Exhibit 1.1
EXECUTION VERSION
QUIDEL CORPORATION
(a Delaware
corporation)
$150,000,000
Convertible Senior Notes due 2020
UNDERWRITING AGREEMENT
Dated: December 2, 2014
QUIDEL CORPORATION
(a Delaware corporation)
$150,000,000
Convertible Senior
Notes due 2020
UNDERWRITING AGREEMENT
December 2, 2014
Merrill
Lynch, Pierce, Fenner & Smith Incorporated
J.P. Morgan Securities LLC
as Representatives of the several Underwriters
c/o Merrill Lynch, Pierce, Fenner & Smith Incorporated
One Bryant Park
New York, New
York 10036
Ladies and Gentlemen:
QUIDEL CORPORATION, a Delaware corporation (the “Company”), confirms its agreement with Merrill Lynch, Pierce,
Fenner & Smith Incorporated (“Merrill Lynch”), J.P. Morgan Securities LLC (“J.P. Morgan”) and each of the other Underwriters named in Schedule A hereto (collectively, the “Underwriters,” which term shall also
include any underwriter substituted as hereinafter provided in Section 10 hereof), for whom Merrill Lynch and J.P. Morgan are acting as representatives (in such capacity, the “Representatives”), with respect to (i) the sale by
the Company and the purchase by the Underwriters, acting severally and not jointly, of the respective principal amounts set forth in said Schedule A of $150,000,000 aggregate principal amount of the Company’s Convertible Senior Notes due
2020 (the “Initial Securities”) and (ii) the grant by the Company to the Underwriters, acting severally and not jointly, of the option to purchase all or any part of an additional $22,500,000 aggregate principal amount of its
Convertible Senior Notes due 2020 (the “Option Securities” and, together with the Initial Securities, the “Securities”). The Securities are to be issued pursuant to an indenture dated as of December 1, 2014, as supplemented
by the First Supplemental Indenture, to be dated as of December 8, 2014 (together, the “Indenture”), between the Company and The Bank Of New York Mellon Trust Company, National Association, as trustee (the “Trustee”).
The Company understands that the Underwriters propose to make a public offering of the Securities as soon as the
Representatives deem advisable after this Agreement has been executed and delivered and the Indenture has been qualified under the Trust Indenture Act of 1939, as amended (together with the rules and regulations promulgated thereunder, the
“1939 Act”).
The Company has prepared and filed with the Securities and Exchange Commission (the
“Commission”) an automatic shelf registration statement on Form S-3 (File No. 333-200654) covering the public offering and sale of certain securities, including the Securities, under the Securities Act of 1933, as amended (the
“1933 Act”), and the rules and regulations promulgated thereunder (the “1933 Act Regulations”), which automatic shelf registration statement became effective under Rule 462(e) under the 1933 Act Regulations (“Rule
462(e)”). Such registration statement, as of any time, means such
registration statement as amended by any post-effective amendments thereto to such time, including the exhibits and any schedules thereto at such time, the documents incorporated or deemed to be
incorporated by reference therein at such time pursuant to Item 12 of Form S-3 under the 1933 Act and the documents otherwise deemed to be a part thereof as of such time pursuant to Rule 430B under the 1933 Act Regulations (“Rule
430B”), is referred to herein as the “Registration Statement;” provided, however, that the “Registration Statement” without reference to a time means such registration statement as amended by any post-effective amendments
thereto as of the time of the first contract of sale for the Securities, which time shall be considered the “new effective date” of such registration statement with respect to the Securities within the meaning of paragraph (f)(2) of Rule
430B, including the exhibits and schedules thereto as of such time, the documents incorporated or deemed incorporated by reference therein at such time pursuant to Item 12 of Form S-3 under the 1933 Act and the documents otherwise deemed to be
a part thereof as of such time pursuant to the Rule 430B. Each preliminary prospectus used in connection with the offering of the Securities, including the documents incorporated or deemed to be incorporated by reference therein pursuant to
Item 12 of Form S-3 under the 1933 Act, are collectively referred to herein as a “preliminary prospectus.” Promptly after execution and delivery of this Agreement, the Company will prepare and file a final prospectus relating to the
Securities in accordance with the provisions of Rule 424(b) under the 1933 Act Regulations (“Rule 424(b)”). The final prospectus, in the form first furnished or made available to the Underwriters for use in connection with the offering of
the Securities, including the documents incorporated or deemed to be incorporated by reference therein pursuant to Item 12 of Form S-3 under the 1933 Act, are collectively referred to herein as the “Prospectus.” For purposes of this
Agreement, all references to the Registration Statement, any preliminary prospectus, the Prospectus or any amendment or supplement to any of the foregoing shall be deemed to include the copy filed with the Commission pursuant to its Electronic Data
Gathering, Analysis and Retrieval system or any successor system (“EDGAR”).
As used in this Agreement:
“Applicable Time” means 7:50 P.M., New York City time, on December 2, 2014 or such other time as
agreed by the Company, Merrill Lynch and J.P. Morgan.
“General Disclosure Package” means any
Issuer General Use Free Writing Prospectuses issued at or prior to the Applicable Time and the most recent preliminary prospectus (including any documents incorporated therein by reference) that is distributed to investors prior to the Applicable
Time, all considered together.
“Issuer Free Writing Prospectus” means any “issuer free
writing prospectus,” as defined in Rule 433 of the 1933 Act Regulations (“Rule 433”), including without limitation any “free writing prospectus” (as defined in Rule 405 of the 1933 Act Regulations (“Rule 405”))
relating to the Securities that is (i) required to be filed with the Commission by the Company, (ii) a “road show that is a written communication” within the meaning of Rule 433(d)(8)(i), whether or not required to be filed with
the Commission, (iii) exempt from filing with the Commission pursuant to Rule 433(d)(5)(i) because it contains a description of the Securities or of the offering that does not reflect the final terms, in each case in the form filed or required
to be filed with the Commission or, if not required to be filed, in the form retained in the Company’s records pursuant to Rule 433(g), or (iv) the Final Term Sheet (as defined below).
“Issuer General Use Free Writing Prospectus” means any Issuer Free Writing Prospectus that is
intended for general distribution to prospective investors, as evidenced by its being specified in Schedule B hereto.
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“Issuer Limited Use Free Writing Prospectus” means any
Issuer Free Writing Prospectus that is not an Issuer General Use Free Writing Prospectus.
All references in this
Agreement to financial statements and schedules and other information which is “contained,” “included” or “stated” (or other references of like import) in the Registration Statement, any preliminary prospectus or the
Prospectus shall be deemed to include all such financial statements and schedules and other information incorporated or deemed incorporated by reference in the Registration Statement, any preliminary prospectus or the Prospectus, as the case may be,
prior to the execution and delivery of this Agreement; and all references in this Agreement to amendments or supplements to the Registration Statement, any preliminary prospectus or the Prospectus shall be deemed to include the filing of any
document under the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder (collectively, the “1934 Act”), incorporated or deemed to be incorporated by reference in the Registration Statement, such
preliminary prospectus or the Prospectus, as the case may be, at or after the execution and delivery of this Agreement.
SECTION 1.
Representations and Warranties
.
(a)
Representations and Warranties by the Company
. The Company represents and warrants to each Underwriter as of
the date hereof, the Applicable Time, the Closing Time (as defined below) and any Date of Delivery (as defined below), and agrees with each Underwriter, as follows:
(i)
Registration Statement and Prospectuses
. The Company meets the requirements for use of Form S-3
under the 1933 Act. The Registration Statement is an “automatic shelf registration statement” (as defined in Rule 405) and the Securities have been and remain eligible for registration by the Company on such automatic shelf registration
statement. The Registration Statement has become effective under the 1933 Act. No stop order suspending the effectiveness of the Registration Statement has been issued under the 1933 Act, no order preventing or suspending the use of any preliminary
prospectus or the Prospectus has been issued and no proceedings for any of those purposes have been instituted or are pending or, to the Company’s knowledge, contemplated. The Company has complied with each request (if any) from the Commission
for additional information.
Each of the Registration Statement and any post-effective amendment thereto,
at the time of its effectiveness and at each deemed effective date with respect to the Underwriters pursuant to Rule 430B(f)(2) under the 1933 Act Regulations, complied in all material respects with the requirements of the 1933 Act and the 1933 Act
Regulations. Each preliminary prospectus, the Prospectus and any amendment or supplement thereto, at the time each was filed with the Commission, complied in all material respects with the requirements of the 1933 Act Regulations. Each preliminary
prospectus and the Prospectus delivered to the Underwriters for use in connection with this offering was identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by
Regulation
S-T.
The documents incorporated or deemed to be
incorporated by reference in the Registration Statement, any preliminary prospectus and the Prospectus, when they became effective or at the time they were or hereafter are filed with the Commission, complied and will comply in all material respects
with the requirements of the 1934 Act and the rules and regulations of the Commission under the 1934 Act (the “1934 Act Regulations”).
(ii)
Accurate Disclosure
. Neither the Registration Statement nor any amendment thereto, at its effective
time, at the Closing Time or at any Date of Delivery, contained, contains or will contain an untrue statement of a material fact or omitted, omits or will omit to state a material fact required to
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be stated therein or necessary to make the statements therein not misleading. As of the Applicable Time, neither (A) the General Disclosure Package nor (B) any individual Issuer Limited
Use Free Writing Prospectus, when considered together with the General Disclosure Package, included, includes or will include an untrue statement of a material fact or omitted, omits or will 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. Neither the Prospectus nor any amendment or supplement thereto, as of its issue date, at the time of any filing with the Commission pursuant to
Rule 424(b), at the Closing Time or at any Date of Delivery, included, includes or will include an untrue statement of a material fact or omitted, omits or will 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. The documents incorporated or deemed to be incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus, at the time the
Registration Statement became effective or when such documents incorporated by reference were filed with the Commission, as the case may be, when read together with the other information in the Registration Statement, the General Disclosure Package
or the Prospectus, as the case may be, did not and will not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading.
The representations and warranties in this subsection shall not apply to (i) the Statement of Eligibility
(Form T-1) of the Trustee under the 1939 Act or (ii) statements in or omissions from the Registration Statement (or any amendment thereto), the General Disclosure Package or the Prospectus (or any amendment or supplement thereto) made in
reliance upon and in conformity with written information furnished to the Company by any Underwriter through Merrill Lynch and J.P. Morgan expressly for use therein. For purposes of this Agreement, the only information so furnished shall be the
information in the first paragraph under the heading “Underwriting–Commissions and Discounts,” the information in the third sentence under the heading “Underwriting–New Issue of Notes,” the information in the first and
second paragraphs under the heading “Underwriting–Price Stabilization, Short Positions” and the information under the heading “Underwriting–Electronic Distribution” in each case contained in the Prospectus
(collectively, the “Underwriter Information”).
(iii)
Issuer Free Writing Prospectuses
. No
Issuer Free Writing Prospectus conflicts or will conflict with the information contained in the Registration Statement or the Prospectus, including any document incorporated by reference therein, and any preliminary or other prospectus deemed to be
a part thereof that has not been superseded or modified. Any offer that is a written communication relating to the Securities made prior to the initial filing of the Registration Statement by the Company or any person acting on its behalf (within
the meaning, for this paragraph only, of Rule 163(c) of the 1933 Act Regulations) has been filed with the Commission in accordance with the exemption provided by Rule 163 under the 1933 Act Regulations (“Rule 163”) and otherwise complied
with the requirements of Rule 163, including without limitation the legending requirement, to qualify such offer for the exemption from Section 5(c) of the 1933 Act provided by Rule 163.
(iv)
Well-Known Seasoned Issuer.
(A) At the original effectiveness of the Registration Statement,
(B) at the time of the most recent amendment thereto for the purposes of complying with Section 10(a)(3) of the 1933 Act (whether such amendment was by post-effective amendment, incorporated report filed pursuant to Section 13 or
15(d) of the 1934 Act or form of prospectus), (C) at the time the Company or any person acting on its behalf (within the meaning, for this clause only, of Rule 163(c)) made any offer relating to the Securities in reliance on the exemption of
Rule 163, and (D) as of the Applicable Time, the Company was and is a “well-known seasoned issuer” (as defined in Rule 405).
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(v)
Company Not Ineligible Issuer
. At the time of filing
the Registration Statement and any post-effective amendment thereto, at the earliest time thereafter that the Company or another offering participant made a
bona fide
offer (within the meaning of Rule 164(h)(2) of the 1933 Act Regulations) of
the Securities and at the date hereof, the Company was not and is not an “ineligible issuer,” as defined in Rule 405, without taking account of any determination by the Commission pursuant to Rule 405 that it is not necessary that the
Company be considered an ineligible issuer.
(vi)
Independent Accountants
. The accountants who
certified the financial statements and supporting schedules included in the Registration Statement, the General Disclosure Package and the Prospectus are independent public accountants as required by the 1933 Act, the 1933 Act Regulations, the 1934
Act, the 1934 Act Regulations and the Public Company Accounting Oversight Board.
(vii)
Financial
Statements
. The financial statements included or incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus, together with the related schedules and notes, present fairly in all material respects
the financial position of the Company and its consolidated subsidiaries at the dates indicated and the statement of operations, stockholders’ equity and cash flows of the Company and its consolidated subsidiaries for the periods specified; said
financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“GAAP”) applied on a consistent basis throughout the periods involved, except as may be stated in the notes to such financial
statements and, in the case of unaudited, interim financial statements, subject to normal, year-end adjustments. The supporting schedules, if any, present fairly, in all material respects, in accordance with GAAP the information required to be
stated therein. The selected financial data and the summary financial information included in the Registration Statement, the General Disclosure Package and the Prospectus present fairly in all material respects the information shown therein and
have been compiled on a basis consistent with that of the audited financial statements included therein. Any pro forma financial statements and the related notes thereto included in the Registration Statement, the General Disclosure Package and the
Prospectus present fairly in all material respects the information shown therein, have been prepared in accordance with the Commission’s rules and guidelines with respect to pro forma financial statements and have been properly compiled on the
bases described therein, and the assumptions used in the preparation thereof are reasonable and the adjustments used therein are appropriate to give effect to the transactions and circumstances referred to therein. Except as included therein, no
historical or pro forma financial statements or supporting schedules are required to be included or incorporated by reference in the Registration Statement, the General Disclosure Package or the Prospectus under the 1933 Act or the 1933 Act
Regulations. The interactive data in eXtensible Business Reporting Language incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus 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.
(viii)
No Material Adverse Change in Business
. Except as otherwise stated therein, since the respective
dates as of which information is given in the Registration Statement, the General Disclosure Package or the Prospectus, (A) there has been no material adverse change in the condition, financial or otherwise, or in the earnings or business
affairs of the Company and its subsidiaries considered as one enterprise, whether or not arising in the ordinary course of business (a “Material Adverse Effect”), (B) there have been no transactions entered into by the Company or any
of its subsidiaries, other than those in the ordinary course of business, which are material with respect to the Company and its subsidiaries considered as one enterprise, and (C) there has been no dividend or distribution of any kind declared,
paid or made by the Company on any class of its capital stock.
(ix)
Good Standing of the Company
.
The Company has been duly organized and is validly existing as a corporation in good standing under the laws of the State of Delaware and has corporate
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power and authority to own, lease and operate its properties and to conduct its business as described in the Registration Statement, the General Disclosure Package and the Prospectus and to enter
into and perform its obligations under this Agreement; and the Company is duly qualified as a foreign corporation to transact business and is in good standing in each other jurisdiction in which such qualification is required, whether by reason of
the ownership or leasing of property or the conduct of business, except where the failure so to qualify or to be in good standing would not reasonably be expected to result in a Material Adverse Effect.
(x)
Good Standing of Subsidiaries
. Each “significant subsidiary” of the Company (as such term
is defined in Rule 1-02 of Regulation S-X) (each, a “Subsidiary” and, collectively, the “Subsidiaries”) has been duly organized and is validly existing in good standing under the laws of the jurisdiction of its incorporation or
organization, has corporate or similar power and authority to own, lease and operate its properties and to conduct its business as described in the Registration Statement, the General Disclosure Package and the Prospectus and is duly qualified to
transact business and is in good standing in each jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except where the failure to so qualify or to be in good
standing would not reasonably be expected to result in a Material Adverse Effect. Except as otherwise disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, all of the issued and outstanding capital stock of each
Subsidiary has been duly authorized and validly issued, is fully paid and
non-assessable
and is owned by the Company, directly or through subsidiaries, free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim or equity. None of the outstanding shares of capital stock of any Subsidiary were issued in violation of the preemptive or similar rights of any securityholder of such Subsidiary. The only subsidiaries of the Company
are (A) the subsidiaries listed on Exhibit 21.1 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2013, and (B) certain other subsidiaries which, considered in the aggregate as a single subsidiary, do
not constitute a “significant subsidiary” as defined in Rule 1-02 of Regulation S-X.
(xi)
Capitalization
. The authorized, issued and outstanding shares of capital stock of the Company are as set forth in the Registration Statement, the General Disclosure Package and the Prospectus in the column entitled “Actual” under
the caption “Capitalization” (except for subsequent issuances, if any, pursuant to this Agreement, pursuant to reservations, agreements or employee benefit plans referred to in the Registration Statement, the General Disclosure Package and
the Prospectus or pursuant to the exercise of convertible securities or options referred to in the Registration Statement, the General Disclosure Package and the Prospectus).
(xii)
Authorization of Agreement
. This Agreement has been duly authorized, executed and delivered by the
Company.
(xiii)
Authorization of the Indenture
. The Indenture has been duly authorized by the
Company and duly qualified under the 1939 Act and, when duly executed and delivered by the Company and the Trustee, will constitute a valid and binding agreement of the Company, enforceable against the Company in accordance with its terms, except as
the enforcement thereof may be limited by bankruptcy, insolvency (including, without limitation, all laws relating to fraudulent transfers), reorganization, moratorium or similar laws affecting enforcement of creditors’ rights generally and
except as enforcement thereof is subject to general principles of equity (regardless of whether enforcement is considered in a proceeding in equity or at law).
(xiv)
Authorization of the Securities and the Common Stock
. The Securities have been duly authorized
and, at the Closing Time, will have been duly executed by the Company and, when authenticated, issued and delivered in the manner provided for in the Indenture and delivered against
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payment of the purchase price therefor as provided in this Agreement, will constitute valid and binding obligations of the Company, enforceable against the Company in accordance with their terms,
except as the enforcement thereof may be limited by bankruptcy, insolvency (including, without limitation, all laws relating to fraudulent transfers), reorganization, moratorium or similar laws affecting enforcement of creditors’ rights
generally and except as enforcement thereof is subject to general principles of equity (regardless of whether enforcement is considered in a proceeding in equity or at law), and will be in the form contemplated by, and entitled to the benefits of,
the Indenture. The shares of common stock of the Company (“Common Stock”) issuable upon conversion of the Securities, if any, have been duly authorized and reserved for issuance upon such conversion by all necessary corporate action and
such shares, when issued upon such conversion and delivered in accordance with the provisions of the Securities and the Indenture, will be validly issued and will be fully paid and non-assessable; no holder of such shares will be subject to personal
liability by reason of being such a holder; and the issuance of such shares upon such conversion will not be subject to the preemptive or other similar rights of any securityholder of the Company.
(xv)
Description of the Securities, the Common Stock and the Indenture
. The Securities and the Indenture
will conform in all material respects to the respective statements relating thereto contained in the Registration Statement, the General Disclosure Package and the Prospectus and will be in substantially the respective forms filed or incorporated by
reference, as the case may be, as exhibits to the Registration Statement. The Common Stock conforms in all material respects to all statements relating thereto contained or incorporated by reference in the Registration Statement, the General
Disclosure Package and the Prospectus and such description conforms in all material respects to the rights set forth in the instruments defining the same.
(xvi)
Registration Rights
. There are no persons with registration rights or other similar rights to have
any securities registered for sale pursuant to the Registration Statement or otherwise registered for sale or sold by the Company under the 1933 Act pursuant to this Agreement.
(xvii)
Absence of Violations, Defaults and Conflicts
. Neither the Company nor any of its subsidiaries is
(A) in violation of its charter, by-laws or similar organizational document, (B) in default in the performance or observance of any obligation, agreement, covenant or condition contained in any contract, indenture, mortgage, deed of trust,
loan or credit agreement, note, lease or other agreement or instrument to which the Company or any of its subsidiaries is a party or by which it or any of them may be bound or to which any of the properties or assets of the Company or any subsidiary
is subject (collectively, “Agreements and Instruments”), except for such defaults that would not, singly or in the aggregate, reasonably be expected to result in a Material Adverse Effect, or (C) in violation of any law, statute,
rule, regulation, judgment, order, writ or decree of any arbitrator, court, governmental body, regulatory body, administrative agency or other authority, body or agency having jurisdiction over the Company or any of its subsidiaries or any of their
respective properties, assets or operations (each, a “Governmental Entity”), except for such violations that would not, singly or in the aggregate, reasonably be expected to result in a Material Adverse Effect. The execution, delivery and
performance of this Agreement and the consummation of the transactions contemplated herein and in the Registration Statement, the General Disclosure Package and the Prospectus (including the issuance and sale of the Securities) and compliance by the
Company with its obligations hereunder have been duly authorized by all necessary corporate action and do not and will not, whether with or without the giving of notice or passage of time or both, conflict with or constitute a breach of, or default
or Repayment Event (as defined below) under, or result in the creation or imposition of any lien, charge or encumbrance upon any properties or assets of the Company or any subsidiary pursuant to, the Agreements and Instruments (except for such
conflicts, breaches, defaults or Repayment Events or liens, charges or encumbrances that would not, singly or in the aggregate, reasonably be expected to result in a Material Adverse Effect or materially adversely affect the consummation of the
transactions
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contemplated hereby), nor will such action result in any violation of the provisions of the charter, by-laws or similar organizational document of the Company or any of its subsidiaries or any
law, statute, rule, regulation, judgment, order, writ or decree of any Governmental Entity. As used herein, a “Repayment Event” means any event or condition which gives the holder of any note, debenture or other evidence of indebtedness
(or any person acting on such holder’s behalf) the right to require the repurchase, redemption or repayment of all or a portion of such indebtedness by the Company or any of its subsidiaries.
(xviii)
Absence of Labor Dispute
. No labor dispute with the employees of the Company or any of its
subsidiaries exists or, to the knowledge of the Company, is imminent, and the Company is not aware of any existing or imminent labor disturbance by the employees of any of its or any subsidiary’s principal suppliers, manufacturers, customers or
contractors, which, in either case, would reasonably be expected to result in a Material Adverse Effect.
(xix)
Absence of Proceedings
. Except as disclosed in the Registration Statement, the General Disclosure
Package and the Prospectus, there is no action, suit, proceeding, inquiry or investigation before or brought by any Governmental Entity now pending or, to the knowledge of the Company, threatened, against or affecting the Company or any of its
subsidiaries, which would reasonably be expected to result in a Material Adverse Effect, or would reasonably be expected to materially and adversely affect their respective properties or assets or the consummation of the transactions contemplated in
this Agreement or the performance by the Company of its obligations hereunder; and the aggregate of all pending legal or governmental proceedings to which the Company or any such subsidiary is a party or of which any of their respective properties
or assets is the subject which are not described in the Registration Statement, the General Disclosure Package and the Prospectus, including ordinary routine litigation incidental to the business, would not reasonably be expected to result in a
Material Adverse Effect.
(xx)
Accuracy of Exhibits
. There are no contracts or documents which are
required to be described in the Registration Statement, the General Disclosure Package or the Prospectus or to be filed as exhibits to the Registration Statement which have not been so described and filed as required.
(xxi)
Absence of Further Requirements
. No filing with, or authorization, approval, consent, license,
order, registration, qualification or decree of, any Governmental Entity is necessary or required for the performance by the Company of its obligations hereunder, in connection with the offering, issuance or sale of the Securities hereunder or the
consummation of the transactions contemplated by this Agreement, except such as have been already obtained or as may be required under the 1933 Act, the 1933 Act Regulations, the rules of the NASDAQ Global Select Market, state securities laws or the
rules of Financial Industry Regulatory Authority, Inc. (“FINRA”).
(xxii)
Possession of
Licenses and Permits
. The Company and its subsidiaries possess such permits, licenses, approvals, consents and other authorizations (collectively, “Governmental Licenses”) issued by the appropriate Governmental Entities necessary to
conduct the business now operated by them, except where the failure so to possess would not, singly or in the aggregate, reasonably be expected to result in a Material Adverse Effect. The Company and its subsidiaries are in compliance with the terms
and conditions of all Governmental Licenses, except where the failure so to comply would not, singly or in the aggregate, reasonably be expected to result in a Material Adverse Effect. All of the Governmental Licenses are valid and in full force and
effect, except when the invalidity of such Governmental Licenses or the failure of such Governmental Licenses to be in full force and effect would not, singly or in the aggregate, reasonably be expected to result in a Material Adverse Effect.
Neither the Company nor any of its subsidiaries (i) has received any notice of the revocation, suspension, limitation, withdrawal, or modification of any Governmental License or any
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proceedings related thereto or (ii) has any knowledge that any such action has been threatened or is under consideration by any applicable Governmental Entity, which, with respect to
(i) or (ii), singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would reasonably be expected to result in a Material Adverse Effect, and in each case with respect to notices specifically directed to the
Company by a Governmental Entity with respect to a Governmental License, and not notices provided by a Governmental Entity as to actions or proposed actions generally applicable to a market, product, or procedure.
(xxiii)
Title to Property
. The Company and its subsidiaries have good and marketable title to all real
property owned by them and good title to all other properties owned by them, in each case, free and clear of all mortgages, pledges, liens, security interests, claims, restrictions or encumbrances of any kind except such as (A) are described in
the Registration Statement, the General Disclosure Package and the Prospectus or (B) do not, singly or in the aggregate, materially affect the value of such property and do not materially interfere with the use made and proposed to be made of
such property by the Company or any of its subsidiaries. To the knowledge of the Company, all of the leases and subleases material to the business of the Company and its subsidiaries, considered as one enterprise, and under which the Company or any
of its subsidiaries holds properties described in the Registration Statement, the General Disclosure Package or the Prospectus, are in full force and effect, and neither the Company nor any such subsidiary has any notice of any claim of any sort
(i) that has been asserted by anyone adverse to the rights of the Company or any subsidiary under any of the leases or subleases mentioned above, or (ii) affecting or questioning the rights of the Company or such subsidiary to the
continued possession of the leased or subleased premises under any such lease or sublease, which in each case, would, singly or in the aggregate, reasonably be expected to result in a Material Adverse Effect.
(xxiv)
Possession of Intellectual Property
. Except as described in the Registration Statement, the
General Disclosure Package and the Prospectus or would not, singly or in the aggregate, reasonably be expected to result in a Material Adverse Effect, (A) the Company and its subsidiaries own or possess, or can acquire on reasonable terms,
adequate patents, patent rights, licenses, inventions, copyrights,
know-how
(including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures),
trademarks, service marks, trade names or other intellectual property (collectively, “Intellectual Property”) necessary to carry on the business now operated by them, and (B) neither the Company nor any of its subsidiaries has
received any notice or is otherwise aware of any infringement of or conflict with asserted rights of others with respect to any Intellectual Property owned by the Company or its subsidiaries or of any facts or circumstances which would render any
such Intellectual Property invalid or inadequate to protect the interest of the Company or any of its subsidiaries therein.
(xxv)
Environmental Laws
. Except as described in the Registration Statement, the General Disclosure
Package and the Prospectus or would not, singly or in the aggregate, reasonably be expected to result in a Material Adverse Effect, (A) neither the Company nor any of its subsidiaries is in violation of any federal, state, local or foreign
statute, law, rule, regulation, ordinance, code, policy or rule of common law or any judicial or administrative interpretation thereof, including any judicial or administrative order, consent, decree or judgment, relating to pollution or protection
of human health, the environment (including, without limitation, ambient air, surface water, groundwater, land surface or subsurface strata) or wildlife, including, without limitation, laws and regulations relating to the release or threatened
release of chemicals, pollutants, contaminants, wastes, toxic substances, hazardous substances, petroleum or petroleum products, asbestos-containing materials or mold (collectively, “Hazardous Materials”) or to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials (collectively, “Environmental Laws”), (B) the Company and its subsidiaries have all permits, authorizations and approvals required under any
9
applicable Environmental Laws and are each in compliance with their requirements, (C) there are, to the knowledge of the Company, no pending or threatened administrative, regulatory or
judicial actions, suits, demands, demand letters, claims, liens, notices of noncompliance or violation, investigations or proceedings relating to any Environmental Law against the Company or any of its subsidiaries and (D) there are, to the
knowledge of the Company, no events or circumstances that would reasonably be expected to form the basis of an order for clean-up or remediation, or an action, suit or proceeding by any private party or Governmental Entity, against or affecting the
Company or any of its subsidiaries relating to Hazardous Materials or any Environmental Laws.
(xxvi)
Accounting Controls and Disclosure Controls
. The Company and each of its subsidiaries maintain effective internal control over financial reporting (as defined under Rule
13-a15
and
15d-15
under the 1934 Act Regulations) and a system of internal accounting controls sufficient to provide reasonable assurances that (A) transactions are executed in accordance with management’s general or
specific authorization; (B) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain accountability for assets; (C) access to assets is permitted only in accordance with
management’s general or specific authorization; (D) 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 (E) the
interactive data in eXtensible Business Reporting Language incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus 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 described in the Registration Statement, the General Disclosure Package and the Prospectus, since the end of the Company’s most recent audited fiscal
year, there has been (1) no material weakness in the Company’s internal control over financial reporting (whether or not remediated) and (2) no change in the Company’s internal control over financial reporting that has materially
affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting. The Company and each of its subsidiaries maintain an effective system of disclosure controls and procedures (as defined in Rule
13a-15
and Rule
15d-15
under the 1934 Act Regulations) that are designed to ensure that information required to be disclosed by the Company in the reports that it files or
submits under the 1934 Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms, and is accumulated and communicated to the Company’s management, including its principal
executive officer or officers and principal financial officer or officers, as appropriate, to allow timely decisions regarding disclosure.
(xxvii)
Compliance with the 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 in all material respects with any provision of the Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated in connection therewith,
including Section 402 related to loans and Sections 302 and 906 related to certifications.
(xxviii)
Payment of Taxes
. All United States federal income tax returns of the Company and its
subsidiaries required by law to be filed have been filed and all taxes shown by such returns or otherwise assessed, which are due and payable, have been paid, except taxes or assessments that are being contested in good faith and as to which
adequate reserves have been provided or where the failure to pay such taxes or assessments would not reasonably be expected to result in a Material Adverse Effect. The Company and its subsidiaries have filed all other tax returns that are required
to have been filed by them pursuant to applicable foreign, state, local or other law except insofar as the failure to file such returns would not reasonably be expected to result in a Material Adverse Effect, and has paid all taxes due pursuant to
such returns or pursuant to any assessment received by the Company and its subsidiaries, except for such taxes, if any, as are being contested in good faith and as to which adequate reserves have been established by the Company or where failure to
pay such taxes or assessments would not reasonably be expected to result in a Material Adverse Effect.
10
(xxix)
Insurance
. The Company and its subsidiaries carry
or are entitled to the benefits of insurance, with financially sound and reputable insurers, in such amounts and covering such risks as the Company believes is generally maintained by companies of established repute engaged in the same or similar
business, and to the knowledge of the Company all such insurance is in full force and effect. The Company has no reason to believe that it or any of its subsidiaries will not be able (A) to renew its existing insurance coverage as and when such
policies expire or (B) to obtain comparable coverage from similar institutions as may be necessary or appropriate to conduct its business as now conducted and at a cost that would not result in a Material Adverse Effect. Neither of the Company
nor any of its subsidiaries has been denied any insurance coverage which it has sought or for which it has applied.
(xxx)
Investment Company Act
. The Company is not required, and upon the issuance and sale of the
Securities as herein contemplated and the application of the net proceeds therefrom as described in the Registration Statement, the General Disclosure Package and the Prospectus will not be required, to register as an “investment company”
under the Investment Company Act of 1940, as amended (the “1940 Act”).
(xxxi)
Absence of
Manipulation
. Neither the Company nor any affiliate of the Company has taken, nor will the Company or any affiliate take, directly or indirectly, any action which is designed, or would be expected, to cause or result in, or which constitutes,
the stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Securities or to result in a violation of Regulation M under the 1934 Act.
(xxxii)
Foreign Corrupt Practices Act
. None of the Company, any of its subsidiaries or, to the knowledge
of the Company, any director, officer, agent, employee, affiliate or other person acting on behalf of the Company or any of its subsidiaries is aware of or has taken any action, directly or indirectly, that would reasonably be expected to result in
a violation by such persons of the Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder (the “FCPA”) and any other applicable anti-corruption or anti-bribery laws, including, without limitation,
making use of the mails or any means or instrumentality of interstate commerce corruptly in furtherance of an offer, payment, promise to pay or authorization of the payment of any money, or other property, gift, promise to give, or authorization of
the giving of anything of value to any “foreign official” (as such term is defined in the FCPA) or any foreign political party or official thereof or any candidate for foreign political office, in contravention of the FCPA and the Company
and, to the knowledge of the Company, its affiliates have instituted and maintains policies and procedures designed to ensure, and which are reasonably expected to continue to ensure, continued compliance with the FCPA and any other applicable
anti-corruption or anti-bribery laws.
(xxxiii)
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 of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the money laundering statutes
of all jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any Governmental Entity (collectively, the “Money Laundering Laws”); and no action,
suit or proceeding by or before any Governmental Entity involving the Company or any of its subsidiaries with respect to the Money Laundering Laws is pending or, to the knowledge of the Company, threatened.
(xxxiv)
OFAC
. None of the Company, any of its subsidiaries or, to the knowledge of the Company, any
director, officer, agent, employee, affiliate or representative of the Company or any of
11
its subsidiaries is an individual or entity (“Person”) currently the subject or target of any sanctions administered or enforced by the United States Government, including, without
limitation, the U.S. Department of the Treasury’s Office of Foreign Assets Control (“OFAC”), 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 located, organized or resident in a country or territory that is the subject of Sanctions; and the Company will not directly or indirectly use the proceeds of the sale of
the Securities, or lend, contribute or otherwise make available such proceeds to any subsidiaries, joint venture partners or other Person, to fund any activities of or business with any Person, or in any country or territory, that, at the time of
such funding, is the subject of Sanctions.
(xxxv)
Lending Relationship
.
Except as disclosed
in the Registration Statement, the General Disclosure Package and the Prospectus, the Company (i) does not have any material lending or other relationship with any bank or lending affiliate of any Underwriter and (ii) does not intend
to use any of the proceeds from the sale of the Securities to repay any outstanding debt owed to any affiliate of any Underwriter.
(xxxvi)
Statistical and Market-Related Data
. Any statistical and market-related data included in the
Registration Statement, the General Disclosure Package or the Prospectus are based on or derived from sources that the Company believes to be reliable and accurate or represent the Company’s good faith estimates that are made on the basis of
data derived from such sources and, to the extent required, the Company has obtained the written consent to the use of such data from such sources.
(xxxvii)
No Rating
.
Neither the Company nor its subsidiaries have any debt securities or
preferred stock that are rated by any “nationally recognized statistical rating agency” (as defined in Section 3(a)(62) of the 1934 Act).
(xxxviii)
Clinical Trials
. Except as would not, singly or in the aggregate, reasonably be expected to
result in a Material Adverse Effect, (A) the studies, tests and preclinical and clinical trials conducted by, and to the Company’s knowledge, to the extent conducted by third parties on behalf of, the Company and its subsidiaries were and,
if still pending, are being conducted in compliance with experimental protocols, procedures and controls pursuant to generally accepted professional scientific standards for the development of medical devices (including diagnostic products) and all
applicable laws and authorizations, including, without limitation, the Health Care Laws (defined below), and the rules and regulations promulgated thereunder, including, without limitation, any requirement thereunder mandating the submission and
effectiveness of any Investigational Device Exemption under the FDCA (defined below) or counterpart thereof under Health Care Laws outside the United States; (B) the descriptions of the results of such studies, tests and trials contained in the
Registration Statement, the General Disclosure Package and the Prospectus, if any, are accurate and complete in all material respects and fairly present the data derived from such studies, tests and trials; (C) the Company is not aware of any
studies, tests or trials, the results of which the Company believes reasonably call into question the study, test, or trial results described or referred to in the Registration Statement, the General Disclosure Package and the Prospectus; and
(D) the Company and its subsidiaries have not received any written notices or correspondence from any applicable Governmental Entity engaged in the regulation of clinical trials, medical devices (including diagnostic products), or biohazardous
substances or materials, including, without limitation, the U.S. Food and Drug Administration (“FDA”), Health Canada, the European Medicines Agency (“EMA”), and the Japanese Pharmaceuticals and Medical Devices Agency
(“PMDA”), requiring the termination, suspension or material modification of any studies, tests or preclinical or clinical trials currently being conducted by or on behalf of the Company or its subsidiaries.
12
(xxxix)
Health Care Laws
. Neither the Company nor any of
its subsidiaries, nor any of their respective business operations, is in violation of any Health Care Laws (as defined below), except as would not reasonably be expected to result in a Material Adverse Effect. “Health Care Laws” means
(i) all federal and state fraud and abuse laws, including, but not limited to, the federal Anti-Kickback Statute (as codified in 42 U.S.C. §1320a-7b(b)), the Stark Law (as codified in 42 U.S.C. §1395nn), the Anti-Inducement Law (as
codified in 42 U.S.C. § 1320a-7a(a)(5)), the civil False Claims Act (as codified in 31 U.S.C. §3729 et seq.), the administrative False Claims Law (as codified in 42 U.S.C. § 1320a-7b(a)), the exclusion laws (as codified in 42 U.S.C.
§ 1320a-7), the civil monetary penalty laws (as codified in 42 U.S.C. § 1320a-7a) and the regulations promulgated pursuant to such laws; (ii) the Health Insurance Portability and Accountability Act of 1996 (as codified in 42 U.S.C.
§1320d et seq.) as amended by the Health Information Technology for Economic and Clinical Health Act of 2009 (as codified in 42 U.S.C. §17921 et seq.), the regulations promulgated thereunder and comparable state privacy and security laws,
(iii) Medicare (Title XVIII of the Social Security Act) and the regulations promulgated thereunder; (iv) Medicaid (Title XIX of the Social Security Act) and the regulations promulgated thereunder; (v) the Federal Food, Drug, and
Cosmetic Act (as codified in 21 U.S.C. § 301 et seq.) and the regulations promulgated pursuant thereto (the “FDCA”); (vi) the Clinical Laboratory Improvement Amendments of 1988 (as codified in 42 U.S.C. § 263a) and the
regulations promulgated pursuant thereto; and (vii) any and all other state, federal, or foreign laws, regulations, accreditation standards, manual provisions, policies and administrative guidance of any Governmental Entity that impose legally
binding requirements (including, without limitation, requirements relating to quality and safety) applicable to any products, products under development, operations and activities of the Company or any of its subsidiaries. Except as described in the
Registration Statement, the General Disclosure Package and the Prospectus, neither the Company nor any of its subsidiaries has received written notice of any claim, action, suit, proceeding, hearing, enforcement, investigation, arbitration, adverse
finding, warning letter, untitled letter, correspondence, or other similar action from any Governmental Entity alleging that any product, product under development, operation or activity of the Company or any of its subsidiaries is in material
violation of any applicable Health Care Law and to the knowledge of the Company, no Governmental Entity has threatened or intends to make or take any such claim, litigation, arbitration, action, suit, investigation or proceeding.
(b)
Officer’s Certificates
. Any certificate signed by any officer of the Company or any of its subsidiaries
delivered to the Representatives or to counsel for the Underwriters shall be deemed a representation and warranty by the Company to each Underwriter as to the matters covered thereby.
SECTION 2.
Sale and Delivery to Underwriters; Closing
.
(a)
Initial Securities
. On the basis of the representations and warranties herein contained and subject to the terms and
conditions herein set forth, the Company agrees to sell to each Underwriter, severally and not jointly, and each Underwriter, severally and not jointly, agrees to purchase from the Company, at the price set forth in Schedule A, the aggregate
principal amount of Initial Securities set forth in Schedule A, plus any additional principal amount of Initial Securities which such Underwriter may become obligated to purchase pursuant to the provisions of Section 10 hereof, subject to such
adjustments as Merrill Lynch and J.P. Morgan in their discretion shall make to ensure that any sales or purchases are in authorized denominations.
(b)
Option Securities
. In addition, on the basis of the representations and warranties herein contained and subject to
the terms and conditions herein set forth, the Company hereby grants an option to the Underwriters, severally and not jointly, to purchase the Option Securities, at the price set forth in Schedule A, solely to cover over-allotments. The option
hereby granted may be exercised for 30 days after the date hereof and may be exercised in whole or in part at any time from time to time upon notice by the Representatives to the Company setting forth the amount of Option Securities as to which
the
13
several Underwriters are then exercising the option and the time and date of payment and delivery for such Option Securities. Any such time and date of delivery (a “Date of Delivery”)
shall be determined by the Representatives, but shall not be later than seven full business days after the exercise of said option, nor in any event prior to the Closing Time. If the option is exercised as to all or any portion of the Option
Securities, each of the Underwriters, acting severally and not jointly, will purchase that proportion of the total principal amount of Option Securities then being purchased which the total principal amount of Initial Securities set forth in
Schedule A opposite the name of such Underwriter bears to the total principal amount of Initial Securities, subject in each case to such adjustments as Merrill Lynch and J.P. Morgan in their discretion shall make to ensure that any sales or
purchases are in authorized denominations.
(c)
Payment
. Payment of the purchase price for, and delivery of
certificates or security entitlements for, the Initial Securities shall be made at the offices of Sidley Austin
LLP
at 787 Seventh Avenue, New York, NY 10019, or at such other place as shall be agreed upon by the Representatives and
the Company, at 9:00 A.M. (New York City time) on the third (fourth, if the pricing occurs after 4:30 P.M. (New York City time) on any given day) business day after the date hereof (unless postponed in accordance with the provisions of
Section 10), or such other time not later than ten business days after such date as shall be agreed upon by the Representatives and the Company (such time and date of payment and delivery being herein called “Closing Time”).
In addition, in the event that any or all of the Option Securities are purchased by the Underwriters, payment of the purchase
price for, and delivery of certificates or security entitlements for, such Option Securities shall be made at the
above-mentioned
offices, or at such other place as shall be agreed upon by the Representatives
and the Company, on each Date of Delivery as specified in the notice from Merrill Lynch and J.P. Morgan to the Company.
Payment shall be made to the Company by wire transfer of immediately available funds to a bank account designated by the
Company, against delivery to the Representatives for the respective accounts of the Underwriters of certificates or security entitlements for the Securities to be purchased by them. It is understood that each Underwriter has authorized the
Representatives, for its account, to accept delivery of, receipt for, and make payment of the purchase price for, the Initial Securities and the Option Securities, if any, which it has agreed to purchase. Merrill Lynch and J.P. Morgan, each
individually and not as representative of the Underwriters, may (but shall not be obligated to) make payment of the purchase price for the Initial Securities or the Option Securities, if any, to be purchased by any Underwriter whose funds have not
been received by the Closing Time or the relevant Date of Delivery, as the case may be, but such payment shall not relieve such Underwriter from its obligations hereunder.
SECTION 3.
Covenants of the Company
. The Company covenants with each Underwriter as follows:
(a)
Compliance with Securities Regulations and Commission Requests
. The Company, subject to Section 3(b), and for
the period set forth therein, will comply with the requirements of Rule 430B, and will notify the Representatives immediately, and confirm the notice in writing, (i) when any post-effective amendment to the Registration Statement shall become
effective or any amendment or supplement to the Prospectus shall have been filed, (ii) of the receipt of any comments from the Commission, (iii) of any request by the Commission for any amendment to the Registration Statement or any
amendment or supplement to the Prospectus, including any document incorporated by reference therein or for additional information, (iv) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration
Statement or any post-effective amendment or of any order preventing or suspending the use of any preliminary prospectus or the Prospectus, or of the suspension of the qualification of the Securities for offering or sale in any jurisdiction, or of
the initiation or threatening
14
of any proceedings for any of such purposes or of any examination pursuant to Section 8(d) or 8(e) of the 1933 Act concerning the Registration Statement and (v) if the Company becomes
the subject of a proceeding under Section 8A of the 1933 Act in connection with the offering of the Securities. The Company will effect all filings required under Rule 424(b), in the manner and within the time period required by Rule 424(b)
(without reliance on Rule 424(b)(8)), and will take such steps as it deems necessary to ascertain promptly whether the form of prospectus transmitted for filing under Rule 424(b) was received for filing by the Commission and, in the event that it
was not, it will promptly file such prospectus. The Company will make every reasonable effort to prevent the issuance of any stop order, prevention or suspension and, if any such order is issued, to obtain the lifting thereof at the earliest
possible moment. The Company shall pay the required Commission filing fees relating to the Securities within the time required by Rule 456(b)(1)(i) under the 1933 Act Regulations without regard to the proviso therein and otherwise in accordance with
Rules 456(b) and 457(r) under the 1933 Act Regulations (including, if applicable, by updating the “Calculation of Registration Fee” table in accordance with Rule 456(b)(1)(ii) either in a post-effective amendment to the Registration
Statement or on the cover page of a prospectus filed pursuant to Rule 424(b)).
(b)
Continued Compliance with
Securities Laws
. The Company will comply with the 1933 Act, the 1933 Act Regulations, the 1934 Act and the 1934 Act Regulations so as to permit the completion of the distribution of the Securities as contemplated in this Agreement and in the
Registration Statement, the General Disclosure Package and the Prospectus. If at any time when a prospectus relating to the Securities is (or, but for the exception afforded by Rule 172 of the 1933 Act Regulations (“Rule 172”), would be)
required by the 1933 Act to be delivered in connection with sales of the Securities, any event shall occur or condition shall exist as a result of which it is necessary, in the opinion of counsel for the Underwriters or for the Company, to
(i) amend the Registration Statement in order that the Registration Statement will not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not
misleading, (ii) amend or supplement the General Disclosure Package or the Prospectus in order that the General Disclosure Package or the Prospectus, as the case may be, will not include any untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements therein not misleading in the light of the circumstances existing at the time it is delivered to a purchaser or (iii) amend the Registration Statement or amend or supplement the General
Disclosure Package or the Prospectus, as the case may be, in order to comply with the requirements of the 1933 Act or the 1933 Act Regulations, the Company will promptly (A) give the Representatives notice of such event, to the extent arising
from an opinion of counsel to the Company, (B) prepare any amendment or supplement as may be necessary to correct such statement or omission or to make the Registration Statement, the General Disclosure Package or the Prospectus comply with
such requirements and, a reasonable amount of time prior to any proposed filing or use, furnish the Representatives with copies of any such amendment or supplement and (C) file with the Commission any such amendment or supplement; provided that
the Company shall not file or use any such amendment or supplement to which the Representatives or counsel for the Underwriters shall reasonably object. The Company will furnish to the Underwriters such number of copies of such amendment or
supplement as the Underwriters may request. The Company has given the Representatives notice of any filings made pursuant to the 1934 Act or 1934 Act Regulations within 48 hours prior to the Applicable Time; the Company will give the Representatives
notice of its intention to make any such filing from the Applicable Time to the Closing Time and will furnish the Representatives with copies of any such documents a reasonable amount of time prior to such proposed filing, as the case may be, and
will not file or use any such document to which the Representatives or counsel for the Underwriters shall reasonably object.
(c)
Delivery of Registration Statements
. The Company has furnished or will deliver to the Representatives and counsel
for the Underwriters, without charge, signed copies of the Registration Statement as originally filed and each amendment thereto (including exhibits filed therewith or
15
incorporated by reference therein and documents incorporated or deemed to be incorporated by reference therein) and signed copies of all consents and certificates of experts, and will also
deliver to the Representatives, without charge, a conformed copy of the Registration Statement as originally filed and each amendment thereto (without exhibits) for each of the Underwriters. The copies of the Registration Statement and each
amendment thereto furnished to the Underwriters will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation
S-T.
(d)
Delivery of Prospectuses
. The Company has delivered to each Underwriter, without charge, as many copies of
each preliminary prospectus as such Underwriter reasonably requested, and the Company hereby consents to the use of such copies for purposes permitted by the 1933 Act. The Company will furnish to each Underwriter, without charge, during the period
when a prospectus relating to the Securities is (or, but for the exception afforded by Rule 172, would be) required to be delivered under the 1933 Act, such number of copies of the Prospectus (as amended or supplemented) as such Underwriter may
reasonably request. The Prospectus and any amendments or supplements thereto furnished to the Underwriters will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted
by Regulation
S-T.
(e)
Blue Sky Qualifications
. The Company will use its
commercially reasonable efforts, in cooperation with the Underwriters, to qualify the Securities for offering and sale under the applicable securities laws of such states and other jurisdictions (domestic or foreign) as the Representatives may
designate and to maintain such qualifications in effect so long as required to complete the distribution of the Securities; provided, however, that the Company shall not be obligated to file any general consent to service of process or to qualify as
a foreign corporation or as a dealer in securities in any jurisdiction in which it is not so qualified or to subject itself to taxation in respect of doing business in any jurisdiction in which it is not otherwise so subject.
(f)
Rule 158
. The Company will timely file such reports pursuant to the 1934 Act as are necessary in order to make
generally available to its securityholders as soon as practicable an earnings statement for the purposes of, and to provide to the Underwriters the benefits contemplated by, the last paragraph of Section 11(a) of the 1933 Act.
(g)
Use of Proceeds
. The Company will use the net proceeds received by it from the sale of the Securities in the manner
specified in the Registration Statement, the General Disclosure Package and the Prospectus under “Use of Proceeds.”
(h)
Restriction on Sale of Securities
. During a period of 60 days from the date of the Prospectus, the Company will
not, without the prior written consent of Merrill Lynch and J.P. Morgan, (i) directly or indirectly, 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 any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock or file any registration statement under the 1933 Act with respect to any
of the foregoing or (ii) enter into any swap or any other agreement or any transaction that transfers, in whole or in part, directly or indirectly, the economic consequence of ownership of the Common Stock, whether any such swap or 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. The foregoing sentence shall not apply to (A) the Securities to be sold hereunder or any shares of
Common Stock issuable upon conversion thereof, (B) any shares of Common Stock issued by the Company upon the exercise of an option or warrant or the conversion of a security outstanding on the date hereof and referred to in the Registration
Statement, the General Disclosure Package and the Prospectus, (C) any shares of Common Stock issued or options to purchase Common Stock or restricted stock units granted pursuant to existing employee benefit plans of the
16
Company referred to in the Registration Statement, the General Disclosure Package and the Prospectus or (D) any shares of Common Stock issued or options to purchase Common Stock or
restricted stock units granted pursuant to any non-employee director stock plan or dividend reinvestment plan referred to in the Registration Statement, the General Disclosure Package and the Prospectus. Notwithstanding the foregoing, if
(1) during the last 17 days of the 60-day restricted period the Company issues an earnings release or material news or a material event relating to the Company occurs or (2) prior to the expiration of the 60-day restricted period, the
Company announces that it will issue an earnings release or becomes aware that material news or a material event will occur during the 16-day period beginning on the last day of the 60-day restricted period, the restrictions imposed in this clause
(h) shall continue to apply until the expiration of the 18-day period beginning on the date of the issuance of the earnings release or the occurrence of the material news or material event, unless Merrill Lynch and J.P. Morgan waive, in
writing, such extension.
(i)
Reporting Requirements
. The Company, during the period when a Prospectus
relating to the Securities is (or, but for the exception afforded by Rule 172, would be) required to be delivered under the 1933 Act, will file all documents required to be filed with the Commission pursuant to the 1934 Act within the time periods
required by the 1934 Act and 1934 Act Regulations.
(j)
Final Term Sheet; Issuer Free Writing
Prospectuses
. The Company will prepare a final term sheet (the “Final Term Sheet”), in the form set forth in Schedule C hereto, reflecting the final terms of the Securities, in form and substance satisfactory to the Representatives,
and shall file such Final Term Sheet as an “issuer free writing prospectus” pursuant to Rule 433 prior to the close of business two business days after the date hereof; provided that the Company shall furnish the Representatives with
copies of any such Final Term Sheet a reasonable amount of time prior to such proposed filing and will not use or file any such document to which the Representatives or counsel to the Underwriters shall reasonably object. The Company agrees that,
unless it obtains the prior written consent of the Representatives, it will not make any offer relating to the Securities that would constitute an Issuer Free Writing Prospectus or that would otherwise constitute a “free writing
prospectus,” or a portion thereof, required to be filed by the Company with the Commission or retained by the Company under Rule 433; provided that the Representatives will be deemed to have consented to the Issuer Free Writing Prospectuses
listed on Schedule B hereto and any “road show that is a written communication” within the meaning of Rule 433(d)(8)(i) that has been reviewed by the Representatives. The Company represents that it has treated or agrees that it will treat
each such free writing prospectus consented to, or deemed consented to, by the Representatives as an “issuer free writing prospectus,” as defined in Rule 433, and that it has complied and will comply with the applicable requirements of
Rule 433 with respect thereto, including timely filing with the Commission where required, legending and record keeping. If at any time following issuance of an Issuer Free Writing Prospectus there occurred or occurs an event or development as a
result of which such Issuer Free Writing Prospectus conflicted or would conflict with the information contained in the Registration Statement, any preliminary prospectus or the Prospectus or included or would include an untrue statement of a
material fact or omitted or would omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing at that subsequent time, not misleading, the Company will promptly notify the
Representatives and will promptly amend or supplement, at its own expense, such Issuer Free Writing Prospectus to eliminate or correct such conflict, untrue statement or omission.
SECTION 4.
Payment of Expenses
.
(a)
Expenses
. The Company will pay or cause to be paid all expenses incident to the performance of its
obligations under this Agreement, including (i) the preparation, printing and filing of the Registration Statement (including financial statements and exhibits) as originally filed and each amendment thereto, (ii) the preparation, printing
and delivery to the Underwriters of copies of each
17
preliminary prospectus, each Issuer Free Writing Prospectus and the Prospectus and any amendments or supplements thereto and any costs associated with electronic delivery of any of the foregoing
by the Underwriters to investors, (iii) the preparation, issuance and delivery of the Securities to the Underwriters and the Common Stock issuable upon conversion thereof, (iv) the fees and disbursements of the Company’s counsel,
accountants and other advisors, (v) the qualification of the Securities under securities laws in accordance with the provisions of Section 3(e) hereof, including filing fees and the reasonable fees and disbursements of counsel for the
Underwriters in connection therewith and in connection with the preparation of the Blue Sky Survey and any supplement thereto (such fees and disbursements of counsel not to exceed $10,000 in the aggregate), (vi) all fees and expenses of the
Trustee and any expenses of any transfer agent or registrar for the Securities or the Common Stock issuable upon conversion of the Securities, (vii) the costs and expenses of the Company relating to investor presentations on any “road
show” undertaken in connection with the marketing of the Securities, including without limitation, expenses associated with the production of road show slides and graphics, fees and expenses of any consultants engaged in connection with the
road show presentations, travel and lodging expenses of the representatives and officers of the Company and any such consultants, (viii) the fees and expenses incurred in connection with the listing of the Common Stock issuable upon conversion
of the Securities on the Nasdaq Global Select Market and (ix) the costs and expenses (including, without limitation, any damages or other amounts payable in connection with legal or contractual liability) associated with the reforming of any
contracts for sale of the Securities made by the Underwriters caused by a breach of the representation contained in the second sentence of Section 1(a)(ii). For the avoidance of doubt, except as expressly set forth herein, the Underwriters
shall pay their own expenses, including the fees and expenses of counsel.
(b)
Termination of Agreement
. If
this Agreement is terminated by the Representatives in accordance with the provisions of Section 5, Section 9(a)(i) or (iii) or Section 10 hereof, the Company shall reimburse the non-defaulting Underwriters for all of their
reasonable and documented
out-of-pocket
expenses, including the reasonable fees and disbursements of counsel for the Underwriters.
SECTION 5.
Conditions of Underwriters’ Obligations
. The obligations of the several Underwriters hereunder are
subject to the accuracy of the representations and warranties of the Company contained herein or in certificates of any officer of the Company or any of its subsidiaries, to the performance by the Company of its covenants and other obligations
hereunder, and to the following further conditions:
(a)
Effectiveness of Registration Statement
. The
Registration Statement has become effective and at the Closing Time no stop order suspending the effectiveness of the Registration Statement or any post-effective amendment thereto has been issued under the 1933 Act, no order preventing or
suspending the use of any preliminary prospectus or the Prospectus has been issued and no proceedings for any of those purposes have been instituted or are pending or, to the Company’s knowledge, contemplated; and the Company has complied with
each request (if any) from the Commission for additional information. The Company shall have paid the required Commission filing fees relating to the Securities within the time period required by Rule 456(b)(1)(i) under the 1933 Act Regulations
without regard to the proviso therein and otherwise in accordance with Rules 456(b) and 457(r) under the 1933 Act Regulations and, if applicable, shall have updated the “Calculation of Registration Fee” table in accordance with Rule
456(b)(1)(ii) either in a post-effective amendment to the Registration Statement or on the cover page of a prospectus filed pursuant to Rule 424(b).
(b)
Opinion of Counsel for Company
. At the Closing Time, (i) the Representatives shall have received the
favorable opinion, dated the Closing Time, of Gibson, Dunn & Crutcher LLP, counsel for the Company, in form and substance reasonably satisfactory to counsel for the Underwriters, together with signed or reproduced copies of such letter for
each of the other Underwriters to the effect set forth in
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Exhibit A hereto, and (ii) Gibson, Dunn & Crutcher LLP shall have furnished to the Representatives, a letter, dated the Closing Time, in form and substance reasonably satisfactory
to counsel for the Underwriters, together with signed or reproduced copies of such letter for each of the other Underwriters to the effect set forth in Exhibit A hereto.
(c)
Opinion of Counsel for Underwriters
. At the Closing Time, the Representatives shall have received the
favorable opinion, dated the Closing Time, of Sidley Austin
LLP
, counsel for the Underwriters, together with signed or reproduced copies of such letter for each of the other Underwriters in form and substance satisfactory to the
Representatives. In giving such opinion such counsel may rely, as to all matters governed by the laws of jurisdictions other than the law of the State of New York, the General Corporation Law of the State of Delaware and the federal securities laws
of the United States, upon the opinions of counsel satisfactory to the Representatives. Such counsel may also state that, insofar as such opinion involves factual matters, they have relied, to the extent they deem proper, upon certificates of
officers and other representatives of the Company and its subsidiaries and certificates of public officials.
(d)
Officers’ Certificate
. At the Closing Time, there shall not have been, since the date hereof or since
the respective dates as of which information is given in the Registration Statement, the General Disclosure Package or the Prospectus, any material adverse change in the condition, financial or otherwise, or in the earnings or business affairs or
business prospects of the Company and its subsidiaries considered as one enterprise, whether or not arising in the ordinary course of business, and the Representatives shall have received a certificate of the Chief Executive Officer or the President
of the Company and of the chief financial or chief accounting officer of the Company, dated the Closing Time, to the effect that (i) there has been no such material adverse effect, (ii) the representations and warranties of the Company in
this Agreement are true and correct with the same force and effect as though expressly made at and as of the Closing Time, (iii) the Company has complied in all material respects with all agreements and satisfied all conditions on its part to
be performed or satisfied at or prior to the Closing Time, and (iv) no stop order suspending the effectiveness of the Registration Statement under the 1933 Act has been issued, no order preventing or suspending the use of any preliminary
prospectus or the Prospectus has been issued and no proceedings for any of those purposes have been instituted or are pending or, to their knowledge, contemplated.
(e)
Accountant’s Comfort Letter
. At the time of the execution of this Agreement, the Representatives shall
have received from Ernst & Young LLP a letter, dated such date, in form and substance reasonably satisfactory to the Representatives, together with signed or reproduced copies of such letter for each of the other Underwriters
containing statements and information of the type ordinarily included in accountants’ “comfort letters” to underwriters with respect to the financial statements and certain financial information contained in the Registration
Statement, the General Disclosure Package and the Prospectus.
(f)
Bring-down Comfort Letter
. At the
Closing Time, the Representatives shall have received from Ernst & Young LLP a letter, dated as of the Closing Time, to the effect that they reaffirm the statements made in the letter furnished pursuant to subsection (e) of this
Section, except that the specified date referred to shall be a date not more than three business days prior to the Closing Time.
(g)
Approval of Listing
. At the Closing Time, the Common Stock issuable upon conversion of the Securities shall
have been approved for listing on the Nasdaq Global Select Market, subject only to official notice of issuance.
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(h)
Lock-up Agreements
. At the date of this Agreement, the Representatives
shall have received an agreement substantially in the form of Exhibit B hereto signed by the persons listed on Schedule D hereto.
(i)
No Rating
. Neither the Company nor its subsidiaries have any debt securities or preferred stock that are rated by
any “nationally recognized statistical rating agency” (as defined in Section 3(a) (62) of the 1934 Act).
(j)
Conditions to Purchase of Option Securities
. In the event that the Underwriters exercise their option provided in
Section 2(b) hereof to purchase all or any portion of the Option Securities, the representations and warranties of the Company contained herein and the statements in any certificates furnished by the Company and any of its subsidiaries
hereunder shall be true and correct as of each Date of Delivery and, at the relevant Date of Delivery, the Representatives shall have received:
(i)
Officers’ Certificate
. A certificate, dated such Date of Delivery, of the President or a Vice
President of the Company and of the chief financial or chief accounting officer of the Company confirming that the certificate delivered at the Closing Time pursuant to Section 5(d) hereof remains true and correct as of such Date of Delivery.
(ii)
Opinion of Counsel for Company
. If requested by the Representatives, (1) the favorable
opinion of Gibson, Dunn & Crutcher LLP, counsel for the Company, in form and substance reasonably satisfactory to counsel for the Underwriters, dated such Date of Delivery, relating to the Option Securities to be purchased on such Date of
Delivery and otherwise to the same effect as the opinion required by Section 5(b)(i) hereof, and (2) Gibson, Dunn & Crutcher LLP will furnish a letter in form and substance reasonably satisfactory to counsel for the Underwriters,
dated such Date of Delivery, and otherwise to the same effect as the letter required by Section 5(b)(ii) hereof.
(iv)
Opinion of Counsel for Underwriters
. If requested by the Representatives, the favorable opinion of
Sidley Austin
LLP
, counsel for the Underwriters, dated such Date of Delivery, relating to the Option Securities to be purchased on such Date of Delivery in form and substance satisfactory to the Representatives.
(v)
Bring-down Comfort Letter
. If requested by the Representatives, a letter from Ernst &
Young LLP, in form and substance reasonably satisfactory to the Representatives and dated such Date of Delivery, substantially in the same form and substance as the letter furnished to the Representatives pursuant to Section 5(e) hereof,
except that the “specified date” in the letter furnished pursuant to this paragraph shall be a date not more than three business days prior to such Date of Delivery.
(k)
Additional Documents
. At the Closing Time and at each Date of Delivery (if any) counsel for the Underwriters shall
have been furnished with such documents and opinions as they may reasonably require for the purpose of enabling them to pass upon the issuance and sale of the Securities as herein contemplated, or in order to evidence the accuracy of any of the
representations or warranties, or the fulfillment of any of the conditions, herein contained; and all proceedings taken by the Company in connection with the issuance and sale of the Securities as herein contemplated shall be reasonably satisfactory
in form and substance to the Representatives and counsel for the Underwriters.
(l)
Termination of Agreement
. If
any condition specified in this Section shall not have been fulfilled when and as required to be fulfilled, this Agreement, or, in the case of any condition to the purchase of Option Securities on a Date of Delivery which is after the Closing Time,
the obligations of
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the several Underwriters to purchase the relevant Option Securities, may be terminated by the Representatives by notice to the Company at any time at or prior to Closing Time or such Date of
Delivery, as the case may be, and such termination shall be without liability of any party to any other party except as provided in Section 4 and except that Sections 1, 6, 7, 8, 14, 15 and 16 shall survive any such termination and remain in
full force and effect.
SECTION 6.
Indemnification
.
(a)
Indemnification of Underwriters
. The Company agrees to indemnify and hold harmless each Underwriter, its affiliates
(as such term is defined in Rule 501(b) under the 1933 Act (each, an “Affiliate”)), its selling agents and each person, if any, who controls any Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act as follows:
(i) against any and all loss, liability, claim, damage and expense whatsoever, as
incurred, (A) arising out of any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement (or any amendment thereto), including any information deemed to be a part thereof pursuant to Rule 430B, or
the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein not misleading or (B) arising out of any untrue statement or alleged untrue statement of a material fact
included (1) in any preliminary prospectus, any Issuer Free Writing Prospectus, the General Disclosure Package or the Prospectus (or any amendment or supplement thereto) or (2) in any materials or information provided to investors by, or
with the written approval of, the Company in connection with the marketing of the offering of the Securities (“Marketing Materials”), including any roadshow or investor presentations made to investors by the Company (whether in person or
electronically), or the omission or alleged omission in any preliminary prospectus, Issuer Free Writing Prospectus, Prospectus or in any Marketing Materials of a material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(ii) against any and all loss, liability, claim,
damage and expense whatsoever, as incurred, to the extent of the aggregate amount paid in settlement of any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or of any claim whatsoever based
upon any such untrue statement or omission, or any such alleged untrue statement or omission; provided that (subject to Section 6(d) below) any such settlement is effected with the written consent of the Company;
(iii) against any and all expense whatsoever, as incurred (including the fees and disbursements of counsel
chosen by Merrill Lynch and J.P. Morgan), reasonably incurred in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever
based upon any such untrue statement or omission, or any such alleged untrue statement or omission, to the extent that any such expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss, liability, claim, damage or expense to the extent arising out of
any untrue statement or omission or alleged untrue statement or omission made in the Registration Statement (or any amendment thereto), including any information deemed to be a part thereof pursuant to Rule 430B, the General Disclosure Package or
the Prospectus (or any amendment or supplement thereto) in reliance upon and in conformity with the Underwriter Information.
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(b)
Indemnification of Company, Directors and Officers.
Each Underwriter
severally agrees to indemnify and hold harmless the Company, its directors, each of its officers who signed the Registration Statement, and each person, if any, who controls the Company within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act, against any and all loss, liability, claim, damage and expense described in the indemnity contained in subsection (a) of this Section, as incurred, but only with respect to untrue statements or omissions, or
alleged untrue statements or omissions, made in the Registration Statement (or any amendment thereto), including any information deemed to be a part thereof pursuant to Rule 430B, the General Disclosure Package or the Prospectus (or any amendment or
supplement thereto) in reliance upon and in conformity with the Underwriter Information.
(c)
Actions against Parties;
Notification.
Each indemnified party shall give notice as promptly as reasonably practicable to each indemnifying party of any action commenced against it in respect of which indemnity may be sought hereunder, but failure to so notify an
indemnifying party shall not relieve such indemnifying party from any liability hereunder to the extent it is not materially prejudiced as a result thereof and in any event shall not relieve it from any liability which it may have otherwise than on
account of this indemnity agreement. In case any such action is brought against any indemnified party and such indemnified party seeks or intends to seek indemnity from an indemnifying party, the indemnifying party will be entitled to participate
in, and, to the extent that it shall elect by written notice delivered to the indemnified party as promptly as reasonably practicable after receiving the aforesaid notice from such indemnified party, to assume the defense thereof with counsel
reasonably satisfactory to such indemnified party. In any such proceeding, any indemnified person shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of the indemnified party, unless
(x) the defendants in any such action include both the indemnified party and the indemnifying party and counsel to the indemnified party shall have reasonably concluded that (1) a conflict may arise between the positions of the
indemnifying party and the indemnified party in conducting the defense of any such action or (2) there may be legal defenses available to the indemnified party that are different from or additional to those available to the indemnifying party,
or (y) the indemnifying party shall not have employed counsel reasonably satisfactory to the indemnified party to represent the indemnified party within a reasonable time after notice of commencement of the action, in each of which cases the
fees and expenses of counsel to the indemnified party shall be at the expense of the indemnifying party. If the indemnifying party does not elect to assume the defense of such action, in the case of parties indemnified pursuant to Section 6(a)
above, counsel to the indemnified parties shall be selected by Merrill Lynch and J.P. Morgan, and, in the case of parties indemnified pursuant to Section 6(b) above, counsel to the indemnified parties shall be selected by the Company; and an
indemnifying party may participate at its own expense in the defense of any such action; provided, however, that counsel to the indemnifying party shall not (except with the consent of the indemnified party) also be counsel to the indemnified party.
In no event shall the indemnifying parties be liable for fees and expenses of more than one counsel (in addition to any local counsel) separate from their own counsel for all indemnified parties in connection with any one action or separate but
similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances. No indemnifying party shall, without the prior written consent of the indemnified parties, settle or compromise or consent to the entry
of any judgment with respect to any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever in respect of which indemnification or contribution could be sought under this
Section 6 or Section 7 hereof (whether or not the indemnified parties are actual or potential parties thereto), unless such settlement, compromise or consent (i) includes an unconditional release of each indemnified party from all
liability arising out of such litigation, investigation, proceeding or claim and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party.
(d)
Settlement without Consent if Failure to Reimburse.
If at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
22
counsel, such indemnifying party agrees that it shall be liable for any settlement of the nature contemplated by Section 6(a)(ii) effected without its written consent if (i) such
settlement is entered into more than 45 days after receipt by such indemnifying party of the aforesaid request, (ii) such indemnifying party shall have received notice of the terms of such settlement at least 30 days prior to such settlement
being entered into and (iii) such indemnifying party shall not have reimbursed such indemnified party in accordance with such request prior to the date of such settlement (provided that the foregoing shall not be applicable to any failure to
reimburse if the Company is disputing such payment in good faith and shall have paid any amounts not in dispute).
SECTION
7.
Contribution
. If the indemnification provided for in Section 6 hereof is for any reason unavailable to or insufficient to hold harmless an indemnified party in respect of any losses, liabilities, claims, damages or expenses referred
to therein, then in lieu thereof each indemnifying party shall contribute to the aggregate amount of such losses, liabilities, claims, damages and expenses incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company, on the one hand, and the Underwriters, on the other hand, from the offering of the Securities pursuant to this Agreement 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) above but also the relative fault of the Company, on the one hand, and of the Underwriters, on
the other hand, in connection with the statements or omissions which resulted in such losses, liabilities, claims, damages or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company, on the one hand, and the Underwriters, on the other hand, in connection with
the offering of the Securities pursuant to this Agreement shall be deemed to be in the same respective proportions as the total net proceeds from the offering of the Securities pursuant to this Agreement (before deducting expenses) received by the
Company, on the one hand, and the total underwriting discount received by the Underwriters, on the other hand, in each case as set forth on the cover of the Prospectus, bear to the aggregate initial public offering price of the Securities as set
forth on the cover of the Prospectus.
The relative fault of the Company, on the one hand, and the Underwriters, on the
other hand, shall be determined by reference to, among other things, whether any such untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by the Company or by
the Underwriters and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.
The Company and the Underwriters 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 Underwriters were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to above in this Section 7.
The aggregate amount of losses, liabilities, claims, damages and expenses incurred by an indemnified party and referred to above in this Section 7 shall be deemed to include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue or alleged untrue statement or
omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter shall be required to
contribute any amount in excess of the underwriting commissions received by such Underwriter in connection with the Securities underwritten by it and distributed to the public.
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No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 1933 Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an Underwriter within the meaning of Section 15 of
the 1933 Act or Section 20 of the 1934 Act and each Underwriter’s Affiliates and selling agents shall have the same rights to contribution as such Underwriter, and each director of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall have the same rights to contribution as the Company. The Underwriters’
respective obligations to contribute pursuant to this Section 7 are several in proportion to the aggregate principal amount of Initial Securities set forth opposite their respective names in Schedule A hereto and not joint.
SECTION 8.
Representations, Warranties and Agreements to Survive
. All representations, warranties and agreements
contained in this Agreement or in certificates of officers of the Company or any of its subsidiaries submitted pursuant hereto, shall remain operative and in full force and effect regardless of (i) any investigation made by or on behalf of any
Underwriter or its Affiliates or selling agents, any person controlling any Underwriter, its officers or directors or any person controlling the Company and (ii) delivery of and payment for the Securities.
SECTION 9.
Termination of Agreement
.
(a)
Termination
. The Representatives may terminate this Agreement, by notice to the Company, at any time at or prior to
the Closing Time (i) if there has been, in the judgment of the Representatives, since the time of execution of this Agreement or since the respective dates as of which information is given in the Registration Statement, the General Disclosure
Package or the Prospectus, any material adverse change in the condition, financial or otherwise, or in the earnings or business affairs or business prospects of the Company and its subsidiaries considered as one enterprise, whether or not arising in
the ordinary course of business, or (ii) if there has occurred any material adverse change in the financial markets in the United States or the international financial markets, any outbreak of hostilities or escalation thereof or other calamity
or crisis or any change or development involving a prospective change in national or international political, financial or economic conditions, in each case the effect of which is such as to make it, in the judgment of the Representatives,
impracticable or inadvisable to proceed with the completion of the offering or to enforce contracts for the sale of the Securities, or (iii) if trading in any securities of the Company has been suspended or materially limited by the Commission
or the Nasdaq Global Select Market, or (iv) if trading generally on the NYSE MKT or the New York Stock Exchange or in the Nasdaq Global Select Market has been suspended or materially limited, or minimum or maximum prices for trading have been
fixed, or maximum ranges for prices have been required, by any of said exchanges or by order of the Commission, FINRA or any other Governmental Entity, or (v) a material disruption has occurred in commercial banking or securities settlement or
clearance services in the United States or with respect to Clearstream or Euroclear systems in Europe, or (vi) if a banking moratorium has been declared by either Federal or New York authorities.
(b)
Liabilities.
If this Agreement is terminated pursuant to this Section, such termination shall be without liability
of any party to any other party except as provided in Section 4 hereof, and provided further that Sections 1, 6, 7, 8, 14, 15 and 16 shall survive such termination and remain in full force and effect.
SECTION 10.
Default by One or More of the Underwriters
. If one or more of the Underwriters shall fail at the Closing
Time or a Date of Delivery to purchase the Securities which it or they are obligated to purchase under this Agreement (the “Defaulted Securities”), the Representatives shall have
24
the right, within 24 hours thereafter, to make arrangements for one or more of the
non-defaulting
Underwriters, or any other underwriters, to purchase
all, but not less than all, of the Defaulted Securities in such amounts as may be agreed upon and upon the terms herein set forth; if, however, the Representatives shall not have completed such arrangements within such
24-hour
period, then:
(i) if the total principal amount of
Defaulted Securities does not exceed 10% of the aggregate principal amount of the Securities to be purchased on such date, each of the
non-defaulting
Underwriters shall be obligated, severally and not jointly,
to purchase the full amount thereof in the proportions that their respective underwriting obligations hereunder bear to the underwriting obligations of all
non-defaulting
Underwriters, or
(ii) if the total principal amount of Defaulted Securities exceeds 10% of the aggregate principal amount of the
Securities to be purchased on such date, this Agreement or, with respect to any Date of Delivery which occurs after the Closing Time, the obligation of the Underwriters to purchase, and the Company to sell, the Option Securities to be purchased and
sold on such Date of Delivery shall terminate without liability on the part of any
non-defaulting
Underwriter.
No action taken pursuant to this Section shall relieve any defaulting Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination of this Agreement or, in the case of a Date of
Delivery which is after the Closing Time, which does not result in a termination of the obligation of the Underwriters to purchase and the Company to sell the relevant Option Securities, as the case may be, either the (i) Representatives or
(ii) the Company shall have the right to postpone Closing Time or the relevant Date of Delivery, as the case may be, for a period not exceeding seven days in order to effect any required changes in the Registration Statement, the General
Disclosure Package or the Prospectus or in any other documents or arrangements. As used herein, the term “Underwriter” includes any person substituted for an Underwriter under this Section 10.
SECTION 11.
Notices
. All notices and other communications hereunder shall be in writing and shall be deemed to have
been duly given if mailed or transmitted by any standard form of telecommunication. Notices to the Underwriters shall be directed to Merrill Lynch at One Bryant Park, New York, New York 10036, attention of Syndicate Department (facsimile:
(646) 855-3073), with a copy to ECM Legal (facsimile: (212) 230-8730) and to J.P. Morgan at 383 Madison Avenue, New York, New York 10179, attention Equity Syndicate Desk (facsimile: (212) 622-8358); notices to the Company shall be
directed to it at 10165 McKellar Court, San Diego California 92121, attention of General Counsel.
SECTION 12.
No
Advisory or Fiduciary Relationship
. The Company acknowledges and agrees that (a) the purchase and sale of the Securities pursuant to this Agreement, including the determination of the initial public offering price of the Securities and any
related discounts and commissions, is an arm’s-length commercial transaction between the Company, on the one hand, and the several Underwriters, on the other hand, (b) in connection with the offering of the Securities and the process
leading thereto, each Underwriter is and has been acting solely as a principal and is not the agent or fiduciary of the Company, any of its subsidiaries or their respective stockholders, creditors, employees or any other party, (c) no
Underwriter has assumed or will assume an advisory or fiduciary responsibility in favor of the Company with respect to the offering of the Securities or the process leading thereto (irrespective of whether such Underwriter has advised or is
currently advising the Company or any of its subsidiaries on other matters) and no Underwriter has any obligation to the Company with respect to the offering of the Securities except the obligations expressly set forth in this Agreement,
(d) the Underwriters and their respective affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Company and (e) the Underwriters have not provided any legal, accounting, regulatory
or tax advice with respect to the offering of the Securities and the Company has consulted its own respective legal, accounting, regulatory and tax advisors to the extent it deemed appropriate.
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SECTION 13.
Parties
. This Agreement shall each inure to the benefit of and
be binding upon the Underwriters and the Company and their respective successors. Nothing expressed or mentioned in this Agreement is intended or shall be construed to give any person, firm or corporation, other than the Underwriters and the Company
and their respective successors and the controlling persons and officers and directors referred to in Sections 6 and 7 and their heirs and legal representatives, any legal or equitable right, remedy or claim under or in respect of this
Agreement or any provision herein contained. This Agreement and all conditions and provisions hereof are intended to be for the sole and exclusive benefit of the Underwriters and the Company and their respective successors, and said controlling
persons and officers and directors and their heirs and legal representatives, and for the benefit of no other person, firm or corporation. No purchaser of Securities from any Underwriter shall be deemed to be a successor by reason merely of such
purchase.
SECTION 14.
Trial by Jury
. The Company (on its behalf and, to the extent permitted by applicable law, on
behalf of its stockholders and affiliates) and each of the Underwriters 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
Agreement or the transactions contemplated hereby.
SECTION 15.
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 WITHOUT REGARD TO ITS CHOICE OF LAW PROVISIONS.
SECTION 16.
Consent to Jurisdiction; Waiver of Immunity
. Any legal suit, action or proceeding arising out of or based
upon this Agreement or the transactions contemplated hereby (“Related Proceedings”) shall be instituted in (i) the federal courts of the United States of America located in the City and County of New York, Borough of Manhattan
or (ii) the courts of the State of New York located in the City and County of New York, Borough of Manhattan (collectively, the “Specified Courts”), and each party irrevocably submits to the exclusive jurisdiction (except for
proceedings instituted in regard to the enforcement of a judgment of any such court (a “Related Judgment”), as to which such jurisdiction is non-exclusive) of such courts in any such suit, action or proceeding. Service of any process,
summons, notice or document by mail to such party’s address set forth above shall be effective service of process for any suit, action or other proceeding brought in any such court. The parties irrevocably and unconditionally waive any
objection to the laying of venue of any suit, action or other proceeding in the Specified Courts and irrevocably and unconditionally waive and agree not to plead or claim in any such court that any such suit, action or other proceeding brought in
any such court has been brought in an inconvenient forum.
SECTION 17.
TIME
. TIME SHALL BE OF THE ESSENCE OF THIS
AGREEMENT. EXCEPT AS OTHERWISE SET FORTH HEREIN, SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 18.
Counterparts
. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all such counterparts shall together constitute one and the same Agreement.
SECTION 19.
Effect of Headings
. The Section headings herein are for convenience only and shall not affect the
construction hereof.
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If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the Company a counterpart hereof, whereupon this instrument, along with all counterparts, will become a binding agreement among the Underwriters and the Company in accordance with its terms.
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Very truly yours,
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QUIDEL CORPORATION
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By:
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/s/ Randall J. Steward
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Name: Randall J. Steward
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Title: Chief Financial Officer
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[Signature Page to
Underwriting Agreement]
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CONFIRMED AND ACCEPTED,
as of the date first above written:
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MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
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J.P. MORGAN SECURITIES LLC
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By:
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MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
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By:
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/s/ Adam Chazan
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Authorized Signatory
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By:
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J.P. MORGAN SECURITIES LLC
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|
By:
|
|
/s/ Sudheer Tegulapalle
|
|
|
|
Authorized Signatory
|
For themselves and as Representatives of the other Underwriters named in Schedule A hereto.
[Signature Page to
Underwriting Agreement]
SCHEDULE A
The initial public offering price of the Securities shall be 100.00% of the principal amount thereof, plus accrued interest, if any, from the
date of issuance.
The purchase price to be paid by the Underwriters for the Securities shall be 97.25% of the principal amount thereof.
The interest rate on the Securities shall be 3.25% per annum.
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|
|
|
|
|
|
Name of Underwriter
|
|
Principal
Amount of
Securities
|
|
|
Merrill Lynch, Pierce, Fenner & Smith Incorporated
|
|
$
|
86,250,000
|
|
|
J.P. Morgan Securities LLC
|
|
$
|
48,750,000
|
|
|
William Blair & Company, L.L.C.
|
|
$
|
3,750,000
|
|
|
Canaccord Genuity Inc.
|
|
$
|
3,750,000
|
|
|
Cowen and Company LLC
|
|
$
|
3,750,000
|
|
|
Piper Jaffray & Co.
|
|
$
|
3,750,000
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
150,000,000
|
|
|
|
|
|
|
|
Sch A-1
SCHEDULE B
Free Writing Prospectuses
Final Term Sheet
Sch B - 1
SCHEDULE C
Final Term Sheet
Quidel Corporation
3.25% Convertible Senior Notes due 2020
The information in this pricing term sheet relates to Quidel Corporation’s offering (the “Offering”) of its 3.25% Convertible Senior Notes
due 2020 (the “Notes”) and should be read together with the preliminary prospectus supplement dated December 1, 2014 (including the documents incorporated by reference therein and the base prospectus dated December 1, 2014 in
respect thereof) relating to the Offering (the “Preliminary Prospectus Supplement”). The information in this pricing term sheet supersedes the information in the Preliminary Prospectus Supplement to the extent that it is inconsistent
therewith. Terms used but not defined herein have the meanings ascribed to them in the Preliminary Prospectus Supplement.
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|
|
|
|
Issuer:
|
|
Quidel Corporation (NASDAQ: QDEL)
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|
|
|
|
Securities Offered:
|
|
3.25% Convertible Senior Notes due 2020
|
|
|
|
|
Offering Size:
|
|
$150,000,000 aggregate principal amount (or $172,500,000 aggregate principal amount if the underwriters exercise their over-allotment option in full)
|
|
|
|
|
Public Offering Price:
|
|
100% of the principal amount, plus accrued interest, if any, from the Settlement Date
|
|
|
|
|
Underwriting Discount:
|
|
2.75% of the principal amount
|
|
|
|
|
Use of Proceeds:
|
|
We estimate that the net proceeds from this offering, after deducting estimated expenses payable by us and the underwriters’ discount, will be approximately $145.28 million (or approximately $167.16 million if the
underwriters exercise their over-allotment option in full). We intend to use the net proceeds from this offering for working capital and other general corporate purposes, which may include acquisitions of products, technologies or businesses, and
opportunistic repurchases of shares of our common stock. See “Use of Proceeds” in the Preliminary Prospectus Supplement.
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|
|
|
|
Maturity:
|
|
December 15, 2020, unless earlier purchased, redeemed or converted
|
|
|
|
|
Interest Rate:
|
|
3.25% per annum payable semiannually in arrears in cash
|
|
|
|
|
Interest Payment Dates:
|
|
June 15 and December 15, beginning June 15, 2015
|
|
|
|
|
No Redemption:
|
|
The Issuer may not redeem the Notes prior to maturity and no sinking fund is provided with respect to the Notes.
|
|
|
|
|
NASDAQ Closing Sale Price on December 2, 2014:
|
|
$23.75 per share of the Issuer’s common stock (the “Common Stock”)
|
|
|
|
|
Initial Conversion Rate:
|
|
31.1891 shares of Common Stock per $1,000 principal amount of Notes
|
|
|
|
|
Initial Conversion Price:
|
|
Approximately $32.06 per share of Common Stock
|
Sch C - 1
|
|
|
|
|
|
|
|
Conversion Premium:
|
|
Approximately 35% above the NASDAQ Closing Sale Price on December 2, 2014
|
|
|
|
|
Reserved Shares:
|
|
Notwithstanding anything to the contrary under the caption “Description of the Notes” in the Preliminary Prospectus Supplement, if the Issuer is
required to deliver shares of its Common Stock to a converting holder under any settlement method and such delivery obligation exceeds the aggregate number of authorized but unissued shares and treasury shares available to the Issuer on the
conversion date (in the case of stock settlement) or the last trading day of the relevant conversion period (in the case of any other settlement method) for the purpose of satisfying conversions of the Notes, in lieu of delivery of such excess
shares, the Issuer will pay to such holder the value of any such excess shares in cash based on the daily VWAP of the Common Stock on the relevant conversion date (in the case of stock settlement) or based on the daily VWAP of the Common Stock on
the last trading day of the relevant conversion period (in the case of any other settlement method). As of the first original issuance date of the Notes, the Issuer will have reserved up to 6.73 million shares of Common Stock for the purpose of
satisfying conversions of the Notes and expects that number of shares to be sufficient to satisfy conversions of all the Notes through stock settlement, unless (x) the underwriters exercise their option to purchase additional notes and (y) the
Issuer is required to deliver additional shares of Common Stock in connection with a make-whole fundamental change. In addition, if there are not a sufficient number of authorized shares reserved for the purposes of satisfying conversions of all
Notes through stock settlement (including the delivery of additional shares for conversions in connection with a make-whole fundamental change), the Issuer expects to propose at its next regularly scheduled shareholder meeting a resolution
increasing the number of its authorized shares and to reserve additional shares of Common Stock for the purpose of satisfying conversions of the Notes such that the number of shares reserved for such purpose is sufficient to satisfy conversions of
all the Notes through stock settlement, including the delivery of additional shares for conversions in connection with a make-whole fundamental change.
|
Sch C - 1
|
|
|
|
|
|
|
|
Adjustment to Conversion Rate upon Conversion in Connectionwith a Make-Whole Fundamental Change
|
|
The following table sets forth the number of additional shares (as defined under “Description of the Notes—Adjustment to Conversion Rate upon
Conversion in Connection with a Make-Whole Fundamental Change” in the Preliminary Prospectus Supplement) to be received per $1,000 principal amount of Notes for each stock price and effective date set forth below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock Price
|
|
|
Effective Date
|
|
|
$23.75
|
|
|
|
$26.00
|
|
|
|
$29.00
|
|
|
|
$32.06
|
|
|
|
$40.00
|
|
|
|
$50.00
|
|
|
|
$60.00
|
|
|
|
$80.00
|
|
|
|
$100.00
|
|
|
|
$120.00
|
|
|
December 8, 2014
|
|
|
10.9161
|
|
|
|
9.1533
|
|
|
|
7.4255
|
|
|
|
6.1570
|
|
|
|
4.1830
|
|
|
|
2.9475
|
|
|
|
2.2659
|
|
|
|
1.5414
|
|
|
|
1.1326
|
|
|
|
0.8661
|
|
|
December 15, 2015
|
|
|
10.9161
|
|
|
|
8.8997
|
|
|
|
7.0629
|
|
|
|
5.7399
|
|
|
|
3.7521
|
|
|
|
2.5816
|
|
|
|
1.9716
|
|
|
|
1.3411
|
|
|
|
0.9889
|
|
|
|
0.7588
|
|
|
December 15, 2016
|
|
|
10.9161
|
|
|
|
8.6274
|
|
|
|
6.6486
|
|
|
|
5.2532
|
|
|
|
3.2501
|
|
|
|
2.1657
|
|
|
|
1.6424
|
|
|
|
1.1184
|
|
|
|
0.8281
|
|
|
|
0.6375
|
|
|
December 15, 2017
|
|
|
10.9161
|
|
|
|
8.3283
|
|
|
|
6.1595
|
|
|
|
4.6679
|
|
|
|
2.6542
|
|
|
|
1.6913
|
|
|
|
1.2753
|
|
|
|
0.8722
|
|
|
|
0.6489
|
|
|
|
0.5015
|
|
|
December 15, 2018
|
|
|
10.9161
|
|
|
|
7.9569
|
|
|
|
5.5260
|
|
|
|
3.9089
|
|
|
|
1.9217
|
|
|
|
1.1485
|
|
|
|
0.8708
|
|
|
|
0.6033
|
|
|
|
0.4510
|
|
|
|
0.3497
|
|
|
December 15, 2019
|
|
|
10.9161
|
|
|
|
7.4344
|
|
|
|
4.5920
|
|
|
|
2.7979
|
|
|
|
0.9902
|
|
|
|
0.5648
|
|
|
|
0.4437
|
|
|
|
0.3125
|
|
|
|
0.2343
|
|
|
|
0.1821
|
|
|
December 15, 2020
|
|
|
10.9161
|
|
|
|
7.2724
|
|
|
|
3.2936
|
|
|
|
0.0000
|
|
|
|
0.0000
|
|
|
|
0.0000
|
|
|
|
0.0000
|
|
|
|
0.0000
|
|
|
|
0.0000
|
|
|
|
0.0000
|
|
|
|
|
|
|
|
|
|
|
|
The exact stock prices and effective dates may not be set forth in the table above, in which case 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 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 based on a 365-day year, as
applicable;
|
|
|
|
|
|
|
• in excess of $120.00 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; and
|
|
|
|
|
|
|
• less than $23.75 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.
|
|
|
|
|
|
|
Notwithstanding anything in the indenture to the contrary, we may not increase the conversion rate to more than 42.1052 shares per $1,000 principal amount of notes pursuant to the events described in this section, though we will
adjust such number of shares for the same events for which we must adjust the conversion rate as described under ‘‘Description of the Notes—Conversion of Notes—Conversion Rate Adjustments’’ in the Preliminary Prospectus
Supplement.
|
|
|
|
|
Trade Date:
|
|
December 2, 2014
|
|
|
|
|
Settlement Date:
|
|
December 8, 2014
|
|
|
|
|
CUSIP/ISIN:
|
|
74838J AA9 / US74838JAA97
|
|
|
|
|
Joint Book-Running Managers:
|
|
Merrill Lynch, Pierce, Fenner & Smith Incorporated
J.P. Morgan Securities LLC
|
|
|
|
|
Co-Managers:
|
|
William Blair & Company, L.L.C.
Canaccord Genuity Inc.
Cowen
and Company LLC
Piper Jaffray & Co.
|
Sch C - 1
The Issuer has filed a registration statement including a prospectus and a preliminary prospectus supplement
with the Securities and Exchange Commission, or SEC, for the offering to which this communication relates. Before you invest, you should read the prospectus and preliminary prospectus supplement in that registration statement and other documents the
Issuer has filed with the SEC for more complete information about the Issuer and this offering. You may obtain these documents for free by visiting EDGAR on the SEC Web site at www.sec.gov. Alternatively, the Issuer, any underwriter or any dealer
participating in the offering will arrange to send you the prospectus and the preliminary prospectus supplement if you request them by calling BofA Merrill Lynch toll free at 866-500-5408 or J.P. Morgan toll free at 866-803-9204.
ANY DISCLAIMERS OR OTHER NOTICES THAT MAY APPEAR BELOW ARE NOT APPLICABLE TO THIS COMMUNICATION AND SHOULD BE DISREGARDED. SUCH DISCLAIMERS OR
OTHER NOTICES WERE AUTOMATICALLY GENERATED AS A RESULT OF THIS COMMUNICATION BEING SENT VIA BLOOMBERG OR ANOTHER EMAIL SYSTEM.
Sch C - 1
SCHEDULE D
List of Persons and Entities Subject to Lock-up
Douglas C. Bryant
Randall J.
Steward
Werner Kroll
Robert
J. Bujarski
Mark W. Smits
John D. Tamerius
Thomas D. Brown
Kenneth F. Buechler
Rod F.
Dammeyer
Mary Lake Polan
Mark A. Pulido
Jack W. Schuler
Kenneth J. Widder
Sch D - 1
Exhibit B
FORM OF LOCK-UP TO BE DELIVERED PURSUANT TO SECTION 5(h)
[
—
], 2014
Merrill Lynch, Pierce, Fenner & Smith Incorporated,
J.P. Morgan Securities LLC
as Representatives of the several
Underwriters to be named in the
within-mentioned
Underwriting Agreement
c/o Merrill Lynch, Pierce, Fenner & Smith Incorporated
One Bryant Park
New York, New
York 10036
|
|
Re:
|
Proposed Public Offering by Quidel Corporation
|
Dear Sirs:
The
undersigned, an officer and/or director of Quidel Corporation, a Delaware corporation (the “Company”), understands that Merrill Lynch, Pierce, Fenner & Smith Incorporated (“Merrill Lynch”) and J.P. Morgan Securities LLC
(“J.P. Morgan”) propose to enter into an Underwriting Agreement (the “Underwriting Agreement”) with the Company providing for the public offering of $150,000,000 aggregate principal amount of the Company’s Convertible Senior
Notes due 2020 (the “Securities”). In recognition of the benefit that such an offering will confer upon the undersigned as an officer and/or director of the Company, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the undersigned agrees with each underwriter to be named in the Underwriting Agreement that, during the period beginning on the date hereof and ending on the date that is 60 days from the date of the
Underwriting Agreement (the “Lock-up Period”), the undersigned will not, without the prior written consent of Merrill Lynch and J.P. Morgan, (i) directly or indirectly, 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 any shares of the Company’s common stock, par value $0.001 per share (the “Common
Stock”), or any securities convertible into or exercisable or exchangeable for Common Stock, whether now owned or hereafter acquired by the undersigned or with respect to which the undersigned has or hereafter acquires the power of disposition
(collectively, the “Lock-Up Securities”), or exercise any right with respect to the registration of any of the Lock-up Securities, or file or cause to be filed any registration statement in connection therewith, under the Securities Act of
1933, as amended, or (ii) enter into any swap or any other agreement or any transaction that transfers, in whole or in part, directly or indirectly, the economic consequence of ownership of the Lock-Up Securities, whether any such swap or
transaction is to be settled by delivery of Common Stock or other securities, in cash or otherwise.
Notwithstanding the foregoing, and
subject to the conditions below, the undersigned may transfer the Lock-Up Securities without the prior written consent of Merrill Lynch and J.P. Morgan, provided that
B-1
(1) Merrill Lynch and J.P. Morgan receive a signed lock-up agreement for the balance of the lockup period from each donee, trustee, distributee, or transferee, as the case may be, (2) any
such transfer shall not involve a disposition for value, (3) such transfers are not required to be reported with the Securities and Exchange Commission on Form 4 in accordance with Section 16 of the Securities Exchange Act of 1934, as
amended, and (4) the undersigned does not otherwise voluntarily effect any public filing or report regarding such transfers:
|
|
(i)
|
as a
bona fide
gift or gifts; or
|
|
|
(ii)
|
to any trust for the direct or indirect benefit of the undersigned or the immediate family of the undersigned (for purposes of this lock-up
agreement, “immediate family” shall mean any relationship by blood, marriage or adoption, not more remote than first cousin); or
|
|
|
(iii)
|
to any immediate family of the undersigned; or
|
|
|
(iv)
|
to the undersigned’s affiliates or to any investment fund or other entity controlled or managed by the undersigned.
|
Furthermore, the undersigned may transfer the Lock-Up Securities without the prior written consent of Merrill Lynch and J.P.
Morgan (a) to exercise stock options held by the undersigned as of the date hereof, through the surrender to the Company of shares of Common Stock, provided that any shares of Common Stock received by such person upon such net issuance shall be
subject to the restrictions provided for in this lock-up agreement, (b) any deemed sale of the Lock-Up Securities pursuant to the “net” or “cashless” exercise of outstanding options to the extent permitted by the applicable
grant documents, provided that any shares of Common Stock received by such person upon such “net” or “cashless” exercise of outstanding options shall be subject to the restrictions provided for in this lock-up agreement,
(c) in connection with the partial or full settlement of any withholding tax obligation of the undersigned, through the surrender or forfeiture to the Company of shares of Common Stock, accruing upon the exercise of any stock options or vesting
of any restricted stock or restricted stock units outstanding on the date hereof, or (d) on death, by will or intestate succession.
Furthermore, the undersigned may sell shares of Common Stock of the Company purchased by the undersigned on the open market
following the Public Offering if and only if (i) such sales are not required to be reported in any public report or filing with the Securities and Exchange Commission, or otherwise and (ii) the undersigned does not otherwise voluntarily
effect any public filing or report regarding such sales.
Notwithstanding the foregoing, if:
(1) during the last 17 days of the Lock-up Period, the Company issues an earnings release or material news or a material event
relating to the Company occurs; or
(2) prior to the expiration of the Lock-up Period, the Company announces that it will
release earnings results or becomes aware that material news or a material event will occur during the 16-day period beginning on the last day of the Lock-up Period,
the restrictions imposed by this lock-up agreement shall continue to apply until the expiration of the 18-day period beginning on the issuance
of the earnings release or the occurrence of the material news or material event, as applicable, unless Merrill Lynch and J.P. Morgan waive, in writing, such extension.
B-2
The undersigned agrees that, prior to engaging in any transaction or taking any
other action that is subject to the terms of this lock-up agreement during the period from the date of this lock-up agreement to and including the 34
th
day following the expiration of the initial
Lock-up Period, it will give notice thereof to the Company and will not consummate such transaction or take any such action unless it has received written confirmation from the Company that the Lock-up Period (as may have been extended pursuant to
the previous paragraph) has expired.
The undersigned also agrees and consents to the entry of stop transfer instructions
with the Company’s transfer agent and registrar against the transfer of the Lock-Up Securities except in compliance with the foregoing restrictions.
If (i) the Company notifies you in writing that it does not intend to proceed with the offering, (ii) the
Underwriting Agreement is not executed on or prior to December 15, 2014 or (iii) for any reason the Underwriting Agreement is terminated prior to payment for and delivery of the Securities, this lock-up agreement shall immediately
terminate and the undersigned shall be released from its obligations hereunder.
|
|
|
|
|
Very truly yours,
|
|
|
|
|
Signature:
|
|
|
|
|
|
|
Print Name:
|
|
|
B-3
Exhibit 4.1
QUIDEL CORPORATION
as Issuer
AND
THE BANK OF NEW YORK
MELLON TRUST COMPANY, N.A.
as Trustee
First Supplemental Indenture
Dated as of December 8, 2014
to Indenture
Dated as of
December 1, 2014
3.25% Convertible Senior Notes due 2020
TABLE OF CONTENTS
|
|
|
|
|
|
|
ARTICLE 1
|
|
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
|
|
|
|
|
|
Section 1.01.
|
|
Scope of Supplemental Indenture
|
|
1
|
|
Section 1.02.
|
|
Definitions
|
|
2
|
|
Section 1.03.
|
|
Section References
|
|
10
|
|
|
|
ARTICLE 2
|
|
THE NOTES
|
|
|
|
|
|
Section 2.01.
|
|
Designation, Amount and Issuance of Notes
|
|
10
|
|
Section 2.02.
|
|
Form of the Notes
|
|
10
|
|
Section 2.03.
|
|
Date and Denomination of Notes; Payment at the Stated Maturity Date; Payment of Interest
|
|
11
|
|
Section 2.04.
|
|
Registrar, Paying Agent and Conversion Agent
|
|
11
|
|
Section 2.05.
|
|
Registration of Transfer and Exchange
|
|
12
|
|
Section 2.06.
|
|
Global Securities
|
|
12
|
|
Section 2.07.
|
|
Purchase and Cancellation
|
|
13
|
|
Section 2.08.
|
|
Additional Notes
|
|
13
|
|
Section 2.09.
|
|
Mutilated, Destroyed, Lost or Stolen Notes
|
|
14
|
|
|
|
ARTICLE 3
|
|
PARTICULAR COVENANTS OF THE COMPANY
|
|
|
|
|
|
Section 3.01.
|
|
Covenants in Original Indenture
|
|
14
|
|
Section 3.02.
|
|
Compliance Certificate
|
|
14
|
|
Section 3.03.
|
|
Further Instruments and Acts
|
|
14
|
|
|
|
ARTICLE 4
|
|
REPURCHASE OF NOTES
|
|
|
|
|
|
Section 4.01.
|
|
Right To Require Repurchase Upon a Fundamental Change
|
|
14
|
|
|
|
ARTICLE 5
|
|
CONVERSION
|
|
|
|
|
|
Section 5.01.
|
|
Conversion Privilege; Conversion Rate
|
|
18
|
|
Section 5.02.
|
|
Adjustment to Conversion Rate Upon Conversion in Connection with a Make-Whole Fundamental Change
|
|
20
|
|
Section 5.03.
|
|
Exercise of Conversion Privilege
|
|
22
|
|
Section 5.04.
|
|
Settlement of Conversion Obligation
|
|
23
|
|
Section 5.05.
|
|
Fractions of Shares
|
|
26
|
|
Section 5.06.
|
|
Adjustment of Conversion Rate
|
|
26
|
|
Section 5.07.
|
|
Notice of Adjustments of Conversion Rate
|
|
36
|
|
Section 5.08.
|
|
Company To Reserve Common Stock
|
|
36
|
i
|
|
|
|
|
|
|
Section 5.09.
|
|
Taxes on Conversions
|
|
37
|
|
Section 5.10.
|
|
Certain Covenants
|
|
37
|
|
Section 5.11.
|
|
Cancellation of Converted Notes
|
|
37
|
|
Section 5.12.
|
|
Provision in Case of Effect of Reclassification, Consolidation, Merger or Sale
|
|
38
|
|
Section 5.13.
|
|
Responsibility of Trustee for Conversion Provisions
|
|
39
|
|
Section 5.14.
|
|
Notice to Holders Prior to Certain Actions
|
|
40
|
|
|
|
ARTICLE 6
|
|
NO REDEMPTION
|
|
|
|
|
|
Section 6.01
|
|
No Redemption
|
|
40
|
|
Section 6.02
|
|
No Sinking Fund.
|
|
40
|
|
|
|
ARTICLE 7
|
|
EVENTS OF DEFAULT; REMEDIES
|
|
|
|
|
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Section 7.01.
|
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Original Indenture
|
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40
|
|
Section 7.02.
|
|
Events of Default
|
|
41
|
|
Section 7.03.
|
|
Acceleration of Maturity; Rescission and Annulment
|
|
42
|
|
Section 7.04.
|
|
Limitation on Suits
|
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44
|
|
Section 7.05.
|
|
Unconditional Right of Holders To Receive Payment
|
|
44
|
|
Section 7.06.
|
|
Waiver of Defaults and Events of Default
|
|
44
|
|
Section 7.07.
|
|
Undertaking for Costs
|
|
45
|
|
Section 7.08.
|
|
Waiver of Stay or Extension Laws
|
|
45
|
|
|
|
ARTICLE 8
|
|
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
|
|
|
|
|
|
Section 8.01.
|
|
Original Indenture
|
|
45
|
|
Section 8.02.
|
|
Consolidation, Merger and Sale of Assets
|
|
45
|
|
Section 8.03.
|
|
Successor Substituted
|
|
46
|
|
|
|
ARTICLE 9
|
|
REPORTS BY COMPANY
|
|
|
|
|
|
Section 9.01.
|
|
Reports by Company.
|
|
46
|
|
|
|
ARTICLE 10
|
|
SATISFACTION AND DISCHARGE
|
|
|
|
|
|
Section 10.01.
|
|
Original Indenture
|
|
47
|
|
Section 10.02.
|
|
Discharge of Indenture
|
|
47
|
|
Section 10.03.
|
|
Deposited Monies and Shares To Be Held in Trust by Trustee
|
|
47
|
|
Section 10.04.
|
|
Paying Agent or Conversion Agent To Repay Monies and Shares Held
|
|
47
|
|
Section 10.05.
|
|
Reinstatement
|
|
48
|
ii
|
|
|
|
|
|
|
|
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ARTICLE 11
|
|
SUPPLEMENTAL INDENTURES
|
|
|
|
|
|
Section 11.01.
|
|
Supplemental Indentures Without Consent of Holders
|
|
48
|
|
Section 11.02.
|
|
Supplemental Indentures with Consent of Holders
|
|
49
|
|
|
|
ARTICLE 12
|
|
MISCELLANEOUS
|
|
|
|
|
|
Section 12.01.
|
|
Successors
|
|
50
|
|
Section 12.02.
|
|
Multiple Originals
|
|
50
|
|
Section 12.03.
|
|
Calculations
|
|
50
|
|
Section 12.04.
|
|
Benefits of Supplemental Indenture
|
|
51
|
|
Section 12.05.
|
|
Withholding Taxes.
|
|
51
|
|
Section 12.06.
|
|
Waiver of Jury Trial
|
|
51
|
|
Section 12.07.
|
|
Governing Law
|
|
51
|
|
|
|
|
SCHEDULE
|
|
|
|
|
|
|
|
Schedule A
|
|
Make-Whole Table
|
|
|
|
|
|
|
EXHIBIT
|
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|
|
|
|
|
Exhibit A
|
|
Form of Security
|
|
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iii
FIRST SUPPLEMENTAL INDENTURE, dated as of December 8, 2014, between Quidel Corporation, a
corporation duly organized and existing under the laws of the State of Delaware, as issuer (the “
Company
”), having its principal office at 12544 High Bluff Drive, Suite 200, San Diego, California 92130, and The Bank of New York
Mellon Trust Company, N.A., as trustee (the “
Trustee
”) to the Indenture dated as of December 1, 2014, between the Company and the Trustee (the “
Original Indenture
”; the Original Indenture as amended and
supplemented hereby and as it may be further amended and supplemented in accordance herewith and therewith, with respect to the Notes, the “
Indenture
”).
RECITALS OF THE COMPANY
WHEREAS, the Company executed and delivered the Original Indenture to the Trustee to provide for, among other things, the issuance, from time
to time, of the Company’s Securities, in an unlimited aggregate principal amount, in one or more series to be established by the Company under, and authenticated and delivered as provided in, the Original Indenture;
WHEREAS, Section 2.01 of the Original Indenture provides for the Company to establish Securities of any series pursuant to a supplemental
indenture, and Section 10.01(4) of the Original Indenture provides for the Company and the Trustee to enter into any such supplemental indenture to create a series of Securities and establish its terms as permitted by the Original Indenture;
WHEREAS, the Board of Directors has duly adopted resolutions authorizing the Company to execute and deliver this Supplemental Indenture;
WHEREAS, pursuant to the terms of the Original Indenture, the Company desires to provide for the establishment of a new series of its
Securities to be known as its “3.25% Convertible Senior Notes due 2020” (the “
Notes
”, and each $1,000 principal amount thereof, a “
Note
”), the form and substance of the Notes and the terms, provisions and
conditions thereof to be set forth as provided in the Original Indenture and this Supplemental Indenture; and
WHEREAS, all things
necessary to make the Notes, when executed by the Company and authenticated and delivered hereunder and duly issued by the Company, the valid and legally binding obligations of the Company, and to make this Supplemental Indenture a valid and legally
binding agreement of the Company, in accordance with the terms of the Notes and this Supplemental Indenture, have been done;
NOW,
THEREFORE, THIS SUPPLEMENTAL INDENTURE WITNESSETH, for and in consideration of the premises and the purchases of the Notes by the Holders thereof, it is mutually agreed, for the benefit of the Company and the equal and proportionate benefit of all
Holders of the Notes, as follows:
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 1.01
. Scope of Supplemental Indenture
. The changes, modifications and supplements to the Original Indenture effected by
this Supplemental Indenture shall be
1
applicable only with respect to, and shall only govern the terms of, the Notes, and shall not apply to any other Securities that may be issued under the Original Indenture unless a supplemental
indenture with respect to such other Securities specifically incorporates such changes, modifications and supplements. With respect to the Notes, the provisions of this Supplemental Indenture shall supplement and, to the extent they are inconsistent
therewith, supersede any corresponding provisions in the Original Indenture.
Section 1.02
. Definitions.
For all purposes of the Indenture, except as otherwise expressly provided
or unless the context otherwise requires:
(i) the terms defined in this
Article 1 have the meanings assigned to them in this Article and include the plural as well as the singular;
(ii) all words, terms and phrases used in this Supplemental Indenture and defined in
the Original Indenture (but not otherwise defined herein) shall have the same meanings as in the Original Indenture;
(iii) all other terms used herein that are defined in the Trust Indenture Act, either
directly or by reference therein, have the meanings assigned to them therein;
(iv) all
accounting terms not otherwise defined herein have the meanings assigned to them in accordance with GAAP; and
(v) the words “herein,” “hereof’ and “hereunder” and
other words of similar import refer to this Supplemental Indenture as a whole and not to any particular Article, Section or other subdivision.
“
Additional Interest
” has the meaning specified in Section 7.03.
“
Additional Notes
” has the meaning specified in Section 2.08.
“
Additional Shares
” has the meaning specified in Section 5.02(a).
“
Averaging Period
” has the meaning specified in Section 5.06(e).
“
Bid Solicitation Agent
” means, initially, the Trustee, or any other person the Company may appoint in the future (which may
include the Company) to solicit bids in order to determine a Trading Price for the Notes as may be required pursuant to Section 5.01(b)(ii).
“
Business Day
” means any day other than a Saturday, a Sunday or a day on which state or federally chartered banking
institutions in New York, New York are authorized or required to be closed.
“
Capital Stock
” means any and all shares,
interests, participations, rights or other equivalents (however designated) of corporate stock and limited liability company interests and, with respect to partnerships, partnership interests (whether general or limited) and any other interest or
participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, such partnership.
2
“
Cash Settlement
” has the meaning specified in Section 5.04(a).
A “
Change in Control
” will be deemed to have occurred if any of the following occurs after the Issue Date:
(1) any “person” or “group” within the meaning of
Section 13(d) under the Exchange Act (other than the Company, any of its wholly-owned Subsidiaries or any employee benefit plan of the Company) 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 shares of the Company’s voting stock representing 50% or more of the total voting power of all outstanding
classes of the Company’s voting stock entitled to vote generally in elections of directors;
(2) the consummation of (A) any recapitalization, reclassification or
change of 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, merger or similar transaction involving the Company pursuant to which the Common Stock will be converted into cash, securities or other property; 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
that a transaction described in
clauses (A) or (B) above (i) pursuant to which the holders of all classes of the common equity of the Company immediately prior to such transaction own, directly or indirectly, as a result of such transaction, 50% or more of the
voting power of all classes of common equity of the surviving corporation or transferee Person or the parent thereof immediately after such transaction in substantially the same proportions as such ownership immediately prior to such transaction, or
(ii) effected solely to change the Company’s jurisdiction of incorporation or to form a holding company for the Company and that results in a share exchange or reclassification or similar exchange of the outstanding Common Stock solely
into shares of common stock or other common equity interests of the surviving entity (excluding cash payments for fractional shares and cash payments made in respect of dissenters’ rights) shall not constitute a “Change in Control”;
or
(3) the holders of the Company’s Capital Stock approve any plan or
proposal for the liquidation or dissolution of the Company (whether or not otherwise in compliance with the Indenture).
Notwithstanding
the foregoing, a Change in Control shall not be deemed to have occurred if at least 90% of the consideration paid for the Common Stock in a transaction or transactions described in clause (2) of this definition, excluding cash payments for any
fractional share and cash payments made pursuant to dissenters’ appraisal rights, consists of shares of common stock (or other common equity interests or depositary receipts, or similar certificates, representing common equity interests) traded
on 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 traded immediately following such transaction, and, as a result therefrom, such consideration becomes
the Reference Property for the Notes pursuant to Section 5.12 or any supplemental indenture executed pursuant to such Section.
3
“
Clause A Distribution
” has the meaning specified in Section 5.06(c).
“
Clause B Distribution
” has the meaning specified in Section 5.06(c).
“
Clause C Distribution
” has the meaning specified in Section 5.06(c).
“
close of business
” means 5:00 p.m., New York City time.
“
Closing Sale Price
” of the Common Stock on any Trading Day means the closing per share sale price (or, if no closing sale
price is reported, the average of the last bid and last ask prices or, if more than one in either case, the average of the average last bid and the average last ask prices) at 4:00 p.m. (New York City time) on such date as reported in composite
transactions for The NASDAQ Global Select Market or, if the Common Stock is not listed on The NASDAQ Global Select Market, the principal U.S. national or regional securities exchange on which the Common Stock is listed for trading or, if the Common
Stock is not listed on a U.S. national or regional securities exchange, as reported by OTC Markets Group Inc. at 4:00 p.m. (New York City time) on such date (or in either case the then-standard closing time for regular trading on the relevant
exchange or trading system);
provided
that if the Closing Sale Price of the Common Stock is not so reported, the “Closing 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.
“
Combination Settlement
” has the meaning specified in Section 5.04(a).
“
Common Stock
” means the shares of common stock, par value $0.001 per share, of the Company as they exist on the Issue Date
(or any shares of Capital Stock of the Company resulting from a subdivision or combination or a change to the par value of such common stock), subject to Section 5.12.
“
Company
” means the Person named as the “Company” in the first paragraph of this instrument until a successor
Person shall have become such pursuant to the applicable provisions of the Indenture, and thereafter “Company” shall mean such successor Person.
“
Conversion Agent
” has the meaning specified in Section 2.04.
“
Conversion Date
” has the meaning specified in Section 5.03(a).
“
Conversion Notice
” has the meaning specified in Section 5.03(a).
“
Conversion Period
” means, with respect to any conversion of a Note:
(i) if the relevant Conversion Date occurs prior to the Final Settlement Method
Election Date, the 25 consecutive Trading Day period beginning on, and including, the third Trading Day immediately following the related Conversion Date; and
(ii) if the relevant Conversion Date occurs on or after the Final Settlement Method
Election Date, the 25 consecutive Trading Day period beginning on, and including, the 27th Scheduled Trading Day immediately preceding the Stated Maturity Date.
4
“
Conversion Price
” means, in respect of each Note, as of any date $1,000
divided by
the Conversion Rate as of such date.
“
Conversion Rate
” means initially 31.1891 shares of Common Stock
per $1,000 principal amount of Notes, subject to adjustment as set forth herein.
“
custodian
” means the Trustee, as the
initial custodian with respect to the Global Securities, or any successor entity.
“
Daily Conversion Value
” means, for
each Trading Day during the Conversion Period, one-twenty fifth (1/25th) of the product of (i) the Conversion Rate on such Trading Day and (ii) the Daily VWAP of the Common Stock on such Trading Day.
“
Daily Measurement Value
” has the meaning specified in Section 5.04(a)(v).
“
Daily Settlement Amount
” has the meaning specified in Section 5.04(a)(v).
“
Daily VWAP
” of the Common Stock (or any security that is part of the Reference Property underlying the Notes, if
applicable), in respect of any Trading Day, means the per share volume-weighted average price of the Common Stock (or other security) as displayed under the heading “Bloomberg VWAP” on Bloomberg Page “QDEL <equity> AQR” (or
its equivalent successor if such page is not available, or the Bloomberg Page for any security that is part of such Reference Property, if applicable) 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 such Reference Property is not a security), the market value of one share of the Common Stock (or such Reference Property) on such
Trading Day as determined by a nationally recognized independent investment banking firm retained by the Company for such purpose. The Daily VWAP will be determined without regard to after-hours trading or any other trading outside the regular
trading session.
“
Default
” means any event that is or with the passage of time or the giving of notice or both would
become an Event of Default.
“
Depository
” has the meaning set forth in the Original Indenture, which shall initially be
The Depository Trust Company until a successor Depository shall have become such pursuant to the applicable provisions of the Indenture, and thereafter “
Depository
” shall mean such successor Depository.
“
Effective Date
” has the meaning specified in Section 5.02(b).
“
Event of Default
” has the meaning specified in Section 7.02.
5
“
Ex-Dividend Date
” means the first date on which the 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.
“
Exchange Act
” means the U.S.
Securities Exchange Act of 1934, as amended.
“
Expiration Date
” has the meaning specified in Section 5.06(e).
“
Expiration Time
” has the meaning specified in Section 5.06(e).
“
Filing Failure
” has the meaning specified in Section 7.03.
“
Final Settlement Method Election Date
” means the 30th Scheduled Trading Day prior to the Stated Maturity Date .
“
Free Convertibility Date
” means September 15, 2020.
“
Fundamental Change
” means the occurrence of a Change in Control or a Termination of Trading.
“
Fundamental Change Expiration Time
” has the meaning specified in Section 4.01(a)(i).
“
Fundamental Change Purchase Date
” has the meaning specified in Section 4.01(a).
“
Fundamental Change Purchase Notice
” has the meaning specified in Section 4.01(a)(i).
“
Fundamental Change Purchase Price
” has the meaning specified in Section 4.01(a).
“
Fundamental Change Purchase Right Notice
” has the meaning specified in Section 4.01(b).
“
GAAP
” means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as have been approved by a significant segment
of the accounting profession, in each case, as in effect in the United States from time to time.
“
Indenture
” has the
meaning specified in the first paragraph of this Supplemental Indenture.
“
Interest
” means, when used with reference to
the Notes, any interest payable under the terms of the Notes, including Additional Interest, if any.
“
Interest Payment
Date
” means each June 15 and December 15 of each year, commencing with June 15, 2015.
6
“
Irrevocable Election
” has the meaning specified in Section 5.04(a)(iii).
“
Issue Date
” means December 8, 2014.
“
Make-Whole Fundamental Change
” means (i) any Change in Control (determined after giving effect to any exceptions or
exclusions from such definition but without giving effect to the exclusion set forth in clause (i) of the proviso in clause (2) of the definition thereof), or (ii) any Termination of Trading.
“Market Disruption Event
” means (i) a failure by The NASDAQ Global Select Market, or if the Common Stock is not listed
on The NASDAQ Global Select Market, the principal other U.S. national or regional securities exchange on which the Common Stock is then listed, to open for trading or (ii) the occurrence or existence for more than a one half-hour period in the
aggregate on any Scheduled Trading Day for the Common Stock of any suspension or limitation imposed on trading (by reason of movements in price exceeding limits permitted by The NASDAQ Global Select Market or otherwise) in the Common Stock or in any
options contracts or future contracts relating to the Common Stock, and such suspension or limitation occurs or exists at any time before 1:00 p.m. (New York City time) on such day.
“
Maximum Conversion Rate
” has the meaning specified in Section 5.02(b).
“
Merger Transaction
” has the meaning specified in Section 8.02.
“
Note
” or “
Notes
” has the meaning specified in the fourth paragraph of the Recitals of the Company.
“
open of business
” means 9:00 a.m., New York City time.
“
Original Indenture
” has the meaning specified in the first paragraph of this Supplemental Indenture.
“
Outstanding
” means, with respect to the Notes, notwithstanding the provisions of Section 2.08 of the Original
Indenture, any Notes authenticated by the Trustee except (i) Notes cancelled by it, (ii) Notes delivered to it for cancellation and (iii)(A) Notes replaced pursuant to Section 2.07 of the Original Indenture, on and after the time such
Note is replaced (unless the Trustee and the Company receive proof satisfactory to them that such Note is held by a bona fide purchaser), (B) Notes converted pursuant to Article 5 hereof, on and after their Conversion Date, (C) any and all
Notes, as of the Stated Maturity Date, if the Paying Agent holds, in accordance with this Indenture, money sufficient to pay all of the Notes then payable, and (D) any and all Notes owned by the Company or any other obligor upon the Notes or
any Affiliate of the Company or of such other obligor, except that in determining whether the Trustee shall be protected in relying upon any request, demand, authorization, direction, notice consent or waiver or other action that is to be made by a
requisite principal amount of Outstanding Notes, only such Notes which a responsible officer of the trustee knows to be so owned shall be disregarded.
“
Paying Agent
” means the “Paying Agent” (within the meaning of the Original Indenture) with respect to the Notes,
which shall initially be the Trustee.
7
“
Physical Securities
” means permanent certificated Notes in registered form
issued in denominations of $1,000 principal amount and integral multiples thereof.
“
Place of Payment
” has the meaning
specified in Section 2.04.
“
Record Date
” means, with respect to the payment of Interest, the June 1 (whether
or not a Business Day) immediately preceding an Interest Payment Date on June 15 and the December 1 (whether or not a Business Day) immediately preceding an Interest Payment Date on December 15.
“
Reference Property
” has the meaning specified in Section 5.12(a).
“
Registrar
” has the meaning specified in the Original Indenture, which, with respect to the Notes, shall initially be the
Trustee.
“
Relevant Distribution
” has the meaning specified in Section 5.06(c).
“
Scheduled Trading Day
” means (i) a day that is scheduled to be a Trading Day (as defined in this Section 1.01
depending on whether or not the purpose for the use of “Scheduled Trading Day” or “Trading Day” is to determine Settlement Amounts pursuant to Section 5.04) on the principal U.S. national or regional securities exchange or
market on which the Common Stock is listed for trading or (ii) if the Common Stock is not listed on any such securities exchange or market, a Business Day.
“
Securities Act
” means the U.S. Securities Act of 1933, as amended, and the rules and regulations of the SEC promulgated
thereunder.
“
Settlement Amount
” has the meaning specified in Section 5.04(a)(iv).
“
Settlement Method
” means the election of the Company as set forth in this Supplemental Indenture of settling each Settlement
Amount through Cash Settlement, Stock Settlement or Combination Settlement.
“
Share Exchange Event
” has the meaning
specified in Section 5.12(a).
“
Significant Subsidiary
” means a Subsidiary that is a “significant subsidiary”
as defined in Regulation S-X under the Exchange Act.
“
Specified Dollar Amount
” has the meaning specified in
Section 5.04(a)(v).
“
Spin-Off
” has the meaning specified in Section 5.06(c).
“
Stated Maturity Date
” means December 15, 2020.
“
Stock Price
” means, with respect to a Make-Whole Fundamental Change, (i) in the case of a Make-Whole Fundamental Change
described in clause (2) of the definition of Change in Control in which the Common Stock is acquired solely for cash, the price paid per share of Common Stock in the Change in Control, or (ii) in the case of any other Make-Whole
8
Fundamental Change, the average of the Closing Sale Prices of Common Stock over the five Trading Day period ending on the Trading Day immediately preceding the Effective Date of such other
Make-Whole Fundamental Change.
“
Stock Settlement
” has the meaning specified in Section 5.04(a).
“
Supplemental Indenture
” means this instrument, as it may from time to time be supplemented or amended by one or more
indentures supplemental hereto entered into pursuant to the applicable provisions hereof.
“
Termination of Trading
” means
the Common Stock (or other Reference Property into which the Notes are convertible) 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).
“
Trading Day
” means (a) except for purposes of determining Settlement Amounts pursuant to
Section 5.04, a day on which (i) The NASDAQ Global Select Market or, if the Common Stock is not listed on The NASDAQ Global Select Market, the principal other U.S. national or regional securities exchange on which the Common Stock is then
listed is open for trading, in each case, with a scheduled closing time of 4:00 p.m. (New York City time) or the then-standard closing time for regular trading on the relevant exchange or market, and (ii) a Closing Sale Price for the Common
Stock is available on such securities exchange or market, or (b) for purposes of determining Settlement Amounts pursuant to Section 5.04 only, a day on which (i) there is no Market Disruption Event and (ii) The NASDAQ Global
Select Market or, if the Common Stock is not listed on The NASDAQ Global Select Market, the principal other U.S. national or regional securities exchange on which the Common Stock is then listed is open for trading, in either case, with a scheduled
closing time of 4:00 p.m. (New York City time) or the then-standard closing time for regular trading on the relevant exchange or market. For the purposes of both (a) and (b) of this definition, if the Common Stock is not so listed,
“Trading Day” means a Business Day.
“Trading Price
” of the Notes means, on any date of determination, the
average of the secondary market bid quotations per $1,000 principal amount of Notes obtained by the Bid Solicitation Agent for $2,000,000 principal amount of the Notes at approximately 3:30 p.m. (New York City time) on such determination date from
three independent nationally recognized securities dealers that the Company shall select;
provided
that if at least three such bids cannot reasonably be obtained, but two such bids can reasonably be obtained, then the average of these two
bids shall be used;
provided further
that, if at least two such bids cannot reasonably be obtained, but one such bid can reasonably be obtained, this one bid shall be used. If on any date of determination (i) the Bid Solicitation Agent
cannot reasonably obtain at least one bid for $2,000,000 principal amount of the Notes from an independent nationally recognized securities dealer, (ii) if the Company shall have failed to request the Bid Solicitation Agent (if other than the
Company) to obtain bids when required or (iii) if the Bid Solicitation Agent has failed to obtain bids when required, then, in any such case, the Trading Price per $1,000 principal amount of Notes will be deemed to be less than 98% of the
product of the Closing Sale Price of the Common Stock and the Conversion Rate for the Notes on such date.
9
“
Trading Price Condition
” has the meaning specified in Section 5.01(b)(ii).
“
Trigger Event
” has the meaning specified in Section 5.06(c).
“
U.S.
” or “
United States
” means the United States of America.
“
Valuation Period
” has the meaning specified in Section 5.06(c).
Section 1.03.
Section References.
References to Articles, Sections, Exhibits, Annexes and Schedules are to Articles, Sections,
Exhibits, Annexes and Schedules of this Supplemental Indenture unless otherwise specified.
ARTICLE 2
THE NOTES
Section 2.01
. Designation, Amount and Issuance of Notes.
The Securities to be issued hereunder shall be
designated as the “3.25% Convertible Senior Notes due 2020.” The Notes will be initially limited to an aggregate principal amount of $172,500,000, subject to Section 2.08 of this Supplemental Indenture and except for Notes
authenticated and delivered upon registration or transfer of, or in exchange for, or in lieu of, other Notes pursuant to Sections 2.06, 2.07, 2.12, 2.15 and 10.05 of the Original Indenture and Sections 2.06, 4.01 and 5.03 of this Supplemental
Indenture.
Section 2.02
. Form of the Notes.
The Notes and the Trustee’s certificate of
authentication to be borne by such Notes shall be substantially in the form set forth in Exhibit A hereto. The terms and provisions contained in the form of Notes attached as Exhibit A hereto shall constitute, and are hereby expressly made, a part
of this Supplemental Indenture and, to the extent applicable, the Company and the Trustee, by their execution and delivery of this Supplemental Indenture, expressly agree to such terms and provisions and to be bound thereby.
Subject to Section 2.06 of this Supplemental Indenture, all of the Notes will be represented by one or more Global Securities. The
transfer and exchange of beneficial interests in any such Global Securities shall be effected through the Depository in accordance with the Indenture and the applicable procedures of the Depository. Except as provided in Section 2.06 of this
Supplemental Indenture, beneficial owners of a Global Security shall not be entitled to have certificates registered in their names, will not receive or be entitled to receive physical delivery of certificates in definitive form and will not be
considered Holders of such Global Security.
Any Global Security shall represent such of the Outstanding Notes as shall be specified
therein and shall provide that it shall represent the aggregate amount of Outstanding Notes from time to time endorsed thereon and that the aggregate amount of Outstanding Notes represented thereby may from time to time be increased or reduced to
reflect issuances, repurchases, conversions, transfers or exchanges permitted hereby. Any endorsement of a Global Security 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 for the Global Security, at the direction of the Trustee, in such manner and upon instructions given by the Holder of such Notes in accordance with the Indenture.
10
Section 2.03
. Date and Denomination of Notes; Payment at the Stated Maturity Date;
Payment of Interest.
The Notes shall be issuable in registered form without coupons in denominations of $1,000 principal amount and integral multiples thereof. Each Note shall be dated the date of its authentication and shall accrue
Interest from the date specified on the face of the form of Notes attached as Exhibit A hereto or from the most recent date to which Interest has been duly paid or provided for.
On the Stated Maturity Date, each Holder shall be entitled to receive the principal amount of the Notes held. Payments in respect of the
principal and interest on Global Securities representing the Notes registered in the name of the Depository or its nominee shall be payable to the Depository or its nominee, as the case may be, in its capacity as the registered holder under the
Indenture. In the case of Physical Securities, payments will be made in U.S. dollars at the office of the Trustee or, at the Company’s option, by check mailed to the Holder’s registered address (or, if requested by a Holder of more than
$2,000,000 principal amount of Notes, by wire transfer to the account designated by such Holder). The Company shall make any required interest payments to the Person in whose name each Note is registered at the close of business on the Record Date
for the interest payment.
Notwithstanding anything to the contrary, if the Stated Maturity Date or any Interest Payment Date or
Fundamental Change Purchase Date or any Conversion Date falls, or if any payment, delivery, notice or other action by the Company is otherwise due, on a day that 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 immediately following Business Day with the same force and effect as if taken on such date, and no interest will accrue and no Default shall occur on account of such delay.
Section 2.04
. Registrar, Paying Agent and Conversion Agent.
The Company agrees that the office or agency
maintained by the Company pursuant to Sections 2.03 of the Original Indenture, with respect to the Notes, shall be located in the continental United States. The Company shall also maintain an office in the continental United States where the Notes
may be presented for conversion (the “
Conversion Agent
”). The Company initially appoints the Trustee as the Conversion Agent and initially designates the office or agency maintained by the Company in New York City pursuant to
Section 2.03 of the Original Indenture as the place of payment for the Notes (the “
Place of Payment
”).
The Company
shall enter into an appropriate agency agreement with any Conversion Agent not a party to this Supplemental Indenture. The agreement shall implement the provisions of this Supplemental Indenture that relate to such agent. The Company shall notify
the Trustee of the name and address of any such agent. If the Company fails to maintain a Conversion Agent, the Company shall act as Conversion Agent.
In addition to Section 2.03 of the Original Indenture, the Company may remove any Conversion Agent upon 30 days’ prior written
notice to such Conversion Agent and to the Trustee;
provided
that no such removal shall become effective until (1) acceptance of an appointment by a successor as evidenced by an appropriate agreement entered into by the Company and such
successor Conversion Agent and delivered to the Trustee or (2) notification to the Trustee that the Company shall serve as Conversion Agent until the appointment of a successor in accordance with clause (1) above. The Conversion Agent may
resign at any time
11
upon written notice;
provided
that the Trustee may resign as Conversion Agent only if the Trustee also resigns as Trustee in accordance with Section 7.08 of the Original Indenture. If
the Conversion Agent receives any cash or shares of Common Stock hereunder, the Conversion Agent agrees to hold such cash or shares in trust for the sole benefit of the relevant Holders.
The Company may appoint additional Conversion Agents and may approve any change in the office through which any Conversion Agent acts.
Section 2.05
. Registration of Transfer and Exchange.
Notwithstanding anything in Section 2.06 of the
Original Indenture to the contrary, neither the Company nor the Trustee nor any Registrar shall be required to exchange or register a transfer of (a) any Notes or portions thereof surrendered for conversion pursuant to Article 5, or
(b) any Notes or portions thereof tendered for repurchase (and not withdrawn) pursuant to Section 4.01.
The third sentence of
the first paragraph of Section 2.06 of the Original Indenture shall not apply to the Notes, and any reference in the Original Indenture to such provision shall be deemed to refer to this Section 2.05.
Section 2.06
. Global Securities.
The following provisions shall apply to Global Securities in addition to those
provisions in Section 2.15 of the Original Indenture that are applicable to the Notes:
(a) As set forth in Section 2.15 of the Original Indenture, the Company will issue, and
the Trustee upon receipt of a written order from the Company will authenticate, Physical Securities in the name of the Depository’s participants, in accordance with the Depository’s procedures, in exchange for the Global Security if
(i) the Depository notifies the Company at any time that it is unwilling or unable to continue as Depository for the Global Securities and a successor Depository is not appointed within 90 days; or (ii) the Depository ceases to be
registered as a clearing agency under the Exchange Act and a successor Depository is not appointed within 90 days. In addition, if an Event of Default with respect to the Notes has occurred and is continuing and any beneficial owner of an interest
in a Global Security requests that its beneficial interest be exchanged for a Physical Security, the Company will issue and the Trustee upon receipt of a written order from the Company will authenticate Physical Securities in the name of such
beneficial owner in exchange for the corresponding portion of such Global Security, which the Depository will distribute to such beneficial owner.
Notwithstanding anything to the contrary in the Indenture or the Notes, following the occurrence and during the continuance of an Event of
Default, any beneficial owner of a Global Security may directly enforce against the Company, without the consent, solicitation, proxy, authorization or any other action of the Depository or any other Person, such beneficial owner’s right to
exchange its beneficial interest in such Global Security for a Physical Security in accordance with this Section 2.06.
Physical
Securities issued in exchange for a Global Security or any portion thereof pursuant to this Section 2.06(a) shall be issued in definitive, fully registered form, without Interest coupons, shall have an aggregate principal amount equal to that
of such Global Securities or portion thereof to be so exchanged, shall be registered in such names and be in such
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authorized denominations as the Depository shall designate and shall bear any legends required under the Indenture. The form of legend set forth in Section 2.15(f) of the Original Indenture
shall be deemed replaced for purposes of the Notes with the legend set forth on the Form of Face of Security in Exhibit A hereto.
(b) Upon any request by the Depository or a beneficial owner in the circumstances described in
Section 2.06(a), the Company will promptly make available to the Trustee a sufficient supply of Physical Securities in definitive, fully registered form, without Interest coupons.
(c) At such time as all interests in a Global Security have been repurchased, converted,
cancelled or exchanged for Physical Securities, such Global Security shall, upon receipt thereof, be canceled by the Trustee in accordance with standing procedures and instructions existing between the Depository and the custodian for the Global
Security. At any time prior to such cancellation, if any interest in a Global Security is repurchased, converted, cancelled or exchanged for Physical Securities, the principal amount of such Global Security shall, in accordance with the standing
procedures and instructions existing between the Depository and the custodian for the Global Security, be appropriately reduced, and an endorsement shall be made on such Global Security, by the Trustee or the custodian for the Global Security, at
the direction of the Trustee, to reflect such reduction. The Company shall promptly notify the Trustee in writing of any repurchase, conversion, cancellation or exchange effected through any Paying Agent, Registrar or Conversion Agent other than the
Trustee.
Section 2.07
. Purchase and Cancellation.
The Company may, to the extent permitted by law, and
directly or indirectly (regardless of whether such Notes are surrendered to the Company), purchase Notes in the open market or by tender offer at any price or by private agreement. Notwithstanding anything to the contrary in the Original Indenture,
the Company shall cause any Notes so purchased (other than Notes purchased pursuant to cash-settled swaps or other derivatives) to be surrendered to the Trustee for cancellation pursuant to Section 2.10 of the Original Indenture.
Section 2.08
. Additional Notes.
The Company may, from time to time without the consent of the Holders of Outstanding
Notes, reopen the Indenture and issue additional Notes under the Indenture (“
Additional Notes
”) with the same terms (other than date of issuance, the issue price, if applicable, and the date from which Interest will initially
accrue, if applicable) as the Notes issued on the Issue Date in an unlimited amount;
provided
that if any such Additional Notes are not fungible for U.S. federal income tax purposes with the Notes issued on the Issue Date, such Additional
Notes shall have a separate CUSIP number. The Notes issued on the Issue Date and any Additional Notes shall be treated as a single class for all purposes under the Indenture, including waivers, amendments and offers to purchase and will vote
together as one class on all matters with respect to the Notes.
13
ARTICLE 3
PARTICULAR COVENANTS OF THE COMPANY
Section 3.01
. Covenants in Original Indenture.
The following covenants of the Company are made in addition to the
covenants set forth in Article Four of the Original Indenture.
Section 3.02
. Compliance
Certificate.
Notwithstanding anything to the contrary in Section 4.03 of the Original Indenture, the Company shall deliver to the Trustee (i) within 120 days after the end of each fiscal year of the Company (beginning with the
fiscal year ending December 31, 2014) an Officers’ Certificate stating whether or not the signers thereof have knowledge of any Event of Default that occurred during the previous year and whether the Company, to the Officers’
knowledge, is in default in the performance or observance of any of the terms, provisions and conditions of the Indenture and (ii) within 30 days after the occurrence thereof, written notice of any events that would constitute an Event of
Default, their status and what action the Company is taking or proposing to take in respect thereof. Any notice required to be given under this Section 3.02 shall be delivered to a Trust Officer.
Section 3.03
. 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 the Indenture.
ARTICLE 4
REPURCHASE OF NOTES
Section 4.01
. Right To Require Repurchase Upon a Fundamental Change.
(a) If a Fundamental Change occurs, each Holder of Notes shall have the option to require the
Company to purchase for cash all or any portion of such Holder’s Notes that is equal to $1,000, or an integral multiple of $1,000, on the day of the Company’s choosing that is not less than 20 or more than 35 Business Days after the date
the Company shall provide Holders with the Fundamental Change Purchase Right Notice, subject to extension to comply with applicable law (such day, the “
Fundamental Change Purchase Date
”), at a purchase price (the
“
Fundamental Change Purchase Price
”) equal to 100% of the principal amount of the Notes to be purchased,
plus
accrued and unpaid Interest to but excluding the Fundamental Change Purchase Date (unless the Fundamental Change
Purchase Date is after a Record Date and on or prior to the Interest Payment Date to which it relates, in which case Interest accrued to the Interest Payment Date shall be paid to Holders of the Notes as of such preceding Record Date, and the
Fundamental Change Purchase Price the Company is required to pay to the Holder surrendering the Note for purchase shall be equal to 100% of the principal amount of such Note subject to purchase and shall not include any accrued and unpaid Interest).
Purchases of Notes under this Section 4.01 shall be made, at the option of the Holder thereof, upon:
(i) delivery to the Trustee (or other Paying Agent appointed by the Company) by
a Holder of a duly completed notice (the “
Fundamental Change Purchase Notice
”) in the form set forth on the reverse of the Note during the period between the delivery of the Fundamental Change Purchase Right Notice and the close of
business on the second Business Day immediately preceding the Fundamental Change Purchase Date (the “
Fundamental Change Expiration Time
”); and
14
(ii) delivery or book-entry transfer of
the Notes to the Trustee (or other Paying Agent appointed by the Company) at any time after delivery of the Fundamental Change Purchase Notice (together with all necessary endorsements if the Notes are Physical Securities) at the Corporate Trust
Office of the Trustee (or other Paying Agent appointed by the Company), such delivery being a condition to receipt by the Holder of the Fundamental Change Purchase Price therefor.
The Fundamental Change Purchase Notice shall state:
(A) if Physical Securities, the certificate numbers of Notes to be delivered for purchase;
(B) the portion of the principal amount of Notes to be purchased, which must be
$1,000 or an integral multiple thereof; and
(C) that the Notes are to be purchased by
the Company pursuant to the applicable provisions of the Notes and the Indenture;
provided
,
however
, that if the Notes are Global
Securities, the Fundamental Change Purchase Notice must comply with applicable Depository procedures.
The Company shall be required to
purchase, pursuant to subsection (d), Notes that have been validly surrendered and not withdrawn on the Fundamental Change Purchase Date pursuant to subsection (c) of this Section 4.01.
The Trustee (or other Paying Agent appointed by the Company) shall promptly notify the Company of the receipt by it of any Fundamental Change
Purchase Notice or written notice of withdrawal thereof in accordance with the provisions of subsection (c) of this Section 4.01.
Any Note that is to be purchased only in part shall be, if a Physical Security, surrendered to the Trustee (with, if the Company or the
Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Company and the Trustee duly executed by, the Holder thereof or his attorney duly authorized in writing), and the Company shall execute, and the
Trustee shall authenticate and make available for delivery to the Holder of such Note without service charge, a new Note or Notes, containing identical terms and conditions, each in an authorized denomination in aggregate principal amount equal to
and in exchange for the unpurchased portion of the principal of the Note so surrendered, or, if a Global Security, the Trustee, or the custodian at the direction of the Trustee, shall make a notation on such Global Security as to the reduction in
the principal amount represented thereby for the purchased portion of the principal of the Note.
(b) The Company shall give the Trustee and each Holder a written notice of the Fundamental Change
within five Business Days after the occurrence of such Fundamental Change (such notice, the “
Fundamental Change Purchase Right Notice
”) and issue a press release announcing the occurrence of such Fundamental Change (and make the
press release
15
available on its website). Such Fundamental Change Purchase Right Notice shall be delivered either by first class mail or, with respect to Global Securities, in accordance with the
Depository’s notice procedures.
The Fundamental Change Purchase Right Notice shall specify (if applicable):
(i) the events causing the Fundamental Change;
(ii) the effective date of the Fundamental Change and whether the Fundamental Change
is a Make-Whole Fundamental Change;
(iii) the last date on which a Holder may exercise
the purchase right pursuant to this Article 4;
(iv) the Fundamental Change Purchase
Price;
(v) the Fundamental Change Purchase Date;
(vi) the Conversion Rate and any adjustments to the Conversion Rate, and the procedures
required for exercise of the Holder’s conversion right;
(vii) the procedures required
for exercise of the purchase option upon the Fundamental Change, and for withdrawal of a Fundamental Change Purchase Notice; and
(viii) the name and address of the Paying Agent and the Conversion Agent.
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 4.01.
(c) A Fundamental Change Purchase Notice may be withdrawn, in whole or in part, by means of a
written notice of withdrawal delivered to the Paying Agent in accordance with the Fundamental Change Purchase Right Notice at any time until the Fundamental Change Expiration Time, specifying:
(i) the principal amount of the Notes with respect to which such notice of
withdrawal is being submitted,
(ii) if Physical Securities, the certificate
numbers of the withdrawn Notes,
(iii) the principal amount, if any, of such Note that
remains subject to the original Fundamental Change Purchase 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 not Physical Securities, the withdrawal notice must comply with appropriate procedures of the
Depository.
(d) On or prior to 11:00 a.m., New York City time, on the Fundamental Change
Purchase Date, the Company shall deposit with the Trustee (or other Paying Agent appointed by
16
the Company or if the Company is acting as its own Paying Agent, set aside, segregate and hold in trust) an amount of money sufficient to purchase on the Fundamental Change Purchase Date all of
the Notes to be repurchased on such date at the Fundamental Change Purchase Price. Subject to receipt of funds and/or Notes by the Trustee (or other Paying Agent appointed by the Company), payment for each Note surrendered for purchase (and not
withdrawn) prior to the Fundamental Change Expiration Time shall be made on the later of (x) the Fundamental Change Purchase Date with respect to such Note (
provided
the Holder has satisfied the conditions to the payment of the
Fundamental Change Purchase Price in this Section 4.01), and (y) 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
this Section 4.01, by mailing checks for the amount payable to the Holders of such Notes entitled thereto as they shall appear in the Security Register;
provided
,
however
, that payments to the Depository shall be made by wire
transfer of immediately available funds to the account of the Depository or its nominee. The Trustee (or other Paying Agent) shall, promptly after such payment and upon written demand by the Company, return to the Company any funds in excess of the
Fundamental Change Purchase Price.
(e) If the Trustee (or other Paying Agent appointed by
the Company) holds money sufficient to purchase on the Fundamental Change Purchase Date all the Notes or portions thereof that are to be purchased as of the Business Day following the Fundamental Change Purchase Date, then on and after the
Fundamental Change Purchase Date (i) such Notes shall cease to be Outstanding and Interest, if any, shall cease to accrue on such Notes, whether or not book-entry transfer of the Notes has been made and whether or not the Notes have been
delivered to the Trustee or Paying Agent, and (ii) all other rights of the Holders of such Notes shall terminate, other than (A) the right to receive the Fundamental Change Purchase Price upon delivery or transfer of the Notes, and
(B) if the Fundamental Change Purchase Date falls after a Record Date and on or prior to the related Interest Payment Date the right of the Holder on such Record Date to receive the Interest payable on such Interest Payment Date.
(f) In connection with any offer to purchase the Notes pursuant to this Article 4, the Company
shall:
(i) comply with the provisions of Rule 13e-4, Rule 14e-1 and any
other tender offer rules under the Exchange Act to the extent any such rules are applicable;
(ii) file a Schedule TO or any successor or similar schedule under the Exchange Act,
if required; and
(iii) otherwise comply with all applicable federal and state
securities laws,
in each case, so as to permit the rights and obligations under this Article 4 to be exercised in the time and in the manner specified
herein.
(g) Notwithstanding anything to the contrary herein, no Notes may be purchased by
the Company at the option of 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 the relevant Fundamental Change Purchase Date (except in the case
of an acceleration resulting from the Company’s default in the payment of the Fundamental Change Purchase Price with respect to such Notes).
17
ARTICLE 5
CONVERSION
Section 5.01.
Conversion Privilege; Conversion Rate.
(a) Subject to the conditions and during the periods described in Section 5.01(b), and
upon compliance with the provisions of this Article 5, a Holder shall have the right to surrender for conversion all or any portion (if the portion to be converted is $1,000 principal amount or an integral multiple thereof) of its Notes at any time
until the close of business on the Business Day immediately preceding the Free Convertibility Date. On and after the Free Convertibility Date and until the close of business on the second Scheduled Trading Day immediately prior to the Stated
Maturity Date, a Holder shall have the right to surrender all or any portion (if the portion to be converted is $1,000 principal amount or an integral multiple thereof) of its Notes for conversion, regardless of whether any of the conditions
described in section 5.01(b) have been satisfied, upon compliance with the provisions of this Article 5. Upon conversion of Notes, the holder shall be entitled to receive the amounts due upon conversion specified in Section 5.04 based on the
applicable Conversion Rate then in effect. The Conversion Rate in effect at any time shall be subject to adjustment in the manner set forth herein.
(b) Subject to the conditions and during the periods described in this section 5.01(b), a
Holder shall have the right to surrender its Notes for conversion at any time until the close of business on the Business Day immediately preceding the Free Convertibility Date.
(i) Prior to the close of business on the Business Day immediately preceding
the Free Convertibility Date, a Holder may surrender all or any portion of its Notes for conversion during any calendar quarter commencing after the quarter ending March 31, 2015 (and only during such calendar quarter) if the Closing Sale Price
of the Common Stock for at least twenty (20) Trading Days (whether or not consecutive) in the period of thirty (30) consecutive Trading Days ending on the last Trading Day of the calendar quarter immediately preceding the calendar quarter
in which the conversion occurs, is more than 130% of the Conversion Price of the Notes in effect on each applicable Trading Day.
(ii) If, prior to the close of business on the Business Day immediately preceding the
Free Convertibility Date, the Trading Price per $1,000 principal amount of the Notes on each Trading Day during any five consecutive Trading Day period is less than 98% of (x) the Closing Sale Price of the Common Stock on such Trading Day
multiplied by
(y) the Conversion Rate in effect on such Trading Day, a Holder may surrender its Notes for conversion at any time during the following five consecutive Business Days (the “
Trading Price Condition
”).
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The Bid Solicitation Agent (if other than the Company) shall have no obligation
to determine the Trading Price of the Notes unless the Company shall have requested such determination; and the Company shall have no obligation to make such request (or, if the Company is acting as the Bid Solicitation Agent, it shall have no
obligation to determine the Trading Price) unless a Holder of a Note provides the Company with reasonable evidence that the Trading Price per $1,000 principal amount of Notes would be less than 98% of the product of the Closing Sale Price of the
Common Stock and the applicable Conversion Rate. At such time, the Company shall instruct the Bid Solicitation Agent (if other than the Company) to determine, or if the Company is acting as the Bid Solicitation Agent, the Company shall determine,
the Trading Price per $1,000 principal amount of the 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
Closing Sale Price of the Common Stock and the applicable Conversion Rate. If the Trading Price Condition has been met, the Company shall so notify the Holders of the Notes and the Trustee. If, at any time after the Trading Price Condition 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 Closing Sale Price of the Common Stock and the Conversion Rate for such date, the Company shall so notify the Holders of the Notes and
the Trustee.
(iii) If, prior to the close of business on the Business Day immediately
preceding the Free Convertibility Date, the Company elects to issue or distribute, as the case may be, to all or substantially all holders of the Common Stock:
(x) rights, options or warrants entitling them to subscribe for or purchase,
for a period expiring within 45 days from the announcement date for such distribution, the Common Stock at a price per share that is less than the average of the Closing Sale Prices of Common Stock for the 10 consecutive Trading Day period ending
on, and including, the Trading Day immediately preceding the announcement date for such issuance; or
(y) cash, debt securities (or other evidence of indebtedness) or other assets
or securities (including, for the avoidance of doubt, any rights, options or warrants that are not described in clause (x) above, but excluding dividends or distributions described in Section 5.06(a)), which distribution has a per share
value exceeding 10% of the Closing Sale Price of the Common Stock as of the Trading Day immediately preceding the declaration date for such distribution,
then, in either case, the Company shall notify Holders at least 35 Scheduled Trading Days prior to the Ex-Dividend Date for such distribution.
Once the Company has given such notice, Holders may surrender their Notes for conversion at any time until the earlier of the close of business on the Business Day immediately preceding the Ex-Dividend Date and the Company’s announcement that
such issuance or distribution will not take place. A Holder may not convert any of its Notes under this clause (iii) if the Company provides that Holders of the Notes shall participate, at the same time and upon the same terms as holders of
Common Stock and as a result of holding the Notes, in the relevant distribution described above without having to convert their Notes as if they held a number of shares
19
of Common Stock equal to the Conversion Rate on the record date for the distribution
multiplied
by the principal amount (expressed in thousands) of Notes held by such Holder.
(iv) If ( x) a Fundamental Change or a Make-Whole Fundamental Change occurs or (y) the
Company is a party to (1) a consolidation, merger, binding share exchange, pursuant to which the Common Stock would be converted into cash, securities or other assets or (2) a sale, conveyance, transfer or lease of all or substantially all
of the assets of the Company and its Subsidiaries, on a consolidated basis (other than, in the case of clause (1) and (2), any such transaction to which the Company is a party solely for the purpose of changing its jurisdiction of
incorporation, and which results in a reclassification, conversion or exchange of the Common Stock solely into common stock of the surviving entity, excluding cash payments for fractional shares and cash payments made in respect of dissenters’
appraisal rights), the Notes may be surrendered for conversion at any time from or after the date on which the Company shall provide the notice specified in the following sentence until the close of business (I) if such transaction or event is
a Fundamental Change, on the Business Day immediately preceding the related Fundamental Change Purchase Date, and, (II) otherwise, on the 35th Business Day immediately following the effective date for such transaction or event. The Company will
notify the Holders and the Trustee of any such transaction:
(A) as promptly as
practicable following the date the Company publicly announces such transaction but in no event less than 35 Scheduled Trading Days prior to the anticipated effective date of such transaction; or
(B) if the Company does not have knowledge of such transaction at least 35 Scheduled
Trading Days prior to the anticipated effective date of such transaction, within two Business Days of the date upon which the Company receives notice, or otherwise becomes aware, of such transaction, but in no event later than the actual effective
date of such transaction.
Section 5.02.
Adjustment to Conversion Rate Upon Conversion in Connection with a Make-Whole
Fundamental Change.
(a) If a Holder elects to convert its Notes in connection with a
Make-Whole Fundamental Change, the Conversion Rate shall be increased by an additional number of shares of Common Stock (the “
Additional Shares
”) determined pursuant to Section 5.02(b). A conversion of Notes will be deemed for
these purposes to be “in connection with” a Make-Whole Fundamental Change if the notice of conversion of such Notes is received by the Conversion Agent from, and including, the Effective Date of the Make-Whole Fundamental Change up to, and
including, the close of business on the Business Day immediately prior to the related Fundamental Change Purchase Date or, if such Make-Whole Fundamental Change is not also a Fundamental Change, the 35th Business Day immediately following the
Effective Date for such Make-Whole Fundamental Change.
Upon surrender of Notes for conversion in connection with a Make-Whole Fundamental
Change, the Company shall, at its option, satisfy its conversion obligation by Stock Settlement,
20
Cash Settlement or Combination Settlement in the manner specified in Section 5.04. However, if the consideration paid to holders of the Common Stock in any Make-Whole Fundamental Change
described in the clause (2) of the definition of Change in Control is composed entirely of cash, then, for any conversion of Notes following the Effective Date of such Make-Whole Fundamental Change, the payment and delivery obligations upon the
conversion of a Note shall be calculated based solely on the Stock Price for such Make-Whole Fundamental Change and shall, for each $1,000 principal amount of Notes converted, be deemed to be an amount of cash equal to the product of (i) the
Conversion Rate in effect on the applicable Conversion Date (as increased by any number of Additional Shares required by this Section 5.02)
multiplied by
(ii) such Stock Price. In such event, the Company will pay such amount of cash
to a converting Holder on the third Business Day following the applicable Conversion Date.
(b) The number of Additional Shares, if any, by which the Conversion Rate shall be increased for
conversions in connection with a Make-Whole Fundamental Change as set forth in Section 5.02(a) shall be determined by reference to the table attached as Schedule A hereto, based on the date on which the Make-Whole Fundamental Change occurs or
becomes effective (the “
Effective Date
”) and the Stock Price. The exact Stock Price and Effective Date may not be set forth in the table attached as Schedule A hereto, in which case if the Stock Price is:
(i) between two Stock Prices in the table or the Effective Date is between two
Effective Dates in the table, the number of Additional Shares 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
based on a 365-day year, as applicable;
(ii) in excess of $120.00 per share
(subject to adjustment in the same manner as the Stock Prices pursuant to subsection (c) below), no Additional Shares shall be added to the Conversion Rate; and
(iii) less than $23.75 per share (subject to adjustment in the same manner as the Stock
Prices pursuant to subsection (c) below), no Additional Shares shall be added to the Conversion Rate.
Notwithstanding anything herein to the
contrary, the Company shall not increase the Conversion Rate to more than 42.1052 shares of Common Stock (the “
Maximum Conversion Rate
”) per $1,000 principal amount of Notes pursuant to the events described in this
Section 5.02;
provided
the Company shall adjust the Maximum Conversion Rate upon the occurrence of any event for which, and in the same manner in which, it must adjust the Conversion Rate pursuant to Section 5.06.
(c) The Stock Prices set forth in the first row of the table in Schedule A
hereto (
i.e.
, the column headers) and the number of Additional Shares in the table in Schedule A hereto shall be adjusted as of any date on which the Conversion Rate of the Notes is adjusted pursuant to Section 5.06. 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 applicable Conversion Rate immediately prior to the 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 within the table attached as Schedule A hereto shall each be adjusted in the same manner and at the same time as the Conversion Rate as
set forth in Section 5.06.
(d) The Company shall notify the Holders
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 (and make the press release available on its website).
21
Section 5.03.
Exercise of Conversion Privilege
(a) The right of conversion attaching to any Note may be exercised (i) in the case of a
Global Security, by (A) book-entry transfer of such Note to the Conversion Agent through the facilities of the Depository and compliance with the applicable conversion procedures of the Depository in effect at that time, (B) if required,
paying funds equal to Interest payable on the next Interest Payment Date to which such Holder is not entitled as set forth in Section 5.04(d) and, (C) if required, paying all taxes or duties, if any, as set forth in Section 5.09 and
(ii) in the case of a Physical Security, by (A) completing, manually signing and delivering an irrevocable written notice to the Conversion Agent in the form set forth in Exhibit A hereto (or a facsimile thereof) (a “
Conversion
Notice
”) at the office of the Conversion Agent and stating in writing therein the principal amount of Notes to be converted and the name or names (with addresses) in which such Holder wishes the certificate or certificates for any shares of
Common Stock, if any, to be delivered upon settlement of the conversion obligation to be registered, (B) surrendering such Note, duly endorsed to the Company or in blank (and accompanied by appropriate endorsement and transfer documents), at
the office of the Conversion Agent, (C) if required, paying all transfer or similar taxes, if any, as set forth in Section 5.09 and (D) if required, paying funds equal to Interest payable on the next Interest Payment Date to which
such Holder is not entitled as set forth in Section 5.04(d). The Company shall pay any documentary, stamp or similar issue or transfer tax on the issuance of any shares of Common Stock upon conversion of the Notes, 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 the tax. A Note shall be deemed to have been converted on the date (the “
Conversion Date
”) that the Holder
has complied with the requirements set forth in this Section 5.03.
If the Holder of a Note has submitted such Note for purchase upon
a Fundamental Change, such Holder may only convert such Note if it withdraws its Fundamental Change Purchase Notice prior to the Fundamental Change Expiration Time, in accordance with Section 4.01(c).
(b) In case any Note shall be surrendered for partial conversion, the Company shall execute and
the Trustee shall, upon receipt of an Officers’ Certificate, authenticate and deliver to or upon the written order of the Holder of the Note so surrendered, without charge to such Holder, a new Note or Notes in authorized denominations in an
aggregate principal amount equal to the unconverted portion of the surrendered Notes.
22
Section 5.04
. Settlement of Conversion Obligation.
The provisions of
this Section 5.04 shall be subject to the provisions of Section 5.08.
(a) Upon
conversion of any Note, the Company may choose to satisfy its conversion obligation by paying or delivering, as the case may be, to converting Holders, in respect of each $1,000 principal amount of Notes being converted, (1) solely cash
(“
Cash Settlement
”), (2) shares of Common Stock, together with cash, if applicable, in lieu of any fractional share of Common Stock in accordance with Section 5.05 (“
Stock Settlement
”) or (3) a
combination of cash and shares of Common Stock, if any, with a particular Specified Dollar Amount (“
Combination Settlement
”), as set forth in this Section 5.04.
(i) All conversions on or after the Final Settlement Method Election Date shall
be settled using the same Settlement Method. If the Company has not delivered to the Trustee and all Holders a written notice of its election of a Settlement Method on or prior to the Final Settlement Method Election Date, the Company shall, with
respect to any conversions on or after the Final Settlement Method Election Date, be deemed to have elected to satisfy its conversion obligation using Combination Settlement with a Specified Dollar Amount of $1,000, unless the Company has previously
irrevocably elected another Settlement Method or Combination Settlement with a different Specified Dollar Amount as described in Section 5.04(a)(iii).
(ii) For all conversions prior to the Final Settlement Method Election Date, the
Company shall use the same Settlement Method for all conversions occurring on any given Conversion Date. Except for any conversions that occur on or after the Final Settlement Method Election Date, or following any Irrevocable Election as described
in Section 5.04(a)(iii), the Company shall not have any obligation to use the same Settlement Method with respect to conversions that occur on different Conversion Dates. Until the Final Settlement Method Election Date, unless the Company has
previously made the Irrevocable Election pursuant to Section 5.04(a)(iii), the Company may choose in respect of one Conversion Date to satisfy its conversion obligation using one Settlement Method and choose in respect of another Conversion
Date to satisfy its conversion obligation using another Settlement Method. If the Company elects a particular Settlement Method in connection with any conversion prior to the Final Settlement Method Election Date, unless the Company has previously
made an Irrevocable Election pursuant to Section 5.04(a)(iii), the Company shall inform Holders so converting through the Trustee of the Settlement Method the Company has selected (including the Specified Dollar Amount, if applicable), no later
than the close of business on the second Trading Day immediately following the related Conversion Date. If the Company does not timely make such an election with respect to a conversion, or if the Company elects Combination Settlement in respect of
its conversion obligation in respect of a conversion, but the Company does not timely notify converting Holders of the Specified Dollar Amount per $1,000 principal amount of Notes, the Company shall be deemed to have elected Combination Settlement
with a Specified Dollar Amount of $1,000 per $1,000 principal amount of Notes with respect to such conversion.
(iii) Prior to the Final Settlement Method Election Date, the Company may, by written
notice to the Trustee and the Holders, at its option irrevocably elect Stock Settlement, Cash Settlement or Combination Settlement with a particular Specified Dollar Amount, for all conversions with a Conversion Date subsequent to the Company’s
delivery of such notice (any such election, an “
Irrevocable Election
”).
23
(iv) The amount of cash, if any, and the
number of shares of Common Stock, if any, that the Company is required to pay or deliver, as the case may be, 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 through Stock Settlement,
the Company shall deliver through its stock transfer agent 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
(together with cash in lieu of fractional shares as set forth in Section 5.05);
(B) if the Company elects to satisfy its conversion obligation through 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 25 consecutive Trading Days during the related
Conversion Period; and
(C) if the Company elects (or is deemed to have elected) to
satisfy its conversion obligation through Combination Settlement, the Company shall deliver to Holders, in respect of each $1,000 principal amount of Notes being converted, an amount of cash and shares of Common Stock equal to the sum of the Daily
Settlement Amounts for each of the 25 consecutive Trading Days during the related Conversion Period.
(v) The “
Daily Settlement Amount
” for each $1,000 aggregate
principal amount of Notes validly surrendered for conversion, and for each of the 25 consecutive Trading Days of the applicable Conversion Period, will consist of:
(A) cash equal to the lesser of (1) a dollar amount per $1,000 principal amount of
Notes to be received upon conversion as specified by the Company pursuant to Section 5.04(a)(i) or (ii), as the case may be (the “
Specified Dollar Amount
”), if any,
divided by
25 (such quotient being referred to as the
“
Daily Measurement Value
”) and (2) the Daily Conversion Value; and
(B) to the extent the Daily Conversion Value for such Trading Day exceeds the Daily
Measurement Value for such Trading Day, a number of shares of Common Stock equal to (1) the difference between the Daily Conversion Value and the Daily Measurement Value,
divided by
(2) the Daily VWAP of the Common Stock for such
Trading Day.
(vi) Payment or delivery, as the case may be, of the consideration due
upon conversion shall be made (A) in the case of Stock Settlement, three Business Days after the Conversion Date, unless such Conversion Date occurs following the Record Date immediately preceding the Stated Maturity Date, in which case the
Company shall make such delivery (and payment, if applicable) on the Stated Maturity Date or (B) in the case of any other Settlement Method, three Business Days after the last Trading Day of the Conversion Period;
provided
,
however
, that, in the case of clause (A) or (B), if prior to
24
the Conversion Date for any converted Notes the Common Stock has been replaced by Reference Property consisting solely of cash pursuant to Section 5.12, the Company shall pay the
consideration due in respect of conversion on the third Business Day immediately following the related Conversion Date, and, notwithstanding anything to the contrary herein, no Conversion Period shall apply to those conversions.
(b) Each conversion shall be deemed to have been effected immediately prior to the close of
business on the relevant Conversion Date;
provided
,
however
, that the Person in whose name any shares of Common Stock shall be issuable upon such conversion shall be treated as the holder of record of such shares as of the close of
business on the Conversion Date (in the case of Stock Settlement) or the last Trading Day of the relevant Conversion Period (in any other case).
(c) Any cash amounts due upon conversion by a Holder of Notes surrendered for conversion shall
be paid by the Company to such Holder, or such Holder’s nominee or nominees. In addition, the Company shall issue, or shall cause to be issued, any shares of Common Stock due upon conversion to such Holder, or such Holder’s nominee or
nominees, certificates or a book-entry transfer through the Depository (together with any cash in lieu of fractional shares).
(d) Upon conversion, a Holder shall not receive any additional cash payment for accrued and
unpaid Interest, if any, except as set forth in this clause (d), and the Company shall not adjust the Conversion Rate to account for accrued and unpaid Interest. Except as set forth in this subsection (d), the Company’s settlement of the
conversion of a Note pursuant to this Section 5.04 shall be deemed to satisfy its obligation to pay the principal amount of such Note and accrued and unpaid Interest thereon, if any, to, but not including, the relevant Conversion Date. As a
result, accrued and unpaid Interest, if any, to, but not including, the Conversion Date will be deemed to be paid in full rather than cancelled, extinguished or forfeited. Upon conversion of a Note into a combination of cash and shares of Common
Stock, accrued and unpaid Interest shall be deemed to be paid first out of the cash paid upon such conversion, except as described in the immediately succeeding paragraph.
Notwithstanding the foregoing, if a Note is converted after the close of business on a Record Date, the Holder of such Note at the close of
business on such Record Date shall receive the Interest payable on such Note on the corresponding Interest Payment Date notwithstanding such conversion. A Note surrendered for conversion by a Holder after the close of business on any Record Date but
prior to the open of business on the immediately following Interest Payment Date must be accompanied by payment of an amount equal to the Interest that will be payable on such Interest Payment Date on the Note so converted;
provided
,
however
, that no such payment need be made:
(i) if the Company has
specified a Fundamental Change Purchase Date that is after a Record Date and on or prior to the corresponding Interest Payment Date;
(ii) with respect to any Note surrendered for conversion following the Record Date
immediately preceding the Stated Maturity Date; or
(iii) only to the extent of any
overdue Interest, if any overdue Interest remains unpaid at the time of conversion with respect to such Note.
25
As a result of the foregoing, the Company will pay Interest on the Stated Maturity Date on all Notes converted
after the Record Date preceding the Stated Maturity Date, and converting Holders will not be required to pay equivalent interest amounts.
Section 5.05
. Fractions of Shares.
The Company shall not issue any fractional share of Common Stock upon conversion of the Notes
and shall instead pay cash in lieu of any fractional share of Common Stock otherwise issuable upon conversion based on the Daily VWAP of the Common Stock on the relevant Conversion Date (in the case of Stock Settlement) or based on the Daily VWAP on
the last Trading Day of the relevant Conversion Period (in the case of any other Settlement Method). For each Note surrendered for conversion, if the Company has elected to satisfy its conversion obligation through 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 applicable Conversion Period and any fractional share remaining after such computation shall be paid in
cash. In addition, if more than one Note shall be surrendered for conversion at one time by the same Holder, the number of full shares that shall be issued upon conversion thereof shall be computed on the basis of the aggregate principal amount of
the Notes (or specified portions thereof) so surrendered.
Section 5.06
. Adjustment of Conversion Rate.
The Conversion Rate
shall be adjusted from time to time by the Company as follows:
|
(a)
|
If the Company issues solely shares of Common Stock as a dividend or distribution on all or substantially all shares of Common Stock, or if the Company subdivides or combines the Common Stock, the Conversion Rate shall
be adjusted based on the following formula:
|
where,
|
|
|
|
|
CR
0
=
|
|
the Conversion Rate in effect immediately prior to the open of business on the Ex-Dividend Date for such dividend or distribution, or immediately prior to the open of business on the effective date of such subdivision or combination
of Common Stock, as the case may be;
|
|
|
|
|
CR =
|
|
the Conversion Rate in effect 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 of such subdivision or combination of
Common Stock, as the case may be;
|
|
|
|
|
OS
0
=
|
|
the number of shares of Common Stock outstanding immediately prior to the open of business on the Ex-Dividend Date for such dividend or distribution, or immediately prior to the open of business on the effective date of such
subdivision or combination of Common Stock, as the case may be; and
|
|
|
|
|
OS =
|
|
the number of shares of Common Stock that would be outstanding immediately after giving effect to such dividend, distribution, subdivision or combination of Common Stock, as the case may be.
|
26
Any adjustment made under this subsection (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 of such subdivision or combination of Common Stock, as the case may be. If such dividend, distribution,
subdivision or combination described in this subsection (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 or to effect such subdivision or combination, to the Conversion Rate that would then be in effect if such dividend or distribution had not been declared or such subdivision or combination had not been announced.
|
(b)
|
If the Company distributes 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 from the announcement date for such
distribution to subscribe for or purchase shares of Common Stock, at a price per share less than the average of the Closing Sale Prices of the Common Stock for the 10 consecutive Trading Day period ending on, and including, the Trading Day
immediately preceding the announcement date for such distribution, the Conversion Rate shall be increased based on the following formula:
|
|
|
|
|
|
|
|
CR = CR
0
x
|
|
OS
0
+ X
|
|
|
|
|
OS
0
+ Y
|
|
|
where,
|
|
|
|
|
CR
0
=
|
|
the Conversion Rate in effect immediately prior to the open of business on the Ex-Dividend Date for such distribution;
|
|
|
|
|
CR =
|
|
the Conversion Rate in effect immediately after the open of business on the Ex-Dividend Date for such distribution;
|
|
|
|
|
OS
0
=
|
|
the number of shares of Common Stock outstanding immediately prior to the open of business on the Ex-Dividend Date for such distribution;
|
|
|
|
|
X =
|
|
the total number of shares of Common Stock issuable pursuant to such rights, options or warrants; and
|
|
|
|
|
Y =
|
|
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 Closing Sale Prices of Common Stock over the 10 consecutive Trading Day
period ending on, and including, the Trading Day immediately preceding the announcement date for such distribution.
|
Any increase made under this subsection (b) shall be made successively whenever any such rights,
options or warrants are issued and shall become effective immediately after
27
the open of business on the Ex-Dividend Date for such distribution. To the extent that shares of Common Stock are not delivered after the expiration of such rights, options or warrants, the
Conversion Rate shall be decreased, as of the date of such expiration, 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 issuance had not occurred.
For purposes of this subsection (b) and for purposes of Section 5.01(b)(iii), in determining whether any rights, options or warrants
entitle the Holders to subscribe for or purchase shares of Common Stock at a price that is less than the average of the Closing Sale Prices of the Common Stock for each Trading Day in the applicable 10 consecutive Trading Day period, there shall be
taken into account any consideration the Company receives for such rights, options or warrants and any amount payable on exercise thereof, with the value of such consideration if other than cash to be determined in good faith by the Board of
Directors.
|
(c)
|
If the Company distributes (the “
Relevant Distribution
”) shares of Capital Stock, evidences of indebtedness of the Company or other assets or property of the Company or rights, options or warrants to
acquire Capital Stock or other securities of the Company, to all or substantially all holders of the Common Stock, excluding:
|
(i) share splits, share combinations, dividends or distributions;
(ii) rights, options or warrants of the type described in Section 5.06(b);
(iii) dividends or distributions paid exclusively in cash; and
(iv) Spin-Offs,
then, in each such case, the Conversion Rate shall be adjusted based on the following formula:
|
|
|
|
|
|
|
CR = CR
0
x
|
|
SP
0
|
|
|
|
|
SP
0
- FMV
|
|
|
where,
|
|
|
|
|
CR
0
=
|
|
the Conversion Rate in effect immediately prior to the open of business on the Ex-Dividend Date for such distribution;
|
|
|
|
|
CR =
|
|
the Conversion Rate in effect immediately after the open of business on the Ex-Dividend Date for such distribution;
|
|
|
|
|
SP
0
=
|
|
the average of the Closing Sale Prices of 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
|
|
|
|
|
FMV =
|
|
the fair market value (as determined in good faith by the Board of Directors) of the shares of Capital Stock, evidences of indebtedness, assets or property or rights, options or warrants distributed with respect to each outstanding
share of Common Stock as of the open of business on the Ex-Dividend Date for such distribution.
|
28
Any increase made under the above portion of this subsection (c) shall become effective
immediately after the open of business on the Ex-Dividend Date for such distribution. No adjustment pursuant to the above formula shall result in a decrease of the Conversion Rate;
provided
that if such distribution is not so paid or made,
the Conversion Rate shall be decreased, as of the date the Board of Directors determines not to pay or make such distribution, to be 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 of Notes it holds, at the same time and upon the same terms as holders of Common Stock, without having to convert its Notes, the amount and kind of the Relevant Distribution that such Holder would have
received if such Holder owned a number of shares of Common Stock equal to the Conversion Rate on the record date for the distribution.
With respect to an adjustment pursuant to this subsection (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, 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:
|
|
|
|
|
|
|
CR = CR
0
x
|
|
FMV + MP
0
|
|
|
|
|
MP
0
|
|
|
where,
|
|
|
|
|
CR
0
=
|
|
the Conversion Rate in effect immediately prior to the open of business on the Ex-Dividend Date for the Spin-Off;
|
|
|
|
|
CR =
|
|
the Conversion Rate in effect immediately after the open of business on the Ex-Dividend Date for the Spin-Off;
|
|
|
|
|
FMV =
|
|
the average of the Closing Sale Prices of the Capital Stock or similar equity interest distributed to holders of Common Stock applicable to one share of Common Stock (determined by reference to the definition of Closing Sale Price
as if references therein to Common Stock were to such Capital Stock or similar equity interest) over the first 10 consecutive Trading Day period commencing on, and including, the Ex-Dividend Date for the Spin-Off (such period, the “
Valuation
Period
”); and
|
|
|
|
|
MP
0
=
|
|
the average of the Closing Sale Prices of the Common Stock over the Valuation Period.
|
29
The adjustment to the Conversion Rate under the preceding paragraph of this subsection
(c) shall be determined on the last Trading Day of the Valuation Period but shall be given effect immediately after the open of business on the Ex-Dividend Date for the Spin-Off. If the Ex-Dividend Date for the Spin-Off is less than 10 Trading
Days prior to, and including, the last Trading Day of the Conversion Period in respect of any conversion, references in the definition of “FMV” relating to Spin-Offs to 10 Trading Days shall be deemed to be replaced, solely in respect of
such conversion, 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 Conversion Period. In respect of any conversion during the Valuation
Period for any Spin-Off, references in the definition of “FMV” relating to Spin-Offs to 10 Trading Days shall be deemed to be replaced with such lesser number of Trading Days as have elapsed from, and including, the Ex-Dividend Date for
such Spin-Off to, and including, the relevant Conversion Date.
If any dividend or distribution that constitutes a Spin-Off is declared,
but not so paid or made, the Conversion Rate shall be decreased, as of the date the Board of Directors determines not to pay or make such dividend or distribution, to be the Conversion Rate that would then be in effect in such dividend or
distribution had not been declared.
Rights, options or warrants distributed by the Company to all or substantially all holders of Common
Stock, entitling the holders thereof 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 Common Stock; (ii) are not exercisable; and (iii) are also issued in respect of future issuances of Common Stock, shall
be deemed not to have been distributed for purposes of this subsection (c) (and no adjustment to the Conversion Rate under this subsection (c) shall be required) until the occurrence of the earliest Trigger Event, whereupon such rights,
options and warrants shall be deemed to have been distributed and an appropriate adjustment (if any is required) to the Conversion Rate shall be made under this subsection (c). Subject to Section 5.06(i) if any such rights, options or warrants
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 (and a termination or expiration of the existing rights, options or warrants without exercise by any of the holders thereof). Subject to
Section 5.06(i), 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 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 subsection (c) was made, (1) in the case of any such rights, options or warrants that shall all have been redeemed or repurchased without
exercise by any holders thereof, the Conversion Rate shall be readjusted upon such final redemption or repurchase to give effect to such distribution or Trigger Event, as the case may be, as
30
though it were a cash distribution, equal to the per share redemption or repurchase price received by a holder or holders of Common Stock with respect to such rights, options or warrants
(assuming such holder had retained such rights or warrants), made to all holders of Common Stock as of the date of such redemption or repurchase, 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 this subsection (c) and subsections (a) and (b) of this Section 5.06, any dividend or distribution to
which this subsection (c) is applicable that also includes shares of Common Stock to which subsection (a) of this Section 5.06 applies (the “
Clause A Distribution
”) or rights, options or warrants to subscribe for or
purchase shares of Common Stock to which subsection (b) of this Section 5.06 applies (the “
Clause B Distribution
”), shall be deemed instead to be (1) a dividend or distribution of the shares of Capital Stock,
evidences of indebtedness or other assets or property, other than the Clause A Distribution and the Clause B Distribution to which this subsection (c) applies (the “
Clause C Distribution
”) (and any Conversion Rate adjustment
required by this subsection (c) with respect to such dividend or distribution shall then be made) immediately followed by (2) the Clause B Distribution (and any further Conversion Rate adjustment required by subsection (b) of this
Section 5.06 shall then be made), except, if determined by the Company, (A) the Ex-Dividend Date of the Clause B Distribution shall be deemed to be the Ex-Dividend Date of the Clause C Distribution and (B) any shares of Common Stock
included in the Clause A Distribution or the Clause B Distribution shall not be deemed “outstanding immediately prior to the open of business on the Ex-Dividend Date for such distribution” within the meaning of subsection (b) of this
Section 5.06 immediately followed by (3) the Clause A Distribution (and any further Conversion Rate adjustment required by subsection (a) of this Section 5.06 with respect to such dividend or distribution shall then be made) ,
except, if determined by the Company, (A) the Ex-Dividend Date of the Clause A Distribution shall be deemed to be the Ex-Dividend Date of the Clause C Distribution and (B) any shares of Common Stock included in the Clause A Distribution or
the Clause B Distribution shall not be deemed “outstanding immediately prior to the open of business on the Ex-Dividend Date for such dividend or distribution, or immediately prior to the open of business on the effective date of such
subdivision or combination of Common Stock, as the case may be” within the meaning of subsection (a) of this Section 5.06.
|
(d)
|
If the Company makes any cash dividend or distribution to all, or substantially all, holders of outstanding Common Stock (other than any dividend or distribution in connection with the Company’s liquidation,
dissolution or winding up), the Conversion Rate will be increased based on the following formula:
|
|
|
|
|
|
|
|
CR = CR
0
x
|
|
SP
0
|
|
|
|
|
SP
0
- C
|
|
|
where,
31
|
|
|
|
|
CR
0
=
|
|
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;
|
|
|
|
|
SP
0
=
|
|
the average of the Closing Sale Prices of Common Stock over the 10 consecutive Trading Day period ending on and including the Trading Day immediately preceding the Ex-Dividend Date for such dividend or distribution; and
|
|
|
|
|
C =
|
|
the amount in cash per share the Company pays or distributes to all or substantially all holders of Common Stock.
|
Any increase made under this subsection (d) shall become effective immediately after the open of
business on the Ex-Dividend Date for such dividend or distribution. No adjustment pursuant to the above formula shall result in a decrease of the Conversion Rate;
provided
that if any dividend or distribution described in this subsection
(d) is declared but not so paid or made, the new Conversion Rate shall be readjusted, as of the date the Board of Directors determines not to pay or make such dividend or distribution, to 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 held by such Holder, at the same time
and upon the same terms as holders of shares of Common Stock, without having to convert its Notes, 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
record date for such cash dividend or distribution.
|
(e)
|
If the Company or any of its Subsidiaries makes a payment in respect of a tender or exchange offer for Common Stock and, if the cash and value of any other consideration included in the payment per share of Common Stock
exceeds the average of the Closing 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 “
Expiration Date
”), the Conversion Rate shall be increased based on the following formula:
|
|
|
|
|
|
|
|
CR = CR
0
x
|
|
AC + (OS x SP)
|
|
|
|
|
OS
0
x SP
|
|
|
where,
|
|
|
|
|
CR
0
=
|
|
the Conversion Rate in effect immediately prior to the open of business on the Trading Day next succeeding the Expiration Date;
|
32
|
|
|
|
|
CR =
|
|
the Conversion Rate in effect immediately after the open of business on the Trading Day next succeeding the Expiration Date;
|
|
|
|
|
AC =
|
|
the aggregate value of all cash and any other consideration (as determined in good faith by the Board of Directors) paid or payable for shares purchased in such tender or exchange offer;
|
|
|
|
|
OS
0
=
|
|
the number of shares of Common Stock outstanding immediately prior to the time (the “
Expiration Time
”) such tender or exchange offer expires (prior to giving effect to such tender offer or exchange offer);
|
|
|
|
|
OS =
|
|
the number of shares of Common Stock outstanding immediately after the Expiration Time (after giving effect to such tender offer or exchange offer); and
|
|
|
|
|
SP =
|
|
the average of the Closing Sale Prices of Common Stock over the 10 consecutive Trading Day period commencing on, and including, the Trading Day next succeeding the Expiration Date (the “
Averaging Period
”).
|
The adjustment to the Conversion Rate under this subsection (e) shall be determined at the close of
business on the last Trading Day of the Averaging Period, but shall be given effect at the open of business on the Trading Day next succeeding the Expiration Date. If the Trading Day next succeeding the Expiration Date is less than 10 Trading Days
prior to, and including, the end of the Conversion Period in respect of any conversion, references in the definition of “SP” above to 10 consecutive Trading Days shall be deemed to be replaced, solely in respect of that conversion, with
such lesser number of Trading Days as have elapsed from, and including, the Trading Day next succeeding the Expiration Date, to and including, the last Trading Day of such Conversion Period. In respect of any conversion during the 10 consecutive
Trading Days commencing on the Trading Day next succeeding the Expiration Date, references in the definition of “SP” above to 10 consecutive Trading Days shall be deemed to be replaced with such lesser number of Trading Days as have
elapsed from, and including, the Trading Day next succeeding the Expiration Date to, but excluding, the relevant Conversion Date. No adjustment pursuant to the above formula shall result in a decrease of the Conversion Rate.
If the Company or any of its Subsidiaries is obligated to purchase shares of Common Stock pursuant to any such tender offer or exchange offer,
but the Company or any of its Subsidiaries is ultimately prevented by applicable law from effecting all or any portion of such purchases or all or any portion of such purchases are rescinded, the Conversion Rate shall immediately be readjusted to be
the Conversion Rate that would then be in effect if such tender offer or exchange offer had not been made or had been made only in respect of the purchase of shares of Common Stock that had been effected.
(f) If:
(i) the Company elects to satisfy its conversion obligation through Combination
Settlement and shares of Common Stock are deliverable for a given Trading Day within the Conversion Period applicable to Notes that a Holder has converted,
33
(ii) the record date, effective date or
expiration date for any distribution or transaction that requires an adjustment to the Conversion Rate as described in subsections (a), (b), (c), (d) and (e) of this Section 5.06 occurs on or after the first Trading Day of the
relevant Conversion Period and on or prior to the last Trading Day of such Conversion Period,
(iii) the number of such shares of Common Stock is calculated (x) for a Trading Day in
such Conversion Period that occurs on or prior to such record date, effective date or expiration date and (y) based on a Conversion Rate that is not adjusted as described in subsections (a), (b), (c), (d) and (e) of this
Section 5.06 in respect of such distribution or transaction, and
(iv) the shares
a Holder will receive in respect of such Trading Day are not entitled to participate in the relevant distribution or transaction (because such shares were not held on a related record date or otherwise),
then the Company shall adjust the number of shares that the Company will deliver to you in respect of the relevant Trading Day as the Company determines
appropriate in good faith to reflect the relevant distribution or transaction.
(g) If a
Conversion Rate adjustment becomes effective on any Ex-Dividend Date as described above, and a Holder that has converted its Note on or after such Ex-Dividend Date and on or prior to the related record date would be treated as the record holder of
shares of Common Stock as of the related Conversion Date pursuant to Section 5.04(b) based on an adjusted Conversion Rate for such Ex-Dividend Date, then, notwithstanding the foregoing Conversion Rate adjustment provisions and settlement
provisions, the Conversion Rate adjustment relating to such Ex-Dividend Date shall not be made for such converting Holder. Instead, such Holder shall be treated as if such Holder were the record owner of the shares of Common Stock such Holder is
entitled to receive upon conversion on an unadjusted basis and participate in the related dividend, distribution or other event giving rise to such adjustment.
In addition, if a Holder converts a Note, Combination Settlement is applicable to such Note and the Daily Settlement Amount for any Trading
Day during the Conversion Period applicable to such Note:
(i) is
calculated based on a Conversion Rate adjusted on account of any distribution or transaction described in subsections (a), (b), (c), (d) and (e) of this Section 5.06; and
(ii) includes any shares of Common Stock that entitle their holder to
participate in such event;
then, notwithstanding the foregoing Conversion Rate adjustment provisions and settlement provisions, (x) such Conversion
Rate adjustment shall only be made for such converting Holder for such Trading Day to the extent of the cash or other consideration (other than shares of Common Stock entitled to participate in such event) included in the Daily Settlement Amount for
such Trading Day and (y) with respect to such shares of Common Stock, 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.
34
(h) Notwithstanding the foregoing, the
Conversion Rate will 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 its Subsidiaries;
(iii) upon the issuance of any shares of Common Stock pursuant to any option, warrant,
right or exercisable, exchangeable or convertible security not described in subclause (ii) and outstanding as of the date the Notes were first issued;
(iv) upon the repurchase of any shares of Common Stock pursuant to an open-market share
repurchase program, structured share repurchase transaction or other buy-back transaction (including through the use of derivatives) that is not a tender offer or exchange offer of the nature described under subsection (e) of this
Section 5.06;
(v) solely for a change in the par value of the Common Stock;
or
(vi) for accrued and unpaid interest, if any.
(i) To the extent that the Company has a rights plan in effect upon conversion of the Notes
(
i.e.
, a poison pill), converting Holders of the Notes shall receive, in addition to any Common Stock received in connection with such conversion, the rights under such rights plan, unless prior to such conversion, the rights have separated
from the Common Stock, in which case the Conversion Rate shall be adjusted at the time of separation as if the Company distributed to all holders of Common Stock shares of the Company’s Capital Stock, evidences of indebtedness or other assets
or property, pursuant to Section 5.06(c), subject to readjustment in the event of the expiration, termination or redemption of such rights.
(j) In addition to those adjustments required by subsections (a), (b), (c), (d), (e) and
(f) of this Section 5.06, and to the extent permitted by applicable law and applicable listing rules of The NASDAQ Global Select Market and any other securities exchange on which the Company’s securities are then listed, (i) the
Company in its sole discretion from time to time may increase the Conversion Rate by any amount for a period of at least 20 Business Days so long as such increase is irrevocable during such period and the Board of Directors determines that such
increase would be in the Company’s best interest and (ii) the Company may also (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 shares of Common
Stock in connection with a dividend or distribution of shares (or rights to acquire shares) of Common Stock or similar events.
35
(k) Adjustments to the Conversion Rate shall be
calculated to the nearest one-ten thousandth (1/10,000) of a share. The Company shall not be required to make an adjustment in the Conversion Rate unless the adjustment would require a change of at least 1% in the Conversion Rate;
provided
that the Company shall carry forward any adjustment that is less than 1% of the Conversion Rate, take such carried-forward adjustments into account in any subsequent adjustment, and make such carried forward adjustments, regardless
of whether the aggregate adjustment is less than 1%, (i) on the Conversion Date for any Notes, (ii) on each Trading Day of the Conversion Period in respect of any Notes, and (iii) on any Fundamental Change effective date, unless such
adjustment has already been made.
(l) For purposes of this Section 5.06, the number
of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock.
(m) Whenever any provision of the Indenture requires the Company to calculate Closing Sale Prices, Daily
VWAPs, Daily Conversion Values, Daily Settlement Amounts or the Stock Price for purposes of a Make-Whole Fundamental Change over a span of multiple days, the Board of Directors shall make appropriate adjustments 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, Expiration Date or effective date of the event occurs, at any time during the period for which such Closing Sale Prices,
Daily VWAPs, Daily Conversion Values, Daily Settlement Amounts or the Stock Price is to be calculated. For the avoidance of doubt, the adjustments made pursuant to this subsection (m) shall be made without duplication of any adjustment made
pursuant to subsection (f) of this Section 5.06. Neither the Trustee nor the Conversion Agent shall have any responsibility for any of the foregoing calculations or determinations.
(n) No adjustment to the Conversion Rate need be made for a given transaction if each Holder of
a Note will be entitled to participate in such transaction, without conversion of such Note, on the same terms and at the same time as the holder of a number of shares of Common Stock equal to (i) the principal amount of such Holder’s Note
divided by
$1,000 and
multiplied by
(ii) the Conversion Rate would be entitled to participate.
Section 5.07
. Notice of Adjustments of Conversion Rate.
Whenever the Conversion Rate is adjusted as herein
provided, the Company shall compute the adjusted Conversion Rate in accordance herewith and shall prepare a certificate signed by the Chief Financial Officer or Controller of the Company setting forth the adjusted Conversion Rate and describing in
reasonable detail the facts upon which such adjustment is based. Such certificate shall promptly be filed with the Trustee and with the Conversion Agent (if other than the Trustee), and the Company shall issue a press release containing the relevant
information (and make the press release available on its website). Failure to deliver any such certificate or notice shall not affect the validity of such adjustment.
Section 5.08.
Company To Reserve Common Stock.
As of the date of this Supplemental Indenture, the Company
has reserved 6,735,163 shares of Common Stock for the purpose of satisfying conversions of the Notes. The Company expects to propose at its regularly scheduled
36
shareholder meeting next following the date of this Supplemental Indenture a resolution increasing the number of authorized shares and to reserve additional shares for the purpose of satisfying
conversions of the Notes such that the number of shares reserved for such purpose is sufficient to satisfy conversions of all the Notes through Stock Settlement, including delivery of Additional Shares in connection with a Make-Whole Fundamental
Change. The Company shall at all times and from time to time reserve and keep available, free from preemptive rights, out of its authorized but unissued Common Stock that is not committed for any other purpose, for the purpose of issuance upon
conversion of Notes, (x) the number of shares of Common Stock equal to the number so reserved as of the date of this Supplemental Indenture and (y) following the approval by the Company’s shareholders of the resolution to increase the
number of authorized shares of Common Stock in accordance with the preceding sentence, a number of shares of Common Stock equal to the product of (a) the Maximum Conversion Rate and (b) the aggregate principal amount of Outstanding Notes
divided by $1,000.
Notwithstanding anything to the contrary in this Supplemental Indenture, if the Company is required to deliver shares
Common Stock to a converting Holder under any Settlement Method and such delivery obligation exceeds the aggregate number of authorized but unissued shares and treasury shares available to the Company on the Conversion Date (in the case of Stock
Settlement) or the last trading day of the relevant Conversion Period (in the case of any other Settlement Method) for the purpose of satisfying conversions of the Notes, in lieu of delivery of such excess shares, the Company shall pay to such
Holder the value of any such excess shares of Common Stock in cash based on the Daily VWAP of the Common Stock on the relevant Conversion Date (in the case of Stock Settlement) or based on the Daily VWAP of the Common Stock on the last trading day
of the relevant Conversion Period (in the case of any other Settlement Method).
Section 5.09
. Taxes on
Conversions.
The Company shall pay any and all documentary, stamp or similar issue or transfer taxes that may be payable in respect of the issuance of shares of Common Stock upon any conversion of Notes hereunder;
provided
that
the Company shall not be required to pay any tax that is due because the converting Holder requests such shares to be issued in a name other than such Holder’s name, and no such issuance shall be made unless and until the Holder has paid to the
Company the amount of any such tax or duty, or has established to the satisfaction of the Company that such tax or duty has been paid.
Section 5.10
. Certain Covenants.
Before taking any action which would cause an adjustment reducing the
Conversion Rate below the then par value, if any, of the shares of Common Stock issuable upon conversion of the Notes, the Company shall take all corporate action that it reasonably determines is necessary to ensure that the Company may validly and
legally issue a number of shares of Common Stock equal to the Maximum Conversion Rate (giving effect to such prospective adjustment), and that such shares would be considered fully paid under applicable law.
Section 5.11
. Cancellation of Converted Notes.
All Notes delivered to the Conversion Agent for conversion
shall be delivered to the Trustee or its agent and canceled by the Trustee as provided in Section 2.12 of the Original Indenture.
37
Section 5.12.
Provision in Case of Effect of Reclassification, Consolidation,
Merger or Sale.
(a) In the event of:
(i) any recapitalization, reclassification or change of the Common Stock (other
than changes resulting from a subdivision or combination or a change to the par value of the Common Stock);
(ii) a consolidation, merger, combination, binding share exchange or similar
transaction involving the Company;
(iii) a sale, assignment, conveyance, transfer,
lease or other disposition to another Person of the Company’s property and assets as an entirety or substantially as an entirety; or
(iv) a liquidation or dissolution of the Company,
in each case, in which holders of outstanding Common Stock are entitled to receive cash, securities or other property for their shares of Common Stock
(“
Reference Property
” and any such transaction, a “
Share Exchange Event
”), then the Company or the successor or purchasing Person, as the case may be, shall execute with the Trustee a supplemental indenture
providing that, at and after the effective time of such Share Exchange Event, Holders of each $1,000 principal amount of Notes will be entitled to convert their Notes into the kind and amount of Reference Property that a holder of a number of shares
of Common Stock equal to the Conversion Rate immediately prior to such Share Exchange Event would have owned or been entitled to receive upon such Share Exchange Event;
provided
that at and after the effective time of any such Share Exchange
Event, (i) the Company will continue to have the right to determine the Settlement Method applicable to any conversion of Notes, unless the Company has previously made an Irrevocable Election pursuant to Section 5.04(a)(iii), (ii) any
amount otherwise payable in cash upon conversion of the Notes pursuant to Section 5.04(a)(iv) shall continue to be payable in cash, (iii) any shares of Common Stock that the Company would have been required to deliver upon conversion of
the Notes pursuant to Section 5.04(a)(iv) 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 received in such Share Exchange Event and (iv) 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 Share Exchange Event. Such supplemental indenture shall also provide for anti-dilution and other
adjustments that are as nearly equivalent as possible to the adjustments set forth in Section 5.06. If the Reference Property in respect of any such Share Exchange Event includes shares of stock, securities or other property or assets of a
company other than the successor or purchasing Person, as the case may be, in such Share Exchange Event, such other company shall also execute such supplemental indenture, and such supplemental indenture shall contain such additional provisions to
protect the interests of the Holders, including the right of Holders to require the Company to purchase their Notes upon a Fundamental Change pursuant to Section 4.01, as the Board of Directors reasonably considers necessary by reason of the
foregoing. If the Notes become convertible into Reference Property pursuant to this Section 5.12 or such a supplemental
38
indenture, the Company shall notify the Trustee in writing and issue a press release containing the relevant information and make such press release available on the Company’s website.
Throughout Article 5, if the Common Stock has been replaced by Reference Property as a result of any Share Exchange Event, references to Common Stock are intended to refer to such Reference Property, subject to the provisions of this Supplemental
Indenture.
For purposes of this Section 5.12, the type and amount of consideration that holders of Common Stock are entitled to in
the case of Share Exchange Events that cause Common Stock to be converted into the right to receive more than a single type of consideration because the holders of Common Stock have the right to elect the type of consideration they receive 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. The Company shall notify Holders of such weighted average as soon as practicable after such determination is made. If the Holders receive only cash in any Share
Exchange Event, then for all conversions that occur after the effective date of such Share Exchange Event (i) 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 relevant Conversion Date (as may be increased by any Additional Shares),
multiplied by
the price paid per share of Common Stock in such Share Exchange Event and (ii) the Company shall satisfy its
conversion obligation by paying cash to converting Holders on the third Business Day immediately following the relevant Conversion Date. The Company shall not become a party to any Share Exchange Event unless its terms are consistent with this
Section 5.12.
(b) The above provisions of this Section 5.12 shall similarly
apply to successive Share Exchange Events.
Section 5.13
. Responsibility of Trustee for Conversion
Provisions.
The Trustee and any Conversion Agent or Bid Solicitation Agent, subject to the provisions of Article Seven of the Original Indenture, shall not at any time be under any duty or responsibility to any Holder of Notes or to
the Company to determine whether any facts exist which may require any adjustment of the Conversion Rate, or with respect to the nature or extent of any such adjustment when made, or with respect to the method employed, herein or in any supplemental
indenture provided to be employed, in making the same, or whether a supplemental indenture need be entered into. Neither the Trustee nor any Conversion Agent or Bid Solicitation Agent, subject to the provisions of Article Seven of the Original
Indenture, shall be responsible for any failure of the Company to make or calculate any cash payment or to issue, transfer or deliver any shares of Common Stock or share certificates or other securities or property or cash upon the surrender of any
Note for the purpose of conversion; and the Trustee and any Conversion Agent or any Bid Solicitation Agent, subject to the provisions of Article Seven of the Original Indenture, shall not be responsible for any failure of the Company to comply with
any of the covenants of the Company contained in this Article 5. The Company shall provide written notice to the Trustee and the Conversion Agent at any time any Notes become convertible.
39
Section 5.14.
Notice to Holders Prior to Certain Actions.
In
case of:
(a) any action by the Company or any Subsidiary thereof that
would require an adjustment to the Conversion Rate under Section 5.06;
(b) any Share Exchange Event;
(c) any voluntary or involuntary dissolution, liquidation or winding up of the
Company or any of its Subsidiaries; or
(d) any Merger Transaction;
then, in each case (unless notice of such event is otherwise required pursuant to another provision of the Indenture excluding, for the avoidance of doubt,
Section 5.07), the Company shall cause to be furnished to the Trustee and the Conversion Agent and to be sent to each Holder at such Holder’s address appearing on the list of Holders provided for in Section 2.05 of the Original
Indenture, as promptly as practicable but in any event at least five calendar days prior to the applicable date specified in clause (x) or (y) below (or, if later, no more than two Business Days following the date on which the Company
knows of the applicable date specified in clause (x) or (y) below), a notice stating (x) the date on which a record is to be taken for the purpose of such action by the Company or its Subsidiary 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 its Subsidiary, or (y) the date on which such Share Exchange Event, Merger Transaction, dissolution, liquidation or
winding up is expected to become effective or occur, and, if applicable, 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 Share Exchange Event, Merger Transaction, dissolution, liquidation or winding up. Failure to give such notice, or any defect therein, shall not affect the operation of any provision herein consequent on such event.
ARTICLE 6
NO REDEMPTION
Section 6.01.
No Redemption
. Article Three of the Original Indenture shall not apply with respect to the
Notes. The Notes shall not be redeemable at the option of the Company prior to the Stated Maturity Date.
Section 6.02.
No Sinking
Fund. No sinking fund shall be provided with respect to the Notes.
ARTICLE 7
EVENTS OF DEFAULT;
REMEDIES
Section 7.01
. Original Indenture.
With respect to the Notes, (i) Section 7.02 hereof
shall supersede Section 6.01 of the Original Indenture; (ii) Section 7.03 hereof shall supersede Section 6.02 of the Original Indenture; (iii) Section 7.04 hereof shall supersede Section 6.06 of the Original
Indenture; (iv) Section 7.05 hereof shall supersede Section 6.07 of the Original Indenture; (v) Section 7.06 hereof shall supersede Section 6.04 of the Original Indenture;
(vi)
40
Section 7.07 hereof shall supersede Section 6.11 of the Original Indenture, and any reference in the Original Indenture to any such provision of the Original Indenture shall be deemed
to refer to the corresponding provision herein (if any).
Section 7.02.
Events of Default
.
Notwithstanding the “Events of Default” set forth in Section 6.01 of the Original Indenture, which shall not apply with respect
to the Notes, each of the following events shall constitute an “
Event of Default
” under the Indenture:
(a) failure by the Company to pay the principal of any Note when due;
(b) failure by the Company to pay or deliver, as the case may be, the Settlement Amount owing
upon conversion of any Note (including any Additional Shares or cash in lieu thereof) within five days;
(c) failure by the Company to pay any Interest on any Note when due, and such failure continues
for 30 days;
(d) failure by the Company to pay the Fundamental Change Purchase Price of
any Note when due;
(e) failure by the Company to provide timely written notice pursuant to
Section 5.01(b)(iii) or (b)(iv) or to timely provided a Fundamental Change Purchase Right Notice in accordance with the terms provided in Section 4.01(b);
(f) failure by the Company to perform any other covenant required of it as provided in
the Indenture (other than a covenant or agreement a default in whose performance or whose breach is specifically dealt with in subsections (a) through (e) above) and such failure continues for 60 days after written notice thereof has been
received by the Company from the Trustee or the Holders of at least 25% in aggregate principal amount of the Notes then Outstanding;
(g) any indebtedness for money borrowed by, or any other payment obligation of, the Company or
any of its Subsidiaries that is a Significant Subsidiary (or any group of Subsidiaries that, taken together, would constitute a Significant Subsidiary), in an outstanding principal amount, individually or in the aggregate, in excess of $20 million
is not paid at final maturity (or when otherwise due) or is accelerated, unless such indebtedness is discharged or such acceleration is cured, waived, rescinded, stayed or annulled within a period of 30 days after becoming due and payable;
(h) failure by the Company or any of its Subsidiaries that is a Significant Subsidiary (or any
group of Subsidiaries that, taken together, would constitute a Significant Subsidiary) to pay one or more final and non-appealable judgments entered by a court or courts of competent jurisdiction, the aggregate uninsured or unbonded portion of which
is in excess of $20 million, if the judgments are not paid, discharged or stayed within 30 days;
(i) the Company or any Significant Subsidiary (or any group of Subsidiaries that, taken
together, would constitute a Significant Subsidiary) thereof shall commence a voluntary
41
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; and
(j) an involuntary case or other proceeding shall be
commenced against the Company or any Significant Subsidiary (or any group of Subsidiaries that, taken together, would constitute a Significant Subsidiary) thereof 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 90 consecutive days.
Section 7.03
. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default, other than an
Event of Default specified in Section 7.02(i) or Section 7.02(j) with respect to the Company, occurs and is continuing, then in every such case either the Trustee or the Holders of at least 25% in aggregate principal amount of the
Outstanding Notes may declare the principal amount of, and all accrued unpaid Interest on, the Notes to be due and payable immediately, by a notice in writing to the Company (with a copy to the Trustee), and upon any such declaration such principal
and Interest shall become immediately due and payable. If an Event of Default specified in Section 7.02(i) or Section 7.02(j) occurs with respect to the Company, the principal amount of, and accrued and unpaid Interest, if any, on, all of
the Notes shall become immediately due and payable without any declaration or other act of the Holders or any act on the part of the Trustee.
At any time after such an acceleration but before a judgment or decree based on such acceleration, the Holders of a majority in aggregate
principal amount of the Outstanding Notes, by written notice to the Company and the Trustee, may rescind and annul such acceleration (other than with respect to an Event of Default under Sections 7.02(a) (including the Fundamental Change Purchase
Price)) if:
(i) such rescission and annulment will not conflict with any
judgment or decree of a court of competent jurisdiction;
(ii) all Events of
Default, other than the non-payment of the principal amount on Notes that have become due solely by such acceleration, have been cured or waived as provided in Section 7.06; and
(iii) all amounts owing to the Trustee have been paid.
No such rescission shall affect any subsequent Event of Default or impair any right consequent thereon.
42
Notwithstanding the foregoing and notwithstanding the remedies afforded to Holders upon the
occurrence and during the continuation of an Event of Default as set forth in Article Six of the Original Indenture, at the election of the Company, the sole remedy for an Event of Default relating to (i) the failure by the Company to file with
the Trustee pursuant to Section 314(a)(1) of the TIA any documents or reports that the Company is required to file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act or (ii) the failure by the Company to comply with its
reporting obligations to the Trustee and the SEC, under Section 9.01 hereof (in either case, a “
Filing Failure
”), shall, for the 180 days after the occurrence of such an Event of Default, consist exclusively of the right of
Holders to receive additional interest on the Notes (“
Additional Interest
”) at an annual rate equal to (x) for the first 90 days after the occurrence of such an Event of Default, 0.25% of the aggregate principal amount of the
Notes to, but not including, the 91st day thereafter, and (y) for the 90 days from, and including, the 91st day after the occurrence of such an Event of Default, 0.50% of the aggregate principal amount of the Notes to, but not including, the
181st day after the occurrence of such an Event of Default (or, in each case of clauses (x) and (y), if applicable, the earlier date on which the Event of Default relating to the reporting obligations is cured or waived). Any such Additional
Interest shall be payable in the same manner and on the same dates as the stated Interest payable on the Notes. Any such Additional Interest will accrue on the Notes that are then Outstanding from the first day of the Event of Default to, but
excluding, the earlier of (i) the date on which the Company has made the filings initially giving rise to the Filing Failure and (ii) the date that is 180 days after the occurrence of the Event of Default. If such Event of Default is
continuing on the 181st day after such Event of Default first occurred, the Notes shall be subject to acceleration in accordance with the provisions of this Section 7.03 as provided above. This paragraph and the two immediately succeeding
paragraphs shall not affect the rights of Holders of Notes in the event of the occurrence of any other Event of Default. In the event the Company does not elect to pay the Additional Interest upon an Event of Default in accordance with this
paragraph, the Notes shall be subject to acceleration in accordance with the first paragraph of this Section 7.03.
In order to elect
to pay Additional Interest as the sole remedy during the first 180 days after the occurrence of an Event of Default relating to the failure to comply with the reporting obligations set forth in Section 9.01 in accordance with the immediately
preceding paragraph, the Company must notify in writing all Holders of record of the Notes and the Trustee and Paying Agent of such election on or before the date on which such Event of Default would otherwise occur. Upon the Company’s failure
to timely give such notice or pay Additional Interest, the Notes shall be immediately subject to acceleration in accordance with the first paragraph of this Section 7.03. In no event shall Additional Interest accrue at a rate per year in excess
of 0.25% (during the period described in clause (x) of the immediately preceding paragraph) or 0.50% (during the period described in clause (y) of the immediately preceding paragraph), as applicable, pursuant to the Indenture, regardless
of the number of events or circumstances giving rise to requirements to pay such Additional Interest pursuant to the immediately preceding paragraph. With regard to any violation specified in the immediately preceding paragraph, no Additional
Interest shall accrue, and no right to declare the principal or other amounts due and payable in respect of the Notes shall exist, after such violation has been cured.
If Additional Interest is payable under this Section 7.03, the Company shall deliver to a responsible officer of the Trustee at the
Corporate Trust Office of the Trustee a certificate to that effect stating that Additional Interest is payable and the date upon which such Additional Interest
43
shall begin to accrue. Unless and until a responsible officer of the Trustee receives at the corporate trust office of the Trustee such a certificate, the Trustee may assume without inquiry that
Additional Interest is not payable. If Additional Interest has been paid by the Company directly to the persons entitled to it, the Company shall deliver to the Trustee a certificate setting forth the particulars of such payment.
Payments of the Fundamental Change Purchase Price, principal and Interest that are not made when due shall accrue Interest per annum at the
then-applicable interest rate from the required payment date.
Section 7.04
. Limitation on Suits.
Notwithstanding
Section 6.06 of the Original Indenture, which shall not apply to the Notes, no Holder of any Note shall have any right to institute any proceeding, judicial or otherwise, with respect to the Indenture or the Notes, or for the appointment of a
receiver or trustee, or for any other remedy under the Indenture or the Notes, unless:
(i) such Holder has previously given written notice to the Trustee of a
continuing Event of Default;
(ii) the Holders of at least 25% in aggregate
principal amount of the Notes then outstanding have made a written request and have offered indemnity or security to the Trustee satisfactory to it to institute such proceeding as Trustee; and
(iii) the Trustee has failed to institute such proceeding within 60 days after such notice,
request and offer and has not received from the Holders of a majority in aggregate principal amount of the Notes then outstanding a direction inconsistent with such request within 60 days after such notice, request and offer.
However, the limitation on the right of Holders to institute a proceeding under this Section 7.04 shall not apply to a suit instituted by a Holder for
the enforcement of payment of the principal of or Interest on any Note on or after the applicable due date, the right to convert the Note or to receive the consideration due upon conversion or the right of a beneficial owner to exchange its
beneficial interest in a Global Security representing Notes for a Physical Security if an Event of Default has occurred and is continuing, in each case, in accordance with applicable provisions of the Indenture.
Section 7.05
. Unconditional Right of Holders To Receive Payment
. Notwithstanding any other provision of the
Indenture or the Notes, any Holder has the right to receive payment or delivery, as the case may be, of the principal amount, Fundamental Change Purchase Price or accrued and unpaid Interest, if any, in respect of the Notes held by such Holder, on
or after the respective due dates expressed in the Notes or any Fundamental Change Purchase Date, as applicable, and the consideration due upon conversion of the Notes in accordance with Article 5, or to institute suit for the enforcement of any
such payment on or after such respective dates or the right to convert, and such right to receive such payment or delivery, as the case may be, shall not be impaired or affected adversely without the consent of such Holder.
Section 7.06
. Waiver of Defaults and Events of Default.
Notwithstanding Section 6.04 of the Original Indenture,
subject to Section 11.02 of this Supplemental Indenture, the Holders of
44
not less than a majority of the aggregate principal amount of the Outstanding Notes may on behalf of the Holders of all of the Notes waive any Default or Event of Default hereunder, unless:
(i) the Company fails to pay the principal of or any Interest on any Note when
due;
(ii) the Company fails to pay or deliver the consideration due upon
conversion of any Note within the time period required by the Indenture; or
(iii) the
Company fails to comply with any of the provisions of the Indenture the modification of which would require the consent of the Holder of each Outstanding Note affected.
Upon any such waiver, such Default or Event of Default shall cease to exist, and any Event of Default arising from such Default shall be deemed to have been
cured, for every purpose of the Indenture; but no such waiver shall extend to any subsequent or other Default or Event of Default or impair any right consequent thereon.
Section 7.07
. Undertaking for Costs.
The provisions of Section 6.11 of the Original Indenture, in addition to
the limitations set forth therein, shall not apply to any suit instituted by a Holder to enforce its right to receive the consideration due upon conversion of its Notes within the time period prescribed herein.
Section 7.08
. Waiver of Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do so)
that it will not at any time insist upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law or other law which 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 which may affect the covenants or the performance of the Indenture; and the Company (to the extent that it may lawfully do
so) hereby expressly waives all benefit or advantage of any such law and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as
though no such law had been enacted.
ARTICLE 8
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
Section 8.01
. Original Indenture.
This Article 8 supersedes in its entirety Article Five of the Original
Indenture, with the provisions of Section 8.02 of this Supplemental Indenture superseding the provisions of Section 5.01 of the Original Indenture. In addition, each reference in the Original Indenture to Section 5.01 of the Original
Indenture will, respect to the Notes, be deemed to be a reference to Section 8.02 of this Supplemental Indenture.
Section 8.02
. Consolidation, Merger and Sale of Assets.
The Company shall not consolidate with, enter into a
binding share exchange with, or merge with or into, another Person or sell, assign, convey, transfer, lease or otherwise dispose of its properties and assets substantially as an entirety to any successor Person (any such transaction or series of
transactions, a “
Merger Transaction
”), unless:
(a) the Company is the
surviving Person or the successor Person is a corporation organized and existing under the laws of the United States, any state of the United States or the District of Columbia and, if other than the Company, expressly assumes by supplemental
indenture all of the Company’s obligations under the Notes and the Indenture;
45
(b) immediately after giving effect to such
transaction, no Default or Event of Default shall have occurred and be continuing; and
(c) the Company shall deliver, or cause to be delivered, to the Trustee an Officers’
Certificate and an Opinion of Counsel, each to the effect that such Merger Transaction and such supplemental indenture comply with this Article 8.
Section 8.03.
Successor Substituted.
Upon any such Merger Transaction, the resulting, surviving or
transferee Person shall succeed to, and be substituted for, and may exercise every right and power of, the Company under the Indenture with the same effect as if such successor had been named as the Company herein; and thereafter the Company shall
be discharged from its obligations under the Notes and the Indenture, except in the case of any lease of all or substantially all of the Company’s assets. For purposes of the foregoing, any sale, assignment, conveyance, transfer, lease or other
disposition of properties and assets of one or more of the Company’s Subsidiaries that would, if the Company had held such properties and assets directly, have constituted the sale, assignment, conveyance, transfer, lease or disposition of our
properties and assets substantially as an entirety shall be treated as such under the Indenture.
ARTICLE 9
REPORTS BY COMPANY
Section 9.01.
Reports by Company.
The Company will furnish to the Trustee, within 15 days after it is required to file the same with the SEC, copies of the quarterly and annual
reports and of the information, documents and other reports, if any, that it is required to file with the SEC 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), and to otherwise comply with Section 314(a) of the TIA. Any such report, information or document that the Company files with the SEC through the EDGAR system (or any successor thereto) will be deemed to be delivered to the Trustee for the
purposes of this Section 9.01 at the time of such filing through the EDGAR system (or such successor thereto).
Delivery of any such
reports, information and documents to the Trustee shall be for informational purposes only, and the Trustee’s receipt of such reports, information and documents 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 rely exclusively on Officers’ Certificates).
46
ARTICLE 10
SATISFACTION AND DISCHARGE
Section 10.01
. Original Indenture.
This Article 10 supersedes in its entirety the provisions set forth in Article Eight
of the Original Indenture and any reference in the Original Indenture to such Article Eight or any provision therein shall be deemed to refer this Article 10 or the corresponding provision herein (if any), as the case may be.
Section 10.02
. Discharge of Indenture.
When (a) the Company shall deliver to the Trustee for cancellation all
Outstanding Notes theretofore authenticated (other than any Notes that have been destroyed, lost or stolen and in lieu of or in substitution for which other Notes shall have been authenticated and delivered) and not theretofore canceled, or
(b) all the Outstanding Notes not theretofore canceled or delivered to the Trustee for cancellation shall have become due and payable (whether at the Stated Maturity Date, on any Fundamental Change Purchase Date, upon conversion (and
determination of related Settlement Amounts) or otherwise) and the Company shall deposit with the Trustee, in trust, cash or (in the case of conversion) cash and shares of Common Stock, if any, sufficient to pay all amounts due on all of such
Outstanding Notes including principal and Interest due or satisfy the Company’s conversion obligation, as the case may be, and to pay all other sums payable under the Indenture by the Company, then the Indenture shall cease to be of further
effect (except as to (i) remaining rights of registration of transfer, substitution and exchange and conversion of Notes, (ii) rights hereunder of Holders to receive payments of principal of and Interest on, or the consideration due upon
conversion of, the Notes and the other rights, duties and obligations of Holders, as beneficiaries hereof with respect to the amounts, if any, so deposited with the Trustee and (iii) the rights, obligations and immunities of the Trustee
hereunder), and the Trustee, on written demand of the Company accompanied by an Officers’ Certificate and an Opinion of Counsel as may be required pursuant to the Original Indenture and at the cost and expense of the Company, shall execute
proper instruments acknowledging satisfaction and discharge of the Indenture. The Company, however, hereby agrees to reimburse the Trustee for any costs or expenses thereafter reasonably and properly incurred by the Trustee and to compensate the
Trustee for any services thereafter reasonably and properly rendered by the Trustee in connection with the Indenture or the Notes.
Section 10.03
. Deposited Monies and Shares To Be Held in Trust by Trustee.
Subject to Section 10.04, all monies
and shares of Common Stock, if any, deposited with the Trustee pursuant to Section 10.02 shall be held in trust for the sole benefit of the Holders, and such monies and shares of Common Stock, if any, shall be applied by the Trustee to the
payment, either directly or through the Paying Agent or Conversion Agent (including the Company if acting as the Paying Agent or Conversion Agent), to the Holders of the particular Notes for the payment or settlement of which such monies or shares
of Common Stock have been deposited with the Trustee, of all sums due and to become due thereon for principal and Interest or the satisfaction of the Company’s conversion obligation, as the case may be, and payment of all other sums due under
the Indenture.
Section 10.04
. Paying Agent or Conversion Agent To Repay Monies and Shares Held.
Upon the
satisfaction and discharge of the Indenture, all monies and shares of Common Stock, if any, then held by the Paying Agent or Conversion Agent (if other than the Trustee) shall, upon
47
written request of the Company, be repaid or delivered to the Company or paid or delivered to the Trustee, and thereupon such Paying Agent or Conversion Agent shall be released from all further
liability with respect to such monies and shares of Common Stock, if any.
Subject to the requirements of applicable law, any monies and
shares of Common Stock deposited with or paid to the Trustee for payment of the principal of or Interest on or other obligations under, or to satisfy the Company’s conversion obligation with respect to, the Notes and not applied but remaining
unclaimed by the Holders of the Notes for two years after the date upon which the principal of or Interest on, or other obligations under, such Notes or the Company’s conversion obligation, as the case may be, shall have become due and payable,
shall be repaid or delivered to the Company by the Trustee on demand and all liability of the Trustee shall thereupon cease with respect to such monies and shares of Common Stock; and the Holder of any of the Notes shall thereafter look only to the
Company for any payment or delivery that such Holder may be entitled to collect unless an applicable abandoned property law designates another Person.
Section 10.05
. Reinstatement.
If the Trustee or the Paying Agent or Conversion Agent is unable to apply any
money or shares of Common Stock in accordance with Section 10.03 by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, the Company’s obligations under
the Indenture and the Notes shall be revived and reinstated as though no deposit had occurred pursuant to Section 10.02 until such time as the Trustee or the Paying Agent or Conversion Agent is permitted to apply all such money or shares of
Common Stock in accordance with Section 10.03;
provided
,
however
, that if the Company makes any payment of Interest on or principal of any Note or delivery of shares of Common Stock in respect of its conversion obligation
following the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of such Notes to receive such payment from the money or shares of Common Stock held by the Trustee or Paying Agent or Conversion Agent.
ARTICLE 11
SUPPLEMENTAL
INDENTURES
Section 11.01
. Supplemental Indentures Without Consent of Holders.
The Company and the
Trustee at any time and from time to time may without notice to, or the consent of, any Holder enter into one or more indentures supplemental hereto, in form satisfactory to the Trustee, for any of the following purposes in addition to the purposes
set forth in Section 10.01 of the Original Indenture (as amended hereby with respect to the Notes):
(i) to cure any ambiguity, omission, defect or inconsistency;
(ii) to provide for the assumption by a successor corporation of the obligations of
the Company pursuant to Article 8 of this Supplemental Indenture;
(iii) to add
guarantees with respect to the Notes;
(iv) to secure the Notes;
48
(v) to add to the Company’s
covenants for the benefit of the Holders or surrender any rights or power conferred upon the Company;
(vi) to make any change that does not adversely affect the rights of any Holder;
(vii) upon the occurrence of a Share Exchange Event, solely to (a) provide that the Notes
are convertible into Reference Property, subject to Article 5 above, and (b) effect the related changes to the terms of the Notes as described in Section 5.12, in each case, in accordance with the applicable provisions of the Indenture or
reasonably determined necessary by the Company to provide that the Notes are convertible into Reference Property;
(viii) to eliminate, in the aggregate, any one or two Settlement Methods or, in the case of Combination
Settlement, irrevocably elect a Specified Dollar Amount;
(ix) to appoint a successor
Trustee with respect to the Notes;
(x) to comply with any requirement of the SEC
in connection with the qualification of the Indenture under the TIA; or
(xi) to
conform the provisions of the Indenture to the section entitled “Description of the Notes” in the preliminary prospectus supplement dated December 2, 2014, as supplemented by the related pricing term sheet dated December 2, 2014,
relating to the offering and sale of the Notes, as set forth in an Officers’ Certificate.
For purposes of
the Notes, clauses (2) and (14) of Section 10.01 of the Original Indenture shall be deemed to be deleted in their entirety.
Section 11.02
. Supplemental Indentures with Consent of Holders.
The Company and the Trustee may amend or
supplement the Indenture with respect to the Notes with the consent of the Holders of a majority in aggregate principal amount of the Outstanding Notes (including without limitation, consents obtained in connection with a repurchase of, or tender or
exchange offer for, Notes). In addition, the Holders of a majority in aggregate principal amount of the Outstanding Notes (including without limitation, consents obtained in connection with a repurchase of, or tender or exchange offer for, Notes)
may waive the Company’s compliance in any instance with any provision of the Indenture without notice to the other Holders of Notes.
The third sentence of Section 10.02 of the Original Indenture shall not apply with respect to the Notes, and the following sentence shall
replace the third sentence of Section 10.02 of the Original Indenture in its entirety. No amendment, supplement or waiver may be made without the consent of each Holder of outstanding Notes affected thereby if such amendment, supplement or
waiver would:
(i) change the stated maturity of the principal of or any
interest on the Notes;
(ii) reduce the principal amount of or interest on the
Notes;
49
(iii) reduce the amount of principal payable
upon acceleration of the maturity of the Notes;
(iv) change the currency of payment of
principal of or Interest on the Notes or change any Note’s Place of Payment;
(v) impair the right of any Holder to receive payment of principal of 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, the Notes;
(vi) modify the provisions with respect to the purchase rights of the Holders as provided
in Article 4, in each case, in a manner adverse to Holders of Notes;
(vii) change the
ranking of the Notes;
(viii) adversely affect the right of Holders to convert their Notes
hereunder, or reduce the Conversion Rate (it being understood that the Trustee shall have no responsibility for making a determination as to whether such amendment adversely affects the rights of the Holders); or
(ix) modify provisions with respect to modification, amendment or waiver (including waiver
of Events of Default), except to increase the percentage required for modification, amendment or waiver or to provide for consent of each affected Holder of Notes.
ARTICLE 12
MISCELLANEOUS
Section 12.01
. Successors.
All agreements of the Company and the Trustee in the Indenture and the Notes shall bind
their respective successors.
Section 12.02
. Multiple Originals.
The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. One signed copy is enough to prove this Supplemental Indenture. The exchange of copies of the Indenture and of signature pages by
facsimile or PDF transmission shall constitute effective execution and delivery of the 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 12.03
. Calculations.
Subject to
the immediately following paragraph, and except as otherwise provided herein, the Company and any agents the Company shall engage shall be responsible for making all calculations called for under the Indenture and the Notes, including, but not
limited to, determinations of the Closing Sale Prices of Common Stock, the Trading Price of the Notes, any adjustments to the Conversion Rate, the consideration deliverable in respect of any conversion and accrued Interest payable on the Notes and
whether the Notes are convertible. The Company shall make all these calculations in good faith and, absent manifest error, its calculations shall be final and binding on Holders. The Company shall provide a schedule of its
50
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 shall forward a copy of such schedule to any Holder upon the request of such Holder.
The
Trustee (including in its capacities as Bid Solicitation Agent, Conversion Agent, Paying Agent and Registrar) shall have no responsibility to determine the Trading Price of the Notes or whether the Notes are convertible or otherwise to make any of
the foregoing calculations or determinations.
Section 12.04
. Benefits of Supplemental Indenture.
Nothing in this
Supplemental Indenture or in the Notes, express or implied, shall give to any Person, other than the parties hereto and their respective successors hereunder and the Holders of Notes, any benefit or any legal or equitable right, remedy or claim
under this Supplemental Indenture.
Section 12.05
. Withholding Taxes.
Each Holder agrees, and each beneficial owner
of an interest in a Note by its acquisition of such interest is deemed to agree, that if the Company or other applicable withholding agent pays withholding taxes or backup withholding on behalf of the Holder or beneficial owner as a result of an
adjustment to the Conversion Rate, the Company or other applicable withholding agent may, at its option, withhold such amounts from payments of cash and shares of Common Stock on the Note (or, in certain circumstances, against any payments on the
Common Stock).
Section 12.06
. 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 SUPPLEMENTAL INDENTURE, THE NOTES OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
Section 12.07.
Governing Law.
THIS SUPPLEMENTAL INDENTURE, AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER OR
RELATED TO THE INDENTURE OR THE NOTES, SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK.
[Remainder of the page intentionally left blank]
51
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly
executed as of the day and year first above written.
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QUIDEL CORPORATION
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By:
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/s/ Randall J. Steward
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Name: Randall J. Steward
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Title: Chief Financial Officer
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THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee
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By:
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/s/ Michael Countryman
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Name: Michael Countryman
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Title: Vice President
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52
SCHEDULE A
Make-Whole Table
The following table
sets forth the number of Additional Shares to be added to the Conversion Rate for each $1,000 principal amount of Notes pursuant to, and under the circumstances described in, Section 5.02 of this Supplemental Indenture, based on the Stock
Prices and Effective Dates set forth below:
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Stock Price
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Effective Date
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$23.75
|
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$26.00
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$29.00
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$32.06
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$40.00
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$50.00
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$60.00
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$80.00
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$100.00
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$120.00
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December 8, 2014
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10.9161
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9.1533
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7.4255
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6.1570
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4.1830
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2.9475
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2.2659
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1.5414
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1.1326
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0.8661
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December 15, 2015
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10.9161
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8.8997
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7.0629
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5.7399
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3.7521
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2.5816
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1.9716
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1.3411
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0.9889
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0.7588
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December 15, 2016
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10.9161
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8.6274
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6.6486
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5.2532
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3.2501
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2.1657
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1.6424
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1.1184
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0.8281
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0.6375
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December 15, 2017
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10.9161
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8.3283
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6.1595
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4.6679
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2.6542
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1.6913
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1.2753
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0.8722
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0.6489
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0.5015
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December 15, 2018
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10.9161
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7.9569
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5.5260
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3.9089
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1.9217
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1.1485
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0.8708
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0.6033
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0.4510
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0.3497
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December 15, 2019
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10.9161
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7.4344
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4.5920
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2.7979
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0.9902
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0.5648
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0.4437
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0.3125
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0.2343
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0.1821
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December 15, 2020
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10.9161
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7.2724
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3.2936
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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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SCH A - 1
EXHIBIT A
[FORM OF FACE OF SECURITY]
[INCLUDE IF A GLOBAL SECURITY]
[UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO, AND IS REGISTERED IN THE NAME OF THE DEPOSITORY OR A NOMINEE
OF THE DEPOSITORY. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITORY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY
THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY, BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY OR BY THE DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITORY.]
QUIDEL CORPORATION
3.25% Convertible Senior Note due 2020
CUSIP No.: 74838J AA9
ISIN Number:
US74838JAA97
QUIDEL CORPORATION, a Delaware corporation, promises to pay to [CEDE & CO., or its registered assigns]
1
, the principal sum of DOLLARS, [as revised by the Schedule of Increases or Decreases in Global Security attached hereto,]
2
on December 15, 2020.
1
Insert for Global Security
2
Insert for Global Security
Ex A - 1
Interest Payment Dates: June 15 and December 15 commencing on June 15, 2015.
Interest Record Dates: June 1 and December 1.
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 thereof, at the Company’s election, on the terms and subject to the limitations referred to on the reverse hereof and as more fully specified
in the Indenture. Such further provisions shall for all purposes have the same effect as though fully set forth at this place.
In the
case of any conflict between this Note and the Indenture, the provisions of the Indenture shall control.
This Note shall not be valid or
become obligatory for any purpose until the certificate of authentication hereon shall have been manually signed by the Trustee or a duly authorized authenticating agent under the Indenture.
Ex A - 2
IN WITNESS WHEREOF, the Company has caused this Note to be duly executed.
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QUIDEL CORPORATION
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By:
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Name:
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Randall J. Steward
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Title: Chief Financial Officer
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TRUSTEE’S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated herein issued under the within-mentioned Indenture.
THE BANK OF NEW YORK MELLON TRUST
COMPANY, N.A., as Trustee
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By:
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Authorized Signatory
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Dated:
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Ex A - 3
[FORM OF REVERSE OF NOTE]
QUIDEL CORPORATION
3.25%
Convertible Senior Note due 2020
QUIDEL CORPORATION, a Delaware corporation (such corporation, and its successors and assigns under the Indenture, the
“
Company
”), promises to pay Interest on the principal amount of this Note at the rate of 3.25% per annum. The Company will pay Interest semiannually on June 15 and December 15 of each year, commencing on June 15,
2015. Interest on this Note will accrue from the most recent date to which Interest has been paid or, if no Interest has been paid, from December 8, 2014. Interest will be computed on the basis of a 360-day year of twelve 30-day months. The
Company shall pay Interest (including post-petition Interest in any proceeding under any Bankruptcy Law) on overdue principal and premium, if any, from time to time on demand at the rate of Interest then in effect; and it shall pay Interest
(including post-petition Interest in any proceeding under any Bankruptcy Law) on overdue installments of Interest (without regard to any applicable grace periods) from time to time on demand at the same rate to the extent lawful.
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2.
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Paying Agent, Registrar and Conversion Agent
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Initially, The Bank of New York Mellon Trust Company, N.A. (the “
Trustee
”), will act as Paying Agent, Registrar and
Conversion Agent. The Company may appoint and change any Paying Agent, Registrar or Conversion Agent in accordance with the terms of the Indenture. The Company may act as Paying Agent, Registrar or Conversion Agent.
The Company issued the Notes under an Indenture dated as of December 1, 2014 (the “
Original Indenture
”), as supplemented
by the First Supplemental Indenture dated as of December 8, 2014 (the “
Supplemental Indenture
” and the Original Indenture, as supplemented by the Supplemental Indenture, the “
Indenture
”), between the Company
and the Trustee. Terms defined in the Indenture and not defined herein have the meanings ascribed thereto in the Indenture. The Notes are subject to all such terms, and Holders are referred to the Indenture for a statement of those terms.
This Note is one of the Securities of the Company, designated as its 3.25% Convertible Senior Notes due 2020, issued pursuant to the Indenture
in an initial aggregate principal amount of $172,500,000. Additional Notes may be issued in accordance with the terms of the Indenture. The Indenture also imposes limitations on the ability of the Company to consolidate or merge with or into any
other Person or convey, transfer or lease all or substantially all of the property of the Company.
Subject to certain conditions and during certain periods specified in the Indenture, at any time until the close of business on the second
Business Day immediately preceding the Stated
Ex A - 4
Maturity Date of this Note, the Holder hereof has the right, at its option, to convert each $1,000 principal amount of this Note into cash, shares of Common Stock or a combination of cash and
shares of Common Stock, at the Company’s election, determined as set forth in the Indenture, based on the applicable Conversion Rate, as the same may be adjusted from time to time pursuant to the terms of the Indenture.
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5.
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Denominations, Transfer, Exchange
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The Notes are in registered form without coupons in denominations of $1,000 and whole multiples of $1,000. A Holder may transfer or exchange
Notes in accordance with the terms of the Indenture, subject to certain exceptions set forth therein. Upon any transfer or exchange, the Registrar and the Trustee may require a Holder, among other things, to furnish appropriate endorsements or
transfer documents and to pay any taxes required by law or permitted by the Indenture.
The registered Holder of this Note may be treated as the owner of it for all purposes, subject to certain exceptions specified in the
Indenture.
If an Event of Default (other than an Event of Default relating to certain events of bankruptcy, insolvency or reorganization of the Company)
occurs and is continuing, the Trustee or the Holders of at least 25% in principal amount of the Outstanding Notes may declare the principal of and accrued and unpaid Interest on all the Notes to be due and payable. If an Event of Default relating to
certain events of bankruptcy, insolvency or reorganization of the Company occurs, the principal of and Interest on all the Notes will become immediately due and payable without any declaration or other act on the part of the Trustee or any Holder.
Notwithstanding the foregoing, at the election of the Company, the sole remedy for an Event of Default relating to a failure to file certain reports with the SEC and the Trustee shall for the first 180 calendar days after such Event of Default
consist exclusively of the right to receive Additional Interest.
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8.
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No Recourse Against Others
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A director, officer, employee or stockholder, as such, of the Company shall not have any liability for any obligations of the Company under
the Notes or the Indenture or for any claim based on, in respect of or by reason of such obligations or their creation. By accepting a Note, each Holder waives and releases all such liability. The waiver and release are part of the consideration for
the issue of the Notes.
This Note shall not be valid until an authorized signatory of the Trustee (or an authenticating agent) manually signs the certificate of
authentication on the other side of this Note.
Ex A - 5
Customary abbreviations may be used in the name of a Holder or an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entireties), JT TEN (=joint tenants with rights of survivorship and not as tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors Act).
THIS NOTE, AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER OR RELATED TO THE INDENTURE OR THE NOTES, SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK.
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12.
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CUSIP and ISIN Numbers
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The Company has caused CUSIP and ISIN numbers to be printed on the Notes and the Trustee shall use the CUSIP and ISIN numbers in notices as a
convenience to Holders,
provided
, that any such notice may state that no representation is made as to the correctness or accuracy of the CUSIP and ISIN numbers printed in the notice or on the Notes, and that reliance may be placed only on the
other identification numbers printed on the Notes, and that the validity of any such notice shall not be affected by any defect in or omission of any such numbers.
The Company will furnish to any Holder of Notes upon written request and without charge to the Holder a copy of the Indenture which has in
it the text of this Note.
Ex A - 6
SCHEDULE OF INCREASES AND DECREASES IN GLOBAL
SECURITY
3
The following increases or decreases in this Global Security have been made:
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Date of
Exchange
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Amount of
decrease in
principal amount
of this
Global Security
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Amount of
increase in
principal amount
of this
Global Security
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Principal amount
of this
Global Security
following
such
decrease
or increase
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Signature of
authorized
signatory of
Trustee or
Custodian
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3
For Global Securities only.
3
Insert for Global Security
Ex A - 7
[FORM OF CONVERSION NOTICE]
To: Quidel Corporation
The undersigned
registered owner of this Note hereby irrevocably exercises the option to convert this Note, or the portion thereof (which is $1,000 or a multiple thereof) below designated, into cash, shares of Common Stock or a combination of cash and shares of
Common Stock, at the Company’s election, in accordance with the terms of the Indenture referred to in this Note, and directs that the check in payment for cash, if any, and the shares, if any, issuable and deliverable upon such conversion,
together with any check in payment for fractional shares 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 shares 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
provide the appropriate information below and pay all transfer taxes payable with respect thereto. In addition, subject to certain exceptions in the Indenture, if this notice is being delivered on a date after the close of business on a Record Date
and prior to the open of business on the related Interest Payment Date, this notice is accompanied by payment of an amount equal to the Interest payable on such Interest Payment Date of the principal of this Note to be converted.
Capitalized terms used herein but not defined shall have the meanings ascribed to such terms in the Indenture.
Dated:
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Signature(s)
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Signature(s) must be guaranteed by an “eligible guarantor institution” meeting the requirements of the Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program
(“STAMP”) or such other “signature guarantee program” as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.
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Signature Guarantee
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Ex A - 8
Fill in the registration of shares of Common Stock, if any, if to be issued, and Notes, if any,
to be delivered, and the person to whom cash, if any, and payment for fractional shares, if any, is to be made, if other than to and in the name of the registered Holder:
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Please print name and address
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(Name)
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(Street Address)
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(City, State and Zip Code)
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Principal amount to be converted
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(if less than all, must be $1,000 or
whole multiples thereof):
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$
Social Security or Other Taxpayer
Identification
Number:
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NOTICE: The signature on this Conversion Notice must correspond with the name as written upon the face of the Notes in every
particular without alteration or enlargement or any change whatever.
Ex A - 9
[FORM OF FUNDAMENTAL CHANGE PURCHASE NOTICE]
To: Quidel Corporation
The undersigned registered owner of
this Note hereby acknowledges receipt of a notice from Quidel Corporation (the “
Company
”) as to the occurrence of a Fundamental Change with respect to the Company and specifying the Fundamental Change Purchase Date and requests and
instructs the Company to purchase from the registered holder hereof in accordance with the applicable provisions 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 Purchase Date does not fall during the period after a Record Date and on or prior to the corresponding Interest Payment Date, accrued and
unpaid Interest thereon to, but excluding, such Fundamental Change Purchase Date.
In the case of Physical Securities, the certificate numbers of the
Notes to be purchased are as set forth below:
Dated:
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Signature(s)
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Social Security or Other Taxpayer
Identification Number
principal amount to be repaid (if less than all): $ ,000
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NOTICE: The signature on the Fundamental Change Purchase Notice 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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Ex A - 10
[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.
Dated:
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Signature(s)
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Signature(s) must be guaranteed by an institution which is a member of one of the following recognized signature Guarantee Programs:
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(i) The Securities Transfer Agent Medallion Program (STAMP); (ii) The New York Stock Exchange Medallion Program (MNSP); (iii) The Stock Exchange Medallion Program (SEMP) or (iv) another guarantee program acceptable to
the Trustee.
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Signature Guarantee
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Ex A - 11
