stock.
“
Maturity Date
” means July 1, 2019.
“
Measurement Period
” shall have the meaning specified in Section 14.01(b)(i).
“
Merger Common Stock
” shall have the meaning specified in Section 14.07(e)(i).
“
Merger Event
” shall have the meaning specified in Section 14.07(a).
“
Merger Valuation Percentage
” for any Merger Event shall be equal to (x) the arithmetic average of the Last Reported
Sale Prices of one share of such Merger Common Stock over the relevant Merger Valuation Period (determined as if references to “Common Stock” in the definition of “Last Reported Sale Price” were references to the “Merger
Common Stock” for such Merger Event),
divided by
(y) the arithmetic average of the Last Reported Sale Prices of one share of Common Stock over the relevant Merger Valuation Period.
“
Merger Valuation Period
” for any Merger Event means the five consecutive Trading Day period immediately preceding, but
excluding, the effective date for such Merger Event.
“
Note
” or “
Notes
” shall have the meaning specified
in the first paragraph of the recitals of this Indenture.
“
Note Register
” shall have the meaning specified in Section
2.05(a).
“
Note Registrar
” shall have the meaning specified in Section 2.05(a).
“
Notice of Conversion
” shall have the meaning specified in Section 14.02(b).
7
“
Observation Period
” with respect to any Note surrendered for conversion means:
(i) if the relevant Conversion Date occurs prior to March 1, 2019, the 50 consecutive Trading Day period beginning on, and including, the third Trading Day immediately succeeding such Conversion Date; and (ii) if the relevant
Conversion Date occurs on or after March 1, 2019, the 50 consecutive Trading Days beginning on, and including, the 52nd Scheduled Trading Day immediately preceding the Maturity Date.
“
Offering Memorandum
” means the preliminary offering memorandum dated June 23, 2014, as supplemented by the related
pricing term sheet dated June 24, 2014, relating to the offering and sale of the Notes.
“
Officer
” means, with
respect to the Company, the President, the Chief Executive Officer, the Chief Financial Officer, the Chief Accounting Officer, the Treasurer, the Secretary, any Executive or Senior Vice President or any Vice President (whether or not designated by a
number or numbers or word or words added before or after the title “Vice President”).
“
Officers’
Certificate
,” when used with respect to the Company, means a certificate that is delivered to the Trustee and that is signed by (a) two Officers of the Company or (b) one Officer of the Company and one of the Treasurer, any
Assistant Treasurer, the Secretary, any Assistant Secretary or the Controller of the Company. Each such certificate shall include the statements provided for in Section 17.05 if and to the extent required by the provisions of such Section. One of
the Officers giving an Officers’ Certificate pursuant to Section 4.08 shall be the principal executive, financial or accounting officer of the Company.
“
open of business
” means 9:00 a.m. (New York City time).
“
Opinion of Counsel
” means an opinion in writing signed by legal counsel, who may be an employee of or counsel to the
Company, or other counsel acceptable to the Trustee, that is delivered to the Trustee. Each such opinion shall include the statements provided for in Section 17.05 if and to the extent required by the provisions of such Section 17.05.
“
outstanding
,” when used with reference to Notes, shall, subject to the provisions of Section 8.04, mean, as of any
particular time, all Notes authenticated and delivered by the Trustee under this Indenture, except:
(a) Notes theretofore
canceled by the Trustee or accepted by the Trustee for cancellation;
(b) Notes, or portions thereof, that have become due
and payable and in respect of which monies in the necessary amount shall have been deposited in trust with the Trustee or with any Paying Agent (other than the Company) or shall have been set aside and segregated in trust by the Company (if the
Company shall act as its own Paying Agent);
(c) Notes that have been paid pursuant to Section 2.06 or Notes in lieu of
which, or in substitution for which, other Notes shall have been authenticated and delivered pursuant to the terms of Section 2.06 unless proof satisfactory to the Trustee is presented that any such Notes are held by protected purchasers in due
course;
8
(d) Notes converted pursuant to Article 14 and required to be cancelled pursuant
to Section 2.08; and
(e) Notes repurchased by the Company pursuant to the penultimate sentence of Section 2.10.
“
Paying Agent
” shall have the meaning specified in Section 4.02.
“
Person
” means an individual, a corporation, a limited liability company, an association, a partnership, a joint venture, a
joint stock company, a trust, an unincorporated organization or a government or an agency or a political subdivision thereof.
“
Physical Notes
” means permanent certificated Notes in registered form issued in minimum denominations of $1,000 principal
amount and integral multiples thereof.
“
Physical Settlement
” shall have the meaning specified in Section 14.02(a).
“
Predecessor Note
” of any particular Note means every previous Note evidencing all or a portion of the same debt as that
evidenced by such particular Note; and, for the purposes of this definition, any Note authenticated and delivered under Section 2.06 in lieu of or in exchange for a mutilated, lost, destroyed or stolen Note shall be deemed to evidence the same debt
as the mutilated, lost, destroyed or stolen Note that it replaces.
“
Record Date
” means, with respect to any dividend,
distribution or other transaction or event in which the holders of Common Stock (or other applicable security) have the right to receive any cash, securities or other property or in which the Common Stock (or such other security) is exchanged for or
converted into any combination of cash, securities or other property, the date fixed for determination of holders of the Common Stock (or such other security) entitled to receive such cash, securities or other property (whether such date is fixed by
the Board of Directors, by statute, by contract or otherwise).
“
Reference Property
” shall have the meaning specified in
Section 14.07(a).
“
Regular Record Date
,” with respect to any Interest Payment Date, means the June 15 or
December 15 (whether or not such day is a Business Day) immediately preceding the applicable July 1 or January 1 Interest Payment Date, respectively.
“
Resale Restriction Termination Date
” shall have the meaning specified in Section 2.05(c).
“
Responsible Officer
” means, when used with respect to the Trustee, any officer at the Corporate Trust Office who shall have
direct responsibility for the administration of this Indenture, and also means any officer of the Trustee to whom any corporate trust matter relating to this Indenture is referred because of such person’s knowledge of and familiarity with the
particular subject.
“
Restricted Securities
” shall have the meaning specified in Section 2.05(c).
9
“
Rule 144
” means Rule 144 as promulgated under the Securities Act.
“
Rule 144A
” means Rule 144A as promulgated under the Securities Act.
“
Scheduled Trading Day
” means a day that is scheduled to be a Trading Day on the principal U.S. national or regional
securities exchange or market on which the Common Stock is listed or admitted for trading. If the Common Stock is not so listed or admitted for trading, “
Scheduled Trading Day
” means a Business Day.
“
Securities Act
” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“
Settlement Amount
” has the meaning specified in Section 14.02(a)(iv).
“
Settlement Method
” means, with respect to any conversion of Notes, Physical Settlement, Cash Settlement or Combination
Settlement, as elected (or deemed to have been elected) by the Company.
“
Settlement Notice
” has the meaning specified in
Section 14.02(a)(iii).
“
Significant Subsidiary
” means a Subsidiary of the Company that meets the definition of
“significant subsidiary” in Article 1, Rule 1-02 of Regulation S-X under the Exchange Act.
“
Specified Dollar
Amount
” means the maximum cash amount per $1,000 principal amount of Notes to be received upon conversion as specified in the Settlement Notice related to any converted Notes.
“
Spin-Off
” shall have the meaning specified in Section 14.04(c).
“
Stock Price
” shall have the meaning specified in Section 14.03(c).
“
Subsidiary
” means, with respect to any Person, any corporation, association, partnership or other business entity of which
more than 50% of the total voting power of shares of Capital Stock or other interests (including partnership interests) entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers, general partners
or trustees thereof is at the time owned or controlled, directly or indirectly, by (i) such Person; (ii) such Person and one or more Subsidiaries of such Person; or (iii) one or more Subsidiaries of such Person.
“
Successor Company
” shall have the meaning specified in Section 11.01(a).
“
Trading Day
” means a day on which (i) trading in the Common Stock (or other security for which a closing sale price
must be determined) generally occurs on The NASDAQ Global Select Market or, if the Common Stock (or such other security) is not then listed on The NASDAQ Global Select Market, on the principal other U.S. national or regional securities exchange on
which the Common Stock (or such other security) is then listed or, if the Common Stock (or such other security) is not then listed on a U.S. national or regional securities exchange, on the principal other market on which the Common Stock (or such
other security) is then traded
10
and (ii) a Last Reported Sale Price for the Common Stock (or such other security) is available on such securities exchange or market;
provided
that if the Common Stock (or such other
security) is not so listed or traded, “
Trading Day
” means a Business Day; and
provided
,
further
, that for purposes of determining amounts due upon conversion only, “
Trading Day
” means a day on which
(x) there is no Market Disruption Event and (y) trading in the Common Stock generally occurs on The NASDAQ Global Select Market or, if the Common Stock is not then listed on The NASDAQ Global Select Market, on the principal other U.S.
national or regional securities exchange on which the Common Stock is then listed or, if the Common Stock is not then listed on a U.S. national or regional securities exchange, on the principal other market on which the Common Stock is then listed
or admitted for trading, except that if the Common Stock is not so listed or admitted for trading, “
Trading Day
” means a Business Day.
“
Trading Price
” of the Notes on any date of determination means the average of the secondary market bid quotations obtained
by the Bid Solicitation Agent for $5,000,000 principal amount of Notes at approximately 3:30 p.m., New York City time, on such determination date from three independent nationally recognized securities dealers the Company selects for this purpose;
provided
that if three such bids cannot reasonably be obtained by the Bid Solicitation Agent but two such bids are obtained, then the average of the two bids shall be used, and if only one such bid can reasonably be obtained by the Bid
Solicitation Agent, that one bid shall be used. If the Bid Solicitation Agent cannot reasonably obtain at least one bid for $5,000,000 principal amount of Notes from a nationally recognized securities dealer on any determination date, then the
Trading Price per $1,000 principal amount of Notes on such determination date shall be deemed to be less than 98% of the product of the Last Reported Sale Price of the Common Stock and the Conversion Rate.
“
transfer
” shall have the meaning specified in Section 2.05(c).
“
Trigger Event
” shall have the meaning specified in Section 14.04(c).
“
Trust Indenture Act
” means the Trust Indenture Act of 1939, as amended, as it was in force at the date of execution of this
Indenture;
provided
,
however
, that in the event the Trust Indenture Act of 1939 is amended after the date hereof, the term “Trust Indenture Act” shall mean, to the extent required by such amendment, the Trust Indenture Act of
1939, as so amended.
“
Trustee
” means the Person named as the “
Trustee
” in the first paragraph of this
Indenture until a successor trustee shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “
Trustee
” shall mean or include each Person who is then a Trustee hereunder.
“
unit of Reference Property
” shall have the meaning specified in Section 14.07(a).
“
Valuation Period
” shall have the meaning specified in Section 14.04(c).
“
Wholly Owned Subsidiary
” means, with respect to any Person, any Subsidiary of such Person, except that, solely for purposes
of this definition, the reference to “50%” in the definition of “Subsidiary” shall be deemed replaced by a reference to “100% (excluding any directors’ qualifying shares)”.
11
Section 1.02.
References to Interest
. Unless the context otherwise requires, any reference
to interest on, or in respect of, any Note in this Indenture shall be deemed to include Additional Interest if, in such context, Additional Interest is, was or would be payable pursuant to any of Section 4.06(d), Section 4.06(e) and Section 6.03.
Unless the context otherwise requires, any express mention of Additional Interest in any provision hereof shall not be construed as excluding Additional Interest in those provisions hereof where such express mention is not made.
ARTICLE 2
I
SSUE
,
D
ESCRIPTION
, E
XECUTION
, R
EGISTRATION
AND
E
XCHANGE
OF
N
OTES
Section 2.01.
Designation and Amount
. The Notes shall be designated as the “2.25% Convertible Senior Notes due 2019.” The
aggregate principal amount of Notes that may be authenticated and delivered under this Indenture is initially limited to $330,000,000, subject to Section 2.10 and except for Notes authenticated and delivered upon registration or transfer of, or in
exchange for, or in lieu of other Notes pursuant to Section 2.05, Section 2.06, Section 2.07, Section 10.04, Section 14.02 or Section 15.04.
Section 2.02.
Form of Notes
. The Notes and the Trustee’s certificate of authentication to be borne by such Notes shall be
substantially in the respective forms set forth in Exhibit A, the terms and provisions of which shall constitute, and are hereby expressly incorporated in and made a part of this Indenture. To the extent applicable, the Company and the Trustee, by
their execution and delivery of this Indenture, expressly agree to such terms and provisions and to be bound thereby.
Any Global Note may
be endorsed with or have incorporated in the text thereof such legends or recitals or changes not inconsistent with the provisions of this Indenture as may be required by the Custodian or the Depositary, or as may be required to comply with any
applicable law or any regulation thereunder or with the rules and regulations of any securities exchange or automated quotation system upon which the Notes may be listed or traded or designated for issuance or to conform with any usage with respect
thereto, or to indicate any special limitations or restrictions to which any particular Notes are subject.
Any of the Notes may have such
letters, numbers or other marks of identification and such notations, legends or endorsements as the Officers executing the same may approve (execution thereof to be conclusive evidence of such approval) and as are not inconsistent with the
provisions of this Indenture, or as may be required to comply with any law or with any rule or regulation made pursuant thereto or with any rule or regulation of any securities exchange or automated quotation system on which the Notes may be listed
or designated for issuance, or to conform to usage or to indicate any special limitations or restrictions to which any particular Notes are subject.
Each Global Note shall represent such principal amount of the outstanding Notes as shall be specified therein and shall provide that it shall
represent the aggregate principal amount of outstanding Notes from time to time endorsed thereon and that the aggregate principal amount of outstanding Notes represented thereby may from time to time be increased or reduced to reflect
12
repurchases, cancellations, conversions, transfers or exchanges permitted hereby. Any endorsement of a Global Note to reflect the amount of any increase or decrease in the amount of outstanding
Notes represented thereby shall be made by the Trustee or the Custodian, at the direction of the Trustee, in such manner and upon instructions given by the Holder of such Notes in accordance with this Indenture. Payment of principal (including the
Fundamental Change Repurchase Price, if applicable) of, and accrued and unpaid interest on, a Global Note shall be made to the Holder of such Note on the date of payment, unless a record date or other means of determining Holders eligible to receive
payment is provided for herein.
Section 2.03.
Date and Denomination of Notes; Payments of Interest and Defaulted Amounts
.
(a) The Notes shall be issuable in registered form without coupons in minimum denominations of $1,000 principal amount and integral multiples thereof. Each Note shall be dated the date of its authentication and shall bear interest from the date
specified on the face of such Note. Accrued interest on the Notes shall be computed on the basis of a 360-day year composed of twelve 30-day months and, for partial months, on the basis of the number of days actually elapsed in a 30-day month.
(b) The Person in whose name any Note (or its Predecessor Note) is registered on the Note Register at the close of business on any Regular
Record Date with respect to any Interest Payment Date shall be entitled to receive the interest payable on such Interest Payment Date. The principal amount of any Note (x) in the case of any Physical Note, shall be payable at the office or
agency of the Company maintained by the Company for such purposes in the United States, which shall initially be the Corporate Trust Office and (y) in the case of any Global Note, shall be payable by wire transfer of immediately available funds
to the account of the Depositary or its nominee. The Company shall pay interest (i) on any Physical Notes (A) to Holders holding Physical Notes having an aggregate principal amount of $5,000,000 or less, by check mailed to the Holders of
these Notes at their address as it appears in the Note Register and (B) to Holders holding Physical Notes having an aggregate principal amount of more than $5,000,000, either by check mailed to each Holder or, upon application by such a Holder
to the Note Registrar not later than the relevant Regular Record Date, by wire transfer in immediately available funds to that Holder’s account within the United States, which application shall remain in effect until the Holder notifies, in
writing, the Note Registrar to the contrary or (ii) on any Global Note by wire transfer of immediately available funds to the account of the Depositary or its nominee.
(c) Any Defaulted Amounts shall forthwith cease to be payable to the Holder on the relevant payment date but shall accrue interest per annum
at the rate borne by the Notes, subject to the enforceability thereof under applicable law, from, and including, such relevant payment date, and such Defaulted Amounts together with such interest thereon shall be paid by the Company, at its election
in each case, as provided in clause (i) or (ii) below:
(i) The Company may elect to make payment of any
Defaulted Amounts to the Persons in whose names the Notes (or their respective Predecessor Notes) are registered at the close of business on a special record date for the payment of such Defaulted Amounts, which shall be fixed in the following
manner. The Company shall notify the Trustee in writing of the amount of the Defaulted Amounts proposed to be paid on each Note and the date of the proposed payment (which shall be not less than 25 days after the receipt by the Trustee of such
notice, unless the Trustee shall consent to an
13
earlier date), and at the same time the Company shall deposit with the Trustee an amount of money equal to the aggregate amount to be paid in respect of such Defaulted Amounts or shall make
arrangements satisfactory to the Trustee for such deposit on or prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Amounts as in this clause provided.
Thereupon the Company shall fix a special record date for the payment of such Defaulted Amounts which shall be not more than 15 days and not less than 10 days prior to the date of the proposed payment, and not less than 10 days after the receipt by
the Trustee of the notice of the proposed payment. The Company shall promptly notify the Trustee of such special record date and the Trustee, in the name and at the expense of the Company, shall cause notice of the proposed payment of such Defaulted
Amounts and the special record date therefor to be given to each Holder at its address as it appears in the Note Register, not less than 10 days prior to such special record date. Notice of the proposed payment of such Defaulted Amounts and the
special record date therefor having been so given, such Defaulted Amounts shall be paid to the Persons in whose names the Notes (or their respective Predecessor Notes) are registered at the close of business on such special record date and shall no
longer be payable pursuant to the following clause (ii) of this Section 2.03(c).
(ii) The Company may make payment of
any Defaulted Amounts in any other lawful manner not inconsistent with the requirements of any securities exchange or automated quotation system on which the Notes may be listed or designated for issuance, and upon such notice as may be required by
such exchange or automated quotation system, if, after written notice given by the Company to the Trustee of the proposed payment pursuant to this clause, such manner of payment shall be deemed practicable by the Trustee.
Section 2.04.
Execution, Authentication and Delivery of Notes
. The Notes shall be signed in the name and on behalf of the Company
by the manual or facsimile signature of its Chief Executive Officer, President, Chief Financial Officer, Treasurer, Secretary or any of its Executive or Senior Vice Presidents.
At any time and from time to time after the execution and delivery of this Indenture, the Company may deliver Notes executed by the Company to
the Trustee for authentication, together with a Company Order for the authentication and delivery of such Notes, and the Trustee in accordance with such Company Order shall authenticate and deliver such Notes, without any further action by the
Company hereunder, other than delivery of an Officers’ Certificate pursuant to Section 17.05.
Only such Notes as shall bear thereon
a certificate of authentication substantially in the form set forth on the form of Note attached as Exhibit A hereto, executed manually by an authorized signatory of the Trustee (or an authenticating agent appointed by the Trustee as provided by
Section 17.10), shall be entitled to the benefits of this Indenture or be valid or obligatory for any purpose. Such certificate by the Trustee (or such an authenticating agent) upon any Note executed by the Company shall be conclusive evidence that
the Note so authenticated has been duly authenticated and delivered hereunder and that the Holder is entitled to the benefits of this Indenture.
14
In case any Officer of the Company who shall have signed any of the Notes shall cease to be such
Officer before the Notes so signed shall have been authenticated and delivered by the Trustee, or disposed of by the Company, such Notes nevertheless may be authenticated and delivered or disposed of as though the person who signed such Notes had
not ceased to be such Officer of the Company; and any Note may be signed on behalf of the Company by such persons as, at the actual date of the execution of such Note, shall be the Officers of the Company, although at the date of the execution of
this Indenture any such person was not such an Officer.
Section 2.05.
Exchange and Registration of Transfer of Notes;
Restrictions on Transfer; Depositary
. (a) The Company shall cause to be kept at the Corporate Trust Office a register (the register maintained in such office or in any other office or agency of the Company designated pursuant to Section
4.02, the “
Note Register
”) in which, subject to such reasonable regulations as it may prescribe, the Company shall provide for the registration of Notes and of transfers of Notes. Such register shall be in written form or in any
form capable of being converted into written form within a reasonable period of time. The Trustee is hereby initially appointed the “
Note Registrar
” for the purpose of registering Notes and transfers of Notes as herein provided. The
Company may appoint one or more co-Note Registrars in accordance with Section 4.02.
Upon surrender for registration of transfer of any
Note to the Note Registrar or any co-Note Registrar, and satisfaction of the requirements for such transfer set forth in this Section 2.05, the Company shall execute, and the Trustee shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Notes of any authorized denominations and of a like aggregate principal amount and bearing such restrictive legends as may be required by this Indenture.
Notes may be exchanged for other Notes of any authorized denominations and of a like aggregate principal amount, upon surrender of the Notes
to be exchanged at any such office or agency maintained by the Company pursuant to Section 4.02. Whenever any Notes are so surrendered for exchange, the Company shall execute, and the Trustee shall authenticate and deliver, the Notes that the Holder
making the exchange is entitled to receive, bearing registration numbers not contemporaneously outstanding.
All Notes presented or
surrendered for registration of transfer or for exchange, repurchase or conversion shall (if so required by the Company, the Trustee, the Note Registrar or any co-Note Registrar) be duly endorsed, or be accompanied by a written instrument or
instruments of transfer in form satisfactory to the Company and duly executed, by the Holder thereof or its attorney-in-fact duly authorized in writing.
No service charge shall be imposed by the Company, the Trustee, the Note Registrar, any co-Note Registrar or the Paying Agent for any exchange
or registration of transfer of Notes, but the Company may require a Holder to pay a sum sufficient to cover any documentary, stamp or similar issue or transfer tax required in connection therewith as a result of the name of the Holder of new Notes
issued upon such exchange or registration of transfer being different from the name of the Holder of the old Notes surrendered for exchange or registration of transfer.
None of the Company, the Trustee, the Note Registrar or any co-Note Registrar shall be required to exchange or register a transfer of
(i) any Notes surrendered for conversion or, if a
15
portion of any Note is surrendered for conversion, such portion thereof surrendered for conversion or (ii) any Notes, or a portion of any Note, surrendered for repurchase (and not withdrawn)
in accordance with Article 15.
All Notes issued upon any registration of transfer or exchange of Notes in accordance with this Indenture
shall be the valid obligations of the Company, evidencing the same debt, and entitled to the same benefits under this Indenture as the Notes surrendered upon such registration of transfer or exchange.
(b) So long as the Notes are eligible for book-entry settlement with the Depositary, unless otherwise required by law, subject to the fourth
paragraph from the end of Section 2.05(c) all Notes shall be represented by one or more Notes in global form (each, a “
Global Note
”) registered in the name of the Depositary or the nominee of the Depositary. The transfer and
exchange of beneficial interests in a Global Note that does not involve the issuance of a Physical Note shall be effected through the Depositary (but not the Trustee or the Custodian) in accordance with this Indenture (including the restrictions on
transfer set forth herein) and the procedures of the Depositary therefor.
(c) Every Note that bears or is required under this Section
2.05(c) to bear the legend set forth in this Section 2.05(c) (together with any Common Stock issued upon conversion of the Notes that is required to bear the legend set forth in Section 2.05(d), collectively, the “
Restricted
Securities
”) shall be subject to the restrictions on transfer set forth in this Section 2.05(c) (including the legend set forth below), unless such restrictions on transfer shall be eliminated or otherwise waived by written consent of the
Company, and the Holder of each such Restricted Security, by such Holder’s acceptance thereof, agrees to be bound by all such restrictions on transfer. As used in this Section 2.05(c) and Section 2.05(d), the term “
transfer
”
encompasses any sale, pledge, transfer or other disposition whatsoever of any Restricted Security.
Until the date (the “
Resale
Restriction Termination Date
”) that is the later of (1) the date that is one year after the last date of original issuance of the Notes, or such shorter period of time as permitted by Rule 144 or any successor provision thereto, and
(2) such later date, if any, as may be required by applicable law, any certificate evidencing such Note (and all securities issued in exchange therefor or substitution thereof, other than Common Stock, if any, issued upon conversion thereof,
which shall bear the legend set forth in Section 2.05(d), if applicable) shall bear a legend in substantially the following form (unless such Notes have been transferred pursuant to a registration statement that has become or been declared effective
under the Securities Act and that continues to be effective at the time of such transfer, or sold pursuant to the exemption from registration provided by Rule 144 or any similar provision then in force under the Securities Act, or unless otherwise
agreed by the Company in writing, with notice thereof to the Trustee):
THIS SECURITY AND THE COMMON STOCK, IF ANY, ISSUABLE UPON
CONVERSION OF THIS SECURITY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “
SECURITIES ACT
”), AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT IN ACCORDANCE WITH THE FOLLOWING
SENTENCE. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE ACQUIRER:
(1) REPRESENTS THAT IT AND ANY
ACCOUNT FOR WHICH IT IS ACTING IS A “QUALIFIED INSTITUTIONAL BUYER” (WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT) AND THAT IT EXERCISES SOLE INVESTMENT DISCRETION WITH RESPECT TO EACH SUCH ACCOUNT, AND
16
(2) AGREES FOR THE BENEFIT OF MERCADOLIBRE, INC. (THE “
COMPANY
”)
THAT IT WILL NOT OFFER, SELL, PLEDGE OR OTHERWISE TRANSFER THIS SECURITY OR ANY BENEFICIAL INTEREST HEREIN PRIOR TO THE DATE THAT IS THE LATER OF (X) ONE YEAR AFTER THE LAST ORIGINAL ISSUE DATE HEREOF OR SUCH SHORTER PERIOD OF TIME AS PERMITTED
BY RULE 144 UNDER THE SECURITIES ACT OR ANY SUCCESSOR PROVISION THERETO AND (Y) SUCH LATER DATE, IF ANY, AS MAY BE REQUIRED BY APPLICABLE LAW, EXCEPT:
(A) TO THE COMPANY OR ANY SUBSIDIARY THEREOF, OR
(B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BECOME EFFECTIVE UNDER THE SECURITIES ACT, OR
(C) TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, OR
(D) PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT OR ANY OTHER AVAILABLE EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
PRIOR TO THE REGISTRATION OF ANY TRANSFER IN ACCORDANCE WITH CLAUSE
(2)(D) ABOVE, THE COMPANY AND THE TRUSTEE RESERVE THE RIGHT TO REQUIRE THE DELIVERY OF SUCH LEGAL OPINIONS, CERTIFICATIONS OR OTHER EVIDENCE AS MAY REASONABLY BE REQUIRED IN ORDER TO DETERMINE THAT THE PROPOSED TRANSFER IS BEING MADE IN
COMPLIANCE WITH THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS. NO REPRESENTATION IS MADE AS TO THE AVAILABILITY OF ANY EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
No transfer of any Note prior to the Resale Restriction Termination Date will be registered by the Note Registrar unless the applicable box on
the Form of Assignment and Transfer has been checked.
Any Note (or security issued in exchange or substitution therefor) (i) as to
which such restrictions on transfer shall have expired in accordance with their terms, (ii) that has been transferred pursuant to a registration statement that has become effective or been declared effective under the Securities Act and that
continues to be effective at the time of such transfer or (iii) that has been sold pursuant to the exemption from registration provided by Rule 144 or any similar provision then in force under the Securities Act, may, upon surrender of such
Note for exchange to the Note Registrar in accordance with the provisions of this Section 2.05, be exchanged for a new Note or Notes, of like tenor and aggregate principal amount, which shall
17
not bear the restrictive legend required by this Section 2.05(c) and shall not be assigned a restricted CUSIP number. The Company shall be entitled to instruct the Custodian in writing to so
surrender any Global Note as to which any of the conditions set forth in clause (i) through (iii) of the immediately preceding sentence have been satisfied, and, upon such instruction, the Custodian shall so surrender such Global Note for
exchange; and any new Global Note so exchanged therefor shall not bear the restrictive legend specified in this Section 2.05(c) and shall not be assigned a restricted CUSIP number. The Company shall promptly notify the Trustee upon the occurrence of
the Resale Restriction Termination Date and promptly after a registration statement, if any, with respect to the Notes or any Common Stock issued upon conversion of the Notes has been declared effective under the Securities Act.
Notwithstanding any other provisions of this Indenture (other than the provisions set forth in this Section 2.05(c)), a Global Note may not be
transferred as a whole or in part except (i) 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 and (ii) for exchange of a Global Note or a portion thereof for one or more Physical Notes in accordance with the second immediately succeeding paragraph.
The Depositary shall be a clearing agency registered under the Exchange Act. The Company initially appoints The Depository Trust Company to
act as Depositary with respect to each Global Note. Initially, each Global Note shall be issued to the Depositary, registered in the name of Cede & Co., as the nominee of the Depositary, and deposited with the Trustee as custodian for
Cede & Co.
If (i) the Depositary notifies the Company at any time that the Depositary is unwilling or unable to continue as
depositary for the Global Notes and a successor depositary is not appointed within 90 days, (ii) the Depositary ceases to be registered as a clearing agency under the Exchange Act and a successor depositary is not appointed within 90 days or
(iii) an Event of Default with respect to the Notes has occurred and is continuing and a beneficial owner of any Note requests that its beneficial interest therein be issued as a Physical Note, the Company shall execute, and the Trustee, upon
receipt of an Officers’ Certificate and a Company Order for the authentication and delivery of Notes, shall authenticate and deliver at the Company’s expense (x) in the case of clause (iii), a Physical Note to such beneficial owner in
a principal amount equal to the principal amount of such Note corresponding to such beneficial owner’s beneficial interest and (y) in the case of clause (i) or (ii), Physical Notes to each beneficial owner of the related Global Notes
(or a portion thereof) in an aggregate principal amount equal to the aggregate principal amount of such Global Notes in exchange for such Global Notes, and upon delivery of the Global Notes to the Trustee such Global Notes shall be canceled.
Physical Notes issued in exchange for all or a part of the Global Note pursuant to this Section 2.05(c) shall be registered in such names and
in such authorized denominations as the Depositary, pursuant to instructions from its direct or indirect participants or otherwise, or, in the case of clause (iii) of the immediately preceding paragraph, the relevant beneficial owner, shall
instruct the Trustee. Upon execution and authentication, the Trustee shall deliver at the Company’s expense such Physical Notes to the Persons in whose names such Physical Notes are so registered.
18
At such time as all interests in a Global Note have been converted, canceled, repurchased or
transferred, such Global Note shall be, upon receipt thereof, canceled by the Trustee in accordance with standing procedures and existing instructions between the Depositary and the Custodian. At any time prior to such cancellation, if any interest
in a Global Note is exchanged for Physical Notes, converted, canceled, repurchased or transferred to a transferee who receives Physical Notes therefor or any Physical Note is exchanged or transferred for part of such Global Note, the principal
amount of such Global Note shall, in accordance with the standing procedures and instructions existing between the Depositary and the Custodian, be appropriately reduced or increased, as the case may be, and an endorsement shall be made on such
Global Note, by the Trustee or the Custodian, at the direction of the Trustee, to reflect such reduction or increase.
None of the
Company, the Trustee or any agent of the Company or the Trustee shall have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests of a Global Note or maintaining,
supervising or reviewing any records relating to such beneficial ownership interests.
(d) Until the Resale Restriction Termination Date,
any stock certificate representing Common Stock issued upon conversion of a Note shall bear a legend in substantially the following form (unless such Common Stock has been transferred pursuant to a registration statement that has become or been
declared effective under the Securities Act and that continues to be effective at the time of such transfer, or pursuant to the exemption from registration provided by Rule 144 or any similar provision then in force under the Securities Act, or such
Common Stock has been issued upon conversion of a Note that has transferred pursuant to a registration statement that has become or been declared effective under the Securities Act and that continues to be effective at the time of such transfer, or
pursuant to the exemption from registration provided by Rule 144 or any similar provision then in force under the Securities Act, or unless otherwise agreed by the Company with written notice thereof to the Trustee and any transfer agent for the
Common Stock):
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “
SECURITIES
ACT
”), AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT IN ACCORDANCE WITH THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE ACQUIRER:
(1) REPRESENTS THAT IT AND ANY ACCOUNT FOR WHICH IT IS ACTING IS A “QUALIFIED INSTITUTIONAL BUYER” (WITHIN THE
MEANING OF RULE 144A UNDER THE SECURITIES ACT) AND THAT IT EXERCISES SOLE INVESTMENT DISCRETION WITH RESPECT TO EACH SUCH ACCOUNT, AND
(2) AGREES FOR THE BENEFIT OF MERCADOLIBRE, INC. (THE “
COMPANY
”) THAT IT WILL NOT OFFER, SELL, PLEDGE OR
OTHERWISE TRANSFER THIS SECURITY OR ANY BENEFICIAL INTEREST HEREIN PRIOR TO THE DATE THAT IS THE LATER OF (X) ONE YEAR AFTER THE LAST ORIGINAL ISSUE DATE OF THE SERIES OF NOTES UPON THE CONVERSION OF WHICH THIS SECURITY WAS ISSUED OR SUCH
SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144 UNDER THE SECURITIES ACT OR ANY SUCCESSOR PROVISION THERETO AND (Y) SUCH LATER DATE, IF ANY, AS MAY BE REQUIRED BY APPLICABLE LAW, EXCEPT:
(A) TO THE COMPANY OR ANY SUBSIDIARY THEREOF, OR
19
(B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BECOME EFFECTIVE UNDER THE
SECURITIES ACT, OR
(C) TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, OR
(D) PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT OR ANY OTHER AVAILABLE EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
PRIOR TO THE REGISTRATION OF ANY TRANSFER IN ACCORDANCE WITH CLAUSE
(2)(D) ABOVE, THE COMPANY AND THE TRANSFER AGENT FOR THE COMPANY’S COMMON STOCK RESERVE THE RIGHT TO REQUIRE THE DELIVERY OF SUCH LEGAL OPINIONS, CERTIFICATIONS OR OTHER EVIDENCE AS MAY REASONABLY BE REQUIRED IN ORDER TO DETERMINE THAT THE
PROPOSED TRANSFER IS BEING MADE IN COMPLIANCE WITH THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS. NO REPRESENTATION IS MADE AS TO THE AVAILABILITY OF ANY EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
Any such Common Stock (i) as to which such restrictions on transfer shall have expired in accordance with their terms, (ii) that has
been transferred pursuant to a registration statement that has become or been declared effective under the Securities Act and that continues to be effective at the time of such transfer or (iii) that has been sold pursuant to the exemption from
registration provided by Rule 144 or any similar provision then in force under the Securities Act, may, upon surrender of the certificates representing such shares of Common Stock for exchange in accordance with the procedures of the transfer agent
for the Common Stock, be exchanged for a new certificate or certificates for a like aggregate number of shares of Common Stock, which shall not bear the restrictive legend required by this Section 2.05(d).
(e) Any Note or Common Stock issued upon the conversion or exchange of a Note that is repurchased or owned by any Affiliate of the Company (or
any Person who was an Affiliate of the Company at any time during the three months preceding) may not be resold by such Affiliate (or such Person, as the case may be) unless registered under the Securities Act or resold pursuant to an exemption from
the registration requirements of the Securities Act in a transaction that results in such Note or Common Stock, as the case may be, no longer being a “restricted security” (as defined under Rule 144). The Company shall cause any Note that
is repurchased or owned by it to be surrendered to the Trustee for cancellation in accordance with Section 2.08.
(f) The Trustee shall
have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Indenture or under applicable law with respect to any transfer of any interest in any Note (including any transfers
between or
20
among depositary participants or beneficial owners or holders of any Global Note) other than to require delivery of such certificates and other documentation or evidence as are expressly required
by the terms of this Indenture, and to examine the same to determine substantial compliance as to form with the express requirements hereof.
(g) Neither the Trustee nor any agent shall have any responsibility or liability for any actions taken or not taken by the Depositary.
Section 2.06.
Mutilated, Destroyed, Lost or Stolen Notes
. In case any Note shall become mutilated or be destroyed, lost or stolen,
the Company in its discretion may execute, and upon its written request the Trustee or an authenticating agent appointed by the Trustee shall authenticate and deliver, a new Note, bearing a registration number not contemporaneously outstanding, in
exchange and substitution for the mutilated Note, or in lieu of and in substitution for the Note so destroyed, lost or stolen. In every case the applicant for a substituted Note shall furnish to the Company, to the Trustee and, if applicable, to
such authenticating agent such security or indemnity as may be required by them to save each of them harmless from any loss, liability, cost or expense caused by or connected with such substitution, and, in every case of destruction, loss or theft,
the applicant shall also furnish to the Company, to the Trustee and, if applicable, to such authenticating agent evidence to their satisfaction of the destruction, loss or theft of such Note and of the ownership thereof.
The Trustee or such authenticating agent may authenticate any such substituted Note and deliver the same upon the receipt of such security or
indemnity as the Trustee, the Company and, if applicable, such authenticating agent may require. No service charge shall be imposed by the Company, the Trustee, the Note Registrar, any co-Note Registrar or the Paying Agent upon the issuance of any
substitute Note, but the Company may require a Holder to pay a sum sufficient to cover any documentary, stamp or similar issue or transfer tax required in connection therewith as a result of the name of the Holder of the new substitute Note being
different from the name of the Holder of the old Note that became mutilated or was destroyed, lost or stolen. In case any Note that has matured or is about to mature or has been surrendered for required repurchase or is about to be converted in
accordance with Article 14 shall become mutilated or be destroyed, lost or stolen, the Company may, in its sole discretion, instead of issuing a substitute Note, pay or authorize the payment of or convert or authorize the conversion of the same
(without surrender thereof except in the case of a mutilated Note), as the case may be, if the applicant for such payment or conversion shall furnish to the Company, to the Trustee and, if applicable, to such authenticating agent such security or
indemnity as may be required by them to save each of them harmless for any loss, liability, cost or expense caused by or connected with such substitution, and, in every case of destruction, loss or theft, evidence satisfactory to the Company, the
Trustee and, if applicable, any Paying Agent or Conversion Agent evidence to their satisfaction of the destruction, loss or theft of such Note and of the ownership thereof.
Every substitute Note issued pursuant to the provisions of this Section 2.06 by virtue of the fact that any Note is destroyed, lost or stolen
shall constitute an additional contractual obligation of the Company, whether or not the destroyed, lost or stolen Note shall be found at any time, and shall be entitled to all the benefits of (but shall be subject to all the limitations set forth
in) this Indenture equally and proportionately with any and all other Notes duly issued hereunder. To the extent permitted by law, all Notes shall be held and owned upon the express
21
condition that the foregoing provisions are exclusive with respect to the replacement, payment, conversion or repurchase of mutilated, destroyed, lost or stolen Notes and shall preclude any and
all other rights or remedies notwithstanding any law or statute existing or hereafter enacted to the contrary with respect to the replacement, payment, conversion or repurchase of negotiable instruments or other securities without their surrender.
Section 2.07.
Temporary Notes
. Pending the preparation of Physical Notes, the Company may execute and the Trustee or an
authenticating agent appointed by the Trustee shall, upon written request of the Company, authenticate and deliver temporary Notes (printed or lithographed). Temporary Notes shall be issuable in any authorized denomination, and substantially in the
form of the Physical Notes but with such omissions, insertions and variations as may be appropriate for temporary Notes, all as may be determined by the Company. Every such temporary Note shall be executed by the Company and authenticated by the
Trustee or such authenticating agent upon the same conditions and in substantially the same manner, and with the same effect, as the Physical Notes. Without unreasonable delay, the Company shall execute and deliver to the Trustee or such
authenticating agent Physical Notes (other than any Global Note) and thereupon any or all temporary Notes (other than any Global Note) may be surrendered in exchange therefor, at each office or agency maintained by the Company pursuant to Section
4.02 and the Trustee or such authenticating agent shall authenticate and deliver in exchange for such temporary Notes an equal aggregate principal amount of Physical Notes. Such exchange shall be made by the Company at its own expense and without
any charge therefor. Until so exchanged, the temporary Notes shall in all respects be entitled to the same benefits and subject to the same limitations under this Indenture as Physical Notes authenticated and delivered hereunder.
Section 2.08.
Cancellation of Notes Paid, Converted, Etc
. The Company shall cause all Notes surrendered for the purpose of
payment, repurchase, registration of transfer or exchange or conversion, if surrendered to any Person other than the Trustee (including any of the Company’s agents, Subsidiaries or Affiliates), to be surrendered to the Trustee for cancellation.
All Notes delivered to the Trustee shall be canceled promptly by it, and, except for any Notes surrendered for registration of transfer or exchange, no Notes shall be authenticated in exchange therefor except as expressly permitted by any of the
provisions of this Indenture. The Trustee shall dispose of canceled Notes in accordance with its customary procedures and, after such disposition, shall deliver a certificate of such disposition to the Company, at the Company’s written request
in a Company Order.
Section 2.09.
CUSIP Numbers
. The Company in issuing the Notes may use “CUSIP”, “ISIN”
or other similar numbers (if then generally in use), and, if so, the Trustee shall use “CUSIP”, “ISIN” or other similar numbers in all notices issued to Holders as a convenience to such Holders;
provided
that any such
notice may state that no representation is made as to the correctness of such numbers either as printed on the Notes or on such notice and that reliance may be placed only on the other identification numbers printed on the Notes. The Company shall
promptly notify the Trustee in writing of any change in the “CUSIP”, “ISIN” or other similar numbers.
Section 2.10.
Additional Notes; Repurchases
. The Company may, without the consent of the Holders and notwithstanding Section 2.01,
reopen this Indenture and issue additional
22
Notes hereunder with the same terms as the Notes initially issued hereunder (other than differences in the issue price and interest accrued prior to the issue date of such additional Notes) in an
unlimited aggregate principal amount;
provided
that if any such additional Notes are not fungible with the Notes initially issued hereunder for U.S. federal income tax purposes or U.S. securities law purposes, such additional Notes shall have
a separate CUSIP number. Prior to the issuance of any such additional Notes, the Company shall deliver to the Trustee a Company Order, an Officers’ Certificate and an Opinion of Counsel, such Officers’ Certificate and Opinion of Counsel to
cover such matters required by Section 17.05. In addition, the Company may, to the extent permitted by law, and directly or indirectly (regardless of whether such Notes are surrendered to the Company), repurchase Notes in the open market or
otherwise, whether by the Company or its Subsidiaries or through a private or public tender or exchange offer or through counterparties to private agreements, including by cash-settled swaps or other derivatives. The Company shall cause any Notes so
repurchased (other than Notes repurchased pursuant to cash-settled swaps or other derivatives) to be surrendered to the Trustee for cancellation in accordance with Section 2.08.
ARTICLE 3
S
ATISFACTION
AND
D
ISCHARGE
Section 3.01.
Satisfaction and Discharge
. This Indenture shall upon request of the Company contained in an Officers’
Certificate cease to be of further effect, and the Trustee, at the expense of the Company, shall execute instruments reasonably requested by the Company acknowledging satisfaction and discharge of this Indenture, when (a) (i) all Notes
theretofore authenticated and delivered (other than Notes which have been destroyed, lost or stolen and which have been replaced, paid or converted as provided in Section 2.06) have been delivered to the Trustee for cancellation; or (ii) the
Company has deposited with the Trustee or delivered to Holders, as applicable, after the Notes have become due and payable, whether on the Maturity Date, any Fundamental Change Repurchase Date, upon conversion or otherwise, cash, shares of Common
Stock or a combination thereof, as applicable, solely to satisfy the Company’s Conversion Obligation, sufficient to pay all of the outstanding Notes and all other sums due and payable under this Indenture by the Company; and (b) the
Company has delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent herein provided for relating to the satisfaction and discharge of this Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the obligations of the Company to the Trustee under Section 7.06 shall survive.
ARTICLE 4
P
ARTICULAR
C
OVENANTS
OF
THE
C
OMPANY
Section 4.01.
Payment of Principal and Interest
. The Company covenants and agrees that it will cause to be paid the principal
(including the Fundamental Change Repurchase Price, if applicable) of, and accrued and unpaid interest on, each of the Notes at the places, at the respective times and in the manner provided herein and in the Notes.
23
Section 4.02.
Maintenance of Office or Agency
. The Company will maintain in the
United States of America, an office or agency where the Notes may be surrendered for registration of transfer or exchange or for presentation for payment or repurchase (“
Paying Agent
”) or for conversion (“
Conversion
Agent
”) and where notices and demands to or upon the Company in respect of the Notes and this Indenture may be served. 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 any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office.
The Company may also from time to time designate as co-Note Registrars one or more other offices or agencies
where the Notes may be presented or surrendered for any or all such purposes and may from time to time rescind such designations;
provided
that no such designation or rescission shall in any manner relieve the Company of its obligation to
maintain an office or agency in the United States of America so designated by the Trustee as a place 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 terms “
Paying Agent
” and “
Conversion Agent
” include any such additional or other offices or agencies, as applicable.
The Company hereby initially designates the Trustee as the Paying Agent, Note Registrar, Custodian, Bid Solicitation Agent and Conversion
Agent and the Corporate Trust Office as the office or agency in the United States of America, where Notes may be surrendered for registration of transfer or exchange or for presentation for payment or repurchase or for conversion and where notices
and demands to or upon the Company in respect of the Notes and this Indenture may be served.
Section 4.03.
Appointments to Fill
Vacancies in Trustee’s Office
. The Company, whenever necessary to avoid or fill a vacancy in the office of Trustee, will appoint, in the manner provided in Section 7.09, a trustee, so that there shall at all times be a Trustee hereunder.
Section 4.04.
Provisions as to Paying Agent
. (a) If the Company shall appoint a Paying Agent other than the Trustee, the
Company will cause such Paying Agent to execute and deliver to the Trustee an instrument in which such agent shall agree with the Trustee, subject to the provisions of this Section 4.04:
(i) that it will hold all sums held by it as such agent for the payment of the principal (including the Fundamental Change
Repurchase Price, if applicable) of, and accrued and unpaid interest on, the Notes in trust for the benefit of the Holders of the Notes;
(ii) that it will give the Trustee prompt notice of any failure by the Company to make any payment of the principal (including
the Fundamental Change Repurchase Price, if applicable) of, and accrued and unpaid interest on, the Notes when the same shall be due and payable; and
(iii) that at any time during the continuance of an Event of Default, upon request of the Trustee, it will forthwith pay to the
Trustee all sums so held in trust.
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The Company shall, on or before each due date of the principal (including the Fundamental Change
Repurchase Price, if applicable) of, or accrued and unpaid interest on, the Notes, deposit with the Paying Agent a sum sufficient to pay such principal (including the Fundamental Change Repurchase Price, if applicable) or accrued and unpaid
interest, and (unless such Paying Agent is the Trustee) the Company will promptly notify the Trustee of any failure to take such action;
provided
that if such deposit is made on the due date, such deposit must be received by the Paying Agent
by 11:00 a.m., New York City time, on such date.
(b) If the Company shall act as its own Paying Agent, it will, on or before each due
date of the principal (including the Fundamental Change Repurchase Price, if applicable) of, and accrued and unpaid interest on, the Notes, set aside, segregate and hold in trust for the benefit of the Holders of the Notes a sum sufficient to pay
such principal (including the Fundamental Change Repurchase Price, if applicable) and accrued and unpaid interest so becoming due and will promptly notify the Trustee in writing of any failure to take such action and of any failure by the Company to
make any payment of the principal (including the Fundamental Change Repurchase Price, if applicable) of, or accrued and unpaid interest on, the Notes when the same shall become due and payable.
(c) Anything in this Section 4.04 to the contrary notwithstanding, the Company may, at any time, for the purpose of obtaining a satisfaction
and discharge of this Indenture, or for any other reason, pay, cause to be paid or deliver to the Trustee all sums or amounts held in trust by the Company or any Paying Agent hereunder as required by this Section 4.04, such sums or amounts to be
held by the Trustee upon the trusts herein contained and upon such payment or delivery by the Company or any Paying Agent to the Trustee, the Company or such Paying Agent shall be released from all further liability but only with respect to such
sums or amounts.
(d) Subject to applicable abandoned property laws, any money and shares of Common Stock deposited with the Trustee or
any Paying Agent, or then held by the Company, in trust for the payment of the principal (including the Fundamental Change Repurchase Price, if applicable) of, accrued and unpaid interest on and the consideration due upon conversion of any Note and
remaining unclaimed for two years after such principal (including the Fundamental Change Repurchase Price, if applicable), interest or consideration due upon conversion has become due and payable shall be paid to the Company on request of the
Company contained in an Officers’ Certificate, or (if then held by the Company) shall be discharged from such trust; and the Holder of such Note shall thereafter, as an unsecured general creditor, look only to the Company for payment thereof,
and all liability of the Trustee or such Paying Agent with respect to such trust money and shares of Common Stock, and all liability of the Company as trustee thereof, shall thereupon cease;
provided
,
however
, that prior to the Trustee
or the Paying Agent making any such repayment, the Company may cause to be published once, in a newspaper published in the English language, customarily published on each Business Day and of general circulation in The Borough of Manhattan, The City
of New York, notice that such money and shares of Common Stock remain unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such publication, any unclaimed balance of such money and shares of
Common Stock then remaining will be repaid or delivered to the Company.
(e) Upon any Event of Default pursuant to Section 6.01(i) or
Section 6.01(j), the Trustee shall automatically be the Paying Agent.
25
Section 4.05.
Existence
. Subject to Article 11, the Company shall do or cause to be
done all things necessary to preserve and keep in full force and effect its corporate existence.
Section 4.06.
Rule 144A
Information Requirement and Annual Reports
. (a) At any time the Company is not subject to Section 13 or 15(d) of the Exchange Act, the Company shall, so long as any of the Notes or any shares of Common Stock issuable upon conversion
thereof shall, at such time, constitute “restricted securities” within the meaning of Rule 144(a)(3) under the Securities Act, promptly provide to the Trustee and, upon written request, any Holder, beneficial owner or prospective purchaser
of such Notes or any shares of Common Stock issuable upon conversion of such Notes, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act to facilitate the resale of such Notes or shares of Common Stock
pursuant to Rule 144A. The Company shall take such further action as any Holder or beneficial owner of such Notes or such Common Stock may reasonably request to the extent from time to time required to enable such Holder or beneficial owner to sell
such Notes or shares of Common Stock in accordance with Rule 144A, as such rule may be amended from time to time.
(b) The Company shall
file with the Trustee, within 15 days after the same are required to be filed with the Commission, copies of any documents or reports that the Company is required to file with the Commission pursuant to Section 13 or 15(d) of the Exchange Act
(giving effect to any grace period provided by Rule 12b-25 under the Exchange Act). Any such document or report that the Company files with the Commission via the Commission’s EDGAR system shall be deemed to be filed with the Trustee for
purposes of this Section 4.06(b) at the time such documents are filed via the EDGAR system (or any successor thereto), it being understood that the Trustee shall not be responsible for determining whether such filings have been made.
(c) Delivery of the reports and documents described in subsection (b) above to the Trustee is for informational purposes only, and the
Trustee’s receipt of such shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Company’s compliance with any of its covenants hereunder (as to which
the Trustee is entitled to conclusively rely on an Officers’ Certificate).
(d) If, at any time during the six-month period beginning
on, and including, the date that is six months after the last date of original issuance of the Notes, the Company fails to timely file any document or report that it is required to file with the Commission pursuant to Section 13 or 15(d) of the
Exchange Act, as applicable (after giving effect to all applicable grace periods thereunder and other than reports on Form 8-K), or the Notes are not otherwise freely tradable by Holders other than the Company’s Affiliates or Holders that were
the Company’s Affiliates at any time during the three months preceding (as a result of restrictions pursuant to U.S. securities laws or the terms of this Indenture or the Notes), the Company shall pay Additional Interest on the Notes. Such
Additional Interest shall accrue on the Notes at the rate of 0.50% per annum of the principal amount of the Notes outstanding for each day during such period for which the Company’s failure to file has occurred and is continuing or the
Notes are not otherwise freely tradable by Holders other than the Company’s Affiliates (or Holders that have been the Company’s Affiliates at any time during the three months preceding) without restrictions pursuant to U.S. securities laws
or the terms of this Indenture or the Notes.
26
(e) If, and for so long as, the restrictive legend on the Notes specified in Section 2.05(c) has
not been removed, the Notes are assigned a restricted CUSIP number or the Notes are not otherwise freely tradable by Holders other than the Company’s Affiliates or Holders that were the Company’s Affiliates at any time during the three
months preceding (without restrictions pursuant to U.S. securities laws or the terms of this Indenture or the Notes) as of the 375th day after the last date of original issuance of the Notes, the Company shall pay Additional Interest on the Notes at
a rate equal to 0.50% per annum of the principal amount of Notes outstanding until the restrictive legend on the Notes has been removed in accordance with Section 2.05(c), the Notes are assigned an unrestricted CUSIP number and the Notes are
freely tradable by Holders other than the Company’s Affiliates (or Holders that were the Company’s Affiliates at any time during the three months preceding) (without restrictions pursuant to U.S. securities laws or the terms of this
Indenture or the Notes).
(f) Additional Interest will be payable in arrears on each Interest Payment Date following accrual in the same
manner as regular interest on the Notes.
(g) In no event shall the Additional Interest that is payable in accordance with
Section 4.06(d) or Section 4.06(e), together with any Additional Interest that may be payable as a result of the Company’s election pursuant to Section 6.03, accrue at a rate in excess of 0.50% per annum pursuant to this
Indenture, regardless of the number of events or circumstances giving rise to the requirement to pay such Additional Interest.
(h) If
Additional Interest is payable by the Company pursuant to Section 4.06(d) or Section 4.06(e), the Company shall notify Holders and shall deliver to the Trustee and the Paying Agent an Officers’ Certificate to that effect stating
(i) the amount of such Additional Interest that is payable and (ii) the date on which such Additional Interest is payable. Unless and until a Responsible Officer of the Trustee receives at the Corporate Trust Office such a certificate, the
Trustee may assume without inquiry that no such Additional Interest is payable. If the Company has paid Additional Interest directly to the Persons entitled to it, the Company shall deliver to the Trustee an Officers’ Certificate setting forth
the particulars of such payment. The Trustee shall have no duty to verify the Company’s determination as to whether Additional Interest is due or the Company’s calculations as to the amount of such Additional Interest.
Section 4.07.
Stay, Extension and Usury Laws
. The Company covenants (to the extent that it may lawfully do so) that it shall not
at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law or other law that would prohibit or forgive the Company from paying all or any portion of the principal of or
interest on the Notes as contemplated herein, wherever enacted, now or at any time hereafter in force, or that may affect the covenants or the performance of this Indenture; and the Company (to the extent it may lawfully do so) hereby expressly
waives all benefit or advantage of any such law, and covenants that it will not, by resort to any such law, hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such
power as though no such law had been enacted.
27
Section 4.08.
Compliance Certificate; Statements as to Defaults
. The Company shall
deliver to the Trustee within 120 days after the end of each fiscal year of the Company (beginning with the fiscal year ending on December 31, 2014) an Officers’ Certificate stating whether the signers thereof have knowledge of any failure
by the Company to comply with all conditions and covenants then required to be performed under this Indenture and, if so, specifying each such failure and the nature thereof.
In addition, the Company shall deliver to the Trustee, as soon as possible, and in any event within 30 days after the occurrence of any Event
of Default or Default, an Officers’ Certificate setting forth the details of such Event of Default or Default, its status and the action that the Company is taking or proposing to take in respect thereof.
Section 4.09.
Further Instruments and Acts
. Upon request of the Trustee, the Company will execute and deliver such further
instruments and do such further acts as may be reasonably necessary or proper to carry out more effectively the purposes of this Indenture.
ARTICLE 5
L
ISTS
OF
H
OLDERS
AND
R
EPORTS
BY
THE
C
OMPANY
AND
THE
T
RUSTEE
Section 5.01.
Lists of Holders
. The Company covenants and agrees that it will furnish or cause to be furnished to the Trustee and
the Paying Agent, semi-annually, not more than 15 days after each January 1 and July 1 in each year beginning with January 1, 2015, and at such other times as the Trustee may request in writing, within 30 days after receipt by the
Company of any such request (or such lesser time as the Trustee may reasonably request in order to enable it to timely provide any notice to be provided by it hereunder), a list in such form as the Trustee may reasonably require of the names and
addresses of the Holders as of a date not more than 15 days (or such other date as the Trustee may reasonably request in order to so provide any such notices) prior to the time such information is furnished, except that no such list need be
furnished so long as the Trustee is acting as Note Registrar.
Section 5.02.
Preservation and Disclosure of Lists
. The Trustee
shall preserve, in as current a form as is reasonably practicable, all information as to the names and addresses of the Holders contained in the most recent list furnished to it as provided in Section 5.01 or maintained by the Trustee in its
capacity as Note Registrar, if so acting. The Trustee may destroy any list furnished to it as provided in Section 5.01 upon receipt of a new list so furnished.
ARTICLE 6
D
EFAULTS
AND
R
EMEDIES
Section 6.01
. Events of Default.
Each of the following events shall be an
“
Event of Default
” with respect to the Notes (regardless of the cause of such event):
(a) default in any payment of
interest on any Note when due and payable, and the default continues for a period of 30 days;
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(b) default in the payment of principal of any Note when due and payable on the Maturity Date,
upon any required repurchase, upon declaration of acceleration or otherwise;
(c) failure by the Company to comply with its obligation to
convert the Notes in accordance with this Indenture upon exercise of a Holder’s conversion right and such failure continues for five Business Days;
(d) failure by the Company to issue a Fundamental Change Company Notice in accordance with Section 15.02(c) or notice of a specified corporate
event in accordance with Section 14.01(b)(ii) or 14.01(b)(iii), in each case when due;
(e) failure by the Company to comply with its
obligations under Article 11;
(f) failure by the Company for 60 days after written notice from the Trustee or the Holders of at least 25%
in principal amount of the Notes then outstanding has been received by the Company to comply with any of its other agreements contained in the Notes or this Indenture;
(g) default by the Company or any Significant Subsidiary of the Company with respect to any mortgage, agreement or other instrument under
which there may be outstanding, or by which there may be secured or evidenced, any indebtedness for money borrowed in excess of $35 million (or its foreign currency equivalent) in the aggregate of the Company and/or any such Significant Subsidiary,
whether such indebtedness now exists or shall hereafter be created (i) resulting in such indebtedness becoming or being declared due and payable or (ii) constituting a failure to pay the principal or interest of any such debt when due and
payable at its stated maturity, upon required repurchase, upon declaration of acceleration or otherwise;
(h) a final judgment or
judgments for the payment of $35 million (or its foreign currency equivalent) or more (excluding any amounts covered by insurance) in the aggregate rendered against the Company or any Significant Subsidiary of the Company, which judgment is not
discharged or stayed within 60 days after (i) the date on which the right to appeal thereof has expired if no such appeal has commenced, or (ii) the date on which all rights to appeal have been extinguished;
(i) the Company or any Significant Subsidiary shall commence a voluntary case or other proceeding seeking liquidation, reorganization or other
relief with respect to the Company or any such Significant Subsidiary or its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian or other
similar official of the Company or any such Significant Subsidiary or any substantial part of its property, or shall consent to any such relief or to the appointment of or taking possession by any such official in an involuntary case or other
proceeding commenced against it, or shall make a general assignment for the benefit of creditors, or shall fail generally to pay its debts as they become due; or
(j) an involuntary case or other proceeding shall be commenced against the Company or any Significant Subsidiary seeking liquidation,
reorganization or other relief with respect to the Company or such Significant Subsidiary or its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator,
custodian or other similar official of the Company or such Significant Subsidiary or any substantial part of its property, and such involuntary case or other proceeding shall remain undismissed and unstayed for a period of 30 consecutive days.
29
Section 6.02.
Acceleration; Rescission and Annulment
. If one or more Events of
Default shall have occurred and be continuing (whatever the reason for such Event of Default and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or order of any court or any order,
rule or regulation of any administrative or governmental body), then, and in each and every such case (other than an Event of Default specified in Section 6.01(i) or Section 6.01(j) with respect to the Company), unless the principal of all of the
Notes shall have already become due and payable, either the Trustee or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding determined in accordance with Section 8.04, by notice in writing to the Company (and to
the Trustee if given by Holders), may declare 100% of the principal of, and accrued and unpaid interest on, if any, all the Notes to be due and payable immediately, and upon any such declaration the same shall become and shall automatically be
immediately due and payable, anything contained in this Indenture or in the Notes to the contrary notwithstanding. If an Event of Default specified in Section 6.01(i) or Section 6.01(j) with respect to the Company occurs and is continuing, 100% of
the principal of, and accrued and unpaid interest, if any, on, all Notes shall become and shall automatically be immediately due and payable.
The immediately preceding paragraph, however, is subject to the conditions that if, at any time after the principal of the Notes shall have
been so declared due and payable, and before any judgment or decree for the payment of the monies due shall have been obtained or entered as hereinafter provided, the Company shall pay or shall deposit with the Trustee a sum sufficient to pay
installments of accrued and unpaid interest upon all Notes and the principal of any and all Notes that shall have become due otherwise than by acceleration (with interest on overdue installments of accrued and unpaid interest to the extent that
payment of such interest is enforceable under applicable law, and on such principal at the rate borne by the Notes at such time) and amounts due to the Trustee pursuant to Section 7.06, and if (1) rescission would not conflict with any judgment
or decree of a court of competent jurisdiction and (2) any and all existing Events of Default under this Indenture, other than the nonpayment of the principal of and accrued and unpaid interest, if any, on Notes that shall have become due
solely by such acceleration, shall have been cured or waived pursuant to Section 6.09, then and in every such case (except as provided in the immediately succeeding sentence) the Holders of a majority in aggregate principal amount of the Notes then
outstanding, by written notice to the Company and to the Trustee, may waive all Defaults or Events of Default with respect to the Notes and rescind and annul such declaration and its consequences and such Default shall cease to exist, and any Event
of Default arising therefrom shall be deemed to have been cured for every purpose of this Indenture; but no such waiver or rescission and annulment shall extend to or shall affect any subsequent Default or Event of Default, or shall impair any right
consequent thereon. Notwithstanding anything to the contrary herein, no such waiver or rescission and annulment shall extend to or shall affect any Default or Event of Default resulting from (i) the nonpayment of the principal (including the
Fundamental Change Repurchase Price, if applicable) of, or accrued and unpaid interest on, any Notes, (ii) a failure to repurchase any Notes when required or (iii) a failure to pay or deliver, as the case may be, the consideration due upon
conversion of the Notes.
30
Section 6.03.
Additional Interest
. Notwithstanding anything in this Indenture or in
the Notes to the contrary, to the extent the Company elects, the sole remedy for an Event of Default relating to the Company’s failure to comply with its obligations as set forth in Section 4.06(b) shall after the occurrence of such an Event of
Default consist exclusively of the right to receive Additional Interest on the Notes at a rate equal to 0.50% per annum of the principal amount of the Notes outstanding for each day during the 365-day period on which such Event of Default is
continuing beginning on, and including, the date on which such an Event of Default first occurs. If the Company so elects, such Additional Interest shall be payable in the same manner and on the same dates as the stated interest payable on the
Notes. On the 366th day after such Event of Default (if the Event of Default relating to the Company’s failure to file is not cured or waived prior to such 366th day), the Notes shall be immediately subject to acceleration as provided in
Section 6.02. The provisions of this paragraph will not affect the rights of Holders of Notes in the event of the occurrence of any Event of Default other than the Company’s failure to comply with its obligations as set forth in Section
4.06(b). In the event the Company does not elect to pay Additional Interest following an Event of Default in accordance with this Section 6.03 or the Company elected to make such payment but does not pay the Additional Interest when due, the Notes
shall be immediately subject to acceleration as provided in Section 6.02.
In order to elect to pay Additional Interest as the sole remedy
during the first 365 days after the occurrence of any Event of Default described in the immediately preceding paragraph, the Company must notify in writing all Holders of the Notes, the Trustee and the Paying Agent of such election prior to the
beginning of such 365-day period. Upon the failure to timely give such notice, the Notes shall be immediately subject to acceleration as provided in Section 6.02.
In no event shall the Additional Interest described in this Section 6.03, together with any Additional Interest provided for in Section
4.06(d) and Section 4.06(e), accrue at a rate in excess of 0.50% per annum pursuant to this Indenture, regardless of the number of events or circumstances giving rise to the requirement to pay such Additional Interest.
Section 6.04.
Payments of Notes on Default; Suit Therefor
. If an Event of Default described in clause (a) or (b) of Section 6.01
shall have occurred, the Company shall, upon demand of the Trustee, pay to the Trustee, for the benefit of the Holders of the Notes, the whole amount then due and payable on the Notes for principal and interest, if any, with interest on any overdue
principal and interest, if any, at the rate borne by the Notes at such time, and, in addition thereto, such further amount as shall be sufficient to cover any amounts due to the Trustee under Section 7.06. If the Company shall fail to pay such
amounts forthwith upon such demand, the Trustee, in its own name and as trustee of an express trust, may institute a judicial proceeding for the collection of the sums so due and unpaid, may prosecute such proceeding to judgment or final decree and
may enforce the same against the Company or any other obligor upon the Notes and collect the moneys adjudged or decreed to be payable in the manner provided by law out of the property of the Company or any other obligor upon the Notes, wherever
situated.
In the event there shall be pending proceedings for the bankruptcy or for the reorganization of the Company or any other
obligor on the Notes under Title 11 of the United States Code, or any other applicable law, or in case a receiver, assignee or trustee in bankruptcy or reorganization, liquidator, sequestrator or similar official shall have been appointed for or
taken possession of the Company or such other obligor, the property of the Company or such
31
other obligor, or in the event of any other judicial proceedings relative to the Company or such other obligor upon the Notes, or to the creditors or property of the Company or such other
obligor, the Trustee, irrespective of whether the principal of the Notes shall then be due and payable as therein expressed or by declaration or otherwise and irrespective of whether the Trustee shall have made any demand pursuant to the provisions
of this Section 6.04, shall be entitled and empowered, by intervention in such proceedings or otherwise, to file and prove a claim or claims for the whole amount of principal and accrued and unpaid interest, if any, in respect of the Notes, and, in
case of any judicial proceedings, to file such proofs of claim and other papers or documents and to take such other actions as it may deem necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and of the Holders allowed in such judicial proceedings relative to the Company or any other obligor on the Notes, its or their creditors, or its or their
property, and to collect and receive any monies or other property payable or deliverable on any such claims, and to distribute the same after the deduction of any amounts due to the Trustee under Section 7.06; and any receiver, assignee or trustee
in bankruptcy or reorganization, liquidator, custodian or similar official is hereby authorized by each of the Holders to make such payments to the Trustee, as administrative expenses, and, in the event that the Trustee shall consent to the making
of such payments directly to the Holders, to pay to the Trustee any amount due it for reasonable compensation, expenses, advances and disbursements, including agents and counsel fees, and including any other amounts due to the Trustee under Section
7.06, incurred by it up to the date of such distribution. To the extent that such payment of reasonable compensation, expenses, advances and disbursements out of the estate in any such proceedings shall be denied for any reason, payment of the same
shall be secured by a lien on, and shall be paid out of, any and all distributions, dividends, monies, securities and other property that the Holders of the Notes may be entitled to receive in such proceedings, whether in liquidation or under any
plan of reorganization or arrangement or otherwise.
Nothing herein contained shall be deemed to authorize the Trustee to authorize or
consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting such Holder 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.
All rights of action and of asserting claims under this Indenture, or under any of the Notes, may be
enforced by the Trustee without the possession of any of the Notes, or the production thereof at any trial or other proceeding relative thereto, and any such suit or proceeding instituted by the Trustee shall be brought in its own name as trustee of
an express trust, and any recovery of judgment shall, after provision for the payment of the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, be for the ratable benefit of the Holders of the
Notes.
In any proceedings brought by the Trustee (and in any proceedings involving the interpretation of any provision of this Indenture
to which the Trustee shall be a party) the Trustee shall be held to represent all the Holders of the Notes, and it shall not be necessary to make any Holders of the Notes parties to any such proceedings.
32
In case the Trustee shall have proceeded to enforce any right under this Indenture and such
proceedings shall have been discontinued or abandoned because of any waiver pursuant to Section 6.09 or any rescission and annulment pursuant to Section 6.02 or for any other reason or shall have been determined adversely to the Trustee, then and in
every such case the Company, the Holders and the Trustee shall, subject to any determination in such proceeding, be restored respectively to their several positions and rights hereunder, and all rights, remedies and powers of the Company, the
Holders and the Trustee shall continue as though no such proceeding had been instituted.
Section 6.05.
Application of Monies
Collected by Trustee
. Any monies or property collected by the Trustee pursuant to this Article 6 with respect to the Notes shall be applied in the following order, at the date or dates fixed by the Trustee for the distribution of such monies or
property, upon presentation of the several Notes, and stamping thereon the payment, if only partially paid, and upon surrender thereof, if fully paid:
First
, to the payment of all amounts due the Trustee under this Indenture;
Second
, in case the principal of the outstanding Notes shall not have become due and be unpaid, to the payment of interest on, and any
cash due upon conversion of, the Notes in default in the order of the date due of the payments of such interest and cash due upon conversion, as the case may be, with interest (to the extent that such interest has been collected by the Trustee) upon
such overdue payments at the rate borne by the Notes at such time, such payments to be made ratably to the Persons entitled thereto;
Third
, in case the principal of the outstanding Notes shall have become due, by declaration or otherwise, and be unpaid to the payment
of the whole amount (including, if applicable, the payment of the Fundamental Change Repurchase Price and any cash due upon conversion) then owing and unpaid upon the Notes for principal and interest, if any, with interest on the overdue principal
and, to the extent that such interest has been collected by the Trustee, upon overdue installments of interest at the rate borne by the Notes at such time, and in case such monies shall be insufficient to pay in full the whole amounts so due and
unpaid upon the Notes, then to the payment of such principal (including, if applicable, the Fundamental Change Repurchase Price and the cash due upon conversion) and interest without preference or priority of principal over interest, or of interest
over principal or of any installment of interest over any other installment of interest, or of any Note over any other Note, ratably to the aggregate of such principal (including, if applicable, the Fundamental Change Repurchase Price and any cash
due upon conversion) and accrued and unpaid interest; and
Fourth
, to the payment of the remainder, if any, to the Company.
Section 6.06.
Proceedings by Holders
. Except to enforce the right to receive payment of principal (including, if applicable, the
Fundamental Change Repurchase Price) or interest when due, or the right to receive payment or delivery of the consideration due upon conversion, no Holder of any Note shall have any right by virtue of or by availing of any provision of this
Indenture to institute any suit, action or proceeding in equity or at law upon or under or with respect to this Indenture, or for the appointment of a receiver, trustee, liquidator, custodian or other similar official, or for any other remedy
hereunder, unless:
(a) such Holder previously shall have given to the Trustee written notice of an Event of Default and of the
continuance thereof, as herein provided;
33
(b) Holders of at least 25% in aggregate principal amount of the Notes then outstanding shall
have made written request upon the Trustee to institute such action, suit or proceeding in its own name as Trustee hereunder;
(c) such
Holders shall have offered to the Trustee such security or indemnity satisfactory to it against any loss, liability or expense to be incurred therein or thereby;
(d) the Trustee for 60 days after its receipt of such notice, request and offer of such security or indemnity, shall have neglected or refused
to institute any such action, suit or proceeding; and
(e) no direction that, in the opinion of the Trustee, is inconsistent with such
written request shall have been given to the Trustee by the Holders of a majority of the aggregate principal amount of the Notes then outstanding within such 60-day period pursuant to Section 6.09, it being understood and intended, and being
expressly covenanted by the taker and Holder of every Note with every other taker and Holder and the Trustee that no one or more Holders shall have any right in any manner whatever by virtue of or by availing of any provision of this Indenture to
affect, disturb or prejudice the rights of any other Holder, or to obtain or seek to obtain priority over or preference to any other such Holder, or to enforce any right under this Indenture, except in the manner herein provided and for the equal,
ratable and common benefit of all Holders (except as otherwise provided herein). For the protection and enforcement of this Section 6.06, each and every Holder and the Trustee shall be entitled to such relief as can be given either at law or in
equity.
Notwithstanding any other provision of this Indenture and any provision of any Note, the right of any Holder to receive payment
or delivery, as the case may be, of (x) the principal (including the Fundamental Change Repurchase Price, if applicable) of, (y) accrued and unpaid interest, if any, on, and (z) the consideration due upon conversion of, such Note, on
or after the respective due dates expressed or provided for in such Note or in this Indenture, or to institute suit for the enforcement of any such payment or delivery, as the case may be, on or after such respective dates against the Company shall
not be impaired or affected without the consent of such Holder.
Section 6.07.
Proceedings by Trustee
. In case of an Event of
Default, the Trustee may in its discretion proceed to protect and enforce the rights vested in it by this Indenture by such appropriate judicial proceedings as are necessary to protect and enforce any of such rights, either by suit in equity or by
action at law or by proceeding in bankruptcy or otherwise, whether for the specific enforcement of any covenant or agreement contained in this Indenture or in aid of the exercise of any power granted in this Indenture, or to enforce any other legal
or equitable right vested in the Trustee by this Indenture or by law.
Section 6.08.
Remedies Cumulative and Continuing
.
Except as provided in the last paragraph of Section 2.06, all powers and remedies given by this Article 6 to the Trustee or to
34
the Holders shall, to the extent permitted by law, be deemed cumulative and not exclusive of any thereof or of any other powers and remedies available to the Trustee or the Holders of the Notes,
by judicial proceedings or otherwise, to enforce the performance or observance of the covenants and agreements contained in this Indenture, and no delay or omission of the Trustee or of any Holder of any of the Notes to exercise any right or power
accruing upon any Default or Event of Default shall impair any such right or power, or shall be construed to be a waiver of any such Default or Event of Default or any acquiescence therein; and, subject to the provisions of Section 6.06, every power
and remedy given by this Article 6 or by law to the Trustee or to the Holders may be exercised from time to time, and as often as shall be deemed expedient, by the Trustee or by the Holders.
Section 6.09.
Direction of Proceedings and Waiver of Defaults by Majority of Holders
. The Holders of a majority of the aggregate
principal amount of the Notes at the time outstanding determined in accordance with Section 8.04 shall have the right to 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 with respect to the Notes;
provided
,
however
, that (a) such direction shall not be in conflict with any rule of law or with this Indenture, and (b) the Trustee may take any other action
deemed proper by the Trustee that is not inconsistent with such direction. The Trustee may refuse to follow any direction that it determines is in conflict with any rule of law or with this Indenture, is unduly prejudicial to the rights of any other
Holder or that would involve the Trustee in personal liability. The Holders of a majority in aggregate principal amount of the Notes at the time outstanding determined in accordance with Section 8.04 may on behalf of the Holders of all of the Notes
waive any past Default or Event of Default hereunder and its consequences except (i) a default in the payment of accrued and unpaid interest, if any, on, or the principal (including any Fundamental Change Repurchase Price) of, the Notes when
due that has not been cured pursuant to the provisions of Section 6.01, (ii) a failure by the Company to pay or deliver, as the case may be, the consideration due upon conversion of the Notes or (iii) a default in respect of a covenant or
provision hereof which under Article 10 cannot be modified or amended without the consent of each Holder of an outstanding Note affected. Upon any such waiver the Company, the Trustee and the Holders of the Notes shall be restored to their former
positions and rights hereunder; but no such waiver shall extend to any subsequent or other Default or Event of Default or impair any right consequent thereon. Whenever any Default or Event of Default hereunder shall have been waived as permitted by
this Section 6.09, said Default or Event of Default shall for all purposes of the Notes and this Indenture be deemed to have been cured and to be not continuing; but no such waiver shall extend to any subsequent or other Default or Event of Default
or impair any right consequent thereon.
Section 6.10.
Notice of Defaults
. The Trustee shall, within 90 days after the
occurrence and continuance of a Default of which a Responsible Officer has actual knowledge, mail to all Holders as the names and addresses of such Holders appear upon the Note Register (or, in the case of Global Notes, deliver electronically in
accordance with the Depositary’s procedures), notice of all Defaults known to a Responsible Officer, unless such Defaults shall have been cured or waived before the giving of such notice;
provided
that, except in the case of a Default in
the payment of the principal of (including the Fundamental Change Repurchase Price, if applicable), or accrued and unpaid interest on, any of the Notes or a Default in the payment or delivery of the consideration due upon conversion, the Trustee
shall be protected in withholding such notice if and so long as a Responsible Officer of the Trustee in good faith determines that the withholding of such notice is in the interests of the Holders.
35
Section 6.11.
Undertaking to Pay Costs
. All parties to this Indenture agree, and each
Holder of any Note by its acceptance thereof shall be deemed to have agreed, that any court may, in its discretion, require, 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, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit and that such court may in its discretion assess reasonable costs, including reasonable attorneys’ fees and
expenses, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by such party litigant;
provided
that the provisions of this Section 6.11 (to the extent permitted by law) shall
not apply to any suit instituted by the Trustee, to any suit instituted by any Holder, or group of Holders, holding in the aggregate more than 10% in principal amount of the Notes at the time outstanding determined in accordance with Section 8.04,
or to any suit instituted by any Holder for the enforcement of the payment of the principal of or accrued and unpaid interest, if any, on any Note (including, but not limited to, the Fundamental Change Repurchase Price, if applicable) on or after
the due date expressed or provided for in such Note or to any suit for the enforcement of the right to convert any Note, or receive the consideration due upon conversion, in accordance with the provisions of Article 14.
ARTICLE 7
C
ONCERNING
THE
T
RUSTEE
Section 7.01.
Duties and Responsibilities of Trustee
. The Trustee, prior to the occurrence of an Event of Default and after the
curing or waiver of all Events of Default that may have occurred, undertakes to perform such duties and only such duties as are specifically set forth in this Indenture. In the event an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in its exercise, as a prudent person would exercise or use under the circumstances in the conduct of such person’s own
affairs;
provided
that if an Event of Default occurs and is continuing, the Trustee will be under no obligation to exercise any of the rights or powers under this Indenture at the request or direction of any of the Holders unless such Holders
have offered to the Trustee indemnity or security satisfactory to it against any loss, liability or expense that might be incurred by it in compliance with such request or direction.
No provision of this Indenture shall be construed to relieve the Trustee from liability for its own grossly negligent action, its own grossly
negligent failure to act, its own bad faith or its own willful misconduct, except that:
(a) prior to the occurrence of an Event of
Default and after the curing or waiving of all Events of Default that may have occurred:
(i) the duties and obligations of
the Trustee shall be determined solely by the express provisions of this Indenture, and the Trustee shall not be liable except for the performance of such duties and obligations as are specifically set forth in this Indenture and no implied
covenants or obligations shall be read into this Indenture against the Trustee; and
36
(ii) in the absence of bad faith and willful misconduct on the part of the
Trustee, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon any 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 that by any provisions hereof are specifically required to be furnished to the Trustee, the Trustee shall be under a duty to examine the same to determine whether or not they conform to the
requirements of this Indenture (but need not confirm or investigate the accuracy of any mathematical calculations or other facts stated therein);
(b) the Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer or Officers of the Trustee, unless
it shall be proved that the Trustee was grossly negligent in ascertaining the pertinent facts;
(c) the Trustee shall not be liable with
respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the Holders of not less than a majority of the aggregate principal amount of the Notes at the time outstanding determined as provided in
Section 8.04 relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee, under this Indenture;
(d) whether or not therein provided, every provision of this Indenture relating to the conduct or affecting the liability of, or affording
protection to, the Trustee shall be subject to the provisions of this Section;
(e) the Trustee shall not be liable in respect of any
payment (as to the correctness of amount, entitlement to receive or any other matters relating to payment) or notice effected by the Company or any Paying Agent or any records maintained by any co-Note Registrar with respect to the Notes;
(f) if any party fails to deliver a notice relating to an event the fact of which, pursuant to this Indenture, requires notice to be sent to
the Trustee, the Trustee may conclusively rely on its failure to receive such notice as reason to act as if no such event occurred, unless a Responsible Officer of the Trustee had actual knowledge of such event;
(g) in the absence of written investment direction from the Company, all cash received by the Trustee shall be placed in a non-interest
bearing trust account, and in no event shall the Trustee be liable for the selection of investments or for investment losses incurred thereon or for losses incurred as a result of the liquidation of any such investment prior to its maturity date or
the failure of the party directing such investments prior to its maturity date or the failure of the party directing such investment to provide timely written investment direction, and the Trustee shall have no obligation to invest or reinvest any
amounts held hereunder in the absence of such written investment direction from the Company; and
37
(h) in the event that the Trustee is also acting as Custodian, Note Registrar, Paying Agent,
Conversion Agent, Bid Solicitation Agent or transfer agent hereunder, the rights and protections afforded to the Trustee pursuant to this Article 7 shall also be afforded to such Custodian, Note Registrar, Paying Agent, Conversion Agent, Bid
Solicitation Agent or transfer agent.
None of the provisions contained in this Indenture shall require the Trustee to expend or risk its
own funds or otherwise incur personal financial liability in the performance of any of its duties or in the exercise of any of its rights or powers. The Trustee shall not be required to give any bond or surety in respect of the performance of its
powers or duties hereunder.
Section 7.02.
Reliance on Documents, Opinions, Etc
. Except as otherwise provided in Section 7.01:
(a) the Trustee may conclusively rely and shall be fully protected in acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, bond, note, coupon or other paper or document believed by it in good faith to be genuine and to have been signed or presented by the proper party or parties;
(b) any request, direction, order or demand of the Company mentioned herein shall be sufficiently evidenced by an Officers’ Certificate
(unless other evidence in respect thereof be herein specifically prescribed); and any Board Resolution may be evidenced to the Trustee by a copy thereof certified by the Secretary or an Assistant Secretary of the Company;
(c) the Trustee may consult with counsel and require an Opinion of Counsel and any advice of such counsel or Opinion of Counsel shall be full
and complete authorization and protection in respect of any action taken or omitted by it hereunder in good faith and in accordance with such advice or Opinion of Counsel;
(d) the Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond, debenture or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit,
and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Company, personally or by agent or attorney at the expense of the Company and shall incur no
liability of any kind by reason of such inquiry or investigation;
(e) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents, custodians, nominees or attorneys and the Trustee shall not be responsible for any misconduct or negligence on the part of any agent, custodian, nominee or attorney appointed by
it with due care hereunder;
(f) the permissive rights of the Trustee enumerated herein shall not be construed as duties;
38
(g) The Trustee may request that the Company deliver a certificate setting forth the names of
individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture; and
(h) the Trustee
will be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders unless such Holders have offered to the Trustee indemnity or security satisfactory to the Trustee
against the losses, liabilities and expenses that might be incurred by it in compliance with such request or direction.
In no event shall
the Trustee be liable for any special, indirect, punitive or consequential loss or damage of any kind whatsoever (including but not limited to lost profits), even if the Trustee has been advised of the likelihood of such loss or damage and
regardless of the form of action other than any such loss or damage caused by the Trustee’s willful misconduct, bad faith or gross negligence. The Trustee shall not be charged with knowledge of any Default or Event of Default with respect to
the Notes, unless either (1) a Responsible Officer shall have actual knowledge of such Default or Event of Default or (2) written notice of such Default or Event of Default shall have been given to the Trustee by the Company or by any
Holder of the Notes.
Section 7.03.
No Responsibility for Recitals, Etc
. The recitals contained herein and in the Notes
(except in the Trustee’s certificate of authentication) shall be taken as the statements of the Company, and the Trustee assumes no responsibility for the correctness of the same. The Trustee makes no representations as to the validity or
sufficiency of this Indenture, the Notes, or of any Common Stock underlying the Notes. The Trustee shall not be accountable for the use or application by the Company of any Notes or the proceeds of any Notes authenticated and delivered by the
Trustee in conformity with the provisions of this Indenture. Neither the Trustee nor any of its agents will be accountable for the use or application by the Company of the Notes or the proceeds thereof, or for any funds received and disbursed in
accordance with this Indenture. The Trustee shall have no responsibility or liability with respect to any information, statement or recital in the Offering Memorandum or other disclosure material prepared or distributed with respect to the issuance
of the Notes.
Section 7.04.
Trustee, Paying Agents, Conversion Agents, Bid Solicitation Agent or Note Registrar May Own
Notes
. The Trustee, any Paying Agent, any Conversion Agent, Bid Solicitation Agent (if other than the Company) or Note Registrar, in its individual or any other capacity, may become the owner or pledgee of Notes with the same rights it would
have if it were not the Trustee, Paying Agent, Conversion Agent, Bid Solicitation Agent or Note Registrar.
Section 7.05.
Monies
and Shares of Common Stock to Be Held in Trust
. All monies and shares of Common Stock received by the Trustee shall, until used or applied as herein provided, be held in trust for the purposes for which they were received. Money and shares of
Common Stock held by the Trustee in trust hereunder need not be segregated from other funds except to the extent required by law. The Trustee shall be under no liability for interest on any money or shares of Common Stock received by it hereunder
except as may be agreed from time to time by the Company and the Trustee.
Section 7.06.
Compensation and Expenses of Trustee
.
The Company covenants and agrees to pay to the Trustee, in any of its capacities under the Indenture, from time to time, and
39
the Trustee shall be entitled to, compensation for all services rendered by it hereunder in any capacity (which shall not be limited by any provision of law in regard to the compensation of a
trustee of an express trust) as mutually agreed to in writing between the Trustee and the Company, and the Company will pay or reimburse the Trustee upon its request for all expenses, disbursements and advances reasonably incurred or made by the
Trustee in accordance with any of the provisions of this Indenture in any capacity thereunder (including the compensation and the expenses and disbursements of its agents and counsel and of all Persons not regularly in its employ) except any such
expense, disbursement or advance as shall have been caused by its gross negligence, willful misconduct or bad faith. The Company also covenants to indemnify the Trustee in any capacity under this Indenture and any other document or transaction
entered into in connection herewith and its officers, directors, employees and agents and any authenticating agent for, and to hold them harmless against, any loss, claim (whether asserted by the Company, a Holder or any Person), damage, liability
or expense incurred without gross negligence, willful misconduct or bad faith on the part of the Trustee, its officers, directors, agents or employees, or such agent or authenticating agent, as the case may be, as determined by a final,
non-appealable decision of a court of competent jurisdiction, and arising out of or in connection with the acceptance or administration of this Indenture or in any other capacity hereunder, including the costs and expenses of defending themselves
against any claim of liability in the premises. The obligations of the Company under this Section 7.06 to compensate or indemnify the Trustee and to pay or reimburse the Trustee for expenses, disbursements and advances shall be secured by a senior
claim to which the Notes are hereby made subordinate on all money or property held or collected by the Trustee, except, subject to the effect of Section 6.05, funds held in trust herewith for the benefit of the Holders of particular Notes. The
Trustee’s right to receive payment of any amounts due under this Section 7.06 shall not be subordinate to any other liability or indebtedness of the Company. The obligation of the Company under this Section 7.06 shall survive the satisfaction
and discharge of this Indenture and the earlier resignation or removal or the Trustee. The Company need not pay for any settlement made without its consent, which consent shall not be unreasonably withheld. The indemnification provided in this
Section 7.06 shall extend to the officers, directors, agents and employees of the Trustee.
Without prejudice to any other rights
available to the Trustee under applicable law, when the Trustee and its agents and any authenticating agent incur expenses or render services after an Event of Default specified in Section 6.01(i) or Section 6.01(j) occurs, the expenses and the
compensation for the services are intended to constitute expenses of administration under any bankruptcy, insolvency or similar laws.
Section 7.07.
Officers’ Certificate as Evidence
. Except as otherwise provided in Section 7.01, whenever in the administration
of the provisions of this Indenture the Trustee shall deem it necessary or desirable that a matter be proved or established prior to taking or omitting any action hereunder, such matter (unless other evidence in respect thereof be herein
specifically prescribed) may, in the absence of gross negligence, willful misconduct, recklessness and bad faith on the part of the Trustee, be deemed to be conclusively proved and established by an Officers’ Certificate delivered to the
Trustee, and such Officers’ Certificate, in the absence of gross negligence, willful misconduct, recklessness and bad faith on the part of the Trustee, shall be full warrant to the Trustee for any action taken or omitted by it under the
provisions of this Indenture upon the faith thereof.
40
Section 7.08.
Eligibility of Trustee
. There shall at all times be a Trustee hereunder
which shall be a Person that is eligible pursuant to the Trust Indenture Act (as if the Trust Indenture Act were applicable hereto) to act as such and has a combined capital and surplus of at least $50,000,000. If such Person publishes reports of
condition at least annually, pursuant to law or to the requirements of any supervising or examining authority, then for the purposes of this Section, the combined capital and surplus of such Person shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. If at any time the Trustee shall cease to be eligible in accordance with the provisions of this Section, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article.
Section 7.09.
Resignation or Removal of Trustee
. (a) The Trustee may at any time
resign by giving written notice of such resignation to the Company and by giving notice thereof to the Holders at their addresses as they shall appear on the Note Register. Upon receiving such notice of resignation, the Company shall promptly
appoint a successor trustee by written instrument, in duplicate, executed by order of the Board of Directors, one copy of which instrument shall be delivered to the resigning Trustee and one copy to the successor trustee. If no successor trustee
shall have been so appointed and have accepted appointment within 60 days after the giving of such notice of resignation to the Holders, the resigning Trustee may, upon ten Business Days’ notice to the Company and the Holders, petition any
court of competent jurisdiction for the appointment of a successor trustee, or any Holder who has been a bona fide holder of a Note or Notes for at least six months (or since the date of this Indenture) may, subject to the provisions of Section
6.11, on behalf of himself or herself and all others similarly situated, petition any such court for the appointment of a successor trustee. Such court may thereupon, after such notice, if any, as it may deem proper and prescribe, appoint a
successor trustee.
(b) In case at any time any of the following shall occur:
(i) the Trustee shall cease to be eligible in accordance with the provisions of Section 7.08 and shall fail to resign after
written request therefor by the Company or by any such Holder, or
(ii) the Trustee shall become incapable of acting, or
shall be adjudged a bankrupt or insolvent, or a receiver of the Trustee or of its property shall be appointed, or any public officer shall take charge or control of the Trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation,
then, in either case, the Company may by a Board Resolution remove the Trustee and appoint a successor trustee by written
instrument, in duplicate, executed by order of the Board of Directors, one copy of which instrument shall be delivered to the Trustee so removed and one copy to the successor trustee, or, subject to the provisions of Section 6.11, any Holder who has
been a bona fide holder of a Note or Notes for at least six months (or since the date of this Indenture) may, on behalf of himself or herself and all others similarly situated, petition any court of competent jurisdiction for the removal of the
Trustee and the appointment of a successor trustee. Such court may thereupon, after such notice, if any, as it may deem proper and prescribe, remove the Trustee and appoint a successor trustee.
41
(c) The Holders of a majority in aggregate principal amount of the Notes at the time outstanding,
as determined in accordance with Section 8.04, may at any time remove the Trustee and nominate a successor trustee that shall be deemed appointed as successor trustee unless within ten days after notice to the Company of such nomination the Company
objects thereto, in which case the Trustee so removed or any Holder, upon the terms and conditions and otherwise as in Section 7.09(a) provided, may petition any court of competent jurisdiction for an appointment of a successor trustee.
(d) Any resignation or removal of the Trustee and appointment of a successor trustee pursuant to any of the provisions of this Section 7.09
shall become effective upon acceptance of appointment by the successor trustee as provided in Section 7.10.
Section 7.10.
Acceptance by Successor Trustee
. Any successor trustee appointed as provided in Section 7.09 shall execute, acknowledge and deliver to the Company and to its predecessor trustee an instrument accepting such appointment hereunder, and
thereupon the resignation or removal of the predecessor trustee shall become effective and such successor trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, duties and obligations of its
predecessor hereunder, with like effect as if originally named as Trustee herein; but, nevertheless, on the written request of the Company or of the successor trustee, the trustee ceasing to act shall, upon payment of any amounts then due it
pursuant to the provisions of Section 7.06, execute and deliver an instrument transferring to such successor trustee all the rights and powers of the trustee so ceasing to act. Upon request of any such successor trustee, the Company shall execute
any and all instruments in writing for more fully and certainly vesting in and confirming to such successor trustee all such rights and powers. Any trustee ceasing to act shall, nevertheless, retain a senior claim to which the Notes are hereby made
subordinate on all money or property held or collected by such trustee as such, except for funds held in trust for the benefit of Holders of particular Notes, to secure any amounts then due it pursuant to the provisions of Section 7.06.
No successor trustee shall accept appointment as provided in this Section 7.10 unless at the time of such acceptance such successor trustee
shall be eligible under the provisions of Section 7.08.
Upon acceptance of appointment by a successor trustee as provided in this Section
7.10, each of the Company and the successor trustee, at the written direction and at the expense of the Company shall give or cause to be given notice of the succession of such trustee hereunder to the Holders at their addresses as they shall appear
on the Note Register. If the Company fails to give such notice within ten days after acceptance of appointment by the successor trustee, the successor trustee shall cause such notice to be given at the expense of the Company.
Section 7.11.
Succession by Merger, Etc
. Any corporation or other entity into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation or other entity resulting from any merger, conversion or consolidation to which the Trustee shall be a party, or any corporation or other entity succeeding to all or substantially all of the corporate
trust business of the Trustee (including the administration of this Indenture), shall be the successor to the Trustee hereunder without the execution or filing of any paper or any further act on the part of any of the parties hereto;
provided
that in the case of any corporation or other entity succeeding to all or substantially all of the corporate trust business of the Trustee such corporation or other entity shall be eligible under the provisions of Section 7.08.
42
In case at the time such successor to the Trustee shall succeed to the trusts created by
this Indenture, any of the Notes shall have been authenticated but not delivered, any such successor to the Trustee may adopt the certificate of authentication of any predecessor trustee or authenticating agent appointed by such predecessor trustee,
and deliver such Notes so authenticated; and in case at that time any of the Notes shall not have been authenticated, any successor to the Trustee or an authenticating agent appointed by such successor trustee may authenticate such Notes either in
the name of any predecessor trustee hereunder or in the name of the successor trustee; and in all such cases such certificates shall have the full force which it is anywhere in the Notes or in this Indenture provided that the certificate of the
Trustee shall have;
provided
,
however
, that the right to adopt the certificate of authentication of any predecessor trustee or to authenticate Notes in the name of any predecessor trustee shall apply only to its successor or successors
by merger, conversion or consolidation.
Section 7.12.
Trustee’s Application for Instructions from the Company
.
Any application by the Trustee for written instructions from the Company (other than with regard to any action proposed to be taken or omitted to be taken by the Trustee that affects the rights of the Holders of the Notes under this Indenture) may,
at the option of the Trustee, set forth in writing any action proposed to be taken or omitted by the Trustee under this Indenture and the date on and/or after which such action shall be taken or such omission shall be effective. The Trustee shall
not be liable to the Company for any action taken by, or omission of, the Trustee in accordance with a proposal included in such application on or after the date specified in such application (which date shall not be less than three Business Days
after the date any officer that the Company has indicated to the Trustee should receive such application actually receives such application, unless any such officer shall have consented in writing to any earlier date), unless, prior to taking any
such action (or the effective date in the case of any omission), the Trustee shall have received written instructions in accordance with this Indenture in response to such application specifying the action to be taken or omitted.
ARTICLE 8
C
ONCERNING
THE
H
OLDERS
Section 8.01.
Action by Holders
. Whenever in this Indenture it is provided that the Holders of a specified percentage of the
aggregate principal amount of the Notes may take any action (including the making of any demand or request, the giving of any notice, consent or waiver or the taking of any other action), the fact that at the time of taking any such action, the
Holders of such specified percentage have joined therein may be evidenced (a) by any instrument or any number of instruments of similar tenor executed by Holders in person or by agent or proxy appointed in writing, or (b) by the record of
the Holders voting in favor thereof at any meeting of Holders duly called and held in accordance with the provisions of Article 9, or (c) by a combination of such instrument or instruments and any such record of such a meeting of Holders.
Whenever the Company or the Trustee solicits the taking of any action by the Holders of the Notes, the Company or the Trustee may, but shall not be required to, fix in advance of such solicitation, a date as the record date for determining Holders
entitled to take such action. The record date if one is selected shall be not more than fifteen days prior to the date of commencement of solicitation of such action.
43
Section 8.02.
Proof of Execution by Holders
. Subject to the provisions of Section
7.01, Section 7.02 and Section 9.05, proof of the execution of any instrument by a Holder or its agent or proxy shall be sufficient if made in accordance with such reasonable rules and regulations as may be prescribed by the Trustee or in such
manner as shall be satisfactory to the Trustee. The holding of Notes shall be proved by the Note Register or by a certificate of the Note Registrar. The record of any Holders’ meeting shall be proved in the manner provided in Section 9.06.
Section 8.03.
Who Are Deemed Absolute Owners
. The Company, the Trustee, any authenticating agent, any Paying Agent, any Conversion
Agent and any Note Registrar may deem the Person in whose name a Note shall be registered upon the Note Register to be, and may treat it as, the absolute owner of such Note (whether or not such Note shall be overdue and notwithstanding any notation
of ownership or other writing thereon made by any Person other than the Company or any Note Registrar) for the purpose of receiving payment of or on account of the principal of and (subject to Section 2.03) accrued and unpaid interest on such Note,
for conversion of such Note and for all other purposes; and neither the Company nor the Trustee nor any Paying Agent nor any Conversion Agent nor any Note Registrar shall be affected by any notice to the contrary. The sole registered holder of a
Global Note shall be the Depositary or its nominee. All such payments or deliveries so made to any Holder for the time being, or upon its order, shall be valid, and, to the extent of the sums or shares of Common Stock so paid or delivered, effectual
to satisfy and discharge the liability for monies payable or shares deliverable upon any such Note. Notwithstanding anything to the contrary in this Indenture or the Notes following an Event of Default, any holder of a beneficial interest in a
Global Note may directly enforce against the Company, without the consent, solicitation, proxy, authorization or any other action of the Depositary or any other Person, such holder’s right to exchange such beneficial interest for a Note in
certificated form in accordance with the provisions of this Indenture.
Section 8.04.
Company-Owned Notes Disregarded
. In
determining whether the Holders of the requisite aggregate principal amount of Notes have concurred in any direction, consent, waiver or other action under this Indenture, Notes that are owned by the Company, by any Subsidiary thereof or by any
Person directly or indirectly controlling or controlled by or under direct or indirect common control with the Company or any Subsidiary thereof shall be disregarded and deemed not to be outstanding for the purpose of any such determination;
provided that for the purposes of determining whether the Trustee shall be protected in relying on any such direction, consent, waiver or other action only Notes that a Responsible Officer knows are so owned shall be so disregarded. Notes so owned
that have been pledged in good faith may be regarded as outstanding for the purposes of this Section 8.04 if the pledgee shall establish to the satisfaction of the Trustee the pledgee’s right to so act with respect to such Notes and that the
pledgee is not the Company, a Subsidiary thereof or a Person directly or indirectly controlling or controlled by or under direct or indirect common control with the Company or a Subsidiary thereof. In the case of a dispute as to such right, any
decision or indecision by the Trustee taken upon the advice of counsel shall be full protection to the Trustee. Upon request of the Trustee, the Company shall furnish to the Trustee promptly an Officers’ Certificate listing and identifying all
Notes, if any, known by the Company to be owned or held by or for the account of any of the above described Persons; and, subject to Section 7.01, the Trustee shall be
44
entitled to accept such Officers’ Certificate as conclusive evidence of the facts therein set forth and of the fact that all Notes not listed therein are outstanding for the purpose of any
such determination.
Section 8.05
. Revocation of Consents; Future Holders Bound.
At any time prior to (but not after)
the evidencing to the Trustee, as provided in Section 8.01, of the taking of any action by the Holders of the percentage of the aggregate principal amount of the Notes specified in this Indenture in connection with such action, any Holder of a Note
that is shown by the evidence to be included in the Notes the Holders of which have consented to such action may, by filing written notice with the Trustee at its Corporate Trust Office and upon proof of holding as provided in Section 8.02, revoke
such action so far as concerns such Note. Except as aforesaid, any such action taken by the Holder of any Note shall be conclusive and binding upon such Holder and upon all future Holders and owners of such Note and of any Notes issued in exchange
or substitution therefor or upon registration of transfer thereof, irrespective of whether any notation in regard thereto is made upon such Note or any Note issued in exchange or substitution therefor or upon registration of transfer thereof.
ARTICLE 9
H
OLDERS
’ M
EETINGS
Section 9.01.
Purpose of Meetings
. A meeting of Holders may be called at any time and from time to time pursuant to the provisions
of this Article 9 for any of the following purposes:
(a) to give any notice to the Company or to the Trustee or to give any directions to
the Trustee permitted under this Indenture, or to consent to the waiving of any Default or Event of Default hereunder (in each case, as permitted under this Indenture) and its consequences, or to take any other action authorized to be taken by
Holders pursuant to any of the provisions of Article 6;
(b) to remove the Trustee and nominate a successor trustee pursuant to the
provisions of Article 7;
(c) to consent to the execution of an indenture or indentures supplemental hereto pursuant to the provisions of
Section 10.02; or
(d) to take any other action authorized to be taken by or on behalf of the Holders of any specified aggregate principal
amount of the Notes under any other provision of this Indenture or under applicable law.
Section 9.02.
Call of Meetings by
Trustee
. The Trustee may at any time call a meeting of Holders to take any action specified in Section 9.01, to be held at such time and at such place as the Trustee shall determine. Notice of every meeting of the Holders, setting forth the time
and the place of such meeting and in general terms the action proposed to be taken at such meeting and the establishment of any record date pursuant to Section 8.01, shall be mailed to Holders of such Notes at their addresses as they shall appear on
the Note Register. Such notice shall also be mailed to the Company. Such notices shall be mailed not less than 20 nor more than 90 days prior to the date fixed for the meeting.
45
Any meeting of Holders shall be valid without notice if the Holders of all Notes then outstanding
are present in person or by proxy or if notice is waived before or after the meeting by the Holders of all Notes then outstanding, and if the Company and the Trustee are either present by duly authorized representatives or have, before or after the
meeting, waived notice.
Section 9.03.
Call of Meetings by Company or Holders
. In case at any time the Company, pursuant to a
Board Resolution, or the Holders of at least 10% of the aggregate principal amount of the Notes then outstanding, shall have requested the Trustee to call a meeting of Holders, by written request setting forth in reasonable detail the action
proposed to be taken at the meeting, and the Trustee shall not have mailed the notice of such meeting within 20 days after receipt of such request, then the Company or such Holders may determine the time and the place for such meeting and may call
such meeting to take any action authorized in Section 9.01, by mailing notice thereof as provided in Section 9.02.
Section 9.04.
Qualifications for Voting
. To be entitled to vote at any meeting of Holders a Person shall (a) be a Holder of one or more Notes on the record date pertaining to such meeting or (b) be a Person appointed by an instrument in writing
as proxy by a Holder of one or more Notes on the record date pertaining to such meeting. The only Persons who shall be entitled to be present or to speak at any meeting of Holders shall be the Persons entitled to vote at such meeting and their
counsel and any representatives of the Trustee and its counsel and any representatives of the Company and its counsel.
Section 9.05.
Regulations
. Notwithstanding any other provisions of this Indenture, the Trustee may make such reasonable regulations as it may deem advisable for any meeting of Holders, in regard to proof of the holding of Notes and of the appointment of
proxies, and in regard to the appointment and duties of inspectors of votes, the submission and examination of proxies, certificates and other evidence of the right to vote, and such other matters concerning the conduct of the meeting as it shall
think fit.
The Trustee shall, by an instrument in writing, appoint a temporary chairman of the meeting, unless the meeting shall have
been called by the Company or by Holders as provided in Section 9.03, in which case the Company or the Holders calling the meeting, as the case may be, shall in like manner appoint a temporary chairman. A permanent chairman and a permanent secretary
of the meeting shall be elected by vote of the Holders of a majority in aggregate principal amount of the Notes represented at the meeting and entitled to vote at the meeting.
Subject to the provisions of Section 8.04, at any meeting of Holders each Holder or proxyholder shall be entitled to one vote for each $1,000
principal amount of Notes held or represented by him or her;
provided
,
however
, that no vote shall be cast or counted at any meeting in respect of any Note challenged as not outstanding and ruled by the chairman of the meeting to be
not outstanding. The chairman of the meeting shall have no right to vote other than by virtue of Notes held by it or instruments in writing as aforesaid duly designating it as the proxy to vote on behalf of other Holders. Any meeting of Holders duly
called pursuant to the provisions of Section 9.02 or Section 9.03 may be adjourned from time to time by the Holders of a majority of the aggregate principal amount of Notes represented at the meeting, whether or not constituting a quorum, and the
meeting may be held as so adjourned without further notice.
46
Section 9.06.
Voting
. The vote upon any resolution submitted to any meeting of
Holders shall be by written ballot on which shall be subscribed the signatures of the Holders or of their representatives by proxy and the outstanding aggregate principal amount of the Notes held or represented by them. The permanent chairman of the
meeting shall appoint two inspectors of votes who shall count all votes cast at the meeting for or against any resolution and who shall make and file with the secretary of the meeting their verified written reports in duplicate of all votes cast at
the meeting. A record in duplicate of the proceedings of each meeting of Holders shall be prepared by the secretary of the meeting and there shall be attached to said record the original reports of the inspectors of votes on any vote by ballot taken
thereat and affidavits by one or more Persons having knowledge of the facts setting forth a copy of the notice of the meeting and showing that said notice was mailed as provided in Section 9.02. The record shall show the aggregate principal amount
of the Notes voting in favor of or against any resolution. The record shall be signed and verified by the affidavits of the permanent chairman and secretary of the meeting and one of the duplicates shall be delivered to the Company and the other to
the Trustee to be preserved by the Trustee, the latter to have attached thereto the ballots voted at the meeting.
Any record so signed
and verified shall be conclusive evidence of the matters therein stated.
Section 9.07.
No Delay of Rights by Meeting
. Nothing
contained in this Article 9 shall be deemed or construed to authorize or permit, by reason of any call of a meeting of Holders or any rights expressly or impliedly conferred hereunder to make such call, any hindrance or delay in the exercise of any
right or rights conferred upon or reserved to the Trustee or to the Holders under any of the provisions of this Indenture or of the Notes.
ARTICLE 10
S
UPPLEMENTAL
I
NDENTURES
Section 10.01.
Supplemental Indentures Without Consent of Holders
. The Company, when authorized by the resolutions of the Board of
Directors and the Trustee, at the Company’s expense, may from time to time and at any time enter into an indenture or indentures supplemental hereto for one or more of the following purposes:
(a) to cure any ambiguity, omission, defect or inconsistency;
(b) to provide for the assumption by a Successor Company of the obligations of the Company under this Indenture pursuant to Article 11;
(c) to add guarantees with respect to the Notes;
(d) to secure the Notes;
47
(e) to add to the covenants or Events of Default of the Company for the benefit of the Holders or
surrender any right or power conferred upon the Company;
(f) to make any change that does not adversely affect the rights of any Holder;
(g) in connection with any Merger Event, provide that the notes are convertible into Reference Property, subject to the provisions of
Section 14.02, and make such related changes to the terms of the Notes to the extent expressly required by Section 14.07;
(h) to
irrevocably elect one Settlement Method or irrevocably eliminate one or more Settlement Methods or to irrevocably elect a Specified Dollar Amount to be applicable to Combination Settlements;
(i) to evidence the acceptance of appointment by a successor trustee; or
(j) to conform the provisions of this Indenture or the Notes to the “Description of notes” section of the Offering Memorandum.
Upon the written request of the Company, the Trustee is hereby authorized to join with the Company in the execution of any such supplemental
indenture, to make any further appropriate agreements and stipulations that may be therein contained, but the Trustee shall not be obligated to, but may in its discretion, enter into any supplemental indenture that affects the Trustee’s own
rights, duties or immunities under this Indenture or otherwise.
Any supplemental indenture authorized by the provisions of this Section
10.01 may be executed by the Company and the Trustee without the consent of the Holders of any of the Notes at the time outstanding, notwithstanding any of the provisions of Section 10.02.
Section 10.02.
Supplemental Indentures with Consent of Holders
. With the consent (evidenced as provided in Article 8) of the
Holders of at least a majority of the aggregate principal amount of the Notes then outstanding (determined in accordance with Article 8 and including, without limitation, consents obtained in connection with a repurchase of, or tender or
exchange offer for, Notes), the Company, when authorized by the resolutions of the Board of Directors and the Trustee, at the Company’s expense, may from time to time and at any time enter into an indenture or indentures supplemental hereto for
the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Indenture or any supplemental indenture or of modifying in any manner the rights of the Holders;
provided
,
however
, that,
without the consent of each Holder of an outstanding Note affected, no such supplemental indenture shall:
(a) reduce the amount of Notes
whose Holders must consent to an amendment;
(b) reduce the rate of or extend the stated time for payment of interest on any Note;
(c) reduce the principal of or extend the Maturity Date of any Note;
(d) make any change that adversely affects the conversion rights of any Notes;
48
(e) reduce the Fundamental Change Repurchase Price of any Note or amend or modify in any manner
adverse to the Holders the Company’s obligation to make such payments, whether through an amendment or waiver of provisions in the covenants, definitions or otherwise;
(f) make any Note payable in a currency, or at a place of payment, other than that stated in the Note;
(g) change the ranking of the Notes;
(h) impair the right of any Holder to receive payment of principal and interest on such Holder’s Notes on or after the due dates therefor
or to institute suit for the enforcement of any payment on or with respect to such Holder’s Notes; or
(i) make any change in this
Article 10 that requires each Holder’s consent or in the waiver provisions in Section 6.02 or Section 6.09.
Upon the written
request of the Company, and upon the filing with the Trustee of evidence of the consent of Holders as aforesaid and subject to Section 10.05, the Trustee shall join with the Company in the execution of such supplemental indenture unless such
supplemental indenture affects the Trustee’s own rights, duties or immunities under this Indenture or otherwise, in which case the Trustee may in its discretion, but shall not be obligated to, enter into such supplemental indenture.
Holders do not need under this Section 10.02 to approve the particular form of any proposed supplemental indenture. It shall be sufficient if
such Holders approve the substance thereof. After any such supplemental indenture becomes effective, the Company shall mail to the Holders a notice briefly describing such supplemental indenture. However, the failure to give such notice to all the
Holders, or any defect in the notice, will not impair or affect the validity of the supplemental indenture.
Section 10.03.
Effect
of Supplemental Indentures
. Upon the execution of any supplemental indenture pursuant to the provisions of this Article 10, this Indenture and the Notes shall be and be deemed to be modified and amended in accordance therewith and the respective
rights, limitation of rights, obligations, duties and immunities under this Indenture of the Trustee, the Company and the Holders shall thereafter be determined, exercised and enforced hereunder subject in all respects to such modifications and
amendments and all the terms and conditions of any such supplemental indenture shall be and be deemed to be part of the terms and conditions of this Indenture for any and all purposes.
Section 10.04.
Notation on Notes
. Notes authenticated and delivered after the execution of any supplemental indenture pursuant to
the provisions of this Article 10 may, at the Company’s expense, bear a notation in form approved by the Trustee as to any matter provided for in such supplemental indenture. If the Company or the Trustee shall so determine, new Notes so
modified as to conform, in the opinion of the Trustee and the Board of Directors, to any modification of this Indenture contained in any such supplemental indenture may, at the Company’s expense, be prepared and executed by the Company,
authenticated by the Trustee (or an authenticating agent duly appointed by the Trustee pursuant to Section 17.10) and delivered in exchange for the Notes then outstanding, upon surrender of such Notes then outstanding.
49
Section 10.05.
Evidence of Compliance of Supplemental Indenture to Be Furnished to
Trustee
. In addition to the documents required by Section 17.05, the Trustee shall receive an Officers’ Certificate and an Opinion of Counsel as conclusive evidence that any supplemental indenture executed pursuant hereto complies with the
requirements of this Article 10 and is permitted or authorized by this Indenture and that the supplemental indenture constitutes the legal, valid and binding obligation of the Company enforceable in accordance with its terms.
ARTICLE 11
C
ONSOLIDATION
, M
ERGER
, S
ALE
, C
ONVEYANCE
AND
L
EASE
Section 11.01.
Company May Consolidate, Etc. on Certain Terms
. Subject to the provisions of Section 11.02, the Company shall not
consolidate with, merge with or into, or sell, convey, transfer or lease all or substantially all of its properties and assets to another Person, unless:
(a) the resulting, surviving or transferee Person (the “
Successor Company
”), if not the Company, shall be a corporation
organized and existing under the laws of the United States of America, any State thereof or the District of Columbia, and the Successor Company (if not the Company) shall expressly assume, by supplemental indenture all of the obligations of the
Company under the Notes and this Indenture; and
(b) immediately after giving effect to such transaction, no Default or Event of Default
shall have occurred and be continuing under this Indenture.
For purposes of this Section 11.01, the sale, conveyance, transfer or lease
of all or substantially all of the properties and assets of one or more Subsidiaries of the Company to another Person, which properties and assets, if held by the Company instead of such Subsidiaries, would constitute all or substantially all of the
properties and assets of the Company on a consolidated basis, shall be deemed to be the sale, conveyance, transfer or lease of all or substantially all of the properties and assets of the Company to another Person.
Section 11.02.
Successor Corporation to Be Substituted
. In case of any such consolidation, merger, sale, conveyance, transfer or
lease and upon the assumption by the Successor Company, by supplemental indenture, executed and delivered to the Trustee and satisfactory in form to the Trustee, of the due and punctual payment of the principal of and accrued and unpaid interest on
all of the Notes, the due and punctual delivery or payment, as the case may be, of any consideration due upon conversion of the Notes and the due and punctual performance of all of the covenants and conditions of this Indenture to be performed by
the Company, such Successor Company (if not the Company) shall succeed to and, except in the case of a lease of all or substantially all of the Company’s properties and assets, shall be substituted for the Company, with the same effect as if it
had been named herein as the party of the first part. Such Successor Company thereupon may cause to be signed, and may issue either in its own name or in the name of the Company any or all of the Notes issuable hereunder which theretofore shall not
have been signed by the Company and delivered to the Trustee; and, upon the order of such Successor Company instead of the Company and subject to all the terms, conditions and limitations in this Indenture prescribed, the Trustee shall authenticate
and shall
50
deliver, or cause to be authenticated and delivered, any Notes that previously shall have been signed and delivered by the Officers of the Company to the Trustee for authentication, and any Notes
that such Successor Company thereafter shall cause to be signed and delivered to the Trustee for that purpose. All the Notes so issued shall in all respects have the same legal rank and benefit under this Indenture as the Notes theretofore or
thereafter issued in accordance with the terms of this Indenture as though all of such Notes had been issued at the date of the execution hereof. In the event of any such consolidation, merger, sale, conveyance or transfer (but not in the case of a
lease), upon compliance with this Article 11 the Person named as the “Company” in the first paragraph of this Indenture (or any successor that shall thereafter have become such in the manner prescribed in this Article 11) may be dissolved,
wound up and liquidated at any time thereafter and, except in the case of a lease, such Person shall be released from its liabilities as obligor and maker of the Notes and from its obligations under this Indenture and the Notes.
In case of any such consolidation, merger, sale, conveyance, transfer or lease, such changes in phraseology and form (but not in substance)
may be made in the Notes thereafter to be issued as may be appropriate.
Section 11.03.
Opinion of Counsel to Be Given to
Trustee
. No such consolidation, merger, sale, conveyance, transfer or lease shall be effective unless the Trustee shall receive an Officers’ Certificate and an Opinion of Counsel as conclusive evidence that any such consolidation, merger,
sale, conveyance, transfer or lease and any such assumption and, if a supplemental indenture is required in connection with such transaction, such supplemental indenture, complies with the provisions of this Article 11, and that in the case of the
Opinion of Counsel, that such supplemental indenture is the legal, valid, binding and enforceable obligation of such successor company.
ARTICLE 12
I
MMUNITY
OF
I
NCORPORATORS
, S
TOCKHOLDERS
, O
FFICERS
AND
D
IRECTORS
Section 12.01.
Indenture and Notes Solely Corporate Obligations
. No recourse for the payment of the
principal of or accrued and unpaid interest on any Note, nor for any claim based thereon or otherwise in respect thereof, and no recourse under or upon any obligation, covenant or agreement of the Company in this Indenture or in any supplemental
indenture or in any Note, nor because of the creation of any indebtedness represented thereby, shall be had against any incorporator, stockholder, employee, agent, Officer or director or Subsidiary, as such, past, present or future, of the Company
or of any successor corporation, either directly or through the Company or any successor corporation, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise; it being expressly
understood that all such liability is hereby expressly waived and released as a condition of, and as a consideration for, the execution of this Indenture and the issue of the Notes.
51
ARTICLE 13
[I
NTENTIONALLY
O
MITTED
]
ARTICLE 14
C
ONVERSION
OF
N
OTES
Section 14.01.
Conversion Privilege
. (a)Subject to and upon compliance with the provisions of this Article 14, each Holder of a
Note shall have the right, at such Holder’s option, to convert all or any portion (if the portion to be converted is $1,000 principal amount or an integral multiple thereof) of such Note (i) subject to satisfaction of the conditions
described in Section 14.01(b), at any time prior to the close of business on the Business Day immediately preceding January 1, 2019 under the circumstances and during the periods set forth in Section 14.01(b), and (ii) regardless of the
conditions described in Section 14.01(b), on or after January 1, 2019 and prior to the close of business on the second Scheduled Trading Day immediately preceding the Maturity Date, in each case, at an initial conversion rate of 7.9353 shares
of Common Stock (subject to adjustment as provided in this Article 14, the “
Conversion Rate
”) per $1,000 principal amount of Notes (subject to, and in accordance with, the settlement provisions of Section 14.02, the
“
Conversion Obligation
”).
(b) (i) Prior to the close of business on the Business Day immediately preceding
January 1, 2019, a Holder may surrender all or any portion of its Notes for conversion at any time during the five Business Day period immediately after any five consecutive Trading Day period (the “
Measurement Period
”) in
which the Trading Price per $1,000 principal amount of Notes, as determined following a request by a Holder of Notes in accordance with this subsection (b)(i), for each Trading Day of the Measurement Period was less than 98% of the product of the
Last Reported Sale Price of the Common Stock and the Conversion Rate on each such Trading Day. The Trading Prices shall be determined by the Bid Solicitation Agent pursuant to this subsection (b)(i) and the definition of Trading Price set forth in
this Indenture. At such time as the Company directs the Bid Solicitation Agent in writing to solicit bids, the Company shall provide written notice to the Bid Solicitation Agent (if other than the Company) of the three independent nationally
recognized securities dealers selected by the Company pursuant to the definition of Trading Price, along with appropriate contact information for each, and shall request for such securities dealers to provide bids to the Bid Solicitation Agent. The
Bid Solicitation Agent (if other than the Company) shall have no obligation to determine the Trading Price per $1,000 principal amount of Notes unless the Company has requested such determination, and the Company shall have no obligation to make
such request (or, if the Company is acting as Bid Solicitation Agent, the Company shall have no obligation to determine the Trading Price per $1,000 principal amount of Notes) unless a Holder provides the Company with reasonable evidence that the
Trading Price per $1,000 principal amount of Notes is less than 98% of the product of the Last Reported Sale Price of the Common Stock and the Conversion Rate, at which time the Company shall instruct the Bid Solicitation Agent (if other than the
Company) to determine, or if the Company is acting as Bid Solicitation Agent, the Company shall determine, the Trading Price per $1,000 principal amount of Notes beginning on the next Trading Day and on each successive Trading Day until the Trading
Price per $1,000 principal amount of Notes is greater than or equal to 98% of the product of the Last Reported Sale Price of the Common Stock and the Conversion Rate. If (x) the Company is not acting as Bid
52
Solicitation Agent, and the Company does not instruct the Bid Solicitation Agent to determine the Trading Price per $1,000 principal amount of Notes when obligated as provided in the preceding
sentence, or if the Company instructs the Bid Solicitation Agent to obtain bids and the Bid Solicitation Agent fails to make such determination, or (y) the Company is acting as Bid Solicitation Agent and the Company fails to make such
determination when obligated as provided in the preceding sentence, then, in either case, the Trading Price per $1,000 principal amount of Notes shall be deemed to be less than 98% of the product of the Last Reported Sale Price of the Common Stock
and the Conversion Rate on each Trading Day of such failure. If the Trading Price condition set forth above has been met, the Company shall so notify the Holders, the Trustee and the Conversion Agent (if other than the Trustee). If, at any time
after the Trading Price condition set forth above has been met, the Trading Price per $1,000 principal amount of Notes is greater than or equal to 98% of the product of the Last Reported Sale Price of the Common Stock and the Conversion Rate for
such date, the Company shall so notify the Holders of the Notes, the Trustee and the Conversion Agent (if other than the Trustee). The Company shall notify the Holders of the Notes, the Trustee and the Conversion Agent (if other than the Trustee) if
the Notes become convertible pursuant to this Section 14.01(b)(i) by issuing a press release or providing a notice on its website and by providing notice through the Depositary in respect of Global Notes. Neither the Trustee nor the Conversion Agent
(if other than the Trustee) shall have any duty to determine or verify the Company’s determination of whether the Notes are convertible pursuant to this Section 14.01(b)(i).
(ii) If, prior to the close of business on the Business Day immediately preceding January 1, 2019, the Company elects to:
(A) issue to all or substantially all holders of the Common Stock any rights, options or warrants (other than any issuance
of rights, options or warrants issued under a shareholder rights plan that are (i) transferable with shares of the Common Stock, including upon conversion, and (ii) not exercisable until the occurrence of a triggering event;
provided
that any such rights, options or warrants will be deemed distributed under this subclause (A) upon the separation of such rights, options or warrants from the Common Stock, or upon the occurrence of a triggering event) entitling
them, for a period of not more than 45 calendar days after the Ex-Dividend Date of such issuance, to subscribe for or purchase shares of the Common Stock at a price per share that is less than the average of the Last Reported Sale Prices of the
Common Stock for the 10 consecutive Trading Day period ending on, and including, the Trading Day immediately preceding the date of announcement of such issuance; or
(B) distribute to all or substantially all holders of the Common Stock the Company’s assets, securities or rights to
purchase securities of the Company, which distribution has a per share value, as reasonably determined by the Board of Directors, exceeding 15% of the Last Reported Sale Price of the Common Stock on the Trading Day preceding the date of announcement
for such distribution,
then, in either case, the Company shall notify all Holders of the Notes, the Trustee and the Conversion Agent (if other than the
Trustee) at least 60 Scheduled Trading Days prior to the Ex-Dividend
53
Date for such issuance or distribution. The Company shall notify the Holders of the Notes if the Notes become convertible pursuant to this Section 14.01(b)(ii) by issuing a press release or
providing a notice on its website and by providing notice through the Depositary in respect of Global Notes. Once the Company has given such notice, a Holder may surrender all or any portion of its Notes for conversion at any time until the earlier
of (1) the close of business on the Business Day immediately preceding the Ex-Dividend Date for such issuance or distribution and (2) the Company’s announcement that such issuance or distribution will not take place, in each case,
even if the Notes are not otherwise convertible at such time. No Holder may exercise its right to convert pursuant to this Section 14.01(b)(ii) if the Holder otherwise would participate in the distribution without conversion in respect of Notes
held by the Holder as if such Holder held a number of shares of the Common Stock equal to the Conversion Rate for each $1,000 principal amount of Notes it holds. None of the Trustee, the Bid Solicitation Agent or the Conversion Agent shall have any
duty to determine or verify the Company’s determination of whether an issuance or distribution described in this clause (ii) has occurred.
(iii) If a transaction or event that constitutes a Fundamental Change or a Make-Whole Fundamental Change occurs prior to the
close of business on the Business Day immediately preceding January 1, 2019, regardless of whether a Holder has the right to require the Company to repurchase the Notes pursuant to Section 15.02, or if the Company is a party to a consolidation,
merger, binding share exchange, or transfer or lease of all or substantially all of its assets, in each case, pursuant to which the Common Stock would be converted into cash, securities or other assets, all or any portion of a Holder’s Notes
may be surrendered for conversion at any time from or after the date of the notice provided for below until 35 Trading Days after the effective date of such transaction, or if such transaction also constitutes a Fundamental Change, until the related
Fundamental Change Repurchase Date. The Company shall notify Holders, the Trustee and the Conversion Agent (if other than the Trustee) of any such transaction and the corresponding conversion right pursuant to this Section 14.01(b)(iii) at
substantially the same time the Company publicly announces such transaction (but in no event later than the effective date of such transaction). Such notice shall be given by issuing a press release or providing such notice on the Company’s
website and through the Depositary in respect of Global Notes. Neither the Trustee nor the Conversion Agent (if other than the Trustee) shall have the duty to determine or verify the Company’s determination of whether the Notes are convertible
pursuant to this Section 14.01(b)(iii).
(iv) Prior to the close of business on the Business Day immediately preceding
January 1, 2019, a Holder may surrender all or any portion of its Notes for conversion at any time during any calendar quarter commencing after the calendar quarter ending on September 30, 2014 (and only during such calendar quarter), if
the Last Reported Sale Price of the Common Stock for at least 20 Trading Days (whether or not consecutive) during the period of 30 consecutive Trading Days ending on the last Trading Day of the immediately preceding calendar quarter is greater than
or equal to 130% of the Conversion Price on each applicable Trading Day. The Company shall determine at the beginning of each calendar quarter commencing after September 30, 2014 whether the Notes may be surrendered for conversion in accordance
with this clause (iv) and shall notify Holders, the Trustee and the Conversion Agent (if other than the Trustee) if the Notes become convertible in accordance with this clause (iv). Such notice shall be given
54
by issuing a press release or providing such notice on the Company’s website and through the Depositary in respect of Global Notes. Neither the Conversion Agent nor the Trustee shall have
any duty to determine or verify the Company’s determination of whether the Notes are convertible pursuant to this Section 14.01(b)(iv).
Section 14.02.
Conversion Procedure; Settlement Upon Conversion.
(a) Subject to this Section 14.02, Section 14.03(b) and Section 14.07(a), upon conversion of any Note, the Company shall pay or deliver, as
the case may be, to the converting Holder, in respect of each $1,000 principal amount of Notes being converted, cash (“
Cash Settlement
”), shares of Common Stock, together with cash, if applicable, in lieu of delivering any
fractional share of Common Stock in accordance with subsection (j) of this Section 14.02 (“
Physical Settlement
”) or a combination of cash and shares of Common Stock, together with cash, if applicable, in lieu of delivering any
fractional share of Common Stock in accordance with subsection (j) of this Section 14.02 (“
Combination Settlement
”), at its election, as set forth in this Section 14.02.
(i) All conversions for which the relevant Conversion Date occurs on or after March 1, 2019 shall be settled using the
same Settlement Method.
(ii) Except for any conversions for which the relevant Conversion Date occurs on or after
March 1, 2019, the Company shall use the same Settlement Method for all conversions with the same Conversion Date, but the Company shall not have any obligation to use the same Settlement Method with respect to conversions with different
Conversion Dates.
(iii) If, in respect of any Conversion Date (or the period described in the third immediately succeeding
set of parentheses, as the case may be), the Company elects to deliver a notice (the “
Settlement Notice
”) of the relevant Settlement Method in respect of such Conversion Date (or such period, as the case may be), the Company shall
deliver such Settlement Notice to converting Holders (or, in the case of Global Notes, by electronic delivery in accordance with the Depositary’s procedures), with a copy to the Trustee and the Conversion Agent (if other than the Trustee), no
later than the close of business on the second Trading Day immediately following the relevant Conversion Date (or, in the case of any conversions for which the relevant Conversion Date occurs on or after March 1, 2019, no later than
March 1, 2019). If the Company does not elect a Settlement Method prior to the deadline set forth in the immediately preceding sentence, the Company shall no longer have the right to elect Cash Settlement or Physical Settlement and the Company
shall be deemed to have elected Combination Settlement in respect of its Conversion Obligation, and the Specified Dollar Amount per $1,000 principal amount of Notes shall be equal to $1,000. Such Settlement Notice shall specify the relevant
Settlement Method and in the case of an election of Combination Settlement, the relevant Settlement Notice shall indicate the Specified Dollar Amount per $1,000 principal amount of Notes. If the Company delivers a Settlement Notice electing
Combination Settlement in respect of its Conversion Obligation but does not indicate a Specified Dollar Amount per $1,000 principal amount of Notes in such Settlement Notice, the Specified Dollar Amount per $1,000 principal amount of Notes shall be
deemed to be $1,000.
55
(iv) The cash, shares of Common Stock or combination of cash and shares of Common
Stock in respect of any conversion of Notes (the “
Settlement Amount
”) shall be computed as follows:
(A)
if the Company elects to satisfy its Conversion Obligation in respect of such conversion by Physical Settlement, the Company shall deliver to the converting Holder in respect of each $1,000 principal amount of Notes being converted a number of
shares of Common Stock equal to the Conversion Rate in effect on the Conversion Date;
(B) if the Company elects to satisfy
its Conversion Obligation in respect of such conversion by Cash Settlement, the Company shall pay to the converting Holder in respect of each $1,000 principal amount of Notes being converted cash in an amount equal to the sum of the Daily Conversion
Values for each of the 50 consecutive Trading Days during the related Observation Period; and
(C) if the Company elects
(or is deemed to have elected) to satisfy its Conversion Obligation in respect of such conversion by Combination Settlement, the Company shall pay or deliver, as the case may be, to the converting Holder in respect of each $1,000 principal amount of
Notes being converted, a Settlement Amount equal to the sum of the Daily Settlement Amounts for each of the 50 consecutive Trading Days during the related Observation Period.
(v) The Daily Settlement Amounts (if applicable) and the Daily Conversion Values (if applicable) shall be determined by the
Company promptly following the last day of the Observation Period. Promptly after such determination of the Daily Settlement Amounts or the Daily Conversion Values, as the case may be, and the amount of cash payable in lieu of delivering any
fractional share of Common Stock, the Company shall notify the Trustee and the Conversion Agent (if other than the Trustee) of the Daily Settlement Amounts or the Daily Conversion Values, as the case may be, and the amount of cash payable in lieu of
delivering fractional shares of Common Stock. The Trustee and the Conversion Agent (if other than the Trustee) shall have no responsibility for any such determination.
(b) Subject to Section 14.02(e), before any Holder of a Note shall be entitled to convert a Note as set forth above, such Holder shall
(i) in the case of a Global Note, comply with the procedures of the Depositary in effect at that time and, if required pursuant to Section 14.02(e), pay all transfer or similar taxes and, if required, pay funds equal to interest payable on the
next Interest Payment Date to which such Holder is not entitled as set forth in Section 14.02(h) and (ii) in the case of a Physical Note (1) complete, manually sign and deliver an irrevocable notice to the Conversion Agent as set forth in
the Form of Notice of Conversion (or a facsimile thereof) (a “
Notice of Conversion
”) at the office of the Conversion Agent and state in writing therein the principal amount of Notes to be converted and the name or names (with
addresses) in which such
56
Holder wishes the certificate or certificates for any shares of Common Stock to be delivered upon settlement of the Conversion Obligation to be registered, (2) surrender such Notes, duly
endorsed to the Company or in blank (and accompanied by appropriate endorsement and transfer documents), at the office of the Conversion Agent, (3) if required, furnish appropriate endorsements and transfer documents, (4) if required
pursuant to Section 14.02(e), pay all transfer or similar taxes, and (5) if required, pay funds equal to interest payable on the next Interest Payment Date to which such Holder is not entitled as set forth in Section 14.02(h). The Trustee (and
if different, the Conversion Agent) shall notify the Company of any conversion pursuant to this Article 14 on the Conversion Date for such conversion. No Notice of Conversion with respect to any Notes may be surrendered by a Holder thereof if such
Holder has also delivered a Fundamental Change Repurchase Notice to the Company in respect of such Notes and has not validly withdrawn such Fundamental Change Repurchase Notice in accordance with Section 15.03.
If more than one Note shall be surrendered for conversion at one time by the same Holder, the Conversion Obligation with respect to such Notes
shall be computed on the basis of the aggregate principal amount of the Notes (or specified portions thereof to the extent permitted thereby) so surrendered.
(c) A Note shall be deemed to have been converted immediately prior to the close of business on the date (the “
Conversion
Date
”) that the Holder has complied with the requirements set forth in subsection (b) above. Except as set forth in Section 14.03(b) and Section 14.07(a), the Company shall pay or deliver, as the case may be, the consideration due in
respect of the Conversion Obligation on the third Business Day immediately following the relevant Conversion Date, if the Company elects Physical Settlement (
provided
that for any Notes converted after the close of business on the Business
Day immediately preceding the Regular Record Date immediately preceding the Maturity Date, the Company shall deliver the shares and cash in lieu of fractional shares on the Maturity Date), or on the third Business Day immediately following the last
Trading Day of the Observation Period, in the case of any other Settlement Method. If any shares of Common Stock are due to converting Holders, the Company shall issue or cause to be issued, and deliver to the Conversion Agent or to such Holder, or
such Holder’s nominee or nominees, certificates or a book-entry transfer through the Depositary for the full number of shares of Common Stock to which such Holder shall be entitled in satisfaction of the Company’s Conversion Obligation.
(d) In case any Note shall be surrendered for partial conversion, the Company shall execute and the Trustee shall authenticate and
deliver to or upon the written order of the Holder of the Note so surrendered a new Note or Notes in authorized denominations in an aggregate principal amount equal to the unconverted portion of the surrendered Note, without payment of any service
charge by the converting Holder but, if required by the Company or Trustee, with payment of a sum sufficient to cover any documentary, stamp or similar issue or transfer tax or similar governmental charge required by law or that may be imposed in
connection therewith as a result of the name of the Holder of the new Notes issued upon such conversion being different from the name of the Holder of the old Notes surrendered for such conversion.
(e) If a Holder submits a Note for conversion, the Company shall pay any documentary, stamp or similar issue or transfer tax due on the issue
of any shares of Common Stock upon
57
conversion, unless the tax is due because the Holder requests such shares to be issued in a name other than the Holder’s name, in which case the Holder shall pay that tax. The Conversion
Agent may refuse to deliver the certificates representing the shares of Common Stock being issued in a name other than the Holder’s name until the Trustee receives a sum sufficient to pay any tax that is due by such Holder in accordance with
the immediately preceding sentence.
(f) Except as provided in Section 14.04, no adjustment shall be made for dividends on any shares of
Common Stock issued upon the conversion of any Note as provided in this Article 14.
(g) Upon the conversion of an interest in a Global
Note, the Trustee, or the Custodian at the direction of the Trustee, shall make a notation on such Global Note as to the reduction in the principal amount represented thereby. The Company shall notify the Trustee in writing of any conversion of
Notes effected through any Conversion Agent other than the Trustee.
(h) Upon conversion, a Holder shall not receive any separate cash
payment for accrued and unpaid interest, if any, except as set forth below in this Section 14.02(h). The Company’s settlement of the full Conversion Obligation shall be deemed to satisfy in full its obligation to pay the principal amount of the
Note and accrued and unpaid interest, if any, to, but not including, the relevant Conversion Date. As a result, accrued and unpaid interest, if any, to, but not including, the relevant Conversion Date shall be deemed to be paid in full rather than
cancelled, extinguished or forfeited. Upon a conversion of Notes into a combination of cash and shares of Common Stock, accrued and unpaid interest will be deemed to be paid first out of the cash paid upon such conversion. Notwithstanding the
foregoing, if Notes are converted after the close of business on a Regular Record Date, Holders of such Notes as of the close of business on such Regular Record Date will receive the full amount of interest payable on such Notes on the corresponding
Interest Payment Date notwithstanding the conversion. Notes surrendered for conversion during the period from the close of business on any Regular Record Date to the open of business on the immediately following Interest Payment Date must be
accompanied by funds equal to the amount of interest payable on the Notes so converted;
provided
that no such payment shall be required (1) for conversions following the Regular Record Date immediately preceding the Maturity Date;
(2) if the Company has specified a Fundamental Change Repurchase Date that is after a Regular Record Date and on or prior to the Business Day immediately following the date on which the corresponding interest payment is made; or (3) to the
extent of any Defaulted Amounts, if any Defaulted Amounts exists at the time of conversion with respect to such Note. Therefore, for the avoidance of doubt, all Holders of record on the Regular Record Date immediately preceding the Maturity Date
shall receive the full interest payment due on the Maturity Date regardless of whether their Notes have been converted following such Regular Record Date.
(i) The Person in whose name the shares of Common Stock shall be issuable upon conversion shall be treated as a stockholder of record as of
the close of business on the relevant Conversion Date (if the Company elects to satisfy the related Conversion Obligation by Physical Settlement where the Notes are converted on or prior to the close of business on the Business Day immediately
preceding the Regular Record Date immediately preceding the Maturity Date), the second Scheduled Trading Day immediately preceding the Maturity Date (if the Company elects to satisfy the related Conversion Obligation by Physical Settlement where the
Notes are
58
converted after the close of business on the Business Day immediately preceding the Regular Record Date immediately preceding the Maturity Date) or the last Trading Day of the relevant
Observation Period (if the Company elects to satisfy the related Conversion Obligation by Combination Settlement), as the case may be. Upon a conversion of Notes, such Person shall no longer be a Holder of such Notes surrendered for conversion.
(j) The Company shall not issue any fractional share of Common Stock upon conversion of the Notes and shall instead pay cash in lieu of
delivering any fractional share of Common Stock issuable upon conversion based on the Daily VWAP for the relevant Conversion Date (in the case of Physical Settlement,
provided
that for any Notes converted after the close of business on the
Business Day immediately preceding the Regular Record Date immediately preceding the Maturity Date, such cash amount shall be based on the Daily VWAP on the second Scheduled Trading Day immediately preceding the Maturity Date) or based on the Daily
VWAP for the last Trading Day of the relevant Observation Period (in the case of Combination Settlement). For each Note surrendered for conversion, if the Company has elected Combination Settlement, the full number of shares that shall be issued
upon conversion thereof shall be computed on the basis of the aggregate Daily Settlement Amounts for the relevant Observation Period and any fractional shares remaining after such computation shall be paid in cash.
Section 14.03.
Increased Conversion Rate Applicable to Certain Notes Surrendered in Connection with Make-Whole Fundamental
Changes
. (a) If a Make-Whole Fundamental Change occurs or becomes effective prior to the Maturity Date and a Holder elects to convert its Notes in connection with such Make-Whole Fundamental Change, the Company shall increase the Conversion
Rate for the Notes so surrendered for conversion by a number of additional shares of Common Stock (the “
Additional Shares
”), as described below in this Section 14.03. A conversion of Notes shall be deemed for these purposes to be
“in connection with” such Make-Whole Fundamental Change if the relevant Notice of Conversion is received by the Conversion Agent from, and including, the Effective Date of the Make-Whole Fundamental Change up to, and including, the
Business Day immediately prior to the related Fundamental Change Repurchase Date (or, in the case of a Make-Whole Fundamental Change that would have been a Fundamental Change but for the
proviso
in clause (b) of the definition thereof,
the 35th Trading Day immediately following the Effective Date of such Make-Whole Fundamental Change).
(b) Upon surrender of Notes for
conversion in connection with a Make-Whole Fundamental Change pursuant to Section 14.01(b)(iii), the Company shall, at its option, satisfy the related Conversion Obligation by Physical Settlement, Cash Settlement or Combination Settlement in
accordance with Section 14.02;
provided
,
however
, that if, at the effective time of a Make-Whole Fundamental Change described in clause (b) of the definition of Fundamental Change, the Reference Property following such Make-Whole
Fundamental Change is composed entirely of cash, for any conversion of Notes following the Effective Date of such Make-Whole Fundamental Change, the Conversion Obligation shall be calculated based solely on the Stock Price for the transaction and
shall be deemed to be an amount of cash per $1,000 principal amount of converted Notes equal to the Conversion Rate (including any adjustment for Additional Shares as described in this Section 14.03),
multiplied by
such Stock Price. In such
event, the Conversion Obligation shall be paid to Holders in cash on the earlier of (i) the tenth Business Day following the Conversion Date and (ii) the Maturity Date. The Company shall notify the Holders of Notes, the Trustee and the
Conversion Agent (if other than the Trustee) of the Effective Date of any Make-Whole Fundamental Change and issue a press release announcing such Effective Date no later than five Business Days after such Effective Date.
59
(c) The number of Additional Shares, if any, by which the Conversion Rate shall be increased
shall be determined by reference to the table below, based on the date on which the Make-Whole Fundamental Change occurs or becomes effective (the
“
Effective Date
”) and the price (the “
Stock Price
”) paid (or
deemed to be paid) per share of the Common Stock in the Make-Whole Fundamental Change. If the holders of the Common Stock receive in exchange for their Common Stock only cash in a Make-Whole Fundamental Change described in clause (b) of the
definition of Fundamental Change, the Stock Price shall be the cash amount paid per share. Otherwise, the Stock Price shall be the average of the Last Reported Sale Prices of the Common Stock over the five Trading Day period ending on, and
including, the Trading Day immediately preceding the Effective Date of the Make-Whole Fundamental Change. The Board of Directors shall make appropriate adjustments to the Stock Price, in its good faith determination, to account for any adjustment to
the Conversion Rate that becomes effective, or any event requiring an adjustment to the Conversion Rate where the Ex-Dividend Date, Effective Date (as such term is used in Section 14.04) or expiration date of the event occurs during such five
consecutive Trading Day period.
(d) The Stock Prices set forth in the column headings of the table below shall be adjusted as of any date
on which the Conversion Rate of the Notes is otherwise adjusted. The adjusted Stock Prices shall equal the Stock Prices applicable immediately prior to such adjustment,
multiplied by
a fraction, the numerator of which is the Conversion Rate
immediately prior to such adjustment giving rise to the Stock Price adjustment and the denominator of which is the Conversion Rate as so adjusted. The number of Additional Shares set forth in the table below shall be adjusted in the same manner and
at the same time as the Conversion Rate as set forth in Section 14.04.
(e) The following table sets forth the number of Additional Shares
of Common Stock by which the Conversion Rate shall be increased per $1,000 principal amount of Notes pursuant to this Section 14.03 for each Stock Price and Effective Date set forth below:
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Stock Price
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Effective Date
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$91.65
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$100.00
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$112.00
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$126.02
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$140.00
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$155.00
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$170.00
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$185.00
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$200.00
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$220.00
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$260.00
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$300.00
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June 30, 2014
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2.9757
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2.4883
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1.9163
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1.4291
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1.0756
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0.7968
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0.5908
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0.4366
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0.3200
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0.2067
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0.0733
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0.0132
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July 1, 2015
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2.9757
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2.5675
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1.9578
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1.4425
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1.0721
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0.7830
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0.5720
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0.4159
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0.2995
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0.1881
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0.0608
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0.0073
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July 1, 2016
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2.9757
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2.6029
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1.9526
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1.4092
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1.0244
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0.7294
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0.5181
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0.3652
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0.2537
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0.1500
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0.0382
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0.0000
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July 1, 2017
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2.9757
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2.5409
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1.8501
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1.2847
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0.8952
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0.6066
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0.4080
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0.2704
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0.1746
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0.0910
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0.0130
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0.0000
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July 1, 2018
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2.9757
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2.3393
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1.5871
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0.9972
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0.6176
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0.3605
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0.2024
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0.1061
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0.0485
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0.0087
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0.0000
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0.0000
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July 1, 2019
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2.9757
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2.0647
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0.9932
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0.0000
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0.0000
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0.0000
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0.0000
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0.0000
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0.0000
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0.0000
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0.0000
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0.0000
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The exact Stock Prices and Effective Dates may not be set forth in the table above, in which case:
(i) if the Stock Price is between two Stock Prices in the table above or the Effective Date is between two Effective Dates in
the table, the number of Additional
60
Shares by which the Conversion Rate shall be increased shall be determined by a straight-line interpolation between the number of Additional Shares set forth for the higher and lower Stock Prices
and the earlier and later Effective Dates, as applicable, based on a 365-day year;
(ii) if the Stock Price is greater than
$300.00 per share (subject to adjustment in the same manner as the Stock Prices set forth in the column headings of the table above pursuant to subsection (d) above), no Additional Shares shall be added to the Conversion Rate; and
(iii) if the Stock Price is less than $91.65 per share (subject to adjustment in the same manner as the Stock Prices set forth
in the column headings of the table above pursuant to subsection (d) above), no Additional Shares shall be added to the Conversion Rate.
Notwithstanding the foregoing, in no event shall the Conversion Rate per $1,000 principal amount of Notes exceed 10.9110 shares of Common Stock, subject to
adjustment in the same manner as the Conversion Rate pursuant to Section 14.04.
(f) Nothing in this Section 14.03 shall prevent an
adjustment to the Conversion Rate pursuant to Section 14.04 in respect of a Make-Whole Fundamental Change.
Section 14.04.
Adjustment of Conversion Rate.
The Conversion Rate shall be adjusted from time to time by the Company if any of the following events occurs, except that the Company shall not make any adjustments to the Conversion Rate if Holders of the Notes
participate (other than in the case of (x) a share split or share combination or (y) a tender or exchange offer), at the same time and upon the same terms as holders of the Common Stock and solely as a result of holding the Notes, in any
of the transactions described in this Section 14.04, without having to convert their Notes, as if they held a number of shares of Common Stock equal to the Conversion Rate,
multiplied by
the principal amount (expressed in thousands) of Notes
held by such Holder.
(a) If the Company exclusively issues shares of Common Stock as a dividend or distribution on shares of the Common
Stock, or if the Company effects a share split or share combination, the Conversion Rate shall be adjusted based on the following formula:
where,
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CR
0
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=
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the Conversion Rate in effect immediately prior to the open of business on the Ex-Dividend Date of such dividend or distribution, or immediately prior to the open of business on the Effective Date of such share split or share
combination, as applicable;
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61
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CR’
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=
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the Conversion Rate in effect immediately after the open of business on such Ex-Dividend Date or Effective Date;
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OS
0
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=
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the number of shares of Common Stock outstanding immediately prior to giving effect to such dividend, distribution, share split or combination, as the case may be; and
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OS’
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=
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the number of shares of Common Stock outstanding immediately after giving effect to such dividend, distribution, share split or share combination.
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Any adjustment made under this Section 14.04(a) shall become effective immediately after the open of business on the
Ex-Dividend Date for such dividend or distribution, or immediately after the open of business on the Effective Date for such share split or share combination, as applicable. If any dividend or distribution of the type described in this Section
14.04(a) is declared but not so paid or made, the Conversion Rate shall be immediately readjusted, effective as of the date the Board of Directors determines not to pay such dividend or distribution, to the Conversion Rate that would then be in
effect if such dividend or distribution had not been declared.
(b) If the Company issues to all or substantially all holders of the
Common Stock any rights, options or warrants entitling them, for a period of not more than 45 calendar days after the announcement date of such issuance, to subscribe for or purchase shares of the Common Stock at a price per share that is less than
the average of the Last Reported Sale Prices of the Common Stock for the 10 consecutive Trading Day period ending on, and including, the Trading Day immediately preceding the date of announcement of such issuance, the Conversion Rate shall be
increased based on the following formula:
where,
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CR
0
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=
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the Conversion Rate in effect immediately prior to the open of business on the Ex-Dividend Date for such issuance;
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CR’
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=
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the Conversion Rate in effect immediately after the open of business on such Ex-Dividend Date;
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OS
0
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=
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the number of shares of Common Stock outstanding immediately prior to the open of business on such Ex-Dividend Date;
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X
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=
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the total number of shares of Common Stock issuable pursuant to such rights, options or warrants; and
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Y
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=
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the number of shares of Common Stock equal to the aggregate price payable to exercise such rights, options or warrants,
divided by
the average of the Last Reported Sale Prices of the Common Stock over the 10 consecutive
Trading Day period ending on, and including, the Trading Day immediately preceding the date of announcement of the issuance of such rights, options or warrants.
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62
Any increase made under this Section 14.04(b) shall be made successively whenever any such rights, options or
warrants are issued and shall become effective immediately after the open of business on the Ex-Dividend Date for such issuance. To the extent that shares of the Common Stock are not delivered after the expiration of such rights, options or
warrants, the Conversion Rate shall be decreased to the Conversion Rate that would then be in effect had the increase with respect to the issuance of such rights, options or warrants been made on the basis of delivery of only the number of shares of
Common Stock actually delivered. If such rights, options or warrants are not so issued, the Conversion Rate shall be decreased to the Conversion Rate that would then be in effect if such Ex-Dividend Date for such issuance had not occurred.
For purposes of this Section 14.04(b) and for the purpose of Section 14.01(b)(ii)(A), in determining whether any rights, options or warrants
entitle the holders to subscribe for or purchase shares of the Common Stock at less than such average of the Last Reported Sale Prices of the Common Stock for the 10 consecutive Trading Day period ending on, and including, the Trading Day
immediately preceding the date of announcement for such issuance, and in determining the aggregate offering price of such shares of Common Stock, there shall be taken into account any consideration received by the Company for such rights, options or
warrants and any amount payable on exercise or conversion thereof, the value of such consideration, if other than cash, to be determined by the Board of Directors.
(c) If the Company distributes shares of its Capital Stock, evidences of its indebtedness, other assets or property of the Company or rights,
options or warrants to acquire its Capital Stock or other securities, to all or substantially all holders of the Common Stock, excluding (i) dividends, distributions or issuances as to which an adjustment was effected pursuant to Section
14.04(a) or Section 14.04(b), (ii) dividends or distributions paid exclusively in cash as to which an adjustment was effected pursuant to Section 14.04(d), and (iii) Spin-Offs as to which the provisions set forth below in this Section
14.04(c) shall apply (any of such shares of Capital Stock, evidences of indebtedness, other assets or property or rights, options or warrants to acquire Capital Stock or other securities, the “
Distributed Property
”), then the
Conversion Rate shall be increased based on the following formula:
where,
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CR
0
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=
|
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the Conversion Rate in effect immediately prior to the open of business on the Ex-Dividend Date for such distribution;
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|
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CR’
|
|
=
|
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the Conversion Rate in effect immediately after the open of business on such Ex-Dividend Date;
|
63
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|
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SP
0
|
|
=
|
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the average of the Last Reported Sale Prices of the Common Stock over the 10 consecutive Trading Day period ending on, and including, the Trading Day immediately preceding the Ex-Dividend Date for such distribution; and
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FMV
|
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=
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|
the fair market value (as determined by the Board of Directors) of the Distributed Property with respect to each outstanding share of the Common Stock on the Ex-Dividend Date for such distribution.
|
Any increase made under the portion of this Section 14.04(c) above shall become effective immediately after the open of
business on the Ex-Dividend Date for such distribution. If such distribution is not so paid or made, the Conversion Rate shall be decreased to the Conversion Rate that would then be in effect if such distribution had not been declared.
Notwithstanding the foregoing, if “FMV” (as defined above) is equal to or greater than “SP
0
” (as defined above), in lieu of the foregoing increase, each Holder of a Note
shall receive, in respect of each $1,000 principal amount thereof, at the same time and upon the same terms as holders of the Common Stock receive the Distributed Property, the amount and kind of Distributed Property such Holder would have received
if such Holder owned a number of shares of Common Stock equal to the Conversion Rate in effect on the Ex-Dividend Date for the distribution. If the Board of Directors determines the “FMV” (as defined above) of any distribution for purposes
of this Section 14.04(c) by reference to the actual or when-issued trading market for any securities, it shall in doing so consider the prices in such market over the same period used in computing the Last Reported Sale Prices of the Common Stock
over the 10 consecutive Trading Day period ending on, and including, the Trading Day immediately preceding the Ex-Dividend Date for such distribution.
With respect to an adjustment pursuant to this Section 14.04(c) where there has been a payment of a dividend or other distribution on the
Common Stock of shares of Capital Stock of any class or series, or similar equity interest, of or relating to a Subsidiary or other business unit of the Company, that are, or, when issued, will be, listed or admitted for trading on a U.S. national
securities exchange (a “
Spin-Off
”), the Conversion Rate shall be increased based on the following formula:
where,
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CR
0
|
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=
|
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the Conversion Rate in effect immediately prior to the open of business on the Ex-Dividend Date for the Spin-Off;
|
|
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|
|
|
CR’
|
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=
|
|
the Conversion Rate in effect immediately after the open of business on the Ex-Dividend Date for the Spin-Off;
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FMV
0
|
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=
|
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the average of the Last Reported Sale Prices of the Capital Stock or similar equity interest distributed to holders of the Common Stock applicable to one share of the Common Stock (determined by reference to the definition of Last
Reported Sale Price as set forth in Section 1.01 as if references therein to Common Stock were to such Capital Stock or similar equity interest) over the first 10 consecutive Trading Day period after, and including, the Ex-Dividend Date of the
Spin-Off (the “
Valuation Period
”); and
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MP
0
|
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=
|
|
the average of the Last Reported Sale Prices of the Common Stock over the Valuation Period.
|
64
The increase to the Conversion Rate under the preceding paragraph shall occur on the last Trading Day of the
Valuation Period but will be given effect as of the open of business on the Ex-Dividend Date for the Spin-Off;
provided
that in respect of any conversion of Notes during the Valuation Period, references in the portion of this Section 14.04(c)
related to Spin-Offs with respect to 10 Trading Days shall be deemed to be replaced with such lesser number of Trading Days as have elapsed between the Ex-Dividend Date of such Spin-Off and the Conversion Date in determining the Conversion Rate. If
the Ex-Dividend Date of the Spin-Off is after the 10th Trading Day immediately preceding, and including, the end of any Observation Period in respect of a conversion of Notes, references in the preceding paragraph to 10 Trading Days will be deemed
to be replaced, solely in respect of that conversion of Notes, with such lesser number of Trading Days as have elapsed from, and including, the Ex-Dividend Date for the Spin-Off to, and including, the last Trading Day of such Observation Period.
For purposes of this Section 14.04(c) (and subject in all respect to Section 14.11), rights, options or warrants distributed by the
Company to all holders of the Common Stock entitling them to subscribe for or purchase shares of the Company’s Capital Stock, including Common 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 the Common Stock; (ii) are not exercisable; and (iii) are also issued in respect of future issuances of
the Common Stock, shall be deemed not to have been distributed for purposes of this Section 14.04(c) (and no adjustment to the Conversion Rate under this Section 14.04(c) will be required) until the occurrence of the earliest Trigger Event,
whereupon such rights, options or 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 14.04(c). If any such right, option or warrant, including
any such existing rights, options or warrants distributed prior to the date of this Indenture, are subject to events, upon the occurrence of which such rights, options or warrants become exercisable to purchase different securities, evidences of
indebtedness or other assets, then the date of the occurrence of any and each such event shall be deemed to be the date of distribution and Ex-Dividend Date with respect to new rights, options or warrants with such rights (in which case the existing
rights, options or warrants shall be deemed to terminate and expire on such date without exercise by any of the holders thereof). In addition, in the event of any distribution (or deemed distribution) of rights, options or warrants, or any Trigger
Event or other event (of the type described in the immediately preceding sentence) with respect thereto that was counted for purposes of calculating a distribution amount for which an adjustment to the Conversion Rate under this Section 14.04(c) was
made, (1) in the case of any such rights, options or warrants that shall all have been redeemed or purchased without exercise by any holders thereof, upon such final redemption or purchase (x) the Conversion Rate shall be readjusted as if
such rights, options or warrants had not been issued and (y) the Conversion Rate shall then again be readjusted to give effect to such distribution, deemed distribution or Trigger Event, as the case may be, as though it were a cash
distribution, equal to the per share redemption or purchase price received by a holder or holders of Common Stock
65
with respect to such rights, options or warrants (assuming such holder had retained such rights, options or warrants), made to all holders of Common Stock as of the date of such redemption or
purchase, and (2) in the case of such rights, options or warrants that shall have expired or been terminated without exercise by any holders thereof, the Conversion Rate shall be readjusted as if such rights, options and warrants had not been
issued.
For purposes of Section 14.04(a), Section 14.04(b) and this Section 14.04(c), if any dividend or distribution to which this
Section 14.04(c) is applicable also includes one or both of:
(A) a dividend or distribution of shares of Common Stock to which Section
14.04(a) is applicable (the “
Clause A Distribution
”); or
(B) a dividend or distribution of rights, options or warrants
to which Section 14.04(b) is applicable (the “
Clause B Distribution
”),
then, in either case, (1) such dividend or distribution,
other than the Clause A Distribution and the Clause B Distribution, shall be deemed to be a dividend or distribution to which this Section 14.04(c) is applicable (the “
Clause C Distribution
”) and any Conversion Rate adjustment
required by this Section 14.04(c) with respect to such Clause C Distribution shall then be made, and (2) the Clause A Distribution and Clause B Distribution shall be deemed to immediately follow the Clause C Distribution and any Conversion Rate
adjustment required by Section 14.04(a) and Section 14.04(b) with respect thereto shall then be made, except that, if determined by the Company (I) the “Ex-Dividend Date” of the Clause A Distribution and the Clause B Distribution
shall be deemed to be the Ex-Dividend Date of the Clause C Distribution and (II) any shares of Common Stock included in the Clause A Distribution or Clause B Distribution shall be deemed not to be “outstanding immediately prior to the open of
business on such Ex-Dividend Date or Effective Date” within the meaning of Section 14.04(a) or “outstanding immediately prior to the open of business on such Ex-Dividend Date” within the meaning of Section 14.04(b).
(d) If any cash dividend or distribution is made to all or substantially all holders of the Common Stock, other than a regular, quarterly cash
dividend that does not exceed $0.166 per share (the “
Initial Dividend Threshold
”), the Conversion Rate shall be adjusted based on the following formula:
where,
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CR
0
|
|
=
|
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the Conversion Rate in effect immediately prior to the open of business on the Ex-Dividend Date for such dividend or distribution;
|
|
|
|
|
|
CR’
|
|
=
|
|
the Conversion Rate in effect immediately after the open of business on the Ex-Dividend Date for such dividend or distribution;
|
66
|
|
|
|
|
|
|
SP
0
|
|
=
|
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the Last Reported Sale Price of the Common Stock on the Trading Day immediately preceding the Ex-Dividend Date for such dividend or distribution; and
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C
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=
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the amount in cash per share the Company distributes to all or substantially all holders of the Common Stock in excess of the Initial Dividend Threshold;
provided
that if the dividend or distribution is not a regular
quarterly cash dividend, the Initial Dividend Threshold shall be deemed to be zero.
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The Initial Dividend Threshold shall be subject to adjustment in a manner inversely proportional to adjustments to the
Conversion Rate;
provided
that no adjustment shall be made to the Initial Dividend Threshold for any adjustment to the Conversion Rate pursuant to this Section 14.04(d).
Any increase pursuant to this Section 14.04(d) shall become effective immediately after the open of business on the Ex-Dividend Date for such dividend or
distribution. If such dividend or distribution is not so paid, the Conversion Rate shall be decreased, effective as of the date the Board of Directors determines not to make or pay such dividend or distribution, to be the Conversion Rate that would
then be in effect if such dividend or distribution had not been declared. Notwithstanding the foregoing, if “C” (as defined above) is equal to or greater than “SP
0
” (as
defined above), in lieu of the foregoing increase, each Holder of a Note shall receive, for each $1,000 principal amount of Notes, at the same time and upon the same terms as holders of shares of the Common Stock, the amount of cash that such Holder
would have received if such Holder owned a number of shares of Common Stock equal to the Conversion Rate on the Ex-Dividend Date for such cash dividend or distribution.
(e) If the Company or any of its Subsidiaries make a payment in respect of a tender or exchange offer for the Common Stock, to the extent that
the cash and value of any other consideration included in the payment per share of the Common Stock exceeds the average of the Last Reported Sale Prices of the Common Stock over the 10 consecutive Trading Day period commencing on, and including, the
Trading Day next succeeding the last date on which tenders or exchanges may be made pursuant to such tender or exchange offer, the Conversion Rate shall be increased based on the following formula:
where,
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CR
0
|
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=
|
|
the Conversion Rate in effect immediately prior to the open of business on the Trading Day next succeeding the date such tender or exchange offer expires;
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CR’
|
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=
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the Conversion Rate in effect immediately after the open of business on the Trading Day next succeeding the date such tender or exchange offer expires;
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AC
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=
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the aggregate value of all cash and any other consideration (as determined by the Board of Directors) paid or payable for shares of Common Stock purchased in such tender or exchange offer;
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67
|
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OS
0
|
|
=
|
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the number of shares of Common Stock outstanding immediately prior to the date such tender or exchange offer expires (prior to giving effect to the purchase of all shares of Common Stock accepted for purchase or exchange in such
tender or exchange offer);
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OS’
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=
|
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the number of shares of Common Stock outstanding immediately after the date such tender or exchange offer expires (after giving effect to the purchase of all shares of Common Stock accepted for purchase or exchange in such tender or
exchange offer); and
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SP’
|
|
=
|
|
the average of the Last Reported Sale Prices of the Common Stock over the 10 consecutive Trading Day period commencing on, and including, the Trading Day next succeeding the date such tender or exchange offer expires.
|
The increase to the Conversion Rate under this Section 14.04(e) shall occur at the close of business on the 10th Trading Day
immediately following, and including, the Trading Day next succeeding the date such tender or exchange offer expires but will be given effect as of the open of business on the Trading Day next succeeding the date such tender or exchange offer
expires;
provided
that in respect of any conversion of Notes within the 10 Trading Days immediately following, and including, the expiration date of any tender or exchange offer, references in this Section 14.04(e) with respect to 10 Trading
Days shall be deemed replaced with such lesser number of Trading Days as have elapsed between the date that such tender or exchange offer expires and the Conversion Date in determining the Conversion Rate. In addition, if the Trading Day next
succeeding the date such tender or exchange offer expires is after the 10th Trading Day immediately preceding, and including, the end of any Observation Period in respect of a conversion of Notes, references in the preceding paragraph to 10 Trading
Days shall be deemed to be replaced, solely in respect of that conversion of Notes, with such lesser number of Trading Days as have elapsed from, and including, the Trading Day next succeeding the date such tender or exchange offer expires to, and
including, the last Trading Day of such Observation Period. If the Company or any of its Subsidiaries is obligated to purchase the Common Stock pursuant to any such tender offer or exchange offer but is permanently prevented by applicable law from
effecting any such purchase or all such purchases are rescinded, and the Company or any such Subsidiary does not make any payment in respect of such purchases, or such payment is refunded to the Company or any such Subsidiary, the new Conversion
Rate shall be readjusted to be the Conversion Rate that would be in effect if such tender or exchange offer had not been made.
(f) If:
(i) the Company elects (or is deemed to have elected) Combination Settlement and shares of the Common Stock are deliverable to settle the
Daily Settlement Amount for a given Trading Day within the Observation Period applicable to Notes that have been surrendered for conversion;
(ii) any distribution or transaction described in clauses (a), (b), (c), (d) or (e) of this Section 14.04 has not yet resulted in an
adjustment to the applicable Conversion Rate on the Trading Day in question; and
(iii) the shares of the Common Stock that the converting
Holder will receive in respect of such Trading Day are not entitled to participate in the relevant distribution or transaction (because they were not held on a related Regular Record Date or otherwise);
68
then the Company shall adjust the number of shares of the Common Stock that shall be delivered to
such converting Holder in respect of the relevant Trading Day to reflect the relevant distribution or transaction.
(g) If:
(i) the Company elects Physical Settlement;
(ii) any distribution or transaction described in clauses (a), (b), (c), (d) or (e) of this Section 14.04 has not yet resulted in an
adjustment to the applicable Conversion Rate on the Conversion Date; and
(iii) the shares of the Common Stock that the converting Holder
will receive on settlement are not entitled to participate in the relevant distribution or transaction (because they were not held on a related Regular Record Date or otherwise);
then the Company shall adjust the number of shares of the Common Stock that shall be delivered to such converting Holder in respect of the
relevant Trading Day to reflect the relevant distribution or transaction.
The Company will not take any action that would result in an
adjustment of the Conversion Rate, pursuant to Section 14.04(f) or this Section 14.04(g), in such a manner as to result in the reduction of the Conversion Price to less than the par value per share of the Common Stock.
(h) Notwithstanding this Section 14.04 or any other provision of this Indenture or the Notes, if a Conversion Rate adjustment becomes
effective on any Ex-Dividend Date, and a Holder that has converted its Notes on or after such Ex-Dividend Date and on or prior to the related Record Date would be treated as the record holder of the shares of Common Stock prior to the close of
business on such Record Date as described under Section 14.02(i) based on an adjusted Conversion Rate for such Ex-Dividend Date (which would occur if the Company elects Physical Settlement in respect of such Conversion Obligation), then,
notwithstanding the Conversion Rate adjustment provisions in this Section 14.04, the Conversion Rate adjustment relating to such Ex-Dividend Date shall not be made for such converting Holder if the Company has elected to satisfy the related
Conversion Obligation by Physical Settlement. Instead, such Holder shall be treated as if such Holder were the record owner of the shares of Common Stock on an unadjusted basis and participate in the related dividend, distribution or other event
giving rise to such adjustment.
(i) Except as stated herein, the Company shall not adjust the Conversion Rate for the issuance of shares
of the Common Stock or any securities convertible into or exchangeable for shares of the Common Stock or the right to purchase shares of the Common Stock or such convertible or exchangeable securities.
69
(j) In addition to those adjustments required by clauses (a), (b), (c), (d) and (e) of this
Section 14.04, and to the extent permitted by applicable law and subject to the applicable rules of any exchange on which any of the Company’s securities are then listed, the Company from time to time may increase the Conversion Rate by any
amount for a period of at least 20 Business Days if the Board of Directors determines that such increase would be in the Company’s best interest. In addition, to the extent permitted by applicable law and subject to the applicable rules of any
exchange on which any of the Company’s securities are then listed, the Company may (but is not required to) increase the Conversion Rate to avoid or diminish any income tax to holders of Common Stock or rights to purchase Common Stock in
connection with a dividend or distribution of shares of Common Stock (or rights to acquire shares of Common Stock) or similar event. Whenever the Conversion Rate is increased pursuant to either of the preceding two sentences, the Company shall give
to the Holder of each Note at its last address appearing on the Note Register a notice of the increase at least 15 days prior to the date the increased Conversion Rate takes effect, and such notice shall state the increased Conversion Rate and the
period during which it will be in effect.
(k) Notwithstanding anything to the contrary in this Article 14, the Conversion Rate shall not
be adjusted:
(i) upon the issuance of any shares of Common Stock pursuant to any present or future plan providing for the
reinvestment of dividends or interest payable on the Company’s securities and the investment of additional optional amounts in shares of Common Stock under any plan;
(ii) upon the issuance of any shares of Common Stock or options or rights to purchase those shares pursuant to any present or
future employee, director or consultant benefit plan or program of or assumed by the Company or any of the Company’s Subsidiaries;
(iii) upon the issuance of any shares of the Common Stock pursuant to any option, warrant, right or exercisable, exchangeable
or convertible security not described in clause (ii) of this subsection and outstanding as of the date the Notes were first issued;
(iv) solely for a change in the par value of the Common Stock; or
(v) for accrued and unpaid interest, if any.
(l) All calculations and other determinations under this Article 14 shall be made by the Company and shall be made to the nearest one-ten
thousandth (1/10,000th) of a share.
(m) Whenever the Conversion Rate is adjusted as herein provided, the Company shall promptly file
with the Trustee (and the Conversion Agent if not the Trustee) an Officers’ Certificate setting forth the Conversion Rate after such adjustment and setting forth a brief statement of the facts requiring such adjustment. Unless and until a
Responsible Officer of the Trustee shall have received such Officers’ Certificate, the Trustee shall not be deemed to have knowledge of any adjustment of the Conversion Rate and may assume without inquiry that the last Conversion Rate of which
it has knowledge is still in effect. Promptly after delivery of such certificate, the Company shall prepare a notice of such adjustment of the Conversion Rate setting
70
forth the adjusted Conversion Rate and the date on which each adjustment becomes effective and shall give such notice of such adjustment of the Conversion Rate to each Holder at its last address
appearing on the Note Register of this Indenture. Failure to deliver such notice shall not affect the legality or validity of any such adjustment.
(n) For purposes of this Section 14.04, the number of shares of Common Stock at any time outstanding shall not include shares of Common Stock
held in the treasury of the Company so long as the Company does not pay any dividend or make any distribution on shares of Common Stock held in the treasury of the Company, but shall include shares of Common Stock issuable in respect of scrip
certificates issued in lieu of fractions of shares of Common Stock.
Section 14.05.
Adjustments of Prices
. Whenever any
provision of this Indenture requires the Company to calculate the Last Reported Sale Prices, the Daily VWAPs, the Daily Conversion Values or the Daily Settlement Amounts over a span of multiple days (including an Observation Period and the period
for determining the Stock Price for purposes of a Make-Whole Fundamental Change), the Board of Directors shall make appropriate adjustments to each to account for any adjustment to the Conversion Rate that becomes effective, or any event requiring
an adjustment to the Conversion Rate where the Ex-Dividend Date, Effective Date or expiration date, as the case may be, of the event occurs, at any time during the period when the Last Reported Sale Prices, the Daily VWAPs, the Daily Conversion
Values or the Daily Settlement Amounts are to be calculated.
Section 14.06.
Shares to Be Fully Paid
. The Company shall
provide, free from preemptive rights, out of its authorized but unissued shares or shares held in treasury, sufficient shares of Common Stock to provide for conversion of the Notes from time to time as such Notes are presented for conversion
(assuming that at the time of computation of such number of shares, all such Notes would be converted by a single Holder and that Physical Settlement were applicable).
Section 14.07.
Effect of Recapitalizations, Reclassifications and Changes of the Common Stock
.
(a) In the case of:
(i) any recapitalization, reclassification or change of the Common Stock (other than changes resulting from a subdivision or
combination),
(ii) any consolidation, merger, combination or similar transaction involving the Company,
(iii) any sale, lease or other transfer to a third party of the consolidated assets of the Company and the Company’s
Subsidiaries substantially as an entirety or
(iv) any statutory share exchange,
in each case, as a result of which the Common Stock would be converted into, or exchanged for, stock, other securities, other property or assets (including
cash or any combination thereof) (any such event, a “
Merger Event
”), then, at and after the effective time of such Merger Event, the
71
right to convert each $1,000 principal amount of Notes shall be changed into a right to convert such principal amount of Notes into the kind and amount of shares of stock, other securities or
other property or assets (including cash or any combination thereof) that a holder of a number of shares of Common Stock equal to the Conversion Rate immediately prior to such Merger Event would have owned or been entitled to receive (the
“
Reference Property
,” with each “
unit of Reference Property
” meaning the kind and amount of Reference Property that a holder of one share of Common Stock is entitled to receive) upon such Merger Event and, prior to
or at the effective time of such Merger Event, the Company or the successor or purchasing Person, as the case may be, shall execute with the Trustee a supplemental indenture permitted under Section 10.01(g) providing for such change in the right to
convert each $1,000 principal amount of Notes;
provided
,
however
, that at and after the effective time of the Merger Event (A) the Company shall continue to have the right to determine the form of consideration to be paid or
delivered, as the case may be, upon conversion of Notes in accordance with Section 14.02 and (B) (I) any amount payable in cash upon conversion of the Notes in accordance with Section 14.02 shall continue to be payable in cash, (II) any
shares of Common Stock that the Company would have been required to deliver upon conversion of the Notes in accordance with Section 14.02 shall instead be deliverable in the amount and type of Reference Property that a holder of that number of
shares of Common Stock would have been entitled to receive in such Merger Event and (III) the Daily VWAP shall be calculated based on the value of a unit of Reference Property that a holder of one share of Common Stock would have received in such
transaction.
If the Merger Event causes the Common Stock to be converted into, or exchanged for, the right to receive more than a single
type of consideration (determined based in part upon any form of stockholder election), then (i) the Reference Property into which the Notes will be convertible shall be deemed to be (x) the weighted average of the types and amounts of
consideration received by the holders of Common Stock that affirmatively make such an election or (y) if no holders of Common Stock affirmatively make such an election, the types and amounts of consideration actually received by the holders of
Common Stock, and (ii) the unit of Reference Property for purposes of the immediately preceding paragraph shall refer to the consideration referred to in clause (i) attributable to one share of Common Stock. If the holders of the Common
Stock receive only cash in such Merger Event, then for all conversions for which the relevant Conversion Date occurs after the effective date of such Merger Event (A) the consideration due upon conversion of each $1,000 principal amount of
Notes shall be solely cash in an amount equal to the Conversion Rate in effect on the Conversion Date (as may be increased by any Additional Shares pursuant to Section 14.03),
multiplied by
the price paid per share of Common Stock in such
Merger Event and (B) the Company shall satisfy the Conversion Obligation by paying cash to converting Holders on the earlier of (x) the tenth Business Day immediately following the relevant Conversion Date and (y) the Maturity Date.
The Company shall notify Holders, the Trustee and the Conversion Agent (if other than the Trustee) of such weighted average as soon as practicable after such determination is made.
Such supplemental indenture described in the second immediately preceding paragraph shall provide for anti-dilution and other adjustments that
shall be as nearly equivalent as is possible to the adjustments provided for in this Article 14. If, in the case of any Merger Event, the Reference Property includes shares of stock, securities or other property or assets (including cash or any
combination thereof) of a Person other than the Company or the successor or purchasing corporation, as the case may be, in such Merger Event, then such supplemental
72
indenture shall also be executed by such other Person and shall contain such additional provisions to protect the interests of the Holders of the Notes as the Board of Directors shall reasonably
consider necessary by reason of the foregoing, including the provisions providing for the purchase rights set forth in Article 15.
(b)
When the Company executes a supplemental indenture pursuant to subsection (a) of this Section 14.07, the Company shall promptly file with the Trustee an Officers’ Certificate briefly stating the reasons therefor, the kind or amount of cash,
securities or property or asset that will comprise a unit of Reference Property after any such Merger Event, any adjustment to be made with respect thereto and that all conditions precedent have been complied with, and shall promptly give notice
thereof to all Holders. The Company shall cause notice of the execution of such supplemental indenture to be given to each Holder, at its address appearing on the Note Register provided for in this Indenture, within 20 days after execution thereof.
Failure to deliver such notice shall not affect the legality or validity of such supplemental indenture.
(c) The Company shall not become
a party to any Merger Event unless its terms are consistent with this Section 14.07. None of the foregoing provisions shall affect the right of a holder of Notes to convert its Notes into cash, shares of Common Stock or a combination of cash and
shares of Common Stock, as applicable, as set forth in Section 14.01 and Section 14.02 prior to the effective date of such Merger Event.
(d) The above provisions of this Section shall similarly apply to successive Merger Events.
(e) In connection with any Merger Event, the Initial Dividend Threshold shall be subject to adjustment as described in clause (i), clause
(ii) or clause (iii) below, as the case may be.
(i) In the case of a Merger Event in which the Reference
Property (determined, as appropriate, pursuant to subsection (a) above and excluding any dissenters’ appraisal rights) is composed entirely of shares of common stock (the “
Merger Common Stock
”), the Initial Dividend
Threshold at and after the effective time of such Merger Event shall be equal to (x) the Initial Dividend Threshold immediately prior to the effective time of such Merger Event,
divided by
(y) the number of shares of Merger Common
Stock that a holder of one share of Common Stock would receive in such Merger Event (such quotient rounded down to the nearest cent).
(ii) In the case of a Merger Event in which the Reference Property (determined, as appropriate, pursuant to subsection
(a) above and excluding any dissenters’ appraisal rights) is composed in part of shares of Merger Common Stock, the Initial Dividend Threshold at and after the effective time of such Merger Event shall be equal to (x) the Initial
Dividend Threshold immediately prior to the effective time of such Merger Event,
multiplied by
(y) the Merger Valuation Percentage for such Merger Event (such product rounded down to the nearest cent).
(iii) For the avoidance of doubt, in the case of a Merger Event in which the Reference Property (determined, as appropriate,
pursuant to subsection (a) above and
73
excluding any dissenters’ appraisal rights) is composed entirely of consideration other than shares of common stock, the Initial Dividend Threshold at and after the effective time of such
Merger Event shall be equal to zero.
Section 14.08.
Certain Covenants
. (a) The Company covenants that all shares of
Common Stock issued upon conversion of Notes will be fully paid and non-assessable by the Company and free from all taxes, liens and charges with respect to the issue thereof.
(b) The Company covenants that, if any shares of Common Stock to be provided for the purpose of conversion of Notes hereunder require
registration with or approval of any governmental authority under any federal or state law before such shares of Common Stock may be validly issued upon conversion, the Company will, to the extent then permitted by the rules and interpretations of
the Commission, secure such registration or approval, as the case may be.
(c) The Company further covenants that if at any time the
Common Stock shall be listed on any national securities exchange or automated quotation system the Company will list and keep listed, so long as the Common Stock shall be so listed on such exchange or automated quotation system, any Common Stock
issuable upon conversion of the Notes.
Section 14.09.
Responsibility of Trustee
. The Trustee and any other Conversion Agent
shall not at any time be under any duty or responsibility to any Holder to determine the Conversion Rate (or any adjustment thereto) or whether any facts exist that may require any adjustment (including any increase) of the Conversion Rate, or with
respect to the nature or extent or calculation of any such adjustment when made, or with respect to the method employed, or herein or in any supplemental indenture provided to be employed, in making the same. The Trustee and any other Conversion
Agent shall not be accountable with respect to the validity or value (or the kind or amount) of any shares of Common Stock, or of any securities, property or cash that may at any time be issued or delivered upon the conversion of any Note; and the
Trustee and any other Conversion Agent make no representations with respect thereto. Neither the Trustee nor any Conversion Agent shall be responsible for any failure of the Company to issue, transfer or deliver any shares of Common Stock or stock
certificates or other securities or property or cash upon the surrender of any Note for the purpose of conversion or to comply with any of the duties, responsibilities or covenants of the Company contained in this Article. Without limiting the
generality of the foregoing, neither the Trustee nor any Conversion Agent shall be under any responsibility to determine the correctness of any provisions contained in any supplemental indenture entered into pursuant to Section 14.07 relating either
to the kind or amount of shares of stock or securities or property (including cash) receivable by Holders upon the conversion of their Notes after any event referred to in such Section 14.07 or to any adjustment to be made with respect thereto, but,
subject to the provisions of Section 7.01, may accept (without any independent investigation) as conclusive evidence of the correctness of any such provisions, and shall be protected in relying upon, the Officers’ Certificate (which the Company
shall be obligated to file with the Trustee prior to the execution of any such supplemental indenture) with respect thereto. Neither the Trustee nor the Conversion Agent shall be responsible for determining whether any event contemplated by Section
14.01(b) has occurred that makes the Notes eligible for conversion or no longer eligible therefor until the Company has delivered to the Trustee and the Conversion Agent the notices referred to in Section 14.01(b) with respect to the
commencement or termination of such conversion rights, on
74
which notices the Trustee and the Conversion Agent may conclusively rely, and the Company agrees to deliver such notices to the Trustee and the Conversion Agent immediately after the occurrence
of any such event or at such other times as shall be provided for in Section 14.01(b).
Section 14.10.
Notice to Holders Prior to
Certain Actions
. In case of any:
(a) action by the Company or one of its Subsidiaries that would require an adjustment in the
Conversion Rate pursuant to Section 14.04 or Section 14.11;
(b) Merger Event; or
(c) voluntary or involuntary dissolution, liquidation or winding-up of the Company or any of its Subsidiaries;
then, in each case (unless notice of such event is otherwise required pursuant to another provision of this Indenture), the Company shall cause to be filed
with the Trustee and the Conversion Agent (if other than the Trustee) and to be given to each Holder at its address appearing on the Note Register, as promptly as possible but in any event at least 20 days prior to the applicable date hereinafter
specified, a notice stating (i) the date on which a record is to be taken for the purpose of such action by the Company or one of its Subsidiaries or, if a record is not to be taken, the date as of which the holders of Common Stock of record
are to be determined for the purposes of such action by the Company or one of its Subsidiaries, or (ii) the date on which such Merger Event, dissolution, liquidation or winding-up is expected to become effective or occur, and the date as of
which it is expected that holders of Common Stock of record shall be entitled to exchange their Common Stock for securities or other property deliverable upon such Merger Event, dissolution, liquidation or winding-up. Failure to give such notice, or
any defect therein, shall not affect the legality or validity of such action by the Company or one of its Subsidiaries, Merger Event, dissolution, liquidation or winding-up.
Section 14.11
. Stockholder Rights Plans.
If the Company has a stockholder rights plan in effect upon conversion of the
Notes, each share of Common Stock, if any, issued upon such conversion shall be entitled to receive the appropriate number of rights, if any, and the certificates representing the Common Stock issued upon such conversion shall bear such legends, if
any, in each case as may be provided by the terms of any such stockholder rights plan, as the same may be amended from time to time. However, if, prior to any conversion of Notes, the rights have separated from the shares of Common Stock in
accordance with the provisions of the applicable stockholder rights plan, the Conversion Rate shall be adjusted at the time of separation as if the Company distributed to all or substantially all holders of the Common Stock Distributed Property as
provided in Section 14.04(c), subject to readjustment in the event of the expiration, termination or redemption of such rights.
Section 14.12.
Limit on Issuance of Shares of Common Stock Upon Conversion
. Notwithstanding anything to the contrary in this
Indenture, if an event occurs that would result in an increase in the Conversion Rate by an amount in excess of limitations imposed by any shareholder approval rules or listing standards of any national or regional securities exchange that are
applicable to the Company, the Company will, at its option, either obtain stockholder approval of any issuance of Common Stock upon conversion of the Notes in excess of such
75
limitations or pay cash in lieu of delivering any shares of Common Stock otherwise deliverable upon conversions in excess of such limitations based on the Daily VWAP for each Trading Day of the
relevant Observation Period in respect of which, in lieu of delivering shares of Common Stock, the Company pays cash pursuant to this Section 14.12.
Section 14.13.
Exchange in Lieu of Conversion
. Notwithstanding anything herein to the contrary, when a Holder surrenders
Notes for conversion and the Conversion Date for such Note occurs prior to January 1, 2019, the Company may, at its election, direct the Conversion Agent in writing to surrender, on or prior to the Scheduled Trading Day immediately preceding
the first Trading Day of the applicable Observation Period (or, if the Company has elected to satisfy the related Conversion Obligation by Physical Settlement, on or prior to the Scheduled Trading Day immediately preceding the settlement date), such
Notes to a financial institution designated by the Company for exchange in lieu of conversion. In order to accept any Notes surrendered for conversion, the designated financial institution must agree to pay and/or deliver, as the case may be, to the
Conversion Agent for payment to such Holder, in exchange for such Notes, all of the cash, shares of Common Stock or a combination thereof otherwise due upon conversion, as provided under this Article 14. By the close of business on the Scheduled
Trading Day immediately preceding the first Trading Day of the applicable Observation Period (or, if the Company has elected to satisfy the related Conversion Obligation by Physical Settlement, by the close of business on the Scheduled Trading Day
immediately preceding the settlement date), the Company shall notify the Holder surrendering Notes for conversion that it has directed the designated financial institution to make an exchange in lieu of conversion.
If the designated financial institution accepts any such Notes, it will pay and/or deliver, as the case may be, the cash, shares of Common
Stock or a combination thereof due upon conversion to the Conversion Agent, and the Conversion Agent will pay and/or deliver such cash and/or shares of Common Stock to such Holder on the third Business Day immediately following the last Trading Day
of the applicable Observation Period (or, if the Company has elected to satisfy the related Conversion Obligation by Physical Settlement, on the third Business Day immediately following the relevant Conversion Date). Any Notes exchanged by the
designated institution will remain outstanding. If the designated financial institution agrees to accept any Notes for exchange but does not timely pay and/or deliver the related cash, shares of Common Stock or a combination thereof, as the case may
be, or if such designated financial institution does not accept the Notes for exchange, the Company shall convert the Notes and pay and/or deliver, as the case may be, the cash, shares of Common Stock or a combination thereof due upon conversion on
the third Business Day immediately following the last Trading Day of the applicable Observation Period (or, if the Company has elected to satisfy the related Conversion Obligation by Physical Settlement, on the third Business Day immediately
following the relevant Conversion Date), in accordance with this Article 14.
The Company’s designation of a financial institution to
which the Notes may be submitted for exchange does not require the financial institution to accept any Notes (unless the financial institution has separately made an agreement with the Company). The Company may, but is not obligated to, enter into a
separate agreement with any designated financial institution that would compensate it for any such transactions.
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ARTICLE 15
R
EPURCHASE
OF
N
OTES
AT
O
PTION
OF
H
OLDERS
Section 15.01.
[Intentionally Omitted]
Section 15.02
. Repurchase at Option of Holders Upon a Fundamental Change.
(a) If a Fundamental Change
occurs at any time, each Holder shall have the right, at such Holder’s option, to require the Company to repurchase for cash all of such Holder’s Notes, or any portion thereof that is equal to $1,000 or an integral multiple of $1,000, on
the date (the “
Fundamental Change Repurchase Date
”) specified by the Company that is not less than 20 calendar days or more than 35 calendar days following the date of the Fundamental Change Company Notice at a repurchase price
equal to 100% of the principal amount thereof,
plus
accrued and unpaid interest thereon to, but excluding, the Fundamental Change Repurchase Date (the “
Fundamental Change Repurchase Price
”), unless the
Fundamental Change Repurchase Date falls after a Regular Record Date but on or prior to the Interest Payment Date to which such Regular Record Date relates, in which case the Company shall instead pay the full amount of accrued and unpaid interest
to Holders of record as of such Regular Record Date, and the Fundamental Change Repurchase Price shall be equal to 100% of the principal amount of Notes to be repurchased pursuant to this Article 15.
(b) Repurchases of Notes under this Section 15.02 shall be made, at the option of the Holder thereof, upon:
(i) delivery to the Paying Agent by a Holder of a duly completed notice (the “
Fundamental Change Repurchase
Notice
”) in the form set forth in Attachment 2 to the Form of Note attached hereto as Exhibit A, if the Notes are Physical Notes, or in compliance with the Depositary’s procedures for surrendering interests in Global Notes, if the
Notes are Global Notes, in each case on or before the close of business on the Business Day immediately preceding the Fundamental Change Repurchase Date; and
(ii) delivery of the Notes, if the Notes are Physical Notes, to the Paying Agent at any time after delivery of the Fundamental
Change Repurchase Notice (together with all necessary endorsements for transfer) at the Corporate Trust Office of the Paying Agent, or book-entry transfer of the Notes, if the Notes are Global Notes, in compliance with the procedures of the
Depositary, in each case such delivery being a condition to receipt by the Holder of the Fundamental Change Repurchase Price therefor.
The Fundamental Change Repurchase Notice in respect of any Notes to be repurchased shall state:
(i) in the case of Physical Notes, the certificate numbers of the Notes to be delivered for repurchase;
(ii) the portion of the principal amount of Notes to be repurchased, which must be $1,000 or an integral multiple thereof; and
(iii) that the Notes are to be repurchased by the Company pursuant to the applicable provisions of the Notes and this
Indenture;
77
provided
,
however
, that if the Notes are Global Notes, the Fundamental Change Repurchase Notice
must comply with appropriate Depositary procedures.
Notwithstanding anything herein to the contrary, any Holder delivering to the
Paying Agent the Fundamental Change Repurchase Notice contemplated by this Section 15.02 shall have the right to withdraw, in whole or in part, such Fundamental Change Repurchase Notice at any time prior to the close of business on the Business Day
immediately preceding the Fundamental Change Repurchase Date by delivery of a written notice of withdrawal to the Paying Agent in accordance with Section 15.03.
The Paying Agent shall promptly notify the Company of the receipt by it of any Fundamental Change Repurchase Notice or written notice of
withdrawal thereof.
(c) On or before the 20th calendar day after the occurrence of the effective date of a Fundamental Change, the
Company shall provide to all Holders of Notes and the Trustee and the Paying Agent (in the case of a Paying Agent other than the Trustee) a notice (the “
Fundamental Change Company Notice
”) of the occurrence of the effective date of
the Fundamental Change and of the repurchase right at the option of the Holders arising as a result thereof. In the case of Physical Notes, such notice shall be by first class mail or, in the case of Global Notes, such notice shall be delivered in
accordance with the applicable procedures of the Depositary. Simultaneously with providing such notice, the Company shall issue a press release containing the information set forth in the Fundamental Change Company Notice. Each Fundamental Change
Company Notice shall specify:
(i) the events causing the Fundamental Change;
(ii) the date of the Fundamental Change;
(iii) the last date on which a Holder may exercise the repurchase right pursuant to this Article 15;
(iv) the Fundamental Change Repurchase Price;
(v) the Fundamental Change Repurchase Date;
(vi) the name and address of the Paying Agent and the Conversion Agent, if applicable;
(vii) if applicable, the Conversion Rate and any adjustments to the Conversion Rate;
(viii) that the Notes with respect to which a Fundamental Change Repurchase Notice has been delivered by a Holder may be
converted only if the Holder withdraws the Fundamental Change Repurchase Notice in accordance with the terms of this Indenture; and
(ix) the procedures that Holders must follow to require the Company to repurchase their Notes.
78
No failure of the Company to give the foregoing notices and no defect therein shall limit the
Holders’ repurchase rights or affect the validity of the proceedings for the repurchase of the Notes pursuant to this Section 15.02.
At the Company’s request, the Trustee shall give such notice in the Company’s name and at the Company’s expense;
provided
,
however
, that, in all cases, the text of such Fundamental Change Company Notice shall be prepared by the Company and such request is made by the Company at least five (5) Business Days (or such shorter period as may be
agreed to by the Trustee) prior to the date such notice is required to be sent to Holders.
(d) Notwithstanding the foregoing, no
Notes may be repurchased by the Company on any date at the option of the Holders upon a Fundamental Change if the principal amount of the Notes has been accelerated, and such acceleration has not been rescinded, on or prior to such date (except in
the case of an acceleration resulting from a Default by the Company in the payment of the Fundamental Change Repurchase Price with respect to such Notes). The Paying Agent will promptly return to the respective Holders thereof any Physical Notes
held by it during the acceleration of the Notes (except in the case of an acceleration resulting from a Default by the Company in the payment of the Fundamental Change Repurchase Price with respect to such Notes), or any instructions for book-entry
transfer of the Notes in compliance with the procedures of the Depositary shall be deemed to have been cancelled, and, upon such return or cancellation, as the case may be, the Fundamental Change Repurchase Notice with respect thereto shall be
deemed to have been withdrawn.
Section 15.03
. Withdrawal of Fundamental Change Repurchase Notice.
(a) A
Fundamental Change Repurchase Notice may be withdrawn (in whole or in part) by means of a written notice of withdrawal delivered to the Corporate Trust Office of the Paying Agent in accordance with this Section 15.03 at any time prior to the close
of business on the Business Day immediately preceding the Fundamental Change Repurchase Date, specifying:
(i) the
principal amount of the Notes with respect to which such notice of withdrawal is being submitted, which must be $1,000 or an integral multiple thereof,
(ii) if Physical Notes have been issued, the certificate number of the Note in respect of which such notice of withdrawal is
being submitted, and
(iii) the principal amount, if any, of such Note that remains subject to the original Fundamental
Change Repurchase Notice, which portion must be in principal amounts of $1,000 or an integral multiple of $1,000;
provided
,
however
, that
if the Notes are Global Notes, the notice must comply with appropriate procedures of the Depositary.
Section 15.04
.
Deposit of Fundamental Change Repurchase Price.
(a) The Company will deposit with the Trustee (or other Paying Agent appointed by the Company, or if the Company is acting as its own Paying Agent, set aside, segregate and hold in trust as
provided in Section 4.04) on or prior to 11:00 a.m., New York City time, on the Fundamental Change Repurchase Date an amount of money sufficient to repurchase all of the Notes to be repurchased at the appropriate Fundamental Change Repurchase Price.
Subject to receipt of funds and/or
79
Notes by the Trustee (or other Paying Agent appointed by the Company), payment for Notes surrendered for repurchase (and not withdrawn prior to the close of business on the Business
Day immediately preceding the Fundamental Change Repurchase Date) will be made on the later of (i) the Fundamental Change Repurchase Date (
provided
the Holder has satisfied the conditions in Section 15.02) and (ii) the time of
book-entry transfer or the delivery of such Note to the Trustee (or other Paying Agent appointed by the Company) by the Holder thereof in the manner required by Section 15.02 by mailing checks for the amount payable to the Holders of such Notes
entitled thereto as they shall appear in the Note Register;
provided
,
however
, that payments to the Depositary shall be made by wire transfer of immediately available funds to the account of the Depositary or its nominee. The Trustee
shall, promptly after such payment and upon written demand by the Company, return to the Company any funds in excess of the Fundamental Change Repurchase Price.
(b) If by 11:00 a.m. New York City time, on the Fundamental Change Repurchase Date, the Trustee (or other Paying Agent appointed by the
Company) holds money sufficient to make payment on all the Notes or portions thereof that are to be repurchased on such Fundamental Change Repurchase Date, then, with respect to the Notes that have been properly surrendered for repurchase and have
not been validly withdrawn, (i) such Notes will cease to be outstanding, (ii) interest will cease to accrue on such Notes (whether or not book-entry transfer of the Notes has been made or the Notes have been delivered to the Trustee or
Paying Agent) and (iii) all other rights of the Holders of such Notes will terminate (other than the right to receive the Fundamental Change Repurchase Price and, if applicable, accrued and unpaid interest).
(c) Upon surrender of a Note that is to be repurchased in part pursuant to Section 15.02, the Company shall execute and the Trustee shall
authenticate and deliver to the Holder a new Note in an authorized denomination equal in principal amount to the unrepurchased portion of the Note surrendered.
Section 15.05.
Covenant to Comply with Applicable Laws Upon Repurchase of Notes
. In connection with any repurchase offer,
the Company will, if required:
(a) comply with the provisions of Rule 13e-4, Rule 14e-1 and any other tender offer rules under the
Exchange Act;
(b) file a Schedule TO or any other required schedule under the Exchange Act; and
(c) otherwise comply with all federal and state securities laws in connection with any offer by the Company to repurchase the Notes;
in each case, so as to permit the rights and obligations under this Article 15 to be exercised in the time and in the manner specified in this Article 15.
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ARTICLE 16
N
O
R
EDEMPTION
Section 16.01.
No Redemption
. The Notes shall not be redeemable by the Company prior to the Maturity Date, and no sinking
fund is provided for the Notes.
ARTICLE 17
M
ISCELLANEOUS
P
ROVISIONS
Section 17.01
. Provisions Binding on Company’s Successors.
All the covenants, stipulations, promises and agreements of
the Company contained in this Indenture shall bind its successors and assigns whether so expressed or not.
Section 17.02
. Official Acts by Successor Corporation.
Any act or proceeding by any provision of this Indenture authorized
or required to be done or performed by any board, committee or Officer of the Company shall and may be done and performed with like force and effect by the like board, committee or officer of any corporation or other entity that shall at the time be
the lawful sole successor of the Company.
Section 17.03
. Addresses for Notices, Etc.
Any notice or demand that
by any provision of this Indenture is required or permitted to be given or served by the Trustee or by the Holders on the Company shall be deemed to have been sufficiently given or made, for all purposes if given or served by being deposited postage
prepaid by registered or certified mail in a post office letter box addressed (until another address is filed by the Company with the Trustee) to MercadoLibre, Inc., Arias 3751, 7
th
Floor, Buenos
Aires, C1430CRG, Argentina, Attention: General Counsel. Any notice, direction, request or demand hereunder to or upon the Trustee shall be deemed to have been sufficiently given or made, for all purposes, if given or served by being deposited
postage prepaid by registered or certified mail in a post office letter box addressed to the Corporate Trust Office.
The Trustee,
by notice to the Company, may designate additional or different addresses for subsequent notices or communications.
Any notice or
communication mailed to a Holder shall be mailed to it by first class mail, postage prepaid, at its address as it appears on the Note Register and shall be sufficiently given to it if so mailed within the time prescribed;
provided
that
notices given to Holders of Global Notes may be given electronically through the facilities of the Depositary.
Failure to mail a
notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders. If a notice or communication is mailed in the manner provided above, it is duly given, whether or not the addressee receives it.
In case by reason of the suspension of regular mail service or by reason of any other cause it shall be impracticable to give such notice
to Holders by mail, then such notification as shall be made with the approval of the Trustee shall constitute a sufficient notification for every purpose hereunder.
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Section 17.04
. Governing Law; Jurisdiction.
THIS INDENTURE AND EACH NOTE, AND
ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER OR RELATED TO THIS INDENTURE AND EACH NOTE, SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD TO THE CONFLICTS OF LAWS PROVISIONS THEREOF).
The Company irrevocably consents and agrees, for the benefit of the Holders from time to time of the Notes and the Trustee,
that any legal action, suit or proceeding against it with respect to obligations, liabilities or any other matter arising out of or in connection with this Indenture or the Notes may be brought in the courts of the State of New York or the courts of
the United States located in the Borough of Manhattan, New York City, New York and, until amounts due and to become due in respect of the Notes have been paid, hereby irrevocably consents and submits to the non-exclusive jurisdiction of each such
court
in personam
, generally and unconditionally with respect to any action, suit or proceeding for itself in respect of its properties, assets and revenues.
The Company irrevocably and unconditionally waives, to the fullest extent permitted by law, any objection which it may now or hereafter have
to the laying of venue of any of the aforesaid actions, suits or proceedings arising out of or in connection with this Indenture brought in the courts of the State of New York or the courts of the United States located in the Borough of Manhattan,
New York City, New York and hereby further irrevocably and unconditionally waives and agrees not to plead or claim in any such court that any such action, suit or proceeding brought in any such court has been brought in an inconvenient forum.
Section 17.05
. Evidence of Compliance with Conditions Precedent; Certificates and Opinions of Counsel to Trustee.
Upon any
application or demand by the Company to the Trustee to take any action under any of the provisions of this Indenture, the Company shall, if requested by the Trustee, furnish to the Trustee an Officers’ Certificate stating that such action is
permitted by the terms of this Indenture.
Each Officers’ Certificate provided for, by or on behalf of the Company in this
Indenture and delivered to the Trustee with respect to compliance with this Indenture (other than the Officers’ Certificates provided for in Section 4.08) shall include (a) a statement that the person signing such certificate is familiar
with the requested action and this Indenture; (b) a brief statement as to the nature and scope of the examination or investigation upon which the statement contained in such certificate is based; (c) a statement that, in the judgment of
such person, he or she has made such examination or investigation as is necessary to enable him or her to express an informed judgment as to whether or not such action is permitted by this Indenture; and (d) a statement as to whether or not, in
the judgment of such person, such action is permitted by this Indenture and that all conditions precedent thereto have been complied with.
Notwithstanding anything to the contrary in this Section 17.05, if any provision in this Indenture specifically provides that the Trustee
shall or may receive an Opinion of Counsel in connection with any action to be taken by the Trustee or the Company hereunder, the Trustee shall be entitled to, or entitled to request, such Opinion of Counsel.
82
Section 17.06
. Legal Holidays.
In any case where any Interest Payment Date,
Fundamental Change Repurchase Date or Maturity Date is not a Business Day, then any action to be taken on such date need not be taken on such date, but may be taken on the next succeeding Business Day with the same force and effect as if taken on
such date, and no interest shall accrue in respect of the delay.
Section 17.07
. No Security Interest Created.
Nothing in this Indenture or in the Notes, expressed or implied, shall be construed to constitute a security interest under the Uniform Commercial Code or similar legislation, as now or hereafter enacted and in effect, in any jurisdiction.
Section 17.08
. Benefits of Indenture.
Nothing in this Indenture or in the Notes, expressed or implied, shall give
to any Person, other than the Holders, the parties hereto, any Paying Agent, any Conversion Agent, any authenticating agent, any Note Registrar and their successors hereunder, any benefit or any legal or equitable right, remedy or claim under this
Indenture.
Section 17.09
. Table of Contents, Headings, Etc.
The table of contents and the titles 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.
Section 17.10
. Authenticating Agent.
The Trustee may appoint an authenticating agent that shall be authorized to act on its
behalf and subject to its direction in the authentication and delivery of Notes in connection with the original issuance thereof and transfers and exchanges of Notes hereunder, including under Section 2.04, Section 2.05, Section 2.06, Section 2.07,
Section 10.04 and Section 15.04 as fully to all intents and purposes as though the authenticating agent had been expressly authorized by this Indenture and those Sections to authenticate and deliver Notes. For all purposes of this Indenture, the
authentication and delivery of Notes by the authenticating agent shall be deemed to be authentication and delivery of such Notes “by the Trustee” and a certificate of authentication executed on behalf of the Trustee by an authenticating
agent shall be deemed to satisfy any requirement hereunder or in the Notes for the Trustee’s certificate of authentication. Such authenticating agent shall at all times be a Person eligible to serve as trustee hereunder pursuant to Section
7.08.
Any corporation or other entity into which any authenticating agent may be merged or converted or with which it may be
consolidated, or any corporation or other entity resulting from any merger, consolidation or conversion to which any authenticating agent shall be a party, or any corporation or other entity succeeding to the corporate trust business of any
authenticating agent, shall be the successor of the authenticating agent hereunder, if such successor corporation or other entity is otherwise eligible under this Section 17.10, without the execution or filing of any paper or any further act on the
part of the parties hereto or the authenticating agent or such successor corporation or other entity.
Any authenticating agent may at any
time resign by giving written notice of resignation to the Trustee and to the Company. The Trustee may at any time terminate the agency of any authenticating agent by giving written notice of termination to such authenticating agent and to
83
the Company. Upon receiving such a notice of resignation or upon such a termination, or in case at any time any authenticating agent shall cease to be eligible under this Section, the Trustee may
appoint a successor authenticating agent (which may be the Trustee), shall give written notice of such appointment to the Company and shall mail notice of such appointment to all Holders as the names and addresses of such Holders appear on the Note
Register.
The Company agrees to pay to the authenticating agent from time to time reasonable compensation for its services although the
Company may terminate the authenticating agent, if it determines such agent’s fees to be unreasonable.
The provisions of Section
7.02, Section 7.03, Section 7.04, Section 8.03 and this Section 17.10 shall be applicable to any authenticating agent.
If an
authenticating agent is appointed pursuant to this Section 17.10, the Notes may have endorsed thereon, in addition to the Trustee’s certificate of authentication, an alternative certificate of authentication in the following form:
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,
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as Authenticating Agent, certifies that this is one of the Notes described in the within-named Indenture.
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By:
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Authorized Officer
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Section 17.11
. Execution in Counterparts.
This Indenture may be executed in any number of
counterparts, each of which shall be an original, but such counterparts shall together constitute but one and the same instrument. The exchange of copies of this Indenture and of signature pages by facsimile or PDF transmission shall constitute
effective execution and delivery of this Indenture as to the parties hereto and may be used in lieu of the original Indenture for all purposes. Signatures of the parties hereto transmitted by facsimile or PDF shall be deemed to be their original
signatures for all purposes.
Section 17.12
. Severability.
In the event any provision of this Indenture or in
the Notes shall be invalid, illegal or unenforceable, then (to the extent permitted by law) the validity, legality or enforceability of the remaining provisions shall not in any way be affected or impaired.
Section 17.13
. Waiver of Jury Trial.
EACH OF THE COMPANY AND THE TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE, THE NOTES OR THE TRANSACTIONS CONTEMPLATED HEREBY.
Section 17.14.
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
84
or computer (software and hardware) services; it being understood that the Trustee shall use reasonable efforts that are consistent with accepted practices in the banking industry to resume
performance as soon as practicable under the circumstances.
Section 17.15
. Calculations
. Except as otherwise provided herein,
the Company shall be responsible for making all calculations called for under the Notes. These calculations include, but are not limited to, determinations of the Last Reported Sale Prices of the Common Stock, the Daily VWAPs, the Daily Conversion
Values, the Daily Settlement Amounts, accrued interest payable on the Notes, any Additional Interest payable on the Notes and the Conversion Rate of the Notes. The Company shall make all these calculations in good faith and, absent manifest error,
the Company’s calculations shall be final and binding on Holders of Notes. The Company shall provide a schedule of its calculations to each of the Trustee and the Conversion Agent, and each of the Trustee and Conversion Agent is entitled to
rely conclusively upon the accuracy of the Company’s calculations without independent verification. The Trustee will forward the Company’s calculations to any Holder of Notes upon the request of that Holder at the sole cost and expense of
the Company.
Section 17.16.
USA PATRIOT Act.
The parties hereto acknowledge that in accordance with Section 326
of the USA PATRIOT Act, the Trustee, like all financial institutions and in order to help fight the funding of terrorism and money laundering, is required to obtain, verify, and record information that identifies each person or legal entity that
establishes a relationship or opens an account with the Trustee. The parties to this Indenture agree that they will provide the Trustee with such information as it may request in order for the Trustee to satisfy the requirements of the USA PATRIOT
Act.
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85
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed as of the
date first written above.
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MERCADOLIBRE, INC.
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By:
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/s/ Pedro Arnt
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Name:
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Pedro Arnt
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Title:
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Chief Financial Officer
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WILMINGTON TRUST, NATIONAL ASSOCIATION, as Trustee
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By:
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/s/ W. Thomas Morris, II
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Name:
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W. Thomas Morris, II
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Title:
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Vice President
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EXHIBIT A
[FORM OF FACE OF NOTE]
[INCLUDE
FOLLOWING LEGEND IF A GLOBAL NOTE]
[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 HEREUNDER 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.]
[INCLUDE FOLLOWING LEGEND IF A
RESTRICTED SECURITY]
[THIS SECURITY AND THE COMMON STOCK, IF ANY, ISSUABLE UPON CONVERSION OF THIS SECURITY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT IN ACCORDANCE WITH THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST
HEREIN, THE ACQUIRER:
(1) REPRESENTS THAT IT AND ANY ACCOUNT FOR WHICH IT IS ACTING IS A “QUALIFIED INSTITUTIONAL
BUYER” (WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT) AND THAT IT EXERCISES SOLE INVESTMENT DISCRETION WITH RESPECT TO EACH SUCH ACCOUNT, AND
(2) AGREES FOR THE BENEFIT OF MERCADOLIBRE, INC. (THE “COMPANY”) THAT IT WILL NOT OFFER, SELL, PLEDGE OR OTHERWISE
TRANSFER THIS SECURITY OR ANY BENEFICIAL INTEREST HEREIN PRIOR TO THE DATE THAT IS THE LATER OF (X) ONE YEAR AFTER THE LAST ORIGINAL ISSUE DATE HEREOF OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144 UNDER THE SECURITIES ACT OR ANY
SUCCESSOR PROVISION THERETO AND (Y) SUCH LATER DATE, IF ANY, AS MAY BE REQUIRED BY APPLICABLE LAW, EXCEPT:
(A) TO THE
COMPANY OR ANY SUBSIDIARY THEREOF, OR
(B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BECOME EFFECTIVE UNDER THE
SECURITIES ACT, OR
A-1
(C) TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE
SECURITIES ACT, OR
(D) PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT OR ANY
OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
PRIOR TO THE REGISTRATION OF ANY TRANSFER IN
ACCORDANCE WITH CLAUSE (2)(D) ABOVE, THE COMPANY AND THE TRUSTEE RESERVE THE RIGHT TO REQUIRE THE DELIVERY OF SUCH LEGAL OPINIONS, CERTIFICATIONS OR OTHER EVIDENCE AS MAY REASONABLY BE REQUIRED IN ORDER TO DETERMINE THAT THE PROPOSED TRANSFER
IS BEING MADE IN COMPLIANCE WITH THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS. NO REPRESENTATION IS MADE AS TO THE AVAILABILITY OF ANY EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.]
A-2
MERCADOLIBRE, INC.
2.25% Convertible Senior Note due 2019
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No. [ ]
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[Initially]
1
$[ ]
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CUSIP No. [ ]
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MERCADOLIBRE, INC., a corporation duly organized and validly existing under the laws of the State of
Delaware (the “
Company
,” which term includes any successor corporation or other entity under the Indenture referred to on the reverse hereof), for value received hereby promises to pay to [CEDE & CO.]
2
[ ]
3
, or registered assigns, the principal sum [as set forth in the
“Schedule of Exchanges of Notes” attached hereto]
4
[of $[ ]]
5
, which amount, taken
together with the principal amounts of all other outstanding Notes, shall not, unless permitted by the Indenture, exceed $330,000,000 in aggregate at any time, in accordance with the rules and procedures of the Depositary, on July 1, 2019, and
interest thereon as set forth below.
This Note shall bear interest at the rate of 2.25% per year from June 30, 2014, or
from the most recent date to which interest had been paid or provided for to, but excluding, the next scheduled Interest Payment Date until July 1, 2019. Interest is payable semi-annually in arrears on each January 1 and July 1,
commencing on January 1, 2015, to Holders of record at the close of business on the preceding December 15 and June 15 (whether or not such day is a Business Day), respectively. Additional Interest will be payable as set forth in
Section 4.06(d), Section 4.06(e) and Section 6.03 of the within-mentioned Indenture, and any reference to interest on, or in respect of, any Note therein shall be deemed to include Additional Interest if, in such context, Additional
Interest is, was or would be payable pursuant to any of such Section 4.06(d), Section 4.06(e) or Section 6.03, and any express mention of the payment of Additional Interest in any provision therein shall not be construed as excluding
Additional Interest in those provisions thereof where such express mention is not made.
Any Defaulted Amounts shall accrue interest per
annum at the rate borne by the Notes, subject to the enforceability thereof under applicable law, from, and including, the relevant payment date to, but excluding, the date on which such Defaulted Amounts shall have been paid by the Company, at its
election, in accordance with Section 2.03(c) of the Indenture.
The Company shall pay the principal of and interest on this Note, if
and so long as such Note is a Global Note, by wire transfer in immediately available funds to the Depositary or its nominee, as the case may be, as the registered Holder of such Note. As provided in and subject to the provisions of the Indenture,
the Company shall pay the principal of any Notes (other than Notes that are Global Notes) at the office or agency designated by the Company for that purpose.
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Include if a global note.
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2
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Include if a global note.
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3
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Include if a physical note.
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Include if a global note.
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5
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Include if a physical note.
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A-3
The Company has initially designated the Trustee as its Paying Agent and Note Registrar in respect of the Notes and its Corporate Trust Office, as a place where Notes may be presented for payment
or for registration of transfer and exchange.
Reference is made to the further provisions of this Note set forth on the reverse hereof,
including, without limitation, provisions giving the Holder of this Note the right to convert this Note into cash, shares of Common Stock or a combination of cash and shares of Common Stock, as applicable, on the terms and subject to the limitations
set forth in the Indenture. Such further provisions shall for all purposes have the same effect as though fully set forth at this place.
This Note, and any claim, controversy or dispute arising under or related to this Note, shall be construed in accordance with and governed
by the laws of the State of New York (without regard to the conflicts of laws provisions thereof).
In the case of any conflict
between this Note and the Indenture, the provisions of the Indenture shall control and govern.
This Note shall not be valid or become
obligatory for any purpose until the certificate of authentication hereon shall have been signed manually by the Trustee or a duly authorized authenticating agent under the Indenture.
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A-4
IN WITNESS WHEREOF, the Company has caused this Note to be duly executed.
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MERCADOLIBRE, INC.
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By:
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Name:
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Title:
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Dated:
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TRUSTEE’S CERTIFICATE OF AUTHENTICATION
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WILMINGTON TRUST, NATIONAL ASSOCIATION as Trustee, certifies that this is one of the Notes described in the within-named Indenture.
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By:
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Authorized Officer
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A-5
[FORM OF REVERSE OF NOTE]
MERCADOLIBRE, INC.
2.25%
Convertible Senior Note due 2019
This Note is one of a duly authorized issue of Notes of the Company, designated as its 2.25%
Convertible Senior Notes due 2019 (the “
Notes
”), limited to the aggregate principal amount of $330,000,000 all issued or to be issued under and pursuant to an Indenture dated as of June 30, 2014 (as amended or supplemented from
time to time in accordance with its terms, the “
Indenture
”), between the Company and Wilmington Trust, National Association (the “
Trustee
”), to which Indenture and all indentures supplemental thereto reference is
hereby made for a description of the rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, the Company and the Holders of the Notes. Additional Notes may be issued in an unlimited aggregate principal amount,
subject to certain conditions specified in the Indenture. Capitalized terms used in this Note and not defined in this Note shall have the respective meanings set forth in the Indenture.
In case certain Events of Default shall have occurred and be continuing, the principal of, and interest on, all Notes may be declared, by
either the Trustee or Holders of at least 25% in aggregate principal amount of Notes then outstanding, and upon said declaration shall become, due and payable, in the manner, with the effect and subject to the conditions and certain exceptions set
forth in the Indenture.
Subject to the terms and conditions of the Indenture, the Company will make all payments and deliveries in
respect of the Fundamental Change Repurchase Price on the Fundamental Change Repurchase Date and the principal amount on the Maturity Date, as the case may be, to the Holder who surrenders a Note to a Paying Agent to collect such payments in respect
of the Note. The Company will pay cash amounts in money of the United States that at the time of payment is legal tender for payment of public and private debts.
The Indenture contains provisions permitting the Company and the Trustee in certain circumstances, without the consent of the Holders of the
Notes, and in certain other circumstances, with the consent of the Holders of not less than a majority in aggregate principal amount of the Notes at the time outstanding, evidenced as in the Indenture provided, to execute supplemental indentures
modifying the terms of the Indenture and the Notes as described therein. It is also provided in the Indenture that, subject to certain exceptions, the Holders of a majority in aggregate principal amount of the Notes at the time outstanding may on
behalf of the Holders of all of the Notes waive any past Default or Event of Default under the Indenture and its consequences.
No
reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay or deliver, as the case may be, the principal (including the
Fundamental Change Repurchase Price, if applicable) of, accrued and unpaid interest on, and the consideration due upon conversion of, this Note at the place, at the respective times, at the rate and in the lawful money herein prescribed.
A-6
The Notes are issuable in registered form without coupons in denominations of $1,000 principal
amount and integral multiples thereof. At the office or agency of the Company referred to on the face hereof, and in the manner and subject to the limitations provided in the Indenture, Notes may be exchanged for a like aggregate principal amount of
Notes of other authorized denominations, without payment of any service charge but, if required by the Company or Trustee, with payment of a sum sufficient to cover any transfer or similar tax that may be imposed in connection therewith as a result
of the name of the Holder of the new Notes issued upon such exchange of Notes being different from the name of the Holder of the old Notes surrendered for such exchange.
The Notes are not subject to redemption through the operation of any sinking fund or otherwise.
Upon the occurrence of a Fundamental Change, the Holder has the right, at such Holder’s option, to require the Company to repurchase for
cash all of such Holder’s Notes or any portion thereof (in principal amounts of $1,000 or integral multiples thereof) on the Fundamental Change Repurchase Date at a price equal to the Fundamental Change Repurchase Price.
Subject to the provisions of the Indenture, the Holder hereof has the right, at its option, during certain periods and upon the occurrence of
certain conditions specified in the Indenture, prior to the close of business on the second Scheduled Trading Day immediately preceding the Maturity Date, to convert any Notes or portion thereof that is $1,000 or an integral multiple thereof, into
cash, shares of Common Stock or a combination of cash and shares of Common Stock, as applicable, at the Conversion Rate specified in the Indenture, as adjusted from time to time as provided in the Indenture.
Terms used in this Note and defined in the Indenture are used herein as therein defined.
A-7
ABBREVIATIONS
The following abbreviations, when used in the inscription of the face of this Note, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM = as tenants in common
UNIF GIFT MIN ACT = Uniform Gifts to Minors Act
CUST =
Custodian
TEN ENT = as tenants by the entireties
JT TEN =
joint tenants with right of survivorship and not as tenants in common
Additional abbreviations may also be used though not in the above
list.
A-8
SCHEDULE A
6
SCHEDULE OF EXCHANGES OF NOTES
MERCADOLIBRE, INC.
2.25%
Convertible Senior Notes due 2019
The initial principal amount of this Global Note is
DOLLARS ($[ ]). The following increases or decreases in this Global Note have been made:
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Date of exchange
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Amount of
decrease in
principal amount
of this Global Note
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Amount of
increase in
principal amount
of this Global Note
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Principal amount
of this Global Note
following such
decrease or
increase
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Signature of
authorized
signatory of
Trustee or
Custodian
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6
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Include if a global note.
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A-9
ATTACHMENT 1
[FORM OF NOTICE OF CONVERSION]
To: WILMINGTON TRUST, NATIONAL ASSOCIATION
1100 N. Market Street
Wilmington, Delaware 19890
Attn:
MercadoLibre, Inc. Administrator
Fax: (302) 636-4145
The undersigned registered owner of this Note hereby exercises the option to convert this Note, or the portion hereof (that is $1,000
principal amount or an integral multiple thereof) below designated, into cash, shares of Common Stock or a combination of cash and shares of Common Stock, as applicable, in accordance with the terms of the Indenture referred to in this Note, and
directs that any cash payable and any shares of Common Stock issuable and deliverable upon such conversion, together with any cash for any fractional share, and any Notes representing any unconverted principal amount hereof, be issued and delivered
to the registered Holder hereof unless a different name has been indicated below. If any shares of Common Stock or any portion of this Note not converted are to be issued in the name of a Person other than the undersigned, the undersigned will pay
all documentary, stamp or similar issue or transfer taxes, if any in accordance with Section 14.02(d) and Section 14.02(e) of the Indenture. Any amount required to be paid to the undersigned on account of interest accompanies this Note.
Capitalized terms used herein but not defined shall have the meanings ascribed to such terms in the Indenture.
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Dated:
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Signature(s)
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Signature Guarantee
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Signature(s) must be guaranteed by an eligible Guarantor Institution (banks, stock brokers, savings and loan associations and credit unions) with membership in an approved signature guarantee medallion program pursuant
to Securities and Exchange Commission Rule 17Ad-15 if shares of Common Stock are to be issued, or Notes are to be delivered, other than to and in the name of the registered holder.
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A-10
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Fill in for registration of shares if to be issued, and Notes if to be delivered, other than to and in the name of the registered holder:
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(Name)
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(Street Address)
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(City, State and Zip Code)
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Please print name and address
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Principal amount to be converted (if less than all): $ ,000
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NOTICE: The above signature(s) of the Holder(s) hereof must correspond with the name as written upon the face of the Note in every particular without alteration or enlargement or any change whatever.
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Social Security or Other Taxpayer
Identification Number
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A-11
ATTACHMENT 2
[FORM OF FUNDAMENTAL CHANGE REPURCHASE NOTICE]
To: WILMINGTON TRUST, NATIONAL ASSOCIATION
1100 N. Market Street
Wilmington, Delaware 19890
Attn:
MercadoLibre, Inc. Administrator
Fax: (302) 636-4145
The undersigned registered owner of this Note hereby acknowledges receipt of a notice from MercadoLibre, Inc. (the
“
Company
”) as to the occurrence of a Fundamental Change with respect to the Company and specifying the Fundamental Change Repurchase Date and requests and instructs the Company to pay to the registered holder hereof in accordance
with Section 15.02 of the Indenture referred to in this Note (1) the entire principal amount of this Note, or the portion thereof (that is $1,000 principal amount or an integral multiple thereof) below designated, and (2) if such
Fundamental Change Repurchase Date does not fall during the period after a Regular Record Date and on or prior to the corresponding Interest Payment Date, accrued and unpaid interest, if any, thereon to, but excluding, such Fundamental Change
Repurchase Date. Capitalized terms used herein but not defined shall have the meanings ascribed to such terms in the Indenture.
In
the case of Physical Notes, the certificate numbers of the Notes to be repurchased are as set forth below:
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Signature(s)
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Social Security or Other Taxpayer
Identification Number
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Principal amount to be repaid (if less than all): $ ,000
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NOTICE: The above signature(s) of the Holder(s) hereof must correspond with the name as written upon the face of the Note in every particular without alteration or enlargement or any change whatever.
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A-12
ATTACHMENT 3
[FORM OF ASSIGNMENT AND TRANSFER]
For value
received
hereby sell(s), assign(s) and transfer(s) unto (Please insert social security or Taxpayer Identification Number of assignee) the
within Note, and hereby irrevocably constitutes and appoints
attorney
to transfer the said Note on the books of the Company, with full power of substitution in the premises.
In connection with any transfer of the within
Note occurring prior to the Resale Restriction Termination Date, as defined in the Indenture governing such Note, the undersigned confirms that such Note is being transferred:
¨
To MercadoLibre, Inc. or a subsidiary thereof; or
¨
Pursuant to a registration statement that has become or been declared effective under
the Securities Act of 1933, as amended; or
¨
Pursuant to and in compliance with
Rule 144A under the Securities Act of 1933, as amended; or
¨
Pursuant to and in
compliance with Rule 144 under the Securities Act of 1933, as amended, or any other available exemption from the registration requirements of the Securities Act of 1933, as amended.
A-13
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Dated:
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Signature(s)
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Signature Guarantee
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Signature(s) must be guaranteed by an eligible Guarantor Institution (banks, stockbrokers, savings and loan associations and credit unions) with membership in an approved signature guarantee medallion program pursuant to
Securities and Exchange Commission Rule 17Ad-15 if Notes are to be delivered, other than to and in the name of the registered holder.
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NOTICE: The signature on the assignment must correspond with the name as written upon the face of the Note in every particular
without alteration or enlargement or any change whatever.
A-14
