Document:

Exhibit 4.1

 

 

 

RAMBUS INC.,

 

as Issuer

 

 

U.S. BANK NATIONAL ASSOCIATION,

 

as Trustee

 

 

1.125% CONVERTIBLE SENIOR NOTES DUE 2018

 

 

INDENTURE

 

 

DATED AS OF AUGUST 16, 2013

 

 

TABLE OF CONTENTS

 

	
 
    	
 
    	
PAGE
    
	
 
    	
 
    	
 
    
	
ARTICLE 1
    
	
DEFINITIONS AND INCORPORATION BY   REFERENCE
    
	
 
    	
 
    	
 
    
	
Section 1.01.
    	
Definitions
    	
1
    
	
Section 1.02.
    	
Rules of Construction
    	
9
    
	
 
    	
 
    	
 
    
	
ARTICLE 2
    
	
THE SECURITIES
    
	
 
    	
 
    	
 
    
	
Section 2.01.
    	
Title and Terms; Principal and Interest
    	
10
    
	
Section 2.02.
    	
Denominations
    	
10
    
	
Section 2.03.
    	
Form and Dating
    	
10
    
	
Section 2.04.
    	
Execution and Authentication
    	
12
    
	
Section 2.05.
    	
Registrar, Paying Agent and Conversion Agent
    	
13
    
	
Section 2.06.
    	
Paying Agent to Hold Money and Securities in Trust
    	
13
    
	
Section 2.07.
    	
Holder Lists
    	
14
    
	
Section 2.08.
    	
Transfer and Exchange
    	
14
    
	
Section 2.09.
    	
Restrictions on Transfer
    	
15
    
	
Section 2.10.
    	
Replacement Securities
    	
19
    
	
Section 2.11.
    	
Outstanding Securities
    	
20
    
	
Section 2.12.
    	
Treasury Securities
    	
20
    
	
Section 2.13.
    	
Temporary Securities
    	
20
    
	
Section 2.14.
    	
Cancellation of Securities Paid, Converted, Etc.
    	
21
    
	
Section 2.15.
    	
Additional Transfer and Exchange Requirements
    	
21
    
	
Section 2.16.
    	
Repurchases
    	
23
    
	
Section 2.17.
    	
CUSIP Numbers
    	
23
    
	
Section 2.18.
    	
Persons Deemed Owners
    	
23
    
	
 
    	
 
    	
 
    
	
ARTICLE 3
    
	
NO OPTIONAL REDEMPTION
    
	
 
    	
 
    	
 
    
	
Section 3.01.
    	
No Optional Redemption
    	
23
    
	
 
    	
 
    	
 
    
	
ARTICLE 4
    
	
PUT OPTION UPON FUNDAMENTAL   CHANGE
    
	
 
    	
 
    	
 
    
	
Section 4.01.
    	
Repurchase of Securities at Option of Holders Upon a   Fundamental Change
    	
23
    
	
Section 4.02.
    	
Effect of Fundamental Change Repurchase Notice; Withdrawal
    	
28
    
	
Section 4.03.
    	
Deposit of Fundamental Change Repurchase Price
    	
29
    
	
Section 4.04.
    	
Securities Repurchased in Part
    	
30
    

 

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Section 4.05.
    	
Repayment to the Company
    	
30
    
	
Section 4.06.
    	
Compliance with Securities Laws upon Repurchase of   Securities
    	
30
    
	
 
    	
 
    	
 
    
	
ARTICLE 5
    
	
CONVERSION
    
	
 
    	
 
    	
 
    
	
Section 5.01.
    	
Conversion Privilege
    	
30
    
	
Section 5.02.
    	
Conversion Procedures
    	
33
    
	
Section 5.03.
    	
Settlement upon Conversion
    	
35
    
	
Section 5.04.
    	
Taxes on Conversion
    	
36
    
	
Section 5.05.
    	
Company to Provide Stock
    	
36
    
	
Section 5.06.
    	
Adjustment of Conversion Rate
    	
37
    
	
Section 5.07.
    	
No Adjustment
    	
44
    
	
Section 5.08.
    	
Adjustments of Prices
    	
45
    
	
Section 5.09.
    	
Adjustment for Tax Purposes
    	
45
    
	
Section 5.10.
    	
Notice of Adjustment
    	
45
    
	
Section 5.11.
    	
Adjustment to Conversion Rate upon Certain Fundamental   Changes
    	
46
    
	
Section 5.12.
    	
Notice of Certain Transactions
    	
47
    
	
Section 5.13.
    	
Effect of Reclassification, Consolidation, Merger or Sale   on Conversion Privilege
    	
47
    
	
Section 5.14.
    	
Trustee’s Disclaimer
    	
49
    
	
Section 5.15.
    	
Stockholder Rights Plan
    	
49
    
	
Section 5.16.
    	
Exchange in Lieu of Conversion
    	
49
    
	
Section 5.17.
    	
Company Determination Final
    	
50
    
	
 
    	
 
    	
 
    
	
ARTICLE 6
    
	
COVENANTS
    
	
 
    	
 
    	
 
    
	
Section 6.01.
    	
Payment of Securities
    	
50
    
	
Section 6.02.
    	
Reports and Certain Information
    	
51
    
	
Section 6.03.
    	
Compliance Certificates
    	
51
    
	
Section 6.04.
    	
Maintenance of Corporate Existence
    	
51
    
	
Section 6.05.
    	
Rule 144A Information Requirement
    	
51
    
	
Section 6.06.
    	
Stay, Extension and Usury Laws
    	
53
    
	
Section 6.07.
    	
Maintenance of Office or Agency of the Trustee, Registrar,   Paying Agent and Conversion Agent
    	
53
    
	
 
    	
 
    	
 
    
	
ARTICLE 7
    
	
CONSOLIDATION, MERGER,   CONVEYANCE, TRANSFER OR LEASE
    
	
 
    	
 
    	
 
    
	
Section 7.01.
    	
Company May Consolidate, Etc., Only on Certain   Terms
    	
53
    
	
Section 7.02.
    	
Successor Substituted
    	
54
    
	
 
    	
 
    	
 
    
	
ARTICLE 8
    
	
DEFAULT AND REMEDIES
    
	
 
    	
 
    	
 
    
	
Section 8.01.
    	
Events of Default
    	
54
    

 

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Section 8.02.
    	
Acceleration
    	
55
    
	
Section 8.03.
    	
Other Remedies
    	
56
    
	
Section 8.04.
    	
Sole Remedy for Failure to Report
    	
56
    
	
Section 8.05.
    	
Waiver of Defaults and Events of Default
    	
57
    
	
Section 8.06.
    	
Control by Majority
    	
57
    
	
Section 8.07.
    	
Limitations on Suits
    	
57
    
	
Section 8.08.
    	
Rights of Holders to Receive Payment and to Convert
    	
58
    
	
Section 8.09.
    	
Collection Suit by Trustee
    	
58
    
	
Section 8.10.
    	
Trustee May File Proofs of Claim
    	
58
    
	
Section 8.11.
    	
Priorities
    	
59
    
	
Section 8.12.
    	
Undertaking for Costs
    	
59
    
	
Section 8.13.
    	
Notice of Defaults
    	
59
    
	
 
    	
 
    	
 
    
	
ARTICLE 9
    
	
TRUSTEE
    
	
 
    	
 
    	
 
    
	
Section 9.01.
    	
Certain Duties and Responsibilities of Trustee
    	
60
    
	
Section 9.02.
    	
Certain Rights of Trustee
    	
61
    
	
Section 9.03.
    	
Trustee Not Responsible for Recitals or Issuance or Securities
    	
62
    
	
Section 9.04.
    	
May Hold Securities
    	
63
    
	
Section 9.05.
    	
Moneys Held in Trust
    	
63
    
	
Section 9.06.
    	
Compensation and Reimbursement
    	
63
    
	
Section 9.07.
    	
Reliance on Officer’s Certificate
    	
64
    
	
Section 9.08.
    	
Disqualification; Conflicting Interests
    	
64
    
	
Section 9.09.
    	
Corporate Trustee Required; Eligibility
    	
64
    
	
Section 9.10.
    	
Resignation and Removal; Appointment of Successor
    	
64
    
	
Section 9.11.
    	
Acceptance of Appointment by Successor
    	
65
    
	
Section 9.12.
    	
Merger, Conversion, Consolidation or Succession to Business
    	
66
    
	
 
    	
 
    	
 
    
	
ARTICLE 10
    
	
AMENDMENTS, SUPPLEMENTS AND   WAIVERS
    
	
 
    	
 
    	
 
    
	
Section 10.01.
    	
Without Consent of Holders
    	
66
    
	
Section 10.02.
    	
With Consent of Holders
    	
68
    
	
Section 10.03.
    	
Revocation and Effect of Consents
    	
69
    
	
Section 10.04.
    	
Notation on or Exchange of Securities
    	
69
    
	
Section 10.05.
    	
Trustee to Sign Amendments, Etc.
    	
69
    
	
Section 10.06.
    	
Effect of Supplemental Indentures
    	
69
    
	
 
    	
 
    	
 
    
	
ARTICLE 11
    
	
[RESERVED]
    
	
 
    
	
ARTICLE 12
    
	
SATISFACTION AND DISCHARGE
    
	
 
    	
 
    	
 
    
	
Section 12.01.
    	
Satisfaction and Discharge of the Indenture
    	
69
    
	
Section 12.02.
    	
Repayment to the Company
    	
70
    

 

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ARTICLE 13
    
	
MISCELLANEOUS
    
	
 
    	
 
    	
 
    
	
Section 13.01.
    	
Notices
    	
70
    
	
Section 13.02.
    	
Certificate and Opinion as to Conditions Precedent
    	
71
    
	
Section 13.03.
    	
Record Date for Vote or Consent of Holders
    	
72
    
	
Section 13.04.
    	
Rules by Trustee, Paying Agent, Registrar and   Conversion Agent
    	
72
    
	
Section 13.05.
    	
Legal Holidays
    	
72
    
	
Section 13.06.
    	
Governing Law
    	
72
    
	
Section 13.07.
    	
No Adverse Interpretation of Other Agreements
    	
73
    
	
Section 13.08.
    	
No Recourse Against Others
    	
73
    
	
Section 13.09.
    	
Successors
    	
73
    
	
Section 13.10.
    	
Multiple Counterparts
    	
73
    
	
Section 13.11.
    	
Separability
    	
73
    
	
Section 13.12.
    	
Calculations in Respect of the Securities
    	
73
    
	
Section 13.13.
    	
Table of Contents, Headings, Etc.
    	
73
    

 

	
Exhibit A Form of Note:
    
	
 
    	
- Assignment Form
    
	
 
    	
- Form of   Conversion Notice
    
	
 
    	
- Form of   Fundamental Change Repurchase Notice
    

 

iv

 

THIS INDENTURE, dated as of August 16, 2013, is between Rambus Inc., a Delaware corporation (the “Company”), and U.S. Bank National Association, a national banking association, as trustee (the “Trustee”).

 

Recitals

 

The Company has duly authorized the creation of an issue of its 1.125% Convertible Senior Notes due 2018 (herein called the “Initial Securities” and together with any Additional Securities, the “Securities”) of substantially the tenor and amount hereinafter set forth, and to provide the terms and conditions upon which the Securities are to be authenticated, issued and delivered, the Company has duly authorized the execution and delivery of this Indenture.

 

All things necessary to make the Securities, when executed by the Company and authenticated and delivered as provided herein and duly issued by the Company, the valid obligations of the Company, and to make this Indenture a valid agreement of the Company, in accordance with their and its terms, have been done.

 

NOW, THEREFORE, THIS INDENTURE WITNESSETH:

 

For and in consideration of the premises and the purchase of the Securities by the Holders thereof, it is mutually agreed, for the equal and proportionate benefit of all Holders of the Securities, as follows:

 

ARTICLE 1
  DEFINITIONS AND INCORPORATION BY REFERENCE

 

Section 1.01.                          Definitions.

 

“Additional Interest” has the meaning specified in Section 8.04.

 

“Additional Securities” means an unlimited maximum aggregate principal amount of Securities (other than the Initial Securities) issued under this Indenture.

 

“Additional Shares” has the meaning specified in Section 5.11.

 

“Affiliate” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person.  For purposes of this definition, “control” (including, with correlative meanings, the terms “controlling,” “controlled by” and “under common control with”), as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise.

 

“Agent” means any Registrar, Paying Agent, or Conversion Agent.

 

“Agent Members” has the meaning set forth in Section 2.03(c).

 

 

“Applicable Procedures” means, with respect to any transfer or exchange of beneficial ownership interests in a Global Security, the rules and procedures of the Depositary, in each case to the extent applicable to such transfer or exchange.

 

“Bankruptcy Law” means Title 11 of the United States Code (or any successor thereto) or any similar federal or state law for the relief of debtors.

 

“beneficially own” and “beneficially owned” have the meanings set forth in Section 4.01(a).

 

“beneficial owner” has the meaning set forth in Section 4.01(a).

 

“Bid Solicitation Agent” means a nationally-recognized securities dealer, or an Affiliate thereof, selected by the Company in its sole discretion to solicit bids as contemplated by Section 5.01(a) and, initially, the Trustee.

 

“Board of Directors” means, with respect to any Person, either the board of directors of such Person or any duly authorized committee of such board of directors.

 

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

 

“Business Day” means each day that is not a Legal Holiday.

 

“Capital Stock” has the meaning set forth in Section 4.01(a).

 

“cash” means such coin or currency of the United States as at any time of payment is legal tender for the payment of public and private debts.

 

“Cash Percentage” has the meaning set forth in Section 5.03(a).

 

“Certificated Security” means a Security that is in substantially the form attached hereto as Exhibit A and that does not include the information or the schedule called for by footnotes 1 and 3 thereof.

 

“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 reported last sale price per share (or, if no last sale price is reported, the average of the bid and ask prices per share or, if more than one in either case, the average of the average bid and the average ask prices per share) on such date reported by the NASDAQ Global Select Market or, if the Common Stock is not quoted or listed for trading on the NASDAQ Global Select Market, as reported by the principal U.S. national or regional securities exchange on which the Common Stock is listed.

 

2

 

“Common Stock” means any stock of any class of the Company which has no preference in respect of dividends or of amounts payable in the event of any voluntary or involuntary liquidation, dissolution or winding-up of the Company and which is not subject to redemption by the Company.  Subject to the provisions of Section 5.13, however, shares issuable on conversion of Securities shall include only shares of the class designated as Common Stock, par value $0.001, of the Company at the date of this Indenture or shares of any class or classes resulting from any reclassification or reclassifications thereof and which have no preference in respect of dividends or of amounts payable in the event of any voluntary or involuntary liquidation, dissolution or winding-up of the Company and which are not subject to redemption by the Company; provided, however, that if at any time there shall be more than one such resulting class, the shares of each such class then so issuable shall be substantially in the proportion which the total number of shares of such class resulting from all such reclassifications bears to the total number of shares of all such classes resulting from all such reclassifications.

 

“Company” means the party named as such in the first paragraph of this Indenture until a successor replaces it pursuant to the applicable provisions of this Indenture, and thereafter “Company” shall mean such successor Company.

 

“Company Order” has the meaning specified in Section 2.04(d).

 

“Conversion Agent” has the meaning set forth in Section 2.05.

 

“Conversion Date” has the meaning set forth in Section 5.02(a).

 

“Conversion Notice” has the meaning set forth in Section 5.02(a).

 

“Conversion Price” means, per share of Common Stock, at any time, $1,000 divided by the then-applicable Conversion Rate, rounded to the nearest cent, subject to adjustment as set forth herein.

 

“Conversion Rate” means initially 82.8329 shares of Common Stock per $1,000 principal amount of Securities, subject to adjustment as set forth herein.

 

“Conversion Reference Period” means (a) for Securities that are converted on or after May 15, 2018, the 20 consecutive Trading Days beginning on the 22nd Scheduled Trading Day prior to the Maturity Date; and (b) in all other instances, the 20 consecutive Trading Days beginning on, and including, the second Trading Day immediately succeeding the Conversion Date.

 

“Conversion Trigger Price” has the meaning set forth in Section 5.01(a).

 

“Corporate Trust Office” means the office of the Trustee at which at any time the trust created by this Indenture shall be administered, which office at the date of the execution of this Indenture is located at U.S. Bank National Association, Corporate Trust Services, 633 West Fifth Street, 24th Floor, Los Angeles, CA 90071, except that whenever a provision herein refers to an office or agency of the Trustee in the Borough of 

 

3

 

Manhattan, The City of New York, such office is located, at the date hereof, at the office of U.S. Bank Trust National Association, an affiliate of the Trustee at 100 Wall Street, Suite 1600, New York, NY 10005, attention: Corporate Trust Services.

 

“Custodian” means any receiver, trustee, assignee, liquidator, sequestrator or similar official under any Bankruptcy Law.

 

“Daily Conversion Value” means, for each of the 20 consecutive Trading Days during the Conversion Reference Period, one-twentieth (1/20th) of the product of (i) the Conversion Rate on such day and (ii) the Daily VWAP of the Common Stock on such day.

 

“Daily Net Settlement Amount” means, for each of the 20 consecutive Trading Days during the Conversion Reference Period:

 

(a)                                 if the Company does not elect a Cash Percentage as set forth herein, a number of shares of Common Stock equal to (i) the difference between the Daily Conversion Value and $50, divided by (ii) the Daily VWAP for such Trading Day;

 

(b)                                 if the Company elects a Cash Percentage of 100% as set forth herein, cash in an amount equal to the difference between the Daily Conversion Value and $50; or

 

(c)                                  if the Company elects a Cash Percentage of less than 100% as set forth herein, (i) cash equal to the product of (x) the difference between the Daily Conversion Value and $50 and (y) the Cash Percentage and (ii) a number of shares of Common Stock equal to the product of (x)(A) the difference between the Daily Conversion Value and $50, divided by (B) the Daily VWAP for such Trading Day and (y) 100% minus the Cash Percentage.

 

“Daily Settlement Amount” has the meaning set forth in Section 5.03(a).

 

“Daily VWAP” means, for each of the 20 consecutive Trading Days during the Conversion Reference Period, the per share volume-weighted average price as displayed under the heading “Bloomberg VWAP” on Bloomberg page RMBS.US <EQUITY> AQR <GO> (or its equivalent successor if such page is not available) in respect of the period from 9:30 a.m. to 4:00 p.m., New York City time, on such Trading Day (or if such volume-weighted average price is unavailable, the market value of one share of Common Stock on such Trading Day determined, using a volume-weighted average method, by a nationally recognized independent investment banking firm retained for this purpose by the Company), provided that after the occurrence or effectiveness of a Fundamental Change in which the holders of Common Stock receive only cash in connection with such Fundamental Change, the Daily VWAP will be determined to be the cash price per share received by holders of the Common Stock in such Fundamental Change.

 

“Default” or “default” means, when used with respect to the Securities, any event which is or, after notice or passage of time or both, would be an Event of Default.

 

“Depositary” has the meaning set forth in Section 2.03(b).

 

4

 

“Designated Institution” has the meaning set forth in Section 5.16(a).

 

“Effective Date Notice” has the meaning set forth in Section 4.01(b).

 

“Event of Default” has the meaning set forth in Section 8.01.

 

“Ex Date” has the meaning set forth in Section 5.01(a)(iii).

 

“Exchange Act” means the United States Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder, as in effect from time to time.

 

“Fundamental Change” has the meaning set forth in Section 4.01(a).

 

“Fundamental Change Company Notice” has the meaning set forth in Section 4.01(b).

 

“Fundamental Change Repurchase Date” has the meaning set forth in Section 4.01(a).

 

“Fundamental Change Repurchase Notice” has the meaning set forth in Section 4.01(c).

 

“Fundamental Change Repurchase Price” has the meaning set forth in Section 4.01(a).

 

“GAAP” means generally accepted accounting principles set forth in the opinions and pronouncements of the Public Company Accounting Oversight Board 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, which are in effect from time to time and consistently applied.

 

“Global Security” means a permanent Global Security that is in substantially the form attached hereto as Exhibit A and that includes the information and schedule called for by footnotes 1 and 2 thereof and which is deposited with the Depositary or its custodian and registered in the name of the Depositary or its nominee.

 

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

 

“Indenture” means this Indenture as amended or supplemented from time to time pursuant to the terms of this Indenture.

 

“Initial Securities” has the meaning set forth in the Recitals.

 

“Interest Payment Date” means February 15 and August 15 of each year, beginning February 15, 2014.

 

5

 

“Legal Holiday” has the meaning set forth in Section 13.05.

 

“Make-Whole Effective Date” has the meaning set forth in Section 5.11(b).

 

“Make-Whole Fundamental Change” has the meaning set forth in Section 5.11(a).

 

“Market Disruption Event” means (a) a failure by the primary U.S. national or regional exchange or quotation system on which the Common Stock trades or is quoted to open for trading during its regular trading session or (b) the occurrence or existence prior to 1:00 p.m. New York City time on any Scheduled Trading Day for the Common Stock of an aggregate one half-hour period, of any suspension or limitation imposed on trading (by reason of movements in price exceeding limits permitted by the stock exchange or otherwise) in the Common Stock or in any options, contracts or future contracts relating to the Common Stock traded in the United States.

 

“Material Subsidiary” means a Subsidiary that is a significant subsidiary as defined under Rule 1-02(w) of Regulation S-X under the Exchange Act; provided that, in the case of a Subsidiary that meets the criteria of clause (3) of the definition thereof but not clause (1) or (2) thereof, such Subsidiary shall not be deemed to be a Material Subsidiary unless the Subsidiary’s income from continuing operations before income taxes, extraordinary items and cumulative effect of a change in accounting principle exclusive of amounts attributable to any non-controlling interests for the last completed fiscal year prior to the date of such determination exceeds $10,000,000.

 

“Maturity Date” means August 15, 2018, unless the Securities are earlier converted or repurchased.

 

“Measurement Period” has the meaning set forth in Section 5.01(a)(ii).

 

“Merger Event” has the meaning set forth in Section 5.13.

 

“Notice of Default” means written notice provided to the Company by the Trustee or the Holders of not less than 25% in aggregate principal amount of Securities then outstanding of a Default by the Company, which notice must specify the Default, demand that it be remedied and expressly state that such notice is a “Notice of Default.”

 

“Offering Memorandum” means the preliminary offering memorandum dated August 12, 2013, as supplemented by the related pricing term sheet dated August 12, 2013, relating to the offering and sale of the Securities.

 

“Officer” means, with respect to any Person, the Chairman of the Board, the Chief Executive Officer, the President, the Chief Operating Officer, the Chief Financial Officer, the Treasurer, any Assistant Treasurer, the Controller, the Secretary, Assistant Secretary or any Vice President of such Person.

 

“Officer’s Certificate” means a certificate signed by at least one Officer of the Company; provided, however, that for purposes of Section 5.14 and 6.03, “Officer’s 

 

6

 

Certificate” means a certificate signed by the principal executive officer, principal financial officer or principal accounting officer of the Company.

 

“Opening of Business” means 9:00 a.m., New York City time.

 

“Opinion of Counsel” means a written opinion from legal counsel.  The counsel may be an employee of or counsel to the Company or the Trustee.

 

“Paying Agent” has the meaning set forth in Section 2.05.

 

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

 

“Record Date” means, with respect to the payment of interest on the Securities, the February 1 (whether or not a Business Day) next preceding an Interest Payment Date on February 15 and the August 1 (whether or not a Business Day) next preceding an Interest Payment Date on August 15.

 

“Reference Property” has the meaning set forth in Section 5.13.

 

“Register” has the meaning set forth in Section 2.05.

 

“Registrar” has the meaning set forth in Section 2.05.

 

“Reporting Obligations” has the meaning set forth in Section 8.04.

 

“Resale Restricted Termination Date” has the meaning set forth in Section 2.09(a).

 

“Restricted Securities” has the meaning set forth in Section 2.09(a).

 

“Rule 144A” means Rule 144A as promulgated under the Securities Act.

 

“Scheduled Trading Day” means any day that is scheduled to be a Trading Day on the primary U.S. exchange or quotation system on which the Common Stock is listed or admitted for trading, or if the Common Stock is not so listed or admitted for trading, “Scheduled Trading Day” means a Business Day.

 

“SEC” means the United States Securities and Exchange Commission, as from time to time constituted, created under the Exchange Act.

 

“Security” and “Securities” have the meaning set forth in the Recitals and include the Initial Securities and any Additional Securities. The Initial Securities and Additional Securities shall be treated as a single series for all purposes under this Indenture.

 

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

 

7

 

“Securities Custodian” means the Trustee, as custodian with respect to the Global Securities, or any successor thereto.

 

“Settlement Amount” has the meaning set forth in Section 5.03(a).

 

“Settlement Notice” has the meaning set forth in Section 5.03(a).

 

“Shelf Registration Statement” means a registration statement of the Company filed with the Commission on either (i) Form S-3 (or any successor form or other appropriate form under the Securities Act) or (ii) if the Company is not permitted to file a registration statement on Form S-3, an evergreen registration statement on Form S-1 (or any successor form or other appropriate form under the Securities Act), in each case for an offering to be made on a continuous or delayed basis pursuant to Rule 415 under the Securities Act covering Securities.

 

“Spin-Off” has the meaning set forth in Section 5.06(c).

 

“Stock Price” has the meaning set forth in Section 5.11(b).

 

“Subsidiary” means, in respect of any Person, any corporation, association, partnership or other business entity of which more than 50% of the outstanding Voting Stock or other interests (including partnership interests) entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers, general partners or trustees thereof is at the time owned or controlled, directly or indirectly, by (i) such Person; (ii) such Person and one or more Subsidiaries of such Person; or (iii) one or more Subsidiaries of such Person.

 

“TIA” means the United States Trust Indenture Act of 1939, as amended, and the rules and regulations thereunder as in effect on the date of this Indenture and except to the extent any amendment to the Trust Indenture Act expressly provides for application of the Trust Indenture Act as in effect on another date.

 

“Trading Day” means a day on which (i) trading in the Common Stock generally occurs on the NASDAQ Global Select Market or, if the Common Stock is not then listed on the NASDAQ Global Select Market, on the primary other U.S. national or regional securities exchange or quotation system on which the Common Stock is then listed or, if the Common Stock is not then listed on a U.S. national or regional securities exchange, on the primary other market or quotation system on which the Common Stock is then traded and (ii) there is no Market Disruption Event. If the Common Stock is not so listed or traded, “Trading Day” shall mean a Business Day.

 

“Trading Price” means, on any date of determination, the average of the secondary market bid quotations per $1,000 principal amount of the Securities obtained by the Bid Solicitation Agent for $5,000,000 aggregate principal amount of the Securities at approximately 3:30 p.m., New York City time, on such determination date from three independent nationally recognized securities dealers that the Company selects, which may include any of the initial purchasers of the Initial Securities; provided that if three such bids cannot reasonably be obtained by the Bid Solicitation Agent, but two such bids

 

8

 

are obtained, then the average of the two bids shall be used, and if only one such bid can reasonably be obtained by the Bid Solicitation Agent, that one bid shall be used.  If the Bid Solicitation Agent cannot reasonably obtain at least one bid for $5,000,000 principal amount of the Securities from a nationally recognized securities dealer, then the Trading Price per $1,000 principal amount of the Securities will be deemed to be less than 98% of the product of the Closing Sale Price of the Common Stock for such Trading Day and the applicable Conversion Rate for such date of determination.

 

“Trigger Event” has the meaning set forth in Section 5.06(b).

 

“Trustee” means the party named as such in the first paragraph of this Indenture until a successor replaces it pursuant to the applicable provisions of this Indenture, and thereafter “Trustee” should mean such successor Trustee.

 

“Trust Officer” means, with respect to the Trustee, any officer assigned to the Corporate Trust Office, and also, with respect to a particular matter, any other officer to whom such matter is referred because of such officer’s knowledge of and familiarity with the particular subject.

 

“Valuation Period” has the meaning set forth in Section 5.06(c).

 

“Vice President” when used with respect to the Company or the Trustee, means any vice president, whether or not designated by a number or a word or words added before or after the title “vice president.”

 

“Voting Stock” has the meaning set forth in Section 4.01(a).

 

Section 1.02.                          Rules of Construction.  Unless the context otherwise requires:

 

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

 

(b)                   an accounting term not otherwise defined has the meaning assigned to it in accordance with GAAP;

 

(c)                    words in the singular include the plural, and words in the plural include the singular;

 

(d)                   provisions apply to successive events and transactions;

 

(e)                    the term “merger” includes a statutory share exchange and the term “merged” has a correlative meaning;

 

(f)                     the masculine gender includes the feminine and the neuter;

 

(g)                    references to agreements and other instruments include subsequent amendments thereto;

 

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

 

(i)                       unless the context otherwise requires, any reference to an “Article” or a “Section” refers to an Article or Section, as the case may be, of this Indenture.

 

ARTICLE 2
  THE SECURITIES

 

Section 2.01.                          Title and Terms; Principal and Interest.  The aggregate principal amount of Initial Securities which may be authenticated and delivered under this Indenture is limited to $138,000,000 and the aggregate amount of Additional Securities is unlimited, except for Securities authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Securities pursuant to Section 2.08, 2.09, Section 2.13, Section 2.15, 4.04 and 5.02.

 

The Initial Securities and the Additional Securities, if any, shall be known and designated as the “1.125% Convertible Senior Notes due 2018” of the Company.

 

The Securities shall mature August 15, 2018.

 

The Securities shall bear interest at the rate of 1.125% per annum, from August 16, 2013 or from the most recent Interest Payment Date to which interest has been paid or duly provided for, as the case may be, semi-annually in arrears, on February 15 and August 15 of each year, commencing on February 15, 2014, until the principal thereof is paid or made available for payment.  Interest (including Additional Interest, if any) will be computed on the basis of a 360-day year composed of twelve 30-day months.  Interest will cease to accrue on a Security upon the Maturity Date, conversion or repurchase by the Company at the option of the Holder pursuant to Section 4.01.

 

Principal and interest (including Additional Interest, if any) on Global Securities shall be payable in the manner set forth in Section 6.01.

 

The Securities shall be convertible as provided in Article 5.

 

Section 2.02.                          Denominations.  The Securities shall be issuable only in registered form without coupons and only in denominations of $1,000 and any multiple thereof.

 

Section 2.03.                          Form and Dating. (a) The Securities and the corresponding Trustee’s certificate of authentication shall be substantially in the respective forms set forth in Exhibit A, which Exhibit is incorporated in and made part of this Indenture.  The Securities may have notations, legends or endorsements required by law, exchange rule, Applicable Procedures or usage.  The Company shall provide any such notations, legends or endorsements to the Trustee in writing.  Each Security shall be dated the date of its authentication.

 

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The terms and provisions contained in the Securities shall constitute, and are hereby expressly made, a part of this Indenture and the Company and the Trustee, by their execution and delivery of this Indenture, expressly agree to such terms and provisions and to be bound thereby; provided, however, to the extent permitted by applicable law, if any provision of any Security conflicts with the express provisions of this Indenture, the provisions of this Indenture shall govern and be controlling.

 

(b)                                 Global Securities.

 

(i)                           All of the Securities shall be issued initially in the form of one or more Global Securities, which shall be deposited on behalf of the purchasers of the Securities represented thereby with the Trustee, at its Corporate Trust Office, as custodian for the depositary, The Depository Trust Company (such depositary, or any successor thereto, being hereinafter referred to as the “Depositary”), and registered in the name of its nominee, Cede & Co., or as otherwise instructed by the Depositary duly executed by the Company and authenticated by the Trustee as hereinafter provided.  The aggregate principal amount of the Global Securities may from time to time be increased or decreased by adjustments made on the records of the Securities Custodian and the Depositary as hereinafter provided, subject in each case to compliance with the Applicable Procedures and the provisions of this Indenture.

 

(ii)                        Each Global Security shall represent such of the outstanding Securities as shall be specified therein and each shall provide that it shall represent the aggregate amount of outstanding Securities from time to time endorsed thereon and that the aggregate amount of outstanding Securities represented thereby may from time to time be reduced or increased, as appropriate, to reflect exchanges, purchases or conversions of such Securities.  Any adjustment of the aggregate principal amount of a Global Security to reflect the amount of any increase or decrease in the amount of outstanding Securities represented thereby shall be made by the Trustee in accordance with instructions given by the Holder thereof as required by Section 2.15 hereof and shall be made on the records of the Trustee and the Depositary.

 

(iii)                     The Company shall issue and the Trustee shall, upon receipt of a Company Order (which the Company agrees to deliver without unreasonable delay), authenticate and deliver in accordance with Section 2.04, initially one or more Global Securities that (i) shall be registered in the name of Cede & Co. or as otherwise instructed by the Depositary, (ii) shall be delivered by the Trustee to the Depositary or to the Securities Custodian pursuant to the Depositary’s instructions and (iii) shall bear legends required for Global Securities as set forth on Exhibit A hereto.

 

(c)                                  Book Entry Provisions.  Members of, or participants in, the Depositary (“Agent Members”) shall have no rights under this Indenture with respect to any Global Security held on their behalf by the Depositary or under the Global Security, and the Depositary (including, for this purpose, its nominee) may be treated by the Company, the 

 

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Trustee and any agent of the Company or the Trustee as the absolute owner and Holder of such Global Security for all purposes whatsoever.  Notwithstanding the foregoing, nothing herein shall (i)prevent the Company, the Trustee or any agent of the Company or the Trustee from giving effect to any written certification, proxy or other authorization furnished by the Depositary, or such nominee, as the case may be, or (ii)impair, as between the Depositary and its Agent Members, the Applicable Procedures or the operation of customary practices governing the exercise of the rights of a Holder of any Security.

 

(d)                                 Certificated Securities.  Certificated Securities will be issued only under the limited circumstances provided in Section 2.15(a)(i).

 

Section 2.04.                          Execution and Authentication.  (a) An Officer of the Company shall sign the Securities for the Company by manual or facsimile signature.  Typographic and other minor errors or defects in any such facsimile signature shall not affect the validity or enforceability of any Security that has been authenticated and delivered by the Trustee.

 

(b)                                 If an Officer of the Company whose signature is on a Security no longer holds that office at the time the Trustee authenticates the Security, the Security shall be valid nevertheless.

 

(c)                                  A Security shall not be valid until an authorized signatory of the Trustee manually signs the certificate of authentication on the Security.  The signature shall be conclusive evidence that the Security has been authenticated under this Indenture.

 

(d)                                 The Trustee shall initially authenticate and make available for delivery Securities for original issue in the aggregate principal amount of up to $138,000,000 upon receipt of a written order or orders of the Company signed by an Officer of the Company (a “Company Order”).  Each Company Order shall specify the amount of Securities to be authenticated, shall provide that all such Securities be represented by a Global Security and the date on which each original issue of Securities is to be authenticated.  The Company may, without the consent of the Holders, issue Additional Securities with the same terms and with the same CUSIP number as the Initial Securities in an unlimited aggregate principal amount; provided, however that no such Additional Securities may be issued unless fungible with the Initial Securities for U.S. federal income tax purposes.  The Trustee shall authenticate Additional Securities thereafter in unlimited aggregate principal amount (so long as permitted by the terms of this Indenture) for original issue upon a Company Order of the Company in aggregate principal amount as specified in such Company Order (except as provided in Section 2.10).  Such Additional Securities shall have identical terms to the Initial Securities except for issuance dates and prices and with respect to interest accruing prior to their date of issuance, and will constitute the same series as the Initial Securities for all purposes hereunder, including, without limitation, waivers, amendments and offers to purchase.

 

(e)                                  The Trustee shall act as the initial authenticating agent.  Thereafter, the Trustee may appoint an authenticating agent acceptable to the Company to authenticate 

 

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Securities. An authenticating agent may authenticate Securities whenever the Trustee may do so.  Each reference in this Indenture to authentication by the Trustee includes authentication by such agent.  An authenticating agent shall have the same rights as an Agent to deal with the Company or an Affiliate of the Company.

 

Section 2.05.                          Registrar, Paying Agent and Conversion Agent.  The Company shall maintain an office or agency where Securities may be presented for registration of transfer or for exchange (the “Registrar”), an office or agency where Securities may be presented for purchase or payment (the “Paying Agent”), an office or agency where Securities may be presented for conversion (the “Conversion Agent”) and an office or agency where notices and demands to or upon the Company in respect of the Securities and this Indenture may be served.  Pursuant to Section 6.07, the Company shall at all times maintain a Paying Agent, Conversion Agent and Registrar and an office or agency where notices and demands to or upon the Company in respect of the Securities and this Indenture may be served.  The Registrar shall keep a register of the Securities (the “Register”) and of their transfer and exchange.

 

The Company may have one or more co-registrars, one or more additional paying agents and one or more additional conversion agents.  The term Registrar includes any co-registrar, including any named pursuant to Section 6.07.  The term Paying Agent includes any additional paying agent, including any named pursuant to Section 6.07.  The term Conversion Agent includes any additional conversion agent, including any named pursuant to Section 6.07.

 

The Company shall enter into an appropriate agency agreement with any Agent not a party to this Indenture.  The agreement shall implement the provisions of this Indenture that relate to such Agent.  The Company shall notify the Trustee of the name and address of any Agent not a party to this Indenture.  If the Company fails to maintain a Registrar, Paying Agent, Conversion Agent or agent for service of notices and demands in any place required by this Indenture, or fails to give the foregoing notice, the Trustee shall act as such.  The Company or any Affiliate of the Company may act as Paying Agent.

 

The Company hereby initially appoints the Trustee as Registrar, Paying Agent and Conversion Agent in connection with the Securities.

 

Section 2.06.                          Paying Agent to Hold Money and Securities in Trust.  Prior to 10:00 a.m., New York City time, on each due date of payments in respect of, or delivery of cash or a combination of cash and shares of Common Stock, as applicable, upon conversion of, any Security in accordance with this Indenture, the Company shall deposit with the Paying Agent cash (in immediately available funds if deposited on the due date) and/or with the Conversion Agent such number of shares of Common Stock sufficient to make such payments or deliveries when so becoming due.  The Company shall require each Paying Agent or Conversion Agent, as applicable (other than the Trustee), to agree in writing that such Agent shall hold in trust for the benefit of Holders or the Trustee all cash or shares of Common Stock, as applicable, held by such Agent for the making of payments or deliveries in respect of the Securities and shall notify the Trustee of any 

 

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default by the Company in making any such payment or delivery.  If the Company or an Affiliate of the Company acts as Paying Agent or Conversion Agent, as applicable, it shall segregate the cash and shares of Common Stock, as applicable, held by it as Paying Agent or Conversion Agent, as applicable, and hold it as a separate trust fund.

 

The Company at any time may require a Paying Agent or Conversion Agent, as applicable, to pay all cash or shares of Common Stock held by it to the Trustee, and the Trustee may at any time during the continuance of any default, upon written request to the Paying Agent or the Conversion Agent, as applicable, require such Paying Agent or Conversion Agent, as applicable, to pay forthwith to the Trustee all cash or shares of Common Stock, as applicable, so held in trust by such Paying Agent or Conversion Agent.  Upon doing so, the Paying Agent or the Conversion Agent, as applicable, shall have no further liability for the cash or shares of Common Stock, as applicable.

 

Section 2.07.                          Holder Lists.  The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of the Holders.  If the Trustee is not the Registrar, the Company shall furnish to the Trustee on or before each Interest Payment Date, and at such other times as the Trustee may request in writing, a list of the names and addresses of the Holders in such form and as of such date as the Trustee may reasonably request.

 

Section 2.08.                          Transfer and Exchange.

 

(a)                                 Subject to compliance with any applicable additional requirements contained in Section 2.09 or Section 2.15, when a Security is presented to a Registrar with a request to register a transfer thereof or to exchange such Security for an equal principal amount of Securities of other authorized denominations, the Registrar shall register the transfer or make the exchange as requested; provided, however, that every Security presented or surrendered for registration of transfer or exchange shall be duly endorsed or accompanied by an assignment form, in the form included in Exhibit A attached hereto, and in form satisfactory to the Registrar duly executed by the Holder thereof or its attorney duly authorized in writing.  To permit registration of transfers and exchanges, upon surrender of any Security for registration of transfer or exchange at an office or agency maintained pursuant to Section 2.05, the Company shall execute and the Trustee shall authenticate Securities of a like aggregate principal amount at the Registrar’s request.  Any exchange or transfer shall be without charge, except that the Company or the Registrar may require payment of a sum sufficient to cover any tax, assessment or other governmental charge that may be imposed in relation thereto.

 

None of the Company, any Registrar or the Trustee shall be required to register a transfer or exchange of any Securities for which the Holder has delivered, and not validly withdrawn, a Fundamental Change Repurchase Notice, except, in the case of a partial repurchase, with respect to that portion of the Securities not being repurchased.

 

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

 

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(b)                                 Any Registrar appointed pursuant to Section 2.05 hereof shall provide to the Trustee such information as the Trustee may reasonably request in connection with the delivery by such Registrar of Securities upon transfer or exchange of Securities.

 

(c)                                  Each Holder of a Security agrees to indemnify the Company, the Registrar and the Trustee against any liability that may result from the transfer, exchange or assignment of such Holder’s Security in violation of any provision of this Indenture and/or applicable U.S. federal or state securities law.

 

The Trustee shall have no obligation or duty to monitor, determine or inquire as to compliance with any applicable federal or state or other securities and tax laws (including with respect to any transfers between or among Agent Members or other beneficial owners of interests in any Global Security) and shall have no duty to obtain documentation relating to any transfers or exchanges other than as specifically required hereunder.

 

Section 2.09.                          Restrictions on Transfer.  (a) Every Security that bears or is required under this Section 2.09 to bear the legend set forth in this Section 2.09 (together with any Common Stock issued upon conversion of the Securities that is required to bear the legend set forth in this Section 2.09, collectively, the “Restricted Securities”) shall be subject to the restrictions on transfer set forth in this Section 2.09 (including the legend set forth below), unless such restrictions on transfer shall be eliminated or otherwise waived by written consent of the Company, and the Holder of each such Restricted Security, by such Holder’s acceptance thereof, agrees to be bound by all such restrictions on transfer.  As used in this Section 2.09, the term “transfer” encompasses any sale, pledge, transfer or other disposition whatsoever of any Restricted Security.

 

Until the date (the “Resale Restriction Termination Date”) that is the later of (1) the date that is one year after the last date of original issuance of the Securities, or such shorter period of time as permitted by Rule 144 under the Securities Act or any successor provision thereto, and (2) such later date, if any, as may be required by applicable law, any certificate evidencing such Securities (and all securities issued in exchange therefor or substitution thereof, other than Common Stock, if any, issued upon conversion thereof, which shall bear the legend set forth in Section 2.09, if applicable) shall bear a legend in substantially the following form (unless such Securities have been transferred pursuant to a registration statement that has become or been declared effective under the Securities Act and that continues to be effective at the time of such transfer, or sold pursuant to the exemption from registration provided by Rule 144 or any similar provision then in force under the Securities Act, or unless otherwise agreed by the Company in writing, with notice thereof to the Trustee):

 

THIS SECURITY AND THE COMMON STOCK, IF ANY, ISSUABLE UPON CONVERSION OF THIS SECURITY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT IN ACCORDANCE WITH THE FOLLOWING 

 

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SENTENCE. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE ACQUIRER:

 

(1)                       REPRESENTS THAT IT AND ANY ACCOUNT FOR WHICH IT IS ACTING IS A “QUALIFIED INSTITUTIONAL BUYER” (WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT) AND THAT IT EXERCISES SOLE INVESTMENT DISCRETION WITH RESPECT TO EACH SUCH ACCOUNT, AND

 

(2)                       AGREES FOR THE BENEFIT OF RAMBUS INC. (THE “COMPANY”) THAT IT WILL NOT OFFER, SELL, PLEDGE OR OTHERWISE TRANSFER THIS SECURITY OR ANY BENEFICIAL INTEREST HEREIN PRIOR TO THE DATE THAT IS THE LATER OF (X) ONE YEAR AFTER THE LAST ORIGINAL ISSUE DATE HEREOF OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144 UNDER THE SECURITIES ACT OR ANY SUCCESSOR PROVISION THERETO AND (Y) SUCH LATER DATE, IF ANY, AS MAY BE REQUIRED BY APPLICABLE LAW, EXCEPT:

 

(A)                          TO THE COMPANY OR ANY SUBSIDIARY THEREOF, OR

 

(B)                          PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BECOME EFFECTIVE UNDER THE SECURITIES ACT, OR

 

(C)                          TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, OR

 

(D)                          PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT OR ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.

 

PRIOR TO THE REGISTRATION OF ANY TRANSFER IN ACCORDANCE WITH CLAUSE (2)(D) ABOVE, THE COMPANY AND THE TRUSTEE RESERVE THE RIGHT TO REQUIRE THE DELIVERY OF SUCH LEGAL OPINIONS, CERTIFICATIONS OR OTHER EVIDENCE AS MAY REASONABLY BE REQUIRED IN ORDER TO DETERMINE THAT THE PROPOSED TRANSFER IS BEING MADE IN COMPLIANCE WITH THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS. NO REPRESENTATION IS MADE AS TO THE AVAILABILITY OF ANY EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.

 

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No transfer of any Security prior to the Resale Restriction Termination Date will be registered by the Registrar unless the applicable box on the Form of Assignment and Transfer has been checked.

 

Any Security (or security issued in exchange or substitution therefor) as to which such restrictions on transfer shall have expired in accordance with their terms may, upon surrender of such Security for exchange to the Registrar in accordance with the provisions of this Section 2.09, be exchanged for a new Security or Securities, of like tenor and aggregate principal amount, which shall not bear the restrictive legend required by this Section 2.09 and shall not be assigned a restricted CUSIP number. The Company shall be entitled to instruct the Securities Custodian in writing to so surrender any Global Security as to which such restrictions on transfer shall have expired in accordance with their terms for exchange, and, upon such instruction, the Securities Custodian shall so surrender such Global Security for exchange; and any new Global Security so exchanged therefor shall not bear the restrictive legend specified in this Section 2.09 and shall not be assigned a restricted CUSIP number.  The Company shall promptly notify the Trustee upon the occurrence of the Resale Restriction Termination Date and promptly after a registration statement, if any, with respect to the Securities or any Common Stock issued upon conversion of the Securities has been declared effective under the Securities Act.

 

(b)                                 Until the Resale Restriction Termination Date, any stock certificate representing Common Stock issued upon conversion of such Security shall bear a legend in substantially the following form (unless the Security or such Common Stock has been transferred pursuant to a registration statement that has become or been declared effective under the Securities Act and that continues to be effective at the time of such transfer, or pursuant to the exemption from registration provided by Rule 144 or any similar provision then in force under the Securities Act, or such Common Stock has been issued upon conversion of Securities that have been transferred pursuant to a registration statement that has become or been declared effective under the Securities Act and that continues to be effective at the time of such transfer, or pursuant to the exemption from registration provided by Rule 144 or any similar provision then in force under the Securities Act, or unless otherwise agreed by the Company with written notice thereof to the Trustee and any transfer agent for the Common Stock):

 

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT IN ACCORDANCE WITH THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE ACQUIRER:

 

(1)                            REPRESENTS THAT IT AND ANY ACCOUNT FOR WHICH IT IS ACTING IS A “QUALIFIED INSTITUTIONAL BUYER” (WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT) AND THAT IT EXERCISES SOLE INVESTMENT DISCRETION WITH RESPECT TO EACH SUCH ACCOUNT, AND

 

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(2)                            AGREES FOR THE BENEFIT OF RAMBUS INC. (THE “COMPANY”) THAT IT WILL NOT OFFER, SELL, PLEDGE OR OTHERWISE TRANSFER THIS SECURITY OR ANY BENEFICIAL INTEREST HEREIN PRIOR TO THE DATE THAT IS THE LATER OF (X) ONE YEAR AFTER THE LAST ORIGINAL ISSUE DATE OF THE SERIES OF NOTES UPON THE CONVERSION OF WHICH THIS SECURITY WAS ISSUED OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144 UNDER THE SECURITIES ACT OR ANY SUCCESSOR PROVISION THERETO AND (Y) SUCH LATER DATE, IF ANY, AS MAY BE REQUIRED BY APPLICABLE LAW, EXCEPT:

 

(A)                          TO THE COMPANY OR ANY SUBSIDIARY THEREOF, OR

 

(B)                          PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BECOME EFFECTIVE UNDER THE SECURITIES ACT, OR

 

(C)                          TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, OR

 

(D)                          PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT OR ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.

 

PRIOR TO THE REGISTRATION OF ANY TRANSFER IN ACCORDANCE WITH CLAUSE (2)(D) ABOVE, THE COMPANY AND THE TRANSFER AGENT FOR THE COMPANY’S COMMON STOCK RESERVE THE RIGHT TO REQUIRE THE DELIVERY OF SUCH LEGAL OPINIONS, CERTIFICATIONS OR OTHER EVIDENCE AS MAY REASONABLY BE REQUIRED IN ORDER TO DETERMINE THAT THE PROPOSED TRANSFER IS BEING MADE IN COMPLIANCE WITH THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS. NO REPRESENTATION IS MADE AS TO THE AVAILABILITY OF ANY EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.

 

Any such Common Stock as to which such restrictions on transfer shall have expired in accordance with their terms may, upon surrender of the certificates representing such shares of Common Stock for exchange in accordance with the procedures of the transfer agent for the Common Stock, be exchanged for a new certificate or certificates for a like aggregate number of shares of Common Stock, which shall not bear the restrictive legend required by this Section 2.09(b).

 

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(c)                                  Any Security or Common Stock issued upon the conversion or exchange of a Security that is repurchased or owned by any Affiliate of the Company (or any Person who was an Affiliate of the Company at any time during the three months preceding) may not be resold by such Affiliate (or such Person, as the case may be) unless registered under the Securities Act or resold pursuant to an exemption from the registration requirements of the Securities Act in a transaction that results in such Security or Common Stock, as the case may be, no longer being a “restricted security” (as defined under Rule 144 under the Securities Act).  The Company shall cause any Security that is repurchased or owned by it to be surrendered to the Trustee for cancellation in accordance with Section 2.14.

 

Section 2.10.                          Replacement Securities.  If (a) any mutilated Security is surrendered to the Company, a Registrar or the Trustee, or (b) the Company, the Registrar and the Trustee receive evidence to their satisfaction of the destruction, loss or theft of any Security, and, in either case, there is delivered to the Company, the Registrar and the Trustee such security or indemnity as shall be required by them to save each of them harmless, then, in the absence of notice to the Company, such Registrar or the Trustee that such Security has been acquired by a bona fide or protected purchaser, the Company shall issue, and the Trustee shall, upon receipt of a Company Order (which the Company agrees to deliver without unreasonable delay), authenticate and deliver, in exchange for any such mutilated Security or in lieu of any such destroyed, lost or stolen Security, a new Security of like tenor and principal amount, bearing a number not contemporaneously outstanding.

 

In case any such mutilated, destroyed, lost or stolen Security has become or is about to become due and payable, or is about to be purchased by the Company pursuant to Article 4, the Company in its discretion (but subject to any conversion rights) may, instead of issuing a new Security, pay or purchase such Security, as the case may be.

 

Upon the issuance of any new Securities under this Section 2.10, the Company may require the payment of a sum sufficient to cover any tax, assessment or other governmental charge that may be imposed in relation thereto and any other reasonable expenses (including the reasonable fees and expenses of the Trustee or the Registrar) in connection therewith.

 

Every new Security issued pursuant to this Section 2.10 in lieu of any mutilated, destroyed, lost or stolen Security shall constitute an original additional contractual obligation of the Company, whether or not the mutilated, destroyed, lost or stolen Security shall be at any time enforceable by anyone, and shall be entitled to all benefits of this Indenture equally and proportionately with any and all other Securities duly issued hereunder.

 

The provisions of this Section 2.10 are (to the extent lawful) exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities.

 

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Section 2.11.                          Outstanding Securities.  Securities outstanding at any time are all Securities authenticated by the Trustee, except for those canceled by it, those paid or purchased pursuant to Section 2.10, those delivered to it for cancellation and those described in this Section 2.11 as not outstanding.

 

If a Security is replaced pursuant to Section 2.10, it ceases to be outstanding unless the Trustee receives, subsequent to the new Security’s authentication, proof  satisfactory to the Company that the replaced Security is held by a bona fide or protected purchaser.

 

If the Paying Agent holds, in accordance with the terms of this Indenture, prior to 10:00 a.m., New York City time, on the Maturity Date or the Business Day immediately following a Fundamental Change Repurchase Date, as the case may be, cash or securities, sufficient to pay Securities payable, then immediately after such Maturity Date or Fundamental Change Repurchase Date, as the case may be, such Securities shall cease to be outstanding and interest (including Additional Interest, if any) shall cease to accrue.

 

If a Security is converted in accordance with Article 5, then from and after the Close of Business on the Conversion Date, such Security shall cease to be outstanding and interest (including Additional Interest, if any) shall cease to accrue, unless there shall be a default in the delivery of the consideration payable hereunder upon such conversion.

 

Subject to the restrictions contained in Section 2.12, a Security does not cease to be outstanding because the Company or an Affiliate of the Company holds the Security.

 

Section 2.12.                          Treasury Securities.  In determining whether the Holders of the required principal amount of Securities have given or concurred in any notice, request, demand, authorization, direction, waiver or consent, Securities owned by the Company or any other obligor on the Securities or by any Affiliate of the Company or of such other obligor shall be disregarded and deemed not to be outstanding, except that, for purposes of determining whether the Trustee shall be protected in relying on any such notice, direction, waiver or consent, only Securities which a Trust Officer actually knows are so owned shall be so disregarded. Securities so owned which have been pledged in good faith shall not be disregarded if the pledgee establishes to the satisfaction of the Trustee the pledgee’s right so to act with respect to the Securities and that the pledgee is not the Company or any other obligor on the Securities or any Affiliate of the Company or of such other obligor.

 

Section 2.13.                          Temporary Securities.  Until definitive Securities are ready for delivery, the Company may prepare and execute, and, upon receipt of a Company Order, the Trustee shall authenticate and deliver, temporary Securities. Temporary Securities shall be substantially in the form of definitive Securities but may have variations that the Company with the consent of the Trustee considers appropriate for temporary Securities.  After the preparation of definitive Securities, the temporary Securities shall be exchangeable for definitive Securities upon surrender of the temporary Securities at the office or agency of the Company designated for such purpose pursuant to Section 2.05, without charge to the Holder.  Upon surrender for cancellation of any one or more 

 

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temporary Securities the Company shall execute and the Trustee shall, upon receipt of a Company Order (which the Company agrees to deliver without unreasonable delay), authenticate and deliver in exchange therefor a like principal amount of definitive Securities of authorized denominations.  Until so exchanged the temporary Securities shall in all respects be entitled to the same benefits under this Indenture as definitive Securities.

 

Section 2.14.                          Cancellation of Securities Paid, Converted, Etc.  The Company shall cause all Securities surrendered for the purpose of payment, repurchase, registration of transfer or exchange or conversion, if surrendered to any Person other than the Trustee (including any of the Company’s Agents, Subsidiaries or Affiliates), to be surrendered to the Trustee for cancellation.  All Securities delivered to the Trustee shall be canceled promptly by it, and no Securities shall be authenticated in exchange thereof except as expressly permitted by any of the provisions of this Indenture.  The Trustee shall dispose of canceled Securities in accordance with its customary procedures and, after such disposition, shall deliver a certificate of such disposition to the Company, at the Company’s written request in a Company Order.

 

Section 2.15.                          Additional Transfer and Exchange Requirements.

 

(a)                        Transfer and Exchange of Global Securities.

 

(i)             Certificated Securities may be issued in exchange for interests in the Global Securities only (x) if the Depositary notifies the Company that it is unwilling or unable to continue as Depositary for the Global Securities or if it at any time ceases to be a “clearing agency” registered under the Exchange Act, if so required by applicable law or regulation, and a successor Depositary is not appointed by the Company within 90 days, (y) if an Event of Default has occurred and is continuing, or (z) by the Company in accordance with the Applicable Procedures.  In any such case, the Company shall execute, and the Trustee shall, upon receipt of a Company Order (which the Company agrees to deliver without unreasonable delay), authenticate and deliver Certificated Securities in an aggregate principal amount equal to the principal amount of such Global Securities in exchange therefor.  Certificated Securities issued in exchange for beneficial interests in Global Securities shall be registered in such names and shall be in such authorized denominations as the Depositary, pursuant to instructions from its Agent Members or otherwise in accordance with the Applicable Procedures, shall instruct the Trustee.  The Trustee shall deliver or cause to be delivered such Certificated Securities to the Persons in whose name such Securities are so registered.  Such exchange shall be effected in accordance with the Applicable Procedures.

 

(ii)          Notwithstanding any other provisions of this Indenture other than the provisions set forth in Section 2.15(a)(i), a Global Security may not be transferred except as a whole by the Depositary to a nominee of the Depositary or by a nominee of the Depositary to the Depositary or another nominee of the 

 

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Depositary or by the Depositary or any such nominee to a successor Depositary or a nominee of such successor Depositary.

 

(b)                        Transfer and Exchange of Certificated Securities.  If Certificated Securities are issued in exchange for beneficial interests in Global Securities in accordance with Section 2.15(a)(i), and, on or after such event, Certificated Securities are presented by a Holder to the Registrar with a request:

 

(i)             to register the transfer of the Certificated Securities to a Person who will take delivery thereof in the form of Certificated Securities only; or

 

(ii)          to exchange such Certificated Securities for an equal principal amount of Certificated Securities of other authorized denominations,

 

such Registrar shall register the transfer or make the exchange as requested; provided, however, that the Certificated Securities presented or surrendered for register of transfer or exchange shall be duly endorsed or accompanied by a written instrument of transfer in accordance with the proviso to Section 2.08(a).

 

(c)                         Transfers of Certificated Securities for Beneficial Interest in Global Securities.  If Certificated Securities are issued in exchange for beneficial interests in Global Securities and, thereafter, the events or conditions specified in Section 2.15(a)(i) which required such exchange shall cease to exist, the Company shall mail notice to the Trustee and to the Holders stating that Holders may exchange Certificated Securities for interests in Global Securities by complying with the procedures set forth in this Indenture and briefly describing such procedures and the events or circumstances requiring that such notice be given. Thereafter, if Certificated Securities are presented by a Holder to a Registrar with a request:

 

(i)             to register the transfer of such Certificated Securities to a Person who will take delivery thereof in the form of a beneficial interest in a Global Security, or

 

(ii)          to exchange such Certificated Securities for an equal principal amount of beneficial interests in a Global Security, which beneficial interests will be owned by the Holder transferring such Certificated Securities,

 

the Registrar shall register the transfer or make the exchange as requested by cancelling such Certificated Security and causing the aggregate principal amount of the applicable Global Security to be increased accordingly and, if no such Global Security is then outstanding, the Company shall issue and the Trustee shall, upon receipt of a Company Order (which the Company agrees to deliver without unreasonable delay) authenticate and deliver a new Global Security; provided, however, that the Certificated Securities presented or surrendered for registration of transfer or exchange shall be duly endorsed or accompanied by a written instrument of transfer in accordance with the proviso to Section 2.08(a).

 

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(d)                        Transfers to the Company.  Nothing contained in this Indenture or in the Securities shall prohibit the sale or other transfer of any Securities (including beneficial interests in Global Securities) to the Company or any of its Subsidiaries.

 

Section 2.16.                          Repurchases.  The Company may, to the extent permitted by law, directly or indirectly (regardless of whether such Securities are surrendered to the Company) repurchase Securities in the open market or otherwise, whether by the Company or its Subsidiaries or through a private or public tender or exchange offer or through counterparties to private agreements, including by cash-settled swaps or other  derivatives.  The Company shall cause any Securities so repurchased (other than Securities repurchased pursuant to cash-settled swaps or other derivatives) to be surrendered to the Trustee for cancellation in accordance with Section 2.14.

 

Section 2.17.                          CUSIP Numbers.  The Company in issuing the Securities may use one or more “CUSIP” numbers (if then generally in use), and, if so, the Trustee shall use “CUSIP” numbers in notices of purchase as a convenience to Holders; provided, however, that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Securities or as contained in any notice of a purchase and that reliance may be placed only on the other identification numbers printed on the Securities, and any such purchase shall not be affected by any defect in or omission of such numbers.  The Company shall without unreasonable delay notify the Trustee of any change in the “CUSIP” numbers.

 

Section 2.18.                          Persons Deemed Owners.  Prior to due presentment of a Security for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name such Security is registered as the owner of such Security for the purpose of receiving payment of principal of, and interest (including Additional Interest, if any) on such Security, for the purpose of receiving cash or a combination of cash and shares of Common Stock, as applicable, upon conversion and for all other purposes whatsoever, whether or not such Security is overdue, and none of the Company, the Trustee nor any agent of the Company or the Trustee shall be affected by notice to the contrary.

 

ARTICLE 3
  NO OPTIONAL REDEMPTION

 

Section 3.01.                          No Optional Redemption.  The Securities shall not be redeemable by the Company prior to the Maturity Date, and no sinking fund is provided for the Securities.

 

ARTICLE 4
  PUT OPTION UPON FUNDAMENTAL CHANGE

 

Section 4.01.                          Repurchase of Securities at Option of Holders Upon a Fundamental Change.  (a) In the event of a Fundamental Change at any time that Securities remain outstanding, Securities shall be repurchased by the Company, at the option of any Holder thereof, on a date specified by the Company that is not less than 20 

 

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nor more than 45 Business Days after the date the Company mails or deposits with an overnight delivery service the Fundamental Change Company Notice (as defined below) to the Holders (the “Fundamental Change Repurchase Date”), at a purchase price in cash for each $1,000 principal amount of such Securities equal to 100% of the principal amount of the Securities tendered for purchase, plus accrued and unpaid interest thereon, including Additional Interest, if any, to, but excluding, the Fundamental Change Repurchase Date (the “Fundamental Change Repurchase Price”), subject to satisfaction by or on behalf of any Holder of the requirements set forth in Section 4.01(c); provided, however, that if any Security is repurchased pursuant to this Section 4.01 after a regular  Record Date and on or prior to the corresponding Interest Payment Date, the interest, including Additional Interest, if any, payable with respect to such Security on such Interest Payment Date shall be payable to the Holder of record as of the corresponding Record Date.

 

A “Fundamental Change” shall be deemed to have occurred upon the occurrence of any of the following:

 

(1)         any person or group (other than the Company, any directly or indirectly wholly-owned Subsidiary of the Company or any employee benefit plan of the Company or any of its Subsidiaries) files a Schedule 13D or Schedule TO, or any successor schedule, form or report under the Exchange Act, disclosing, or the Company otherwise becomes aware, that such person is or has become the beneficial owner, directly or indirectly, 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 or has the power, directly or indirectly, to elect a majority of the members of the Board of Directors of the Company;

 

(2)         the Company consolidates with, or merges with or into, another Person or the Company sells, assigns, conveys, transfers, leases or otherwise disposes of all or substantially all of the Company’s assets (other than to one or more wholly-owned Subsidiaries of the Company), or any Person consolidates with, or merges with or into, the Company (other than one or more wholly-owned Subsidiaries of the Company), in any such event other than pursuant to a merger or consolidation transaction in which (a) the Common Stock is not changed or exchanged except to the extent necessary to reflect a change in the jurisdiction of organization or (b) the Persons that beneficially owned, directly or indirectly, shares of the Company’s Voting Stock immediately prior to such transaction beneficially own, directly or indirectly, shares of Voting Stock representing a majority of the total voting power of all outstanding classes of Voting Stock of the surviving or transferee Person or the parent entity thereof immediately after such transaction;

 

(3)         the Common Stock, or other common stock into which the Securities are then convertible, ceases to be listed on the NASDAQ Global Select Market, the New York Stock Exchange or another U.S. 

 

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national securities exchange and is not then quoted on an established automated over-the-counter trading market in the United States; or

 

(4)         the adoption of any plan relating to the liquidation or dissolution of the Company.

 

Notwithstanding anything to the contrary set forth in this Section 4.01, a Fundamental Change as a result of (A) a merger or consolidation resulting from clause (1) of the definition thereof or (B) a transaction described in clause (2) of the definition  thereof shall not be deemed to have occurred if at least 90% of the consideration (excluding cash payments for fractional shares and cash payments pursuant to dissenters’ appraisal rights) in the merger or consolidation otherwise constituting the Fundamental Change consists of common stock traded or quoted on a U.S. national securities exchange (or which shall be so traded when issued or exchanged in connection with such Fundamental Change) (“publicly traded securities”) and as a result of such transaction or transactions the Securities become convertible into such publicly traded securities, excluding cash payment for fractional shares or pursuant to statutory appraisal rights (subject to Section 5.03).

 

For purposes of this Section 4.01(a):

 

(1)                                 a “beneficial owner” shall be determined in accordance with Rule 13d-3 under the Exchange Act, as in effect on the date of this Indenture;

 

(2)                                 “beneficially own” and “beneficially owned” have meanings correlative to that of beneficial owner;

 

(3)                                 “Capital Stock” means:  (i) in the case of a corporation, corporate stock; (ii) in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock; (iii) in the case of a partnership or limited liability company, partnership interests (whether general or limited) or membership interests; or (iv) 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, the issuing Person;

 

(4)                                 “person” and “group” shall have the meanings given to them for purposes of Sections 13(d) and 14(d) of the Exchange Act or any successor provisions, and the term “group” includes any group acting for the purpose of acquiring, holding or disposing of securities within the meaning of Rule 13d-5(b)(1) under the Exchange Act, or any successor provision; and

 

(5)                                 “Voting Stock” means any class or classes of Capital Stock or other interests then outstanding and normally entitled (without regard to the occurrence of any contingency) to vote in the election of the Board of Directors, managers or trustees of a Person.

 

(b)                                 Notice of Fundamental Change.  The Company shall provide notice to the Trustee and each Holder (and, in the case of a Fundamental Change Company Notice 

 

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pursuant to clause (y) of this Section 4.01(b), each beneficial owner if required by applicable law) in accordance with Section 13.01 (x) as soon as practicable and in any event at least 25 Scheduled Trading Days prior to the anticipated effective date of a Fundamental Change (without giving effect to the exception regarding publicly traded securities contained in the paragraph immediately following the definition of Fundamental Change in Section 4.01(a)), in the case of a Fundamental Change that is known to the Company, or if not known to the Company prior to such 25th Scheduled Trading Day, then within two Trading Days after the Company becomes aware of such  Fundamental Change (the “Effective Date Notice”), and (y) within 15 Business Days after the effective date of a Fundamental Change (the “Fundamental Change Company Notice”).  The Fundamental Change Company Notice delivered to each Holder (and each beneficial owner, if applicable) pursuant to clause (y) of this Section 4.01(b) shall include the form of a Fundamental Change Repurchase Notice to be completed by the Holder and shall state, as applicable:

 

(1)                                 the events causing a Fundamental Change;

 

(2)                                 the effective date of such Fundamental Change;

 

(3)                                 that the Holder has a right to require the Company to purchase the Holder’s Securities;

 

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

 

(5)                                 the Fundamental Change Repurchase Price;

 

(6)                                 the Fundamental Change Repurchase Date;

 

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

 

(8)                                 that the Securities must be surrendered to the Paying Agent to collect payment of the Fundamental Change Repurchase Price;

 

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

 

(10)                          the then-applicable Conversion Rate and any adjustments to the Conversion Rate that will result from the Fundamental Change;

 

(11)                          that the Securities with respect to which a Fundamental Change Repurchase Notice has been given may be converted pursuant to Article 5 of this Indenture only if the Fundamental Change Repurchase Notice has been withdrawn in accordance with the terms of this Indenture;

 

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(12)                          the procedures that the Holder must follow to exercise its Fundamental Change repurchase right under this Section 4.01;

 

(13)                          the procedures for withdrawing a Fundamental Change Repurchase Notice;

 

(14)                          that, unless the Company defaults in making payment of such Fundamental Change Repurchase Price interest, including Additional Interest, if any, on  Securities surrendered for purchase by the Company, if any, shall cease to accrue on and after the Fundamental Change Repurchase Date; and

 

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

 

Simultaneously with providing the Fundamental Change Company Notice, the Company shall publish such information on its website or through such other public medium as it may use at that time.

 

If any of the Securities is in the form of a Global Security, then the Company shall modify such notice to the extent necessary to accord with the Applicable Procedures applicable to repurchases.

 

At the Company’s request, the Trustee shall give notice of such Fundamental Change on behalf of the Company and at the Company’s expense; provided, however, that the Company makes such request at least three Business Days (unless a shorter period shall be satisfactory to the Trustee) prior to the date by which such Fundamental Change Company Notice must be given to the Holders in accordance with this Section 4.01(b); provided further, however, that the text of such notice shall be prepared by the Company.

 

No failure of the Company to give the foregoing notices and no defect therein shall limit any Holder’s repurchase rights or affect the validity of the proceedings for the repurchase of the Securities pursuant to this Section 4.01.

 

(c)                                  Fundamental Change Repurchase Notice.  A Holder may exercise its right specified in Section 4.01 upon delivery of a written notice (which shall be in substantially the form included in Exhibit A hereto and which may be delivered by letter, overnight courier, hand delivery, facsimile transmission or in any other written form and, in the case of Global Securities, may be delivered electronically or by other means in accordance with the Applicable Procedures) of the exercise of such rights (a “Fundamental Change Repurchase Notice”), to a Paying Agent, and such Fundamental Change Repurchase Notice must be received by the Paying Agent, at any time prior to the Close of Business on the Business Day immediately preceding the Fundamental Change Repurchase Date.  The Fundamental Change Repurchase Notice must state:

 

(1)         if Certificated Securities are to be delivered, the certificate numbers of the Securities that the Holder shall deliver to be purchased;

 

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(2)         the portion of the principal amount of the Securities that the Holder shall deliver to be purchased, which portion must be in principal amounts of $1,000 or a multiple thereof; and

 

(3)         that such Securities shall be purchased by the Company on the Fundamental Change Repurchase Date pursuant to the terms and conditions specified in this Indenture.

 

The delivery of such Security to any Paying Agent (together with all necessary endorsements) at the office of such Paying Agent shall be a condition to the receipt by the Holder of the Fundamental Change Repurchase Price; provided, however, that such Fundamental Change Repurchase Price shall be paid pursuant to this Section 4.01 only if the Security so delivered to the Paying Agent shall conform in all respects to the description thereof in the related Fundamental Change Repurchase Notice.

 

The Company shall purchase from the Holder thereof, pursuant to this Section 4.01, a portion of a Security if the principal amount of such portion is $1,000 or a multiple of $1,000.  Provisions of this Article 4 that apply to the purchase of all of a Security also apply to the purchase of such portion of such Security.

 

Notwithstanding anything herein to the contrary, any Holder delivering to the Paying Agent the Fundamental Change Repurchase Notice contemplated by this Section 4.01(c) shall have the right to withdraw such Fundamental Change Repurchase Notice in accordance with Section 4.02(b).

 

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

 

(d)                        Notwithstanding anything herein to the contrary, in the case of Global Securities, any Fundamental Change Repurchase Notice must be delivered or withdrawn and such Securities must be surrendered or delivered for purchase in accordance with the Applicable Procedures.

 

(e)                         Notwithstanding the foregoing, no Securities may be repurchased by the Company at the option of the Holders on any Fundamental Change Repurchase Date if the principal amount of the Securities has been accelerated, and such acceleration has not been rescinded, on, or prior to such Fundamental Change Repurchase Date (except in the case of an acceleration resulting from a default by the Company in the payment of the Fundamental Change Repurchase Price with respect to such Securities).

 

Section 4.02.                          Effect of Fundamental Change Repurchase Notice; Withdrawal.  (a) Upon receipt by any Paying Agent of the Fundamental Change Repurchase Notice specified in Section 4.01(c) and the delivery to any Paying Agent of the Security in respect of which such Fundamental Change Repurchase Notice was given, in the manner required by Section 4.01(c), the Holder of such Security shall (unless such Fundamental Change Repurchase Notice is withdrawn as specified below) thereafter be entitled to receive the Fundamental Change Repurchase Price with respect to such Security.  Such Fundamental Change Repurchase Price shall be paid to such Holder promptly following

 

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the later of (i) the Fundamental Change Repurchase Date with respect to such Security (provided the conditions in Section 4.01(c) have been satisfied) and (ii) the time of delivery of such Security to a Paying Agent by the Holder thereof in the manner required by Section 4.01(c).  Securities in respect of which a Fundamental Change Repurchase Notice has been given by the Holder thereof may not be converted into shares of Common Stock pursuant to Article 5 hereof on or after the date of the delivery of such Fundamental Change Repurchase Notice, unless such Fundamental Change Repurchase Notice has first been validly withdrawn in accordance with Section 4.02(b).

 

(b)          A Fundamental Change Repurchase Notice may be withdrawn (in whole or in part) upon delivery of a written notice of withdrawal (which may be delivered by mail, overnight courier, hand delivery, facsimile transmission or in any other written form and, in the case of Global Securities, must be delivered electronically or by other means in accordance with the Applicable Procedures) to a Paying Agent, and such written notice of withdrawal must be received by the Paying Agent, at any time prior to the Close of Business on the Business Day immediately preceding the Fundamental Change Repurchase Date, specifying:

 

(i)             if Certificated Securities are to be withdrawn, the certificate numbers of the Securities in respect of which such notice of withdrawal is being submitted;

 

(ii)          the principal amount of the Securities in respect of which such notice of withdrawal is being submitted; and

 

(iii)       the principal amount, if any, of the Securities that remains subject to the original Fundamental Change Repurchase Notice and that has been or shall be delivered for purchase by the Company.

 

If the Securities are other than Certificated Securities, the foregoing notice of withdrawal must comply with the Applicable Procedures of the Depositary.

 

Section 4.03.                          Deposit of Fundamental Change Repurchase Price.  Prior to 10:00 a.m., New York City time, on the Fundamental Change Repurchase Date, the Company shall deposit with the Paying Agent (or if the Company or an Affiliate is acting as the Paying Agent, shall segregate and hold in trust as provided in Section 2.06) an amount in cash (in immediately available funds if deposited on such Fundamental Change Repurchase Date) sufficient to pay the aggregate Fundamental Change Repurchase Price of all the Securities or portions thereof that are to be purchased on that Fundamental Change Repurchase Date.

 

If a Paying Agent holds, in accordance with the terms hereof, at 10:00 a.m., New York City time, on the applicable Fundamental Change Repurchase Date, cash sufficient to pay the Fundamental Change Repurchase Price of any Security for which a Fundamental Change Repurchase Notice has been delivered and not validly withdrawn in accordance with Section 4.02(b) of this Indenture, then, immediately after such Fundamental Change Repurchase Date, such Securities shall cease to be outstanding and 

 

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interest (including Additional Interest, if any) shall cease to accrue thereon, whether or not such Securities are delivered to the Paying Agent, and the rights of the Holders in respect thereof shall terminate (other than the right to receive the Fundamental Change Repurchase Price upon delivery of such Securities by their Holders to the Paying Agent).

 

Section 4.04.                          Securities Repurchased in Part.  Any Certificated Security that is to be purchased only in part shall be surrendered at the office of a Paying Agent (with, if the Company or the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Company and the Trustee duly executed by, the Holder thereof or such Holder’s attorney duly authorized in writing), and promptly after the Fundamental Change Repurchase Date, the Company shall issue and the Trustee shall, upon receipt of a Company Order (which the Company agrees to deliver without unreasonable delay), authenticate and deliver to the Holder of such Security, without service charge, a new Security or Securities, of such authorized denomination or denominations as may be requested by such Holder, in aggregate principal amount equal to, and in exchange for, the portion of the principal amount of the Security so surrendered that is not purchased.

 

Section 4.05.                          Repayment to the Company.  To the extent that the aggregate amount of cash deposited by the Company pursuant to Section 4.03 exceeds the aggregate Fundamental Change Repurchase Price of the Securities or portions thereof that the Company is obligated to purchase on the Fundamental Change Repurchase Date, then, promptly after the Fundamental Change Repurchase Date, the Paying Agent shall return any such excess cash to the Company.

 

Section 4.06.                          Compliance with Securities Laws upon Repurchase of Securities.  When complying with the provisions of Section 4.01 hereof, the Company shall to the extent applicable:

 

(a)                        comply with the provisions, if any, of Rule 13e-4, Rule 14e-1 and any other tender offer rules under the Exchange Act that may then be applicable; and

 

(b)                        otherwise comply with all federal and state securities laws so as to permit the rights and obligations in connection with any purchase pursuant to a Fundamental Change to be exercised in the time and in the manner specified under such applicable federal and state securities laws.

 

ARTICLE 5
  CONVERSION

 

Section 5.01.                          Conversion Privilege.  (a) Subject to and upon compliance with the further provisions of this Article 5 and Paragraph 7 of the Securities, a Holder may convert its Securities (or any portion thereof equal to $1,000 principal amount or a multiple of $1,000 principal amount in excess thereof) at the Conversion Rate, subject to adjustments as set forth in this Article 5 (subject to, and in accordance with, the settlement provisions of Section 5.03, the “Conversion Obligation”), (x) on or after May 15, 2018, without regard to the conditions described in clauses (i) through (v) below and

 

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(y) prior to May 15, 2018, only upon the satisfaction of any of the conditions described in clauses (i) through (v) below; provided that, in the case of any conversion pursuant to this Article 5, the Holder must deliver a Conversion Notice (as defined below) no later than the Close of Business on the second Scheduled Trading Day immediately preceding the Maturity Date.

 

(i)             Prior to the Close of Business on the Business Day immediately preceding May 15, 2018, a Holder may surrender its Securities for conversion during any calendar quarter beginning after the calendar quarter ending on December 31, 2013, and only during such calendar quarter, if the Closing Sale Price of the Common Stock for 20 or more Trading Days in a period of 30 consecutive Trading Days ending on the last Trading Day of the immediately preceding calendar quarter is greater than 130% of the Conversion Price on the last Trading Day of such preceding calendar quarter (the “Conversion Trigger Price”).  The Conversion Agent will, on the Company’s behalf, determine at the beginning of each calendar quarter commencing at any time after December 31, 2013 whether the Securities are convertible as the result of the satisfaction of this condition in the preceding calendar quarter and shall notify the Company and the Trustee accordingly.

 

(ii)          Prior to the Close of Business on the Business Day immediately preceding May 15, 2018, a Holder may surrender its Securities for conversion during the five Business Day period following any five consecutive Trading Day period (the “Measurement Period”) in which the Trading Price per $1,000 principal amount of Securities, all as determined by the Bid Solicitation Agent following a request by the Company in accordance with this Section 5.01(a)(ii), for each Trading Day of such Measurement Period was less than 98% of the product of the Closing Sale Price of the Common Stock for such Trading Day and the applicable Conversion Rate.  In connection with any conversion in accordance with this Section 5.01(a)(ii), the Bid Solicitation Agent shall have no obligation to determine the Trading Price of the Securities unless requested by the Company to do so in writing; and the Company shall have no obligation to make such request unless a Holder of at least $5,000,000 principal amount of Securities provides the Company with reasonable evidence that the Trading Price per $1,000 principal amount of Securities would be less than 98% of the product of the Closing Sale Price of the Common Stock and the applicable Conversion Rate on such date and such Holder requests that the Company request the Bid Solicitation Agent to determine the Trading Prices of the Securities.  Promptly after receiving such evidence, the Company shall instruct the Bid Solicitation Agent to determine the Trading Price of the Securities beginning on the next Trading Day and on each successive Trading Day until the Trading Price per $1,000 principal amount of Securities is greater than or equal to 98% of the product of the Closing Sale Price of the Common Stock and the applicable Conversion Rate on such date.  If the Company does not, when obligated to, instruct the Bid Solicitation Agent to determine the Trading Price of the Securities as provided in the preceding sentence, then the Trading Price per $1,000 principal amount of Securities will be deemed to be less than 98% of the product of the Closing Sale Price of the

 

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Common Stock and the applicable Conversion Rate on each day the Company fails to so instruct the Bid Solicitation Agent.  If the Trading Price condition set forth above has been met, the Company shall so notify the Holders in the manner set forth in Section 13.01.  If, at any time after the Trading Price condition set forth above has been met, the Trading Price per $1,000 principal amount of Securities is greater than or equal to 98% of the product of the Closing Sale Price of the Common Stock and the applicable Conversion Rate, the Company shall so notify the Holders in the manner set forth in Section 13.01.

 

(iii)       If, prior to the Close of Business on the Business Day immediately preceding May 15, 2018, the Company elects to:

 

(A)       distribute, to all or substantially all holders of Common Stock, rights, warrants or options (other than pursuant to the Company’s preferred stock rights plan or any successor plan thereto) entitling such holders to, for a period of not more than 45 calendar days from the record date of such distribution, subscribe for or purchase shares of Common Stock at a price per share less than the average of the Closing Sale Prices of Common Stock for each of the 10 consecutive Trading Days immediately preceding the date that such distribution was first publicly announced; or

 

(B)       distribute, to all or substantially all holders of Common Stock, cash or other assets, debt securities or certain rights or warrants to purchase the Company’s securities (excluding distributions described in Section 5.06(a) or Section 5.06(b)), which distribution has a per share value exceeding 15% of the average of the Closing Sale Prices of the Common Stock for the 10 consecutive Trading Days immediately preceding the date that such distribution was first publicly announced,

 

then, in each case, the Company shall notify the Holders in the manner set forth in Section 13.01 at least 25 Scheduled Trading Days prior to the first date on which the shares of 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 (the “Ex Date”).  Once the Company has given the notice, Holders may surrender their Securities for conversion at any time until the earlier of (x) the Close of Business on the Business Day immediately prior to the Ex Date and (y) the Company’s announcement that such distribution will not take place.  Notwithstanding the foregoing, Holders may not surrender their Securities for conversion under this Section 5.01(a)(iii) if they are otherwise able to participate in such distribution due to the participation of Holders in such distribution.

 

In determining whether any rights, warrants or options entitle the holders to subscribe for or purchase shares of Common Stock at less than the relevant per share prices set forth in this Section 5.01(a)(iii), and in determining the aggregate offering price of such shares of Common Stock, there shall be taken into account any consideration received by the

 

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Company for such rights, warrants or options and any amount payable on exercise or conversion thereof, with the value of such consideration, if other than cash, to be determined by the Board of Directors of the Company or a committee thereof.

 

(iv)      If a transaction or event that constitutes a Fundamental Change (without giving effect to the exception regarding publicly traded securities contained in the paragraph immediately following the definition of Fundamental Change in Section 4.01(a)) or a Make-Whole Fundamental Change occurs prior to the Close of Business on the Business Day immediately preceding May 15, 2018, regardless of whether a Holder has the right require the Company to repurchase the Securities pursuant to Article 4, or if the Company is a party to a consolidation, merger, binding share exchange, or transfer or lease of all or substantially all of its assets, in each case, pursuant to which the Common Stock would be converted into cash, securities or other assets, the Company shall notify the Holders (A)in the manner set forth in Section 13.01 as soon as practicable and in any event at least 25 Scheduled Trading Days prior to the anticipated effective date of such transaction, in the case of a transaction that is known to the Company prior to such 25th Scheduled Trading Day, or within two Trading Days after the Company becomes aware of such transaction, in the case of a transaction that is not known to the Company prior to such 25th Scheduled Trading Day, but in no event later than the actual effective date of such transaction and (B)within 15 Business Days after the effective date of such transaction.  Once the Company has given the notice, Holders may surrender their Securities for conversion under this Section 5.01(a)(iv) at any time beginning 10 Trading Days before the anticipated effective date of such transaction until 35 calendar days after the actual effective date of such transaction (or if such transaction also constitutes a Fundamental Change, until the Close of Business on the Business Day immediately preceding the related Fundamental Change Repurchase Date, if later).

 

(b)                        The cash payable, and the number of shares of Common Stock issuable, if any, on conversion of a Security shall be determined as set forth in Section 5.03.

 

Section 5.02.                          Conversion Procedures.  (a) The right of conversion attaching to any Security may be exercised (i) if such Security is represented by a Global Security, by book-entry transfer to the Conversion Agent through the facilities of the Depositary in accordance with the Applicable Procedures, or (ii) if such Security is represented by a Certificated Security, by delivery of such Security at the specified office of the Conversion Agent, accompanied, in either case, by: (1) a duly signed and completed conversion notice, in the form as set forth on the reverse of Security attached hereto as Exhibit A (a “Conversion Notice”), which once delivered, shall be irrevocable; (2) if such Certificated Security has been lost, stolen, destroyed or mutilated, a notice to the Conversion Agent in accordance with Section 2.10 regarding the loss, theft, destruction or mutilation of the Security; (3) appropriate endorsements and transfer documents if required by the Registrar or the Conversion Agent; (4) payment of any tax or duty, in accordance with Section 5.04; and (5) payment of any interest (including Additional Interest, if any) payable on the Securities in accordance with Section 5.03(c). The date on

 

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which the Holder satisfies all of the requirements specified in this Section 5.02 shall be the “Conversion Date.”

 

(b)                        Each Conversion Notice shall state the name or names (with address or addresses) of the Person or Persons in which any certificate or certificates for shares of Common Stock which shall be issuable on such conversion shall be issued.  All such Securities surrendered for conversion shall, unless the shares of Common Stock issuable on conversion are to be issued in the same name as the registered Holder of such Securities, be duly endorsed by, or be accompanied by instruments of transfer in form satisfactory to the Company duly executed by, the registered Holder or its duly authorized attorney.

 

(c)                         Except as otherwise provided by Section 5.13, upon conversion of the Securities, the Company shall deliver and shall issue to such Holder at the office of the Conversion Agent, the cash amounts payable in respect of such conversion and a certificate or certificates for the number of full shares of Common Stock issuable in respect of such conversion, if any, in accordance with the provisions of this Article 5, no later than the third Business Day after the expiration of the Conversion Reference Period.  In case any Securities of a denomination greater than $1,000 shall be surrendered for partial conversion, the Company shall execute and the Trustee shall authenticate and deliver to the Holder of the Securities so surrendered, without charge to such Holder, new Securities in authorized denominations in an aggregate principal amount equal to the unconverted portion of the surrendered Securities.

 

Each conversion shall be deemed to have been effected as to any such Securities (or portion thereof) immediately prior to the Close of Business on the Conversion Date, and the Person in whose name any certificate or certificates for shares of Common Stock shall be issuable upon such conversion shall be deemed to have become on said date the holder of record of the shares of Common Stock represented thereby; provided, however, that in case of any such surrender on any date when the stock transfer books of the Company shall be closed, the Person or Persons in whose name the certificate or certificates for such shares of Common Stock are to be issued shall be deemed to have become the record holder or holders thereof for all purposes on the next day on which such stock transfer books are open, but such conversion shall be at the Conversion Rate in effect on the date upon which such Securities shall be surrendered.

 

(d)                        Upon the conversion of an interest in Global Securities, the Trustee (or other Conversion Agent appointed by the Company) shall make a notation on such Global Securities as to the reduction in the principal amount represented thereby. The Company shall notify the Trustee in writing of any conversions of Securities effected through any Conversion Agent other than the Trustee.

 

(e)                         No Conversion Notice with respect to any Securities may be delivered by a Holder thereof if such Holder also has delivered a Fundamental Change Repurchase Notice and not validly withdrawn such Fundamental Change Repurchase Notice in accordance with the applicable provisions of Section 4.01.

 

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Section 5.03.                          Settlement upon Conversion.  (a) If a Holder surrenders its Securities for conversion, the Company shall deliver, in respect of each $1,000 principal amount of Securities surrendered for conversion, a “Settlement Amount” equal to the sum of the Daily Settlement Amounts for each of the 20 Trading Days during the Conversion Reference Period for such Security.

 

(i)             All conversions occurring on or after May 15, 2018 shall be settled using the same forms and amounts of consideration.  Except for any conversions that occur on or after May 15, 2018, the Company shall use the same forms and amounts of consideration for all conversions occurring on the same Conversion Date, but the Company shall not have any obligation to use the same forms and amounts with respect to conversions that occur on different Conversion Dates.  If, in respect of any Conversion Date, the Company elects to settle all or a portion of its Conversion Obligation in excess of the principal portion of the Securities being converted in cash in respect of such Conversion Date, the Company shall inform converting Holders through the Trustee of such election (the “Settlement Notice”) no later than the close of business on the second Trading Day immediately following the related Conversion Date (or, in the case of any conversions occurring on or after May 15, 2018, no later than the Close of Business on the Scheduled Trading Day immediately preceding May 15, 2018) and the Company shall indicate in such Settlement Notice the percentage of each share issuable upon conversion in excess of the principal portion of the Securities being converted that will be paid in cash (the “Cash Percentage”).  If the Company does not elect a Settlement Method prior to the deadline set forth in the immediately preceding sentence, the Company shall no longer have the right to elect a Cash Percentage and the Company shall settle its Conversion Obligation by paying cash in respect of the principal portion of the converted Securities and delivering shares of Common Stock in respect of the remainder, if any, of its Conversion Obligation in excess of the aggregate principal portion of the Securities being converted as set forth herein.

 

(ii)          The “Daily Settlement Amount” for each of the 20 Trading Days during the Conversion Reference Period shall consist of:

 

(A)       cash equal to the lesser of (x) $50 and (y) the Daily Conversion Value, plus

 

(B)       if the Daily Conversion Value exceeds $50, the Daily Net Settlement Amount.

 

(b)                        Upon conversion, Holders shall not receive any separate cash payment for accrued and unpaid interest, including Additional Interest, if any, unless such conversion occurs between a Record Date and the Interest Payment Date to which it relates in which case such payment shall be payable to the Holder of converted Securities as of the Record Date.

 

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(c)                         Securities surrendered for conversion during the period from the Close of Business of any Record Date to 9:00 a.m., New York City time, on the immediately following Interest Payment Date, must be accompanied by funds equal to the amount of interest (including any Additional Interest, if any) payable on the Securities being converted; provided further, however, that such payment is not required to be made (i)if the conversion is in connection with a Fundamental Change and the Company has specified a Fundamental Change Repurchase Date that is after a Record Date and prior to the corresponding Interest Payment Date; (ii)with respect to any Securities converted after the Record Date immediately preceding the Maturity Date of the Securities; or (iii)to the extent of any overdue interest (including overdue Additional Interest, if any), if overdue interest exists at the time of conversion with respect to the Securities being converted.

 

(d)                        The Company shall not issue fractional shares of Common Stock upon conversion of Securities.  If multiple Securities shall be surrendered for conversion at one time by the same Holder, the number of full shares which shall be issuable upon conversion shall be computed on the basis of the aggregate principal amount of the Securities (or specified portions thereof to the extent permitted hereby) so surrendered.  If any fractional share of Common Stock would be issuable upon the conversion of any Securities, the Company shall make payment therefor in cash equal to the fraction of a share of Common Stock otherwise issuable multiplied by the Daily VWAP for the final Trading Day of the applicable Conversion Reference Period.

 

Section 5.04.                          Taxes on Conversion.  If a Holder converts a Security, the Company shall pay any documentary, stamp or similar issue or transfer taxes or duties relating to the issuance or delivery of shares of Common Stock, if any, upon exercise of such conversion rights.  However, the Holder shall pay any tax or duty which may be payable relating to any transfer involved in the issuance or delivery of the Common Stock in a name other than the Holder’s name.  The Conversion Agent may refuse to deliver the certificate representing the Common Stock being issued in a name other than the Holder’s name until the Conversion Agent receives a sum sufficient to pay any tax or duties which will be due because the shares are to be issued in a name other than the Holder’s name.  Nothing herein shall preclude any tax withholding required by law or regulation.

 

Section 5.05.                          Company to Provide Stock.  (a) The Company shall, prior to the issuance of any Securities hereunder, and from time to time as may be necessary, reserve at all times and keep available, free from preemptive rights, out of its authorized but unissued Common Stock, a sufficient number of shares of Common Stock to permit delivery upon conversion of all of the Securities.

 

(b)                        All shares of Common Stock that may be issued upon conversion of the Securities shall be newly issued shares or shares held in the treasury of the Company, shall be duly authorized, validly issued, fully paid and nonassessable and shall be free of any preemptive rights and free of any lien or adverse claim.

 

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(c)                         The Company shall use its reasonable efforts to comply with all applicable securities laws regulating the offer and delivery of shares of Common Stock, if any, upon conversion of Securities and shall use its reasonable efforts to list or cause to have quoted such shares of Common Stock on the NASDAQ Global Select Market, the New York Stock Exchange or any other U.S. national securities exchange or in the established automated over-the-counter trading market in the United States on which the Common Stock is then listed or quoted; provided, however, that, if the rules of such automated quotation system or exchange permit the Company to defer the listing of such Common  Stock until the first conversion of the Securities into Common Stock in accordance with the provisions of this Indenture, the Company covenants to list such Common Stock issuable upon conversion of the Securities in accordance with the requirements of such automated quotation system or exchange at such time.

 

Section 5.06.                          Adjustment of Conversion Rate.  The Conversion Rate shall be adjusted from time to time by the Company if any of the following events occurs, except that the Company will not make any adjustment if Holders of Securities may participate (other than in the case of a (A) share split or share combination or (B) a tender or exchange offer), at the same time and upon the same terms as holders of the Common Stock and solely as a result of holding the Securities, in the transactions described in this Section 5.06 without having to convert their Securities, as if they held a number of shares of Common Stock equal to the Conversion Rate, multiplied by the principal amount (expressed in thousands) of Securities held by such Holder:

 

(a)                        If the Company issues shares of Common Stock as a dividend or distribution on shares of Common Stock, which dividend or distribution consists exclusively of shares of Common Stock, or subdivides or combines the outstanding Common Stock, the Conversion Rate will be adjusted based on the following formula:

 

 

where

 

CR0                         =                                         the Conversion Rate in effect immediately prior to the Opening of Business on the Ex Date of such dividend or distribution, or the effective date of such share split or share combination, as applicable;

 

CR1                         =                                         the Conversion Rate in effect immediately after the Opening of Business on such Ex Date or effective date;

 

OS0                           =                                         the number of shares of Common Stock outstanding immediately prior to such Ex Date or effective date; and

 

OS1                           =                                         the number of shares of Common Stock outstanding immediately after the Opening of Business on such Ex Date or effective date

 

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after giving effect to such dividend, distribution, subdivision or share combination.

 

Any adjustment made pursuant to this Section 5.06(a) shall become effective immediately after the Opening of Business on the Ex Date for such dividend or distribution, or the effective date for such subdivision or combination.  If any dividend or distribution of the type described in this Section 5.06(a) is declared but not paid or made, or the outstanding shares of Common Stock are not subdivided or combined, as the case may be, the Conversion Rate shall be immediately readjusted, effective as of the date the  Board of Directors of the Company 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, distribution, or subdivision or combination had not been declared or announced.

 

(b)                        If the Company issues to all or substantially all holders of the Common Stock rights, warrants or options (other than pursuant to the Company’s preferred stock rights plan or any successor plan thereto) entitling such holders for a period of not more than 45 calendar days after the announcement of such issuance to subscribe for or purchase shares of Common Stock, at a price per share or a Conversion Price per share less than the average of the Closing Sale Prices of the Common Stock for the 10 consecutive Trading Days immediately preceding the date that such distribution was first publicly announced, the Conversion Rate will be adjusted based on the following formula:

 

 

where

 

CR0                         =                                         the Conversion Rate in effect immediately prior to the Opening of Business on the Ex Date for such issuance;

 

CR1                         =                                         the Conversion Rate in effect immediately after the Opening of Business on such Ex Date for such issuance;

 

OS0                           =                                         the number of shares of Common Stock outstanding immediately prior to the Opening of Business on the Ex Date;

 

X                                       =                                         the total number of shares of Common Stock issuable pursuant to such rights, warrants or options; and

 

Y                                       =                                         the number of shares of Common Stock equal to the aggregate price payable to exercise such rights or warrants divided by the average of the Closing Sale Prices of the Common Stock for the 10 consecutive Trading Days immediately preceding the date that the distribution of such rights, warrants or options was first publicly announced.

 

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The adjustment described in this Section 5.06(b) shall be successively made whenever any such rights, warrants or options are distributed and shall become effective immediately after the Opening of Business on the Ex Date for such issuance.  If such rights, warrants or options are not so issued, the Conversion Rate shall be adjusted to be the Conversion Rate that would then be in effect if such Ex Date for such issuance had not been fixed.  In addition, to the extent that shares of Common Stock are not delivered after the expiration of such rights, warrants or options, the Conversion Rate shall be readjusted to the Conversion Rate that would then be in effect had the adjustments made  upon the issuance of such rights, warrants or options been made on the basis of only the number of shares of Common Stock actually delivered.

 

In determining whether any rights, warrants or options entitle the Holders to subscribe for or purchase shares of Common Stock at less than such average of the Closing Sale Prices, and in determining the aggregate offering price of such shares of Common Stock, there shall be taken into account any consideration received by the Company for such rights, warrants or options and any amount payable on exercise or conversion thereof, with the value of such consideration, if other than cash, to be determined by the Board of Directors of the Company.

 

For the purposes of this Section 5.06(b), rights, warrants or options distributed by the Company to all or substantially all holders of its Common Stock entitling them to subscribe for or purchase shares of the Company’s Capital Stock (either initially or under certain circumstances), which rights, warrants or options, until the occurrence of a specified event or events (a “Trigger Event”): (1) are deemed to be transferred with such shares of Common Stock; (2) are not exercisable; and (3) also are issued in respect of future issuances of Common Stock, shall be deemed not to have been distributed for purposes of this Section 5.06(b) and no adjustment to the Conversion Rate under this Section 5.06(b) shall be required until the occurrence of the earliest Trigger Event, whereupon such rights, warrants and options shall be deemed to have been distributed and an appropriate adjustment (if any is required) to the Conversion Rate shall be made under this Section 5.06(b).

 

(c)                         If the Company distributes to all or substantially all holders of the Common Stock shares of the Company’s Capital Stock, evidences of indebtedness or other non-cash assets, including securities, rights or warrants, but excluding:

 

(i)             dividends or distributions referred to in Section 5.06(a);

 

(ii)          rights, warrants or options referred to in Section 5.06(b);

 

(iii)       rights issued pursuant to the Company’s preferred stock rights plan or any successor plan thereto, or the detachment of such rights under the terms of any such plan;

 

(iv)      dividends or distributions paid exclusively in cash as to which an adjustment was effected pursuant to Section 5.06(d); and

 

(v)         Spin-Offs to which the provisions of this Section 5.06(c) apply,

 

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then the Conversion Rate shall be adjusted based on the following formula:

 

 

where

 

CR0                         =                                         the Conversion Rate in effect immediately prior to the Opening of Business on the Ex Date for such distribution;

 

CR1                         =                                         the Conversion Rate in effect immediately after the Opening of Business on Ex Date for such distribution;

 

SP0                             =                                         the average of the Closing Sale Prices of the Common Stock over the 10 consecutive Trading Day period ending on the Trading Day immediately preceding the Ex Date for such distribution; and

 

FMV                    =                                         the Fair Market Value (as determined by the Board of Directors of the Company) of the shares of Capital Stock, evidences of indebtedness, assets, or property distributed with respect to each outstanding share of Common Stock on the Ex Date for such distribution.

 

An increase made under the portion of this Section 5.06(c) above shall become effective immediately after the open of business on the Ex Date for such distribution. Notwithstanding the foregoing, if “FMV” (as defined above) is equal to or greater than “SP0” (as defined above), in lieu of the foregoing increase, each Holder of a Security shall receive, in respect of each $1,000 principal amount thereof, the amount and kind of the Company’s Capital Stock, evidences of the Company’s indebtedness, other assets or property of the Company or rights, options or warrants to acquire the Company’s Capital Stock or other securities that such Holder would have received if such Holder owned a number of shares of Common Stock equal to the Conversion Rate in effect on the Ex Date for the distribution.

 

If the Board of Directors of the Company determines the Fair Market Value of any distribution for purposes of this Section 5.06(c) by reference to the actual or when issued trading market for any securities, it must in doing so consider the prices in such market over the same period used in computing the average of the Closing Sale Prices of the Common Stock.

 

With respect to an adjustment pursuant to this Section 5.06(c) where there has been a payment of a dividend or other distribution on the Common Stock or shares of Capital Stock of any class or series, or similar equity interest, of or relating to a Subsidiary or other business unit of the Company, that are, or, when issued, will be, listed or admitted for trading on a U.S. national securities exchange (a “Spin-Off”), the Conversion Rate in effect immediately before the Close of Business, New York City

 

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time, on the effective date of such Spin-Off shall be increased based on the following formula:

 

 

where

 

CR0                         =                                         the Conversion Rate in effect immediately prior to the end of the Valuation Period (as defined below);

 

CR1                         =                                         the Conversion Rate in effect immediately after the end of the Valuation Period;

 

FMV0               =                                         the average of the Closing Sale Prices of the Capital Stock or similar equity interest distributed to holders of Common Stock over the first 10 consecutive Trading Days after, and including, the effective date of the Spin-Off (the “Valuation Period”); and

 

MP0                        =                                         the average of the Closing Sale Prices of Common Stock over the Valuation Period.

 

Because the adjustment to the applicable Conversion Rate under the preceding paragraph will occur immediately after the end of the Valuation Period, (1) if a Holder converts a Security and the first Trading Day of the Conversion Reference Period applicable to such Security occurs on or after the Ex Date for the Spin-Off, but prior to or on the last Trading Day of the Valuation Period for such Spin-Off, the Company shall postpone the Conversion Date applicable to such Security until the first Business Day immediately following the last Trading Day of such Valuation Period (and the settlement of such Security will be postponed accordingly), and (2) if a Holder converts a Security, at least one Trading Day of the Conversion Reference Period applicable to such Security occurs prior to the Ex Date for such Spin-Off and, but for this provision, at least one Trading Day of such Conversion Reference Period would occur on or after the Ex Date for such Spin-Off, but prior to or on the last Trading Day of the Valuation Period for such Spin-Off, such Conversion Reference Period will be suspended on the first such Trading Day and will resume on the first Trading Day immediately following the end of such Valuation Period (and the settlement of such Security will be postponed accordingly).

 

For purposes of the above calculation, (i) the “closing sales price” of any Capital Stock or similar equity interest shall be calculated in a manner analogous to that used to calculate the Closing Sales Price of the Common Stock, (ii) whether a day is a “trading day” (and whether a day is a “scheduled trading day” and whether a “market disruption event” has occurred) for the applicable Capital Stock or similar equity interest shall be determined in a manner analogous to that used to determine whether a day is a Trading Day (or whether a day is a Scheduled Trading Day and whether a Market Disruption Event has occurred) for the Common Stock, and (iii) whether a day is a Trading Day to

 

41

 

be included in a valuation period will be determined based on whether a day is a Trading Day for both the Common Stock and such Capital Stock or similar equity interest.

 

If any dividend or distribution described in this Section 5.06(c) is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate that would then be in effect if such dividend or distribution had not been declared.

 

(d)                        If the Company pays any dividend or makes any distribution (other than in connection with a liquidation, dissolution or winding up of the Company) consisting  exclusively of cash to all or substantially all holders of the Common Stock, the Conversion Rate will be adjusted based on the following formula:

 

 

where

 

CR0                         =                                         the Conversion Rate in effect immediately prior to the Ex Date for such dividend or distribution;

 

CR1                         =                                         the Conversion Rate in effect immediately after the Opening of Business on the Ex Date for such dividend or distribution;

 

SP0                             =                                         the Closing Sale Price of a share of Common Stock on the Trading Day immediately preceding the Ex Date for such dividend or distribution; and

 

C                                       =                                         the amount in cash per share the Company distributes to holders of Common Stock.

 

The adjustment to the Conversion Rate described in this Section 5.06(d) will become effective immediately after the Opening of Business on the Ex Date for such dividend or distribution.  If such dividend or distribution is not so paid or made, the Conversion Rate shall again be adjusted to be the Conversion Rate that would then be in effect if such dividend or distribution had not been declared. Notwithstanding the foregoing, if “C” (as defined above) is equal to or greater than “SP0” (as defined above), in lieu of the foregoing increase, each Holder of a Security shall receive, for each $1,000 principal amount of Securities, at the same time and upon the same terms as holders of shares of the Common Stock, the amount of cash that such Holder would have received if such Holder owned a number of shares of Common Stock equal to the Conversion Rate on the Ex Date for such cash dividend or distribution.

 

(e)                         If the Company or any of its Subsidiaries purchases shares of Common Stock pursuant to a tender offer or exchange offer made at a price per share in excess of the Closing Sale Price of Common Stock on the Trading Day next succeeding the last date on which tenders or exchanges may be made pursuant to such tender or exchange offer, the Conversion Rate will be increased based on the following formula:

 

42

 

 

where

 

CR0                         =                                         the Conversion Rate in effect immediately prior to the effective date of the adjustment;

 

CR1                         =                                         the Conversion Rate in effect immediately after the effective date of the adjustment;

 

AC                              =                                         the aggregate value of all cash and any other consideration (as determined by the Board of Directors of the Company) paid or payable for shares purchased in such tender or exchange offer;

 

OS0                           =                                         the number of shares of Common Stock outstanding immediately prior to the date such tender or exchange offer expires;

 

OS1                           =                                         the number of shares of Common Stock outstanding immediately after the date such tender or exchange offer expires (after giving effect to the purchase of all shares accepted for purchase or exchange in such tender or exchange offer); and

 

SP1                             =                                         the average of the Closing Sale Prices of Common Stock over the 10 consecutive Trading Day period commencing on the Trading Day next succeeding the date such tender or exchange offer expires.

 

The adjustment to the Conversion Rate under this Section 5.06(e) shall occur at the Close of Business on the 10th Trading Day from, and including the Trading Day next succeeding the date such tender or exchange offer expires; provided, that in respect of any conversion within 10 Trading Days immediately following, and including, the expiration date of any tender or exchange offer, references within this Section 5.06(e) to 10 Trading Days shall be deemed replaced with such lesser number of Trading Days as have elapsed between the expiration date of such tender or exchange offer and the Conversion Date in determining the applicable adjustment to the Conversion Rate. In addition, if the Trading Day next succeeding the date such tender or exchange offer expires is after the 10th Trading Day immediately preceding, and including, the end of the Conversion Reference Period in respect of a conversion of Securities, references in the preceding paragraph to 10 trading days shall be deemed to be replaced, solely in respect of such conversion of Securities, with such lesser number of Trading Days as have elapsed from, and including, the Trading Day next succeeding the date such tender or exchange offer expires to, and including, the last Trading Day of such Conversion Reference Period.

 

(f)                          Except as set forth in Sections 5.06(a), 5.06(b), 5.06(c), 5.06(d) or 5.06(e), no adjustment to the Conversion Rate shall be made for the issuance of shares of Common Stock or any securities convertible into or exchangeable for shares of Common

 

43

 

Stock or the right to purchase shares of Common Stock or such convertible or exchangeable securities.  If, however, application of the formulas provided in Sections 5.06(a), 5.06(b), 5.06(c), 5.06(d) or 5.06(e) would result in a decrease in the Conversion Rate, no adjustment to the Conversion Rate shall be made except in the case of a subdivision, split or combination of the Common Stock.

 

(g)                         To the extent permitted by applicable law, subject to the applicable listing standards of the NASDAQ Global Select Market (or such other U.S. national or regional  securities exchange on which the Common Stock is then listed) and subject to Section 5.09 below, the Company from time to time may increase the Conversion Rate by any amount for any period of time for a period of at least 20 days if the Board of Directors of the Company determines that such increase would be in the best interest of the Company.

 

(h)                        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 so long as the Company does not pay any dividend or make any distribution on shares of Common Stock held in the treasury of the Company.

 

(i)                            Notwithstanding anything to the contrary in this Indenture, if an adjustment to the Conversion Rate pursuant to this Article 5 would require the Company to issue shares of Common Stock in excess of the amount permitted by applicable listing standards of the NASDAQ Global Select Market (or such other U.S. national or regional securities exchange on which the Common Stock is then listed) to be issued without approval by the Company’s stockholders, the Company shall, at its option, either (1) obtain the approval of its stockholders with respect to any issuance of Common Stock upon conversion of the Notes in excess of such limitations or (2) pay cash in lieu of delivering any shares of Common Stock otherwise deliverable upon conversion in excess of such limitations to the Holders of Securities being converted in an amount per share of Common Stock based on the Daily VWAP of the Common Stock for each Trading Day of the relevant Conversion Reference Period in respect of which such shares would otherwise be delivered to the converting Holders.

 

Section 5.07.                          No Adjustment.  (a) No adjustment in the Conversion Rate shall be required unless the adjustment would result in a change in the Conversion Rate of at least 1.0%; provided, however, that any adjustment which by reason of this Section 5.07(a) is not required to be made shall be carried forward and taken into account in determining any subsequent adjustment and in connection with any conversion of Securities.  Adjustments to the applicable Conversion Rate under this Article 5 shall be calculated to the nearest 1/10,000th of a share.

 

(b)                        Except as otherwise provided for in this Article 5, (i) the Company shall not be required to adjust the Conversion Rate for the issuance of its Common Stock or any securities convertible or exchangeable for its Common Stock or the right to purchase its Common Stock or such convertible or exchangeable securities, and (ii) no separate payment or adjustment will be made for dividends or distribution on any Common Stock issued upon conversion of Securities.  By delivering to the Holder the cash and shares, if any, of Common Stock issuable upon conversion, together with a cash payment in lieu of

 

44

 

fractional shares, if any, the Company will satisfy its obligation with respect to the conversion of the Securities.  Upon conversion of Securities, all accrued but unpaid interest, including Additional Interest, if any, with respect to the converted Securities will be deemed to be paid in full rather than cancelled, extinguished or forfeited, unless such conversion occurs between a Record Date and the Interest Payment Date to which it relates in which case such payment shall be payable to the Holder of converted Securities as of the Record Date.

 

(c)                         No adjustment to the Conversion Rate shall be made (i) upon the issuances of any shares of Common Stock pursuant to any existing or future Company plan for reinvestment of dividends or interest payable on the Company’s Securities or the investment of additional optional amounts thereunder in shares of Common Stock, (ii) upon any repurchases of Common Stock by the Company that are not a tender offer referred to in Section 5.06(e), including structured or derivative transactions, as approved by the Board of Directors of the Company; (iii) upon the issuance of any shares of Common Stock or options or rights to purchase shares of Common Stock 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; (iv) upon the issuance of any shares of Common Stock pursuant to any option, warrant, right or exercisable, exchangeable or convertible security outstanding as of the date the Securities were first issued; (v) upon a change in the par value of the Common Stock; or (vi) for accrued and unpaid interest (including Additional Interest, if any) .

 

Section 5.08.                          Adjustments of Prices.  Whenever any provision of this Indenture requires the Company to calculate the Closing Sale Prices, the Daily VWAPs, the Daily Conversion Values or the Daily Settlement Amounts over a span of multiple days (including a Conversion Reference Period and the period for determining the Stock Price for purposes of a Make-Whole Fundamental Change) , the Board of Directors of the Company shall make appropriate adjustments to each to account for any adjustment to the Conversion Rate that becomes effective, or any event requiring an adjustment to the Conversion Rate where the Ex Date of the event occurs, at any time during the period when the Closing Sale Prices, the Daily VWAPs, the Daily Conversion Values or the Daily Settlement Amounts are to be calculated.

 

Section 5.09.                          Adjustment for Tax Purposes.  Subject to the applicable listing standards of the NASDAQ Global Select Market (or such other U.S. national or regional securities exchange on which the Common Stock is therein listed), the Company shall be entitled to make such increases in the Conversion Rate, in addition to those required by Section 5.06, as it in its discretion shall determine to be advisable in order to avoid or diminish any tax to stockholders in connection with any stock dividends, subdivisions of shares, distributions of rights to purchase stock or securities or distributions of securities convertible into or exchangeable for stock hereafter made by the Company to its stockholders.

 

Section 5.10.                          Notice of Adjustment.  (a) Whenever the Conversion Rate or conversion privilege is adjusted, the Company shall promptly mail to Holders a notice of the adjustment in accordance with Section 13.01, and file with the Trustee an Officer’s

 

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Certificate briefly stating the facts requiring the adjustment and the manner of computing it.  Unless and until the Trustee shall receive an Officer’s Certificate setting forth an adjustment of the Conversion Price, the Trustee may assume without inquiry that the Conversion Rate has not been adjusted and that the last Conversion Rate of which it has knowledge remains in effect.

 

Section 5.11.                          Adjustment to Conversion Rate upon Certain Fundamental Changes.  (a) If a Holder elects to convert its Securities in connection with a Fundamental Change, as defined in Section 4.01 and determined after giving effect to any exceptions to or exclusions from such definition, but without regard to the exception provided by clause 2(b) of the definition thereof (each such Fundamental Change, a “Make-Whole Fundamental Change”), and such Make-Whole Fundamental Change becomes effective prior to the Maturity Date, then the Conversion Rate of such Securities shall be increased by an additional number of shares of Common Stock (the “Additional Shares”) as described below.  A conversion shall be deemed to be in connection with a Make-Whole Fundamental Change if the Conversion Notice is received by the Conversion Agent during the period that begins on (and includes) the Make-Whole Effective Date and ends at the Close of Business on the Business Day immediately preceding the related Fundamental Change Repurchase Date (or, in the case of a Make-Whole Fundamental Change that would have been a Fundamental Change but for the exception provided by clause (2)(b) of the definition thereof, the 35th Trading Day immediately following the Make-Whole Effective Date).

 

(b)                        The number of Additional Shares, if any, shall be determined by reference to the table attached as Schedule A hereto, which Schedule is incorporated in and made part of this Indenture, based on the date on which the Make-Whole Fundamental Change becomes effective (the “Make-Whole Effective Date”) and the price (the “Stock Price”) paid, or deemed to be paid, per share of Common Stock in such transaction or series of related transactions constituting the Fundamental Change, subject to adjustment as described in Section 5.11(c).  If the holders of Common Stock receive only cash in a Make-Whole Fundamental Change described in clause (2) of the definition of Fundamental Change, the Stock Price shall be the cash amount paid per share.  Otherwise, the Stock Price will be the average of the Closing Sale Prices of Common Stock on the five Trading Days prior to but excluding the Make-Whole Effective Date.  The Company shall notify the Holders and the Trustee of the Make-Whole Effective Date of a Make-Whole Fundamental Change no later than five Business Days after the Make-Whole Effective Date.

 

(c)                         The Stock Prices set forth in the first row of the table in Schedule A hereto shall be adjusted in the same manner as and as of any date on which the Conversion Rate of the Securities is adjusted as described in 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 Conversion Rate immediately prior to the adjustment and the denominator of which is the Conversion Rate as so adjusted.

 

(d)                        If the exact Stock Prices and Make-Whole Effective Dates relating to a Make-Whole Fundamental Change are not set forth in the table in Schedule A, then:

 

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(i)                       If the Stock Price is between two Stock Price amounts in the table of the Make-Whole Effective Date is between two Make-Whole Effective Dates in the table, the number of Additional Shares will be determined by straight-line interpolation between the number of Additional Shares set forth for the higher and lower Stock Price amounts and the two Make-Whole Effective Dates, as applicable, based on a 365-day year.

 

(ii)                    If the Stock Price is greater than $45.00 per share (subject to adjustment in the same manner as the Conversion Rate as set forth in Section 5.06), no Additional Shares will be issued upon conversion.

 

(iii)                 If the Stock Price is less than $8.78 per share (subject to adjustment in the same manner as the Conversion Rate as set forth in Section 5.06), no Additional Shares will be issued upon conversion.

 

(e)                         Notwithstanding the foregoing, in no event will the total number of Additional Shares issuable upon conversion exceed 113.8952 per $1,000 principal amount of Securities (subject to adjustment in the same manner as set forth in Section 5.06).

 

(f)                          For the avoidance of doubt, the increases provided for in this Section 5.11 shall only be made with respect to the Securities being converted in connection with such Make-Whole Fundamental Change and shall not be effective as to any Securities not so converted.

 

Section 5.12.                          Notice of Certain Transactions.  If not otherwise required in connection with a Fundamental Change, if:

 

(a)                        the Company takes any action which would require an adjustment in the Conversion Price;

 

(b)                        the Company consolidates or merges with, or transfers all or substantially all of its property and assets to, another corporation and stockholders of the Company must approve the transaction; or

 

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

 

the Company shall mail to Holders and file with the Trustee a notice stating the proposed record or effective date, as the case may be.  The Company shall mail the notice at least ten days before such date.  Failure to mail such notice or any defect therein shall not affect the validity of any transaction referred to in subsection (a), (b) or (c) of this Section 5.12.

 

Section 5.13.                          Effect of Reclassification, Consolidation, Merger or Sale on Conversion Privilege.  In the event of: (a) any recapitalization, reclassification or change of the Company’s Common Stock (other than a change in par value, or from par value to no par value, or from no par value to par value, or as a result of a subdivision or combination, or any other change for which an adjustment is provided in Section 5.06);

 

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(b) any consolidation, merger or combination involving the Company other than a merger in which the Company is the continuing corporation and which does not result in any reclassification of, or change (other than in par value, or from par value to no par value, or from no par value to par value, or as a result of a subdivision or combination) in, outstanding shares of Common Stock; (c) a sale, lease or other transfer of all or substantially all of the consolidated property and assets of the Company and its Subsidiaries, directly or indirectly, to another Person; or (d) a statutory share exchange  (any such event a “Merger Event”), in which holders of Common Stock would be entitled to receive shares of stock, or other securities, property, assets or cash (or combination thereof) for their shares of Common Stock, then, at the effective time of any such Merger Event, the Holder of each Security then outstanding shall have the right to convert such Security into a right to the kind and amount of shares of stock, or other securities, property, assets or cash (or combination thereof) that a holder of a number of shares of Common Stock equal to the Conversion Rate prior to such Merger Event would have owned or been entitled to receive (the “Reference Property”) in connection with such Merger Event.  However, at and after the effective time of such Merger event, (w) the amount otherwise payable in cash upon conversion of the Securities pursuant to Section 5.03 will continue to be payable in cash, (x) the Company shall continue to have the right to elect to determine the form of consideration to be paid or delivered, as the case may be, in respect of the remainder, if any, of the Conversion Obligation in excess of the principal amount of the Securities being converted as set forth under Section 5.03, (y) the number of shares of Common Stock otherwise deliverable upon the conversion of the Securities pursuant to Section 5.03 will 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 Merger Event and (z) the Daily VWAP will 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 Merger Event.  If the Merger Event causes the Common Stock to be converted into the right to receive more than a single type of consideration (determined based in part upon any form of stockholder election), the Reference Property into which the Securities will be convertible will be deemed to be (a) the weighted average of the types and amounts of consideration received by the holders of Common Stock that affirmatively make such election or (b) 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.  If the holders of Common Stock receive only cash in such Merger Event, then for all conversions that occur after the effective date of such Merger Event (a) the consideration due upon conversion of each $1,000 principal amount of Securities shall be solely cash in an amount equal to the Conversion Rate in effect on the Conversion Date (as may be increased by any Additional Shares pursuant to Section 5.11), multiplied by the price paid per share of Common Stock in such Merger Event and (b) the Company shall satisfy the Conversion Obligation by paying cash to converting Holders on the third Business Day immediately following the relevant Conversion Date. The Company shall notify Holders, the Trustee and the Conversion Agent (if other than the Trustee) of such weighted average as soon as practicable after such determination is made.  The provisions of this Section 5.13 shall similarly apply to successive Merger Events.

 

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Section 5.14.                          Trustee’s Disclaimer.  The Trustee shall have no duty to determine when an adjustment under this Article 5 should be made, how it should be made or what such adjustment should be, but may accept as conclusive evidence of that fact or the correctness of any such adjustment, and shall be protected in relying upon, an Officer’s Certificate, including the Officer’s Certificate with respect thereto which the Company is obligated to file with the Trustee pursuant to Section 5.10.  The Trustee makes no representation as to the validity or value of any securities or assets issued upon  conversion of Securities, and the Trustee shall not be responsible for the Company’s failure to comply with any provisions of this Article 5.

 

The Trustee shall not be under any responsibility to determine the correctness of any provisions contained in any supplemental indenture executed pursuant to Section 5.13, but may accept as conclusive evidence of the correctness thereof, and shall be fully protected in relying upon, the Officer’s Certificate with respect thereto which the Company is obligated to file with the Trustee pursuant to Section 5.13.

 

Section 5.15.                          Stockholder Rights Plan.  Each share of Common Stock issued upon conversion of Securities pursuant to this Article 5 shall be entitled to receive the appropriate number of rights, if any, and the certificates representing the Common Stock issued upon such conversion shall bear such legends, if any, in each case as may be provided by the terms of any stockholder rights plan of the Company that may be in effect at such time.  If at the time of conversion, however, the rights pursuant to an effective stockholder rights plan have separated from the shares of Common Stock in accordance with the provisions of the applicable stockholder rights agreement so that the Holders of the Securities would not be entitled to receive any rights in respect of Common Stock issuable upon conversion of the Securities, in which case, and only in such case, the Conversion Rate will be adjusted at the time of separation as if the Company issued shares of Capital Stock, evidences of indebtedness, assets, property, rights, warrants or options to all or substantially all holders of Common Stock as provided in Section 5.06(c), subject to readjustment in the event of the expiration, termination or redemption of such rights.

 

Section 5.16.                          Exchange in Lieu of Conversion.

 

(a)                        If at any time when a Holder surrenders Securities for conversion prior to the Maturity Date of the Securities the Company:

 

(i)                       has designated a financial institution, which shall be a direct or indirect Depositary participant (a “Designated Institution”), to accept such Securities in exchange for cash and shares of Common Stock, if any, equal to the consideration due upon conversion as provided in Section 5.03; and

 

(ii)                    notifies the Holder surrendering such Securities for conversion by the second Trading Day after the applicable Conversion Date, that it has directed the Designated Institution to make an exchange in lieu of conversion,

 

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then, notwithstanding anything in this Indenture to the contrary, the Company may direct the Conversion Agent to surrender such Securities, on or prior to the commencement of the applicable Conversion Reference Period, to the Designated Institution for exchange in lieu of conversion.

 

(b)                        If the Designated Institution accepts Securities surrendered for exchange, it shall deliver cash and shares of Common Stock, if any, to the Conversion Agent and the Conversion Agent will deliver such cash and shares of Common Stock, if any, to such Holder on the third Business Day immediately following the last day of the applicable  Conversion Reference Period.  Any Securities so exchanged by such Designated Institution shall remain outstanding for all purposes under this Indenture.

 

(c)                         If the Designated Institution agrees to accept any Securities for exchange but does not timely deliver the related consideration to the Conversion Agent, or if the Designated Institution does not accept such Securities for exchange, the Company shall, within the time period specified in Section 5.02(c), convert such Securities into cash and shares of Common Stock, if any, in accordance with the provisions of Section 5.02 and Section 5.03.

 

For the avoidance of doubt, in no event will the Company’s designation of a financial institution pursuant to this Section 5.16 require such financial institution to accept any Securities for exchange.

 

Section 5.17.                          Company Determination Final.  Any determination that the Company or its Board of Directors must make pursuant to this Article 5 shall be conclusive if made in good faith and in accordance with the provisions of this Article 5, absent manifest error, and set forth in a Board Resolution.

 

ARTICLE 6
  COVENANTS

 

Section 6.01.                          Payment of Securities.  The Company shall promptly make all payments in respect of the Securities on the dates and in the manner provided in the Securities and this Indenture, including payments of cash and if applicable, shares of Common Stock upon conversion.  Principal amount and accrued and unpaid interest (including Additional Interest, if any) shall be considered paid on the date it is due if the Paying Agent holds by 10:00 a.m., New York City time, on such date, in accordance with this Indenture, cash or securities designated and sufficient for the payment of all such amounts then due.

 

Payment of the principal of the Securities shall be made at the Corporate Trust Office of the Trustee in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts.  Payment of accrued and unpaid interest, including Additional Interest, if any, on Certificated Securities shall be made by check mailed to the address of the Holder entitled thereto as such address appears in the Register; provided, however, that Holders with Securities in an aggregate principal amount in excess of $5,000,000 shall be paid, at their written

 

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election, by wire transfer of immediately available funds.  Notwithstanding the foregoing, so long as the Securities are registered in the name of a Depositary or its nominee, all payments with respect to the Securities shall be made by wire transfer of immediately available funds to the account of the Depositary or its nominee.

 

Section 6.02.                          Reports and Certain Information.  The Company shall file with the Trustee, within 30 days after it is required to file them with the SEC pursuant to Section 13 or 15(d) of the Exchange Act, copies of its annual report and the information, documents and other reports which the Company is required to file with the SEC  pursuant to Section 13 or 15(d) of the Exchange Act; provided, however, that any such reports, information or documents filed with the SEC pursuant to its Electronic Date Gathering, Analysis and Retrieval (or EDGAR) system shall be deemed filed with the Trustee.  Notwithstanding anything to the contrary herein, the Trustee shall have no duty to review such documents for purposes of determining compliance with any provisions of this Indenture or any applicable law.

 

Section 6.03.                          Compliance Certificates.  The Company will deliver to the Trustee, within 120 days after the end of each fiscal year of the Company ending after the date hereof, an Officer’s Certificate signed by the principal executive officer, principal financial officer or principal accounting officer, as to his or her knowledge (i) of the Company’s compliance with all conditions and covenants under the Indenture (without regard to any period of grace or requirement of notice provided hereunder) and, (ii) if the Company shall be in default, specifying all such defaults and the nature and status thereof of which they may have knowledge.

 

Section 6.04.                          Maintenance of Corporate Existence.  Subject to Article 7, the Company shall do or cause to be done all things necessary to preserve and keep in full force and effect its corporate existence.

 

Section 6.05.                          Rule 144A Information Requirement.  (a) At any time the Company is not subject to Section 13 or 15(d) of the Exchange Act, the Company shall, so long as any of the Securities or any shares of Common Stock issuable upon conversion thereof shall, at such time, constitute “restricted securities” within the meaning of Rule 144(a)(3) under the Securities Act, promptly provide to the Trustee and, upon written request, any Holder, beneficial owner or prospective purchaser of such Securities or any shares of Common Stock issuable upon conversion of such Securities, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act to facilitate the resale of such Securities or shares of Common Stock pursuant to Rule 144A.  The Company shall take such further action as any Holder or beneficial owner of such Securities or such Common Stock may reasonably request to the extent from time to time required to enable such Holder or beneficial owner to sell such Securities or shares of Common Stock in accordance with Rule 144A, as such rule may be amended from time to time.

 

(b)                        If, at any time during the six-month period beginning on, and including, the date that is six months after the last date of original issuance of the Securities, the Company fails to timely file any document or report that it is required to file with the

 

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Commission pursuant to Section 13 or 15(d) of the Exchange Act, as applicable (after giving effect to all applicable grace periods thereunder and other than reports on Form 8-K), the Company shall pay Additional Interest on the Securities.  Such Additional Interest shall accrue on the Securities at the rate of 0.25% per annum of the principal amount of the Securities outstanding for each day during the first 90 days of such period and thereafter at a rate of 0.50% per annum of the principal amount of the Securities outstanding for each date in such period for which the Company’s failure to file has occurred and is continuing or the Securities are not otherwise freely tradable by Holders other than Affiliates of the Company (or Holders that have been Affiliates of the  Company at any time during the three months preceding).  As used in this Section 6.05(b), documents or reports that the Company is required to “file” with the Commission pursuant to Section 13 or 15(d) of the Exchange Act do not include documents or reports that the Company furnishes to the Commission pursuant to Section 13 or 15(d) of the Exchange Act.

 

(c)                         If, and for so long as, the restrictive legend on the Securities specified in Section 2.09(a) has not been removed, the Securities are assigned a restricted CUSIP or the Securities are not otherwise freely tradable by Holders other than the Company’s Affiliates or Holders that were the Company’s Affiliates at any time during the three months preceding (without restrictions pursuant to U.S. securities laws or the terms of this Indenture or the Securities) as of the 375th day after the last date of original issuance of the Securities, the Company shall pay Additional Interest on the Securities at a rate equal to 0.25% per annum of the principal amount of Securities outstanding for the first 90 days after the failure to remove such restrictive legend and thereafter at a rate of 0.50% per annum of the principal amount of Securities outstanding until the restrictive legend on the Securities has been removed in accordance with Section 2.09(a), the Securities are assigned an unrestricted CUSIP and the Securities are freely tradable by Holders other than the Company’s Affiliates (or Holders that were the Company’s Affiliates at any time during the three months preceding) (without restrictions pursuant to U.S. securities laws or the terms of this Indenture or the Securities).

 

(d)                        Additional Interest, if any, will be payable in arrears on each Interest Payment Date following accrual in the same manner as regular interest on the Securities;

 

(e)                         Notwithstanding the foregoing, in no event shall Additional Interest accrue under the terms of this Indenture (aggregating any Additional Interest payable pursuant to Section 6.05(b) or Section 6.05(c) with any Additional Interest payable pursuant to Section 8.04) at a rate per annum in excess of 0.50%, regardless of the number of events or circumstances giving rise to the requirement to pay such Additional Interest.

 

(f)                          Notwithstanding the foregoing, no Additional Interest will accrue or be payable under this Section 6.05 on any date on which, at the Company’s election, (i)(x) the Company has filed a Shelf Registration Statement for the resale of the Securities, (y) such Shelf Registration Statement is effective and usable by Holders for the resale of the Securities and (z) the Holders may register the resale of their Securities under such Shelf Registration Statement on terms customary for the resale of convertible securities offered in reliance on Rule 144A; or (ii) the conditions set forth in clause (i) above have been

 

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satisfied for a period of two years, no further Additional Interest shall be payable under this Section 6.05.

 

Section 6.06.                          Stay, Extension and Usury Laws.  The Company covenants, to the extent it may lawfully do so, that it shall not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law or other law which would prohibit or forgive the Company from paying all or any portion of the principal amount or Fundamental Change Repurchase Price in respect of Securities or any interest (including Additional Interest, if any) on the Securities as  contemplated herein, wherever enacted, now or at any time hereafter in force, or which may affect the covenants or the performance of this Indenture, and the Company, to the extent it may lawfully do so, hereby expressly waives all benefit or advantage of any such law and covenants that it shall not, by resort to any such law, hinder, delay or impede the execution of any power herein granted to the Trustee or any Agent, but shall suffer and permit the execution of every such power as though no such law had been enacted.

 

Section 6.07.                          Maintenance of Office or Agency of the Trustee, Registrar, Paying Agent and Conversion Agent.  The Company shall maintain an office or agency of the Trustee, Registrar, Paying Agent and Conversion Agent where Securities may be presented or surrendered for payment, where Securities may be surrendered for registration of transfer, exchange, purchase or conversion and where notices and demands to or upon the Company in respect of the Securities and this Indenture may be served.  The Company hereby designates the Corporate Trust Office as one such office or agency for all of the aforesaid purposes.  The Company shall give prompt written notice to the Trustee of the location, and of any change in the location, of any such office or agency (other than a change in the location of the office of the Trustee).  If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the address of the Trustee set forth in Section 13.01.

 

ARTICLE 7
  CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

 

Section 7.01.                          Company May Consolidate, Etc., Only on Certain Terms.  The Company shall not, in a single transaction or a series of related transactions, consolidate with or merge into any other Person or sell, convey, transfer or lease all or substantially all of its properties and assets to any successor Person, unless:

 

(a)                        the Company is the surviving Person, or the resulting, surviving or transferee Person is organized and validly existing under the laws of the United States of America, any State thereof or the District of Columbia and shall expressly assume, by an indenture supplemental hereto, executed and delivered to the Trustee all of the obligations of the Company under the Securities and this Indenture;

 

(b)                        immediately after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing; and

 

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(c)                         the Company has delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that such consolidation, merger, conveyance, transfer or lease and, if a supplemental indenture is required in connection with such transaction, such supplemental indenture comply with this Article 7 and that all conditions precedent herein provided for relating to such transaction have been complied with.

 

Section 7.02.                          Successor Substituted.  Upon any consolidation of the Company with, or merger of the Company into, any other Person or any conveyance, transfer or lease of all or substantially all of the properties and assets of the Company in accordance with Section 7.01, the successor Person formed by such consolidation or into which the Company is merged or to which such conveyance, transfer or lease is made shall succeed to, and be substituted for, and may exercise every right and power of, the Company under this Indenture with the same effect as if such successor Person had been named as the Company herein, and thereafter, except in the case of a lease, the predecessor Person shall be relieved of all obligations and covenants under this Indenture and the Securities.

 

ARTICLE 8
  DEFAULT AND REMEDIES

 

Section 8.01.                          Events of Default.  An “Event of Default” shall occur if:

 

(a)                        the Company defaults in the payment of any principal of any of the Securities when the same becomes due and payable (whether at the Maturity Date, upon a Fundamental Change Repurchase Date or otherwise);

 

(b)                        the Company defaults in the payment of any interest (including Additional Interest, if any) on any of the Securities, when due and payable under the Securities, and such default continues for a period of 30 days;

 

(c)                         the Company fails to deliver cash or, if applicable, cash and shares of Common Stock (including any Additional Shares payable as a result of a conversion in connection with a Make-Whole Fundamental Change), when required to be delivered upon the Conversion of any Security;

 

(d)                        the Company fails to provide a Fundamental Change Company Notice when required by clause (y) of Section 4.01(b) or notice of a specified corporate event in accordance with Section 5.01(a)(iii) or Section 5.01(a)(iv), in each case, when due;

 

(e)                         the Company fails to comply with any of its other agreements contained in the Securities or in this Indenture (other than those referred to in clauses (a) through (d) above) for 60 days after receipt by the Company of a Notice of Default;

 

(f)                          the Company fails to pay when due the principal of, or acceleration of, any indebtedness for money borrowed by the Company or any of its Material Subsidiaries in excess of $40,000,000 principal amount, if such indebtedness is not discharged, or such acceleration is not annulled, for a period of 30 days after receipt by the Company of a Notice of Default, without such failure to pay having been cured or waived, such

 

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acceleration having been rescinded or annulled (if applicable) and such indebtedness not having been paid or discharged;

 

(g)                         the Company or any of its Material Subsidiaries pursuant to or within the meaning of any Bankruptcy Law:

 

(i)                           commences a voluntary case or proceeding;

 

(ii)                        consents to the entry of an order for relief against it in an involuntary case or proceeding;

 

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

 

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

 

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

 

(i)                           is for relief against the Company or any of its Material Subsidiaries in an involuntary case or proceeding;

 

(ii)                        appoints a Custodian of the Company or any of its Material Subsidiaries for all or substantially all of the property of the Company; or

 

(iii)                     orders the winding up or liquidation of the Company or any of its Material Subsidiaries;

 

and in each case of this clause (h) the order or decree remains unstayed and in effect for 60 consecutive days.

 

The Trustee shall not be charged with knowledge of any Event of Default unless written notice thereof shall have been given to a Trust Officer at the Corporate Trust Office of the Trustee by the Company, a Paying Agent or any Holder.

 

Section 8.02.                          Acceleration.  If an Event of Default (other than an Event of Default specified in clause (g) or (h) of Section 8.01 involving the Company) occurs and is continuing, the Trustee may, by notice to the Company, or the Holders of at least 25% in aggregate principal amount of the Securities then outstanding may, by notice to the Company and the Trustee, declare all unpaid principal of plus accrued and unpaid interest (including Additional Interest, if any), if any, on all the Securities then outstanding to be due and payable upon any such declaration, and the same shall become and be immediately due and payable.

 

If an Event of Default specified in clause (g) or (h) of Section 8.01 occurs with respect to the Company, all unpaid principal of plus accrued and unpaid interest (including Additional Interest, if any), if any, on all the Securities then outstanding shall

 

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ipso facto become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holder.

 

The Holders of a majority in aggregate principal amount of the Securities then outstanding by notice to the Trustee may rescind and annul an acceleration of Securities and its consequences before a judgment or decree for the payment of money has been obtained by the Trustee if (a) all existing Events of Default, other than the nonpayment of the principal of plus accrued and unpaid interest (including Additional Interest, if any), if any, on the Securities that has become due solely by such declaration of acceleration, have been cured or waived and (b) all payments due to the Trustee and any predecessor Trustee under Section 9.06 have been made.  No such rescission shall affect any subsequent Default or impair any right consequent thereto.

 

Section 8.03.                          Other Remedies.  If an Event of Default occurs and is continuing, the Trustee may, but shall not be obligated to, pursue any available remedy by proceeding at law or in equity to collect the payment of the principal of or accrued and unpaid interest (including Additional Interest, if any) on the Securities or to enforce the performance of any provision of the Securities or this Indenture.

 

The Trustee may maintain a proceeding even if it does not possess any of the Securities or does not produce any of them in the proceeding.  A delay or omission by the Trustee or any Holder in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default.  No remedy is exclusive of any other remedy.  All available remedies are cumulative to the extent permitted by law.

 

Section 8.04.                          Sole Remedy for Failure to Report.  Notwithstanding anything to the contrary in this Indenture, to the extent elected by the Company, the sole remedy for an Event of Default relating to the Company’s failure to comply with the covenant set forth in Section 6.02 hereof, for the failure to file 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, after taking into account any grace period afforded by Rule 12b-25 of the Exchange Act, or for any failure to comply with the requirements of Section 314(a)11) of the TIA, (any such obligation, the “Reporting Obligations”), shall (i) for the first 120 days after the occurrence of such an Event of Default consist exclusively of the right to receive additional interest on the Securities at an annual rate amount equal to 0.25% of the principal amount of the Securities and (ii) for the next 150 days after the expiration of such 120 day period consist exclusively of the right to receive additional interest on the Securities at an annual rate equal to 0.50% of the principal amount of Securities (such amounts under each of clause (i) and (ii), “Additional Interest”). Additional Interest payable pursuant to this Section 8.04 shall be in addition to, not in lieu of, any Additional Interest payable pursuant to Section 6.05, subject to the limitations set forth in Section 6.05(e). If the Company so elects, such Additional Interest will be payable on all outstanding Securities from and including the date on which the Event of Default first occurs to but excluding the 270th day thereafter (or such earlier date on which such Event of Default has been cured or waived).  On the 270th day after such Event of Default (or such earlier date on which such Event of Default has been cured or waived), Additional

 

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Interest will cease to accrue and, if the Event of Default relating to failure to comply with Reporting Obligations has not been cured or waived ), the Securities will be subject to acceleration as provided above. The provisions set forth in this paragraph will not affect the rights of Holders of Securities in the event of the occurrence of any other Event of Default.  To the extent that the Company elects to pay Additional Interest, it shall be payable at the same time and in the same manner as ordinary interest.  If the Company does not elect to pay the Additional Interest in accordance with this paragraph, the Securities will be subject to acceleration as provided in Section 8.02.  In order to elect to pay the Additional Interest as the sole remedy in respect of the first 270 days after the occurrence of an Event of Default relating to failure to comply with the Reporting Obligations, the Company must (i) notify the Trustee and the Paying Agent in writing of such election and (ii) pay all such Additional Interest as described above, in the case of the first extension period, on or before the Close of Business on the date on which such Event of Default first occurs and, in the case of the second extension period, on or before the 120th day after such Event of Default first occurs.  Upon the Company’s failure to timely give such notice or pay the Additional Interest, the Securities will be subject to acceleration as provided above.

 

Section 8.05.                          Waiver of Defaults and Events of Default.  Subject to Section 8.08 and 10.02, the Holders of a majority in aggregate principal amount of the Securities then outstanding by notice to the Trustee may waive an existing Default or Event of Default and its consequence, except a Default or Event of Default in the payment of the principal amount of, accrued and unpaid interest (including Additional Interest, if any) on any Security, the payment of any applicable Fundamental Change Repurchase Price, or a failure by the Company to deliver cash and, if applicable, cash and shares of Common Stock upon conversion in accordance with Article 5 or any Default or Event of Default in respect of any provision of this Indenture or the Securities that, under Section 10.02, cannot be modified or amended without the consent of the Holder of each Security affected.  When a Default or Event of Default is waived, it is deemed cured, but no such waiver shall extend to any subsequent or other Default or impair any consequent right.

 

Section 8.06.                          Control by Majority.  The Holders of a majority in aggregate principal amount of the Securities then outstanding may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on it with respect to the Securities.  However, the Trustee may refuse to follow any direction that conflicts with law or this Indenture, that the Trustee determines may be unduly prejudicial to the rights of another Holder or the Trustee, or that may involve the Trustee in personal liability unless the Trustee is offered indemnity or security reasonably satisfactory to Trustee against any loss, liability or expense to the Trustee to institute such proceeding as Trustee ; provided that the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction.

 

Section 8.07.                          Limitations on Suits.  A Holder of a Security may not pursue any remedy with respect to this Indenture or the Securities unless:

 

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

 

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

 

(c)                         such Holder or Holders offer to the Trustee reasonable indemnity to the Trustee against any loss, liability or expense;

 

(d)                        the Trustee does not comply with the request within 60 days after receipt of the request and the offer of indemnity; and

 

(e)                         no direction inconsistent with such written request has been given to the Trustee during such 60-day period by the Holders of a majority in aggregate principal amount of the Securities then outstanding.

 

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

 

Section 8.08.                          Rights of Holders to Receive Payment and to Convert.  Notwithstanding any other provision of this Indenture, the right of any Holder of a Security to receive payment of the principal amount of, interest (including Additional Interest, if any) on and Fundamental Change Repurchase Price with respect to any Security, on or after the respective due dates expressed in the Security and this Indenture, to convert such Security in accordance with Article 5 and to bring suit for the enforcement of any such payment on or after such respective dates or the right to convert, is absolute and unconditional and shall not be impaired or affected without the consent of the Holder.

 

Section 8.09.                          Collection Suit by Trustee.  If an Event of Default in the payment of principal or interest (including Additional Interest, if any) specified in clause (a) or (b) of Section 8.01 occurs and is continuing, the Trustee may recover judgment in its own name and as trustee of an express trust against the Company or another obligor on the Securities for the whole amount owing with respect to the Securities and the amounts provided for in Section 9.06.

 

Section 8.10.                          Trustee May File Proofs of Claim.  The Trustee may file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and the Holders allowed in any judicial proceedings relative to the Company (or any other obligor on the Securities), its creditors or its property and shall be entitled and empowered to collect and receive any money or other property payable or deliverable on any such claims and to distribute the same, and any Custodian in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee and, if the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due to it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 9.06, and to the extent that such payment of the reasonable compensation, expenses, disbursements and advances in any such proceedings shall be

 

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denied for any reason, payment of the same shall be secured by a lien on, and shall be paid out of, any and all distributions, dividends, money, securities and other property which the Holders may be entitled to receive in such proceedings, whether in liquidation or under any plan of reorganization or arrangement or otherwise.  Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to, or, on behalf of any Holder, to authorize, accept or adopt any plan of reorganization, arrangement, adjustment or composition affecting the Securities or the rights of any Holder thereof, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.

 

Section 8.11.                          Priorities.  If the Trustee collects any money pursuant to this Article 8, it shall pay out the money in the following order:

 

First, to the Trustee for amounts due under Section 9.06;

 

Second, to Holders for amounts due and unpaid on the Securities for the principal amount, accrued interest (including Additional Interest, if any), or Fundamental Change Repurchase Price, as the case may be, ratably, without preference or priority of any kind, according to such amounts due and payable on the Securities; and

 

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

 

The Trustee may fix a record date and payment date for any payment to Holders pursuant to this Section 8.11.  At least 15 days before such record date, the Trustee shall mail to each Holder and the Company a notice that states the record date, the payment date and the amount to be paid.

 

Section 8.12.                          Undertaking for Costs.  In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as Trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys’ fees and expenses, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant.  This Section 8.12 does not apply to a suit made by the Trustee, a suit by a Holder pursuant to Section 8.08, or a suit by Holders of more than 10% in aggregate principal amount of the Securities then outstanding.

 

Section 8.13.                          Notice of Defaults.  If an Event of Default occurs and is continuing with respect to the Securities and if it is actually known to a Trust Officer of the Trustee, the Trustee shall mail to each Holder of such Securities notice of the Event of Default within 90 days after it occurs.  The Trustee may withhold notice to the Holders of the Securities of any Event of Default, except defaults in payment of principal amount or interest (including Additional Interest, if any) on the Securities, and defaults in delivery of cash or, if applicable, cash and shares of Common Stock (including any Additional Shares payable as a result of a conversion in connection with a Make-Whole Fundamental Change), when required to be delivered upon the conversion of any

 

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Security, if and so long as a committee of the Trust Officers of the Trustee in good faith determines that the withholding of such notice is in the interest of the Holders of the Securities.

 

ARTICLE 9
  TRUSTEE

 

Section 9.01.                          Certain Duties and Responsibilities of Trustee.  (a) The Trustee, prior to the occurrence of an Event of Default with respect to the Securities and after the curing of all Events of Default with respect to the Securities that may have occurred, shall undertake to perform with respect to the Securities such duties and only such duties as are specifically set forth in this Indenture, and no implied covenants shall be read into this Indenture against the Trustee.  In case an Event of Default with respect to the Securities has occurred (that has not been cured or waived), the Trustee shall exercise with respect to Securities such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise, as a prudent person would exercise or use under the circumstances in the conduct of his or her own affairs.

 

(b)                        No provision of this Indenture shall be construed to relieve the Trustee from liability for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that:

 

(i)                       prior to the occurrence of an Event of Default with respect to the Securities and after the curing or waiving of all such Events of Default that may have occurred:

 

(A)                 the duties and obligations of the Trustee shall with respect to the Securities be determined solely by the express provisions of this Indenture, and the Trustee shall not be liable with respect to the Securities except for the performance of such duties and obligations as are specifically set forth in this Indenture, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and

 

(B)                 in the absence of bad faith on the part of the Trustee, the Trustee may with respect to the Securities conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon any certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture; but in the case of any such certificates or opinions that by any provision hereof are specifically required to be furnished to the Trustee, the Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirement of this Indenture;

 

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(ii)                    the Trustee shall not be liable for any error of judgment made in good faith by a Trust Officer or Trust Officers of the Trustee, unless it shall be proved that the Trustee, was negligent in ascertaining the pertinent facts;

 

(iii)                 the Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the Holders of not less than a majority in principal amount of the Securities at the time outstanding (determined as provided in Section 2.11) relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee under this Indenture with respect to the Securities; and

 

(iv)                None of the provisions contained in this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur personal financial liability in the performance of any of its duties or in the exercise of any of its rights or powers, if there is reasonable ground for believing that the repayment of such funds or liability is not reasonably assured to it under the terms of this Indenture or adequate indemnity against such risk is not reasonably assured to it.

 

Section 9.02.                          Certain Rights of Trustee.  Except as otherwise provided in Section 10.01:

 

(a)                        The Trustee may conclusively rely and shall be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, approval, bond, security or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties;

 

(b)                        Any request, direction, order or demand of the Company mentioned herein shall be sufficiently evidenced by a resolution of the Board of Directors of the Company or an instrument signed in the name of the Company, by one or more Officers thereof (unless other evidence in respect thereof is specifically prescribed herein);

 

(c)                         The Trustee may consult with counsel and the written advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken or suffered or omitted hereunder in good faith and in reliance thereon;

 

(d)                        The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request, order or direction of any of the Holders, pursuant to the provisions of this Indenture, unless such Holders shall have offered to the Trustee reasonable security or indemnity against the costs, expenses and liabilities that may be incurred therein or thereby; nothing contained herein shall, however, relieve the Trustee of the obligation, upon the occurrence of an Event of Default with respect to the Securities (that has not been cured or waived) to exercise with respect to the Securities such of the rights and powers vested in it by this Indenture, and

 

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to use the same degree of care and skill in their exercise, as a prudent man would exercise or use under the circumstances in the conduct of his own affairs;

 

(e)                         The Trustee shall not be liable for any action taken or omitted to be taken by it in good faith and believed by it to be authorized or within the discretion or rights or powers conferred upon it by this Indenture;

 

(f)                          The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, approval, bond, security, or other papers or documents, unless requested in writing so to do by the Holders of not less than a majority in principal amount of the outstanding Securities affected thereby (determined as provided in Section 2.11); provided, however, that if the payment within a reasonable time to the Trustee of the costs, expenses or liabilities likely to be incurred by it in the making of such investigation is, in the opinion of the Trustee, not reasonably assured to the Trustee by the security afforded to it by the terms of this Indenture, the Trustee may require reasonable indemnity against such costs, expenses or liabilities as a condition to so proceeding.  The reasonable expense of every such examination shall be paid by the Company or, if paid by the Trustee, shall be repaid by the Company upon demand;

 

(g)                         The Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys and the Trustee shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder;

 

(h)                        Except with respect to Section 6.01, the Trustee shall have no duty to inquire as to the performance of the Company with respect to the covenants contained in Article 6.  In addition, the Trustee shall not be deemed to have knowledge of an Event of Default except (i) any Default or Event of Default occurring pursuant to Section 8.01(a) or 8.01(b) or any Default of Event of Default of which a Trust Officer of the Trustee shall have received written notification or obtained actual knowledge; and (ii) delivery of reports, information and documents to the Trustee under Sections 6.02 and 6.03 for informational purposes only and the Trustee’s receipt of the foregoing shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Company’s compliance with any of their covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officer’s Certificates).

 

Section 9.03.                          Trustee Not Responsible for Recitals or Issuance or Securities.

 

(a)                        The recitals contained herein and in the Securities shall be taken as the statements of the Company, and the Trustee assumes no responsibility for the correctness of the same.

 

(b)                        The Trustee makes no representations as to the validity or sufficiency of this Indenture or of the Securities.

 

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(c)                         The Trustee shall not be accountable for the use or application by the Company of any of the Securities or of the proceeds of such Securities, or for the use or application of any moneys paid over by the Trustee in accordance with any provision of this Indenture or for the use or application of any moneys received by any paying agent other than the Trustee.

 

Section 9.04.                          May Hold Securities.

 

The Trustee or any Agent, in its individual or any other capacity, may become the owner or pledgee of Securities with the same rights it would have if it were not Trustee or Agent.

 

Section 9.05.                          Moneys Held in Trust.

 

All moneys received by the Trustee shall, until used or applied as herein provided, be held in trust for the purposes for which they were received, but need not be segregated from other funds except to the extent required by law.  The Trustee shall be under no liability for interest on any moneys received by it hereunder except such as it may agree with the Company to pay thereon.

 

Section 9.06.                          Compensation and Reimbursement.

 

(a)                        The Company covenants and agrees to pay to the Trustee, and the Trustee shall be entitled to, such compensation (which shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust), as the Company, and the Trustee may from time to time agree in writing, for all services rendered by it in the execution of the trusts hereby created and in the exercise and performance of any of the powers and duties hereunder of the Trustee, and, except as otherwise expressly provided herein, the Company will pay or reimburse the Trustee upon its request for all reasonable expenses, disbursements and advances incurred or made by the Trustee in accordance with any of the provisions of this Indenture (including the reasonable compensation and the expenses and disbursements of its counsel and of all Persons not regularly in its employ) except any such expense, disbursement or advance as may arise from its negligence or bad faith.  The Company also covenants to indemnify the Trustee (and its officers, agents, directors and employees) for, and to hold it harmless against, any loss, liability or expense incurred without negligence or bad faith on the part of the Trustee and arising out of or in connection with the acceptance or administration of this trust, including the reasonable costs and expenses of defending itself against any claim of liability in the premises.  The Trustee shall notify the Company promptly of any claim asserted against the Trustee for which it may seek indemnity.  The Company need not pay for any settlement without its written consent, which shall not be unreasonably withheld.

 

(b)                        The obligations of the Company under this Section 9.06 to compensate and indemnify the Trustee and to pay or reimburse the Trustee for reasonable expenses, disbursements and advances shall constitute additional indebtedness hereunder.  Such additional indebtedness shall be secured by a lien prior to that of the Securities upon all

 

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property and funds held or collected by the Trustee as such, except funds held in trust for the benefit of the Holders of particular Securities.

 

Section 9.07.                          Reliance on Officer’s Certificate.  Except as otherwise provided in Section 10.01, whenever in the administration of the provisions of this Indenture the Trustee shall deem it necessary or desirable that a matter be proved or established prior to taking or suffering or omitting to take any action hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed) may, in the absence of negligence or bad faith on the part of the Trustee, be deemed to be conclusively proved and established by an Officer’s Certificate delivered to the Trustee and such certificate, in the absence of negligence or bad faith on the part of the Trustee, shall be full warrant to the Trustee for any action taken, suffered or omitted to be taken by it under the provisions of this Indenture upon the faith thereof.

 

Section 9.08.                          Disqualification; Conflicting Interests.  If the Trustee has or shall acquire any “conflicting interest” within the meaning of Section 310(b) of the TIA, the Trustee and the Company shall in all respects comply with the provisions of Section 310(b) of the TIA.

 

Section 9.09.                          Corporate Trustee Required; Eligibility.  There shall at all times be a Trustee with respect to the Securities issued hereunder which shall at all times be a corporation organized and doing business under the laws of the United States of America or any State or Territory thereof or of the District of Columbia, or a corporation or other Person permitted to act as trustee by the SEC, authorized under such laws to exercise corporate trust powers, having a combined capital and surplus, or being a member of a bank holding company with a combined capital and surplus, of at least 50 million U.S. dollars ($50,000,000), and subject to supervision or examination by Federal, State, Territorial, or District of Columbia authority.  If such corporation publishes reports of condition at least annually, pursuant to law or to the requirements of the aforesaid supervising or examining authority, then for the purposes of this Section 9.09, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published.  The Company may not, nor may any Person directly or indirectly controlling, controlled by, or under common control with the Company, serve as Trustee.  In case at any time the Trustee shall cease to be eligible in accordance with the provisions of this Section 9.09, the Trustee shall resign immediately in the manner and with the effect specified in Section 9.10.

 

Section 9.10.                          Resignation and Removal; Appointment of Successor.

 

(a)                        The Trustee or any successor hereafter appointed, may at any time resign with respect to the Securities by giving written notice thereof to the Company and by transmitting notice of resignation by mail, first class postage prepaid, to the Holders, as their names and addresses appear upon the Register.  Upon receiving such notice of resignation, the Company shall promptly appoint a successor trustee with respect to Securities by or pursuant to a resolution of its Board of Directors.  If no successor trustee shall have been so appointed and have accepted appointment within 30 days after the

 

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mailing of such notice of resignation, the resigning Trustee may petition any court of competent jurisdiction for the appointment of a successor trustee with respect to Securities, or any Holder who has been a bona fide Holder of a Security or Securities for at least six months may on behalf of himself and all others similarly situated, petition any such court for the appointment of a successor trustee.  Such court may thereupon after such notice, if any, as it may deem proper and prescribe, appoint a successor trustee.

 

(b)                        In case at any time any one of the following shall occur:

 

(i)             the Trustee shall fail to comply with the provisions of Section 9.08 after written request therefor by the Company or by any Holder who has been a bona fide Holder of a Security or Securities for at least six months; or

 

(ii)          the Trustee shall cease to be eligible in accordance with the provisions of Section 9.09 and shall fail to resign after written request therefor by the Company or by any such Holder; or

 

(iii)       the Trustee shall become incapable of acting, or shall be adjudged a bankrupt or insolvent, or commence a voluntary bankruptcy proceeding, or a receiver of the Trustee or of its property shall be appointed or consented to, or any public officer shall take charge or control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation, then, in any such case, the Company may remove the Trustee with respect to the Securities and appoint a successor trustee by or pursuant to a Resolution of the Board of Directors of the Company, or, unless the Trustee’s duty to resign is stayed as provided herein, any Holder who has been a bona fide Holder of a Security or Securities for at least six months may, on behalf of that Holder and all others similarly situated, petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor trustee.  Such court may thereupon after such notice, if any, as it may deem proper and prescribe, remove the Trustee and appoint a successor trustee.

 

(c)                         The Holders of a majority in aggregate principal amount of the Securities at the time outstanding may at any time remove the Trustee by so notifying the Trustee and the Company and may appoint a successor Trustee with the written consent of the Company.

 

(d)                        Any resignation or removal of the Trustee and appointment of a successor trustee with respect to the Securities pursuant to any of the provisions of this Section 9.10 shall become effective upon acceptance of appointment by the successor trustee as provided in Section 9.11.

 

(e)                         At any time there shall be only one Trustee with respect to the Securities.

 

Section 9.11.                          Acceptance of Appointment by Successor.

 

(a)                        In case of the appointment hereunder of a successor trustee with respect to the Securities, every such successor trustee so appointed shall execute, acknowledge and

 

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deliver to the Company and to the retiring Trustee an instrument accepting such appointment, and thereupon the resignation or removal of the retiring Trustee shall become effective and such successor trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee; but, on the request of the Company or the successor trustee, such retiring Trustee shall, upon payment of its charges, execute and deliver an instrument transferring to such successor trustee all the rights, powers, and trusts of the retiring Trustee and shall duly assign, transfer and deliver to such successor trustee all property and money held by such retiring Trustee hereunder.

 

(b)                        Upon request of any such successor trustee, the Company shall execute any and all instruments for more fully and certainly vesting in and confirming to such successor trustee all such rights, powers and trusts referred to in paragraph (a) of this Section 9.11.

 

(c)                         No successor trustee shall accept its appointment unless at the time of such acceptance such successor trustee shall be qualified and eligible under this Article 9.

 

(d)                        Upon acceptance of appointment by a successor trustee as provided in this Section 9.11, the Company shall transmit notice of the succession of such trustee hereunder by mail, first class postage prepaid, to the Holders, as their names and addresses appear upon the Register.  If the Company fails to transmit such notice within ten days after acceptance of appointment by the successor trustee, the successor trustee shall cause such notice to be transmitted at the expense of the Company.

 

Section 9.12.                          Merger, Conversion, Consolidation or Succession to Business.  Any corporation into which the Trustee may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Trustee shall be a party, or any corporation succeeding to all or substantially all of the corporate trust business of the Trustee (including the administration of the trust created by this Indenture), shall be the successor of the Trustee hereunder, provided that such corporation shall be qualified under the provisions of Section 9.08 and eligible under the provisions of Section 9.09, without the execution or filing of any paper or any further act on the part of any of the parties hereto, anything herein to the contrary notwithstanding.  In case any Securities shall have been authenticated, but not delivered, by the Trustee then in office, any successor by merger, conversion or consolidation to such authenticating Trustee may adopt such authentication and deliver the Securities so authenticated with the same effect as if such successor Trustee had itself authenticated such Securities.

 

ARTICLE 10
  AMENDMENTS, SUPPLEMENTS AND WAIVERS

 

Section 10.01.                   Without Consent of Holders.  The Company and the Trustee may amend or supplement this Indenture or the Securities without notice to, or consent of, any Holder to:

 

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(a)                        provide for the assumption by a successor corporation of the obligations of the Company under this Indenture pursuant to Article 7;

 

(b)                        secure the Securities;

 

(c)                         make provisions with respect to the conversion rights of Holders of Securities pursuant to Section 5.13 and pursuant to the applicable provisions of this Indenture;

 

(d)                        surrender any right or power conferred upon the Company;

 

(e)                         add to the Company’s covenants for the benefit of the Holders of the Securities;

 

(f)                          cure any ambiguity or correct or supplement any inconsistent or otherwise defective provision contained in this Indenture, so long as such modification or amendment does not adversely affect the interests of the Holders of the Securities; provided that any such modification or amendment made solely to conform the provisions of this Indenture to the section of the Offering Memorandum captioned “Description of the Notes” shall be deemed not to adversely affect the interests of the Holders;

 

(g)                         make any provision with respect to matters or questions arising under this Indenture that the Company may deem necessary or desirable and that shall not be inconsistent with provisions of this Indenture; provided that such change or modification does not, in the good faith opinion of the Board of Directors of the Company, adversely affect the interests of the Holders of the Securities in any material respect; provided, further, that any amendment made solely to conform the provisions of this Indenture to the section of the Offering Memorandum captioned “Description of the Notes” shall be deemed not to adversely affect the interests of the Holders;

 

(h)                        increase the Conversion Rate;

 

(i)                            comply with the requirements of the SEC in order to effect or maintain the qualifications of the Indenture under the TIA;

 

(j)                           comply with the rules of any applicable securities depositary, including the Depositary;

 

(k)                        add guarantees of obligations under the Securities;

 

(l)                            provide for a successor Trustee in accordance with the terms of this Indenture or to otherwise comply with any requirement of this Indenture; and

 

(m)                    conform the provisions of this Indenture to the “Description of Notes” section of the Offering Memorandum.

 

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Section 10.02.                   With Consent of Holders.  The Company and the Trustee may amend or supplement the Securities or this Indenture with the consent of the Holders of at least a majority in aggregate principal amount of the Securities then outstanding.  The Holders of at least a majority in aggregate principal amount of the Securities then outstanding may waive compliance in any instance by the Company with any provision of the Securities or this Indenture without notice to any Holder.  However, notwithstanding the foregoing but subject to Section 10.03, without the consent of the Holders of each Security then outstanding, an amendment, supplement or waiver may not:

 

(a)                        change the Maturity Date of the principal of the Securities;

 

(b)                        reduce the rate or extend the time for payment of interest, including any Additional Interest, if any on any Securities;

 

(c)                         reduce the principal amount of any Securities;

 

(d)                        reduce any amount payable upon repurchase of any Securities;

 

(e)                         impair the right of a Holder to institute suit for payment of any Securities;

 

(f)                          change the currency of payment of principal of, Fundamental Change Repurchase Price or rate of interest (including Additional Interest, if any) of the Securities;

 

(g)                         change the Company’s obligation to repurchase any Securities at the option of the Holder after the occurrence of a Fundamental Change in a manner adverse to the Holders;

 

(h)                        affect the right of a Holder to convert any Securities into cash and, if applicable, shares of Common Stock or reduce the amount of cash and, if applicable, number of shares of Common Stock receivable upon conversion pursuant to the terms of this Indenture; or

 

(i)                            modify any of the provisions of Section 8.02 or this Section 10.02, or reduce the percentage of the Securities required for consent to any modification of this Indenture that does not require the consent of each affected Holder.

 

It shall not be necessary for the consent of the Holders under this Section 10.02 to approve the particular form of any proposed amendment, supplement or waiver, but it shall be sufficient if such consent approves the substance thereof.

 

After an amendment, supplement or waiver under this Section 10.02 becomes effective, the Company shall mail to the Holders affected thereby a notice briefly describing the amendment, supplement or waiver.  Any failure of the Company to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such amendment, supplement or waiver.

 

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Section 10.03.                   Revocation and Effect of Consents.  Until an amendment, supplement or waiver becomes effective, a consent to it by a Holder is a continuing consent by the Holder and every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting Holder’s Security, even if notation of the consent is not made on any Security.  However, any such Holder or subsequent Holder may revoke the consent as to its Security or portion of a Security if the Trustee receives the notice of revocation before the date the amendment, supplement or waiver becomes effective.

 

After an amendment, supplement or waiver becomes effective, it shall bind every applicable Holder.

 

Section 10.04.                   Notation on or Exchange of Securities.  If an amendment, supplement or waiver changes the terms of a Security, the Trustee may require the Holder of the Security to deliver it to the Trustee.  The Trustee may place an appropriate notation on the Security about the changed terms and return it to the Holder.  Alternatively, if the Company or the Trustee so determines, the Company in exchange for the Security shall issue and the Trustee shall authenticate a new Security that reflects the changed terms.

 

Section 10.05.                   Trustee to Sign Amendments, Etc.  The Trustee shall sign any amendment or supplemental indenture authorized pursuant to this Article 10 if the amendment or supplemental indenture does not adversely affect the rights, duties, liabilities or immunities of the Trustee.  If it does, the Trustee may, in its sole discretion, but need not sign it.  In signing or refusing to sign such amendment or supplemental indenture, the Trustee shall be entitled to receive and, subject to Section 9.01, shall be fully protected in relying upon, an Officer’s Certificate and an Opinion of Counsel stating that such amendment or supplemental indenture is authorized or permitted by this Indenture.

 

Section 10.06.                   Effect of Supplemental Indentures.  Upon the execution of any supplemental indenture under this Article 10, this Indenture shall be modified in accordance therewith, and such supplemental indenture shall form a part of this Indenture for all purposes; and every Holder of Securities theretofore or thereafter authenticated and delivered hereunder shall be bound thereby.

 

ARTICLE 11
  [RESERVED]

 

ARTICLE 12
  SATISFACTION AND DISCHARGE

 

Section 12.01.                   Satisfaction and Discharge of the Indenture.  This Indenture shall cease to be of further effect (except as to any surviving rights of registration of transfer or exchange of Securities herein expressly provided for), and the Trustee, on demand of and at the expense of the Company, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture, when

 

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(a)                        either

 

(i)             all Securities theretofore authenticated and delivered (other than Securities that have been destroyed, lost or stolen and which have been replaced or paid as provided in Section 2.10) have been delivered to the Trustee for cancellation; or

 

(ii)          all such Securities not theretofore delivered to the Trustee for cancellation have become due and payable or shall become due and payable within one year, in each case whether at the Maturity Date or with respect to any Fundamental Change Repurchase Date or by delivery of a Conversion Notice or otherwise, and the Company deposits with the Paying Agent or Conversion Agent, as the case may be, cash or a combination of cash and Common Stock, as applicable, sufficient to pay all amounts due and owing, or to become due and owing, to the Maturity Date on all outstanding Securities (other than Securities replaced pursuant to Section 2.10);

 

(b)                        the Company has paid or caused to be paid all other sums payable hereunder by the Company; and

 

(c)                         the Company has delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that all conditions precedent herein provided for relating to the satisfaction and discharge of this Indenture have been complied with.

 

Notwithstanding the satisfaction and discharge of this Indenture, the obligations of the Company as to conversion of the Securities under Article 5 of this Indenture and pursuant to the covenants under Article 7 of this Indenture and to the Trustee under Section 9.06 and, if money shall have been deposited with the Trustee pursuant to Section 12.01(a)(ii), the obligations of the Trustee under Section 12.02 shall survive.

 

Section 12.02.                   Repayment to the Company.  The Trustee and the Paying Agent shall return to the Company upon written request any cash or securities held by them for the payment of any amount with respect to the Securities that remains unclaimed for two years, subject to applicable unclaimed property law.  After return to the Company, Holders entitled to the cash or securities must look to the Company for payment as general creditors unless an applicable abandoned property law designates another Person and the Trustee and the Paying Agent shall have no further liability to the Holders with respect to such cash or securities for that period commencing after the return thereof.

 

ARTICLE 13
  MISCELLANEOUS

 

Section 13.01.                   Notices.  Any demand, authorization notice, request, consent or communication shall be given in writing and delivered in person or mailed by first-class mail, postage prepaid, addressed as follows or transmitted by facsimile transmission (confirmed by delivery in person or mail by first-class mail, postage prepaid, or by guaranteed overnight courier) to the following facsimile numbers:

 

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If to the Company, to:

 

Rambus Inc.
 1050 Enterprise Way, Suite 700
 Sunnyvale, CA  94089
 Attention:              General Counsel
 Facsimile No.:  (408) 462-8001

 

if to the Trustee, to:

 

U.S. Bank National Association
 633 West Fifth Street, 24th Floor
 Los Angeles, CA 90071
 Attention:                 Corporate Trust Services
 (Rambus Inc. 1.125% Convertible Senior Notes due 2018)
 Facsimile No.:  (213) 615-6197

 

Such notices or communications shall be effective when received.

 

The Company or the Trustee by notice to the other may designate additional or different addresses for subsequent notices or communications.

 

Any notice or communication mailed to a Holder shall be mailed by first-class mail, postage prepaid, or delivered by an overnight delivery service to it at its address shown on the Register.

 

Failure to mail a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders. If a notice or communication to a Holder is mailed or delivered in the manner provided above, it is duly given, whether or not the addressee receives it.

 

Section 13.02.                   Certificate and Opinion as to Conditions Precedent.

 

(a)                        Upon any request or application by the Company to the Trustee to take any action under this Indenture, the Company shall furnish to the Trustee at the request of the Trustee:

 

(i)             an Officer’s Certificate stating that, in the opinion of the signers, all conditions precedent (including any covenants, compliance with which constitutes a condition precedent), if any, provided for in this Indenture relating to the proposed action have been complied with; and

 

(ii)          an Opinion of Counsel stating that, in the opinion of such counsel, all such conditions precedent (including any covenants, compliance with which constitutes a condition precedent) have been complied with.

 

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

 

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

 

(ii)                    a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;

 

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

 

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

 

provided that with respect to matters of fact an Opinion of Counsel may rely on an Officer’s Certificate or certificates of public officials.

 

Section 13.03.                   Record Date for Vote or Consent of Holders.  The Company may set a record date for purposes of determining the identity of Holders entitled to vote or consent to any action by vote or consent authorized or permitted under this Indenture, which record date shall not be more than 30 days prior to the date of the commencement of solicitation of such action.  Notwithstanding the provisions of Section 10.03, if a record date is fixed, those Persons who were Holders of Securities at the Close of Business on such record date (or their duly designated proxies), and only those Persons, shall be entitled to take such action by vote or consent or to revoke any vote or consent previously given, whether or not such Persons continue to be Holders after such record date.

 

Section 13.04.                   Rules by Trustee, Paying Agent, Registrar and Conversion Agent.  The Trustee may make reasonable rules (not inconsistent with the terms of this Indenture) for action by or at a meeting of Holders.  Any Registrar, Paying Agent or Conversion Agent may make reasonable rules for its functions.

 

Section 13.05.                   Legal Holidays.  A “Legal Holiday” is a Saturday, Sunday or a day on which state or federally chartered banking institutions in New York, New York and the state in which the Corporate Trust Office is located are not required to be open.  If a payment date is a Legal Holiday, payment shall be made on the next succeeding day that is not a Legal Holiday, and no interest (including Additional Interest, if any) shall accrue for the intervening period.

 

Section 13.06.                   Governing Law.  This Indenture and the Securities shall be governed by, and construed in accordance with, the laws of the State of New York.

 

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Section 13.07.                   No Adverse Interpretation of Other Agreements.  This Indenture may not be used to interpret another indenture, loan or debt agreement of the Company or a Subsidiary of the Company. Any such indenture, loan or debt agreement may not be used to interpret this Indenture.

 

Section 13.08.                   No Recourse Against Others.  All liability described in paragraph 14 of the Securities of any incorporator or past, present or future director, officer, employee or stockholder, as such, of the Company and any successor is waived and released.

 

Section 13.09.                   Successors.  All agreements of the Company in this Indenture and the Securities shall bind its successors. All agreements of the Trustee in this Indenture shall bind its successor.

 

Section 13.10.                   Multiple Counterparts.  The parties may sign multiple counterparts of this Indenture. Each signed counterpart shall be deemed an original, but all of them together represent the same agreement.

 

Section 13.11.                   Separability.  In case any provisions in this Indenture or in the Securities shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

 

Section 13.12.                   Calculations in Respect of the Securities.  The Company or its agents shall make all calculations under this Indenture and the Securities in good faith.  In the absence of manifest error, such calculations shall be final and binding on all Holders.  The Company or its agents shall provide a copy of such calculations to the Trustee as required hereunder, and the Trustee shall be entitled to conclusively rely on the accuracy of any such calculation without independent verification.

 

Section 13.13.                   Table of Contents, Headings, Etc.  The table of contents, cross-reference sheet and headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not to be considered a part hereof, and shall in no way modify or restrict any of the terms or provisions hereof.

 

[Signature Page Follows]

 

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IN WITNESS WHEREOF, the parties hereto have hereunto set their hands as of the date and year first above written.

 

	
 
    	
RAMBUS INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
U.S. BANK NATIONAL   ASSOCIATION, 
    
	
 
    	
as Trustee
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

 

SCHEDULE A

 

The following table sets forth an indicative number of additional shares to be received per $1,000 principal amount of notes:

 

	
 
    	
 
    	
Stock Price
    	
 
    
	
Effective Date
    	
 
    	
$8.78
    	
 
    	
$10.00
    	
 
    	
$12.07
    	
 
    	
$15.00
    	
 
    	
$17.50
    	
 
    	
$20.00
    	
 
    	
$25.00
    	
 
    	
$30.00
    	
 
    	
$35.00
    	
 
    	
$40.00
    	
 
    	
$45.00
    	
 
    
	
August 16,   2013
    	
 
    	
31.0623
    	
 
    	
24.2632
    	
 
    	
16.1545
    	
 
    	
9.7153
    	
 
    	
6.5566
    	
 
    	
4.5450
    	
 
    	
2.2959
    	
 
    	
1.1924
    	
 
    	
0.6098
    	
 
    	
0.2899
    	
 
    	
0.1139
    	
 
    
	
August 15,   2014
    	
 
    	
31.0623
    	
 
    	
24.7930
    	
 
    	
16.0972
    	
 
    	
9.3333
    	
 
    	
6.1060
    	
 
    	
4.1047
    	
 
    	
1.9503
    	
 
    	
0.9484
    	
 
    	
0.4467
    	
 
    	
0.1861
    	
 
    	
0.0542
    	
 
    
	
August 15,   2015
    	
 
    	
31.0623
    	
 
    	
24.7147
    	
 
    	
15.4438
    	
 
    	
8.4555
    	
 
    	
5.2625
    	
 
    	
3.3651
    	
 
    	
1.4437
    	
 
    	
0.6255
    	
 
    	
0.2501
    	
 
    	
0.0743
    	
 
    	
0.0056
    	
 
    
	
August 15,   2016
    	
 
    	
31.0623
    	
 
    	
23.6049
    	
 
    	
13.8004
    	
 
    	
6.8085
    	
 
    	
3.8609
    	
 
    	
2.2463
    	
 
    	
0.7919
    	
 
    	
0.2682
    	
 
    	
0.0653
    	
 
    	
0.0011
    	
 
    	
0.0000
    	
 
    
	
August 15,   2017
    	
 
    	
31.0623
    	
 
    	
21.1223
    	
 
    	
10.6504
    	
 
    	
4.0728
    	
 
    	
1.8204
    	
 
    	
0.8322
    	
 
    	
0.1751
    	
 
    	
0.0174
    	
 
    	
0.0000
    	
 
    	
0.0000
    	
 
    	
0.0000
    	
 
    
	
August 15,   2018
    	
 
    	
31.0623
    	
 
    	
17.1671
    	
 
    	
0.0000
    	
 
    	
0.0000
    	
 
    	
0.0000
    	
 
    	
0.0000
    	
 
    	
0.0000
    	
 
    	
0.0000
    	
 
    	
0.0000
    	
 
    	
0.0000
    	
 
    	
0.0000
    	
 
    

 

 

EXHIBIT A

 

[FORM OF FACE OF 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 A DEPOSITARY OR A NOMINEE THEREOF. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND, UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.](1)

 

[THIS SECURITY AND THE COMMON STOCK, IF ANY, ISSUABLE UPON CONVERSION OF THIS SECURITY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT IN ACCORDANCE WITH THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE ACQUIRER:

 

(1)                                 REPRESENTS THAT IT AND ANY ACCOUNT FOR WHICH IT IS ACTING IS A “QUALIFIED INSTITUTIONAL BUYER” (WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT) AND THAT IT EXERCISES SOLE INVESTMENT DISCRETION WITH RESPECT TO EACH SUCH ACCOUNT, AND

 

(1)  This legend is to be included only if the Security is a Global Security.

 

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(2)                                 AGREES FOR THE BENEFIT OF RAMBUS INC. (THE “COMPANY”) THAT IT WILL NOT OFFER, SELL, PLEDGE OR OTHERWISE TRANSFER THIS SECURITY OR ANY BENEFICIAL INTEREST HEREIN PRIOR TO THE DATE THAT IS THE LATER OF (X) ONE YEAR AFTER THE LAST ORIGINAL ISSUE DATE HEREOF OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144 UNDER THE SECURITIES ACT OR ANY SUCCESSOR PROVISION THERETO AND (Y) SUCH LATER DATE, IF ANY, AS MAY BE REQUIRED BY APPLICABLE LAW, EXCEPT:

 

(A)                               TO THE COMPANY OR ANY SUBSIDIARY THEREOF, OR

 

(B)                               PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BECOME EFFECTIVE UNDER THE SECURITIES ACT, OR

 

(C)                               TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, OR

 

(D)                               PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT OR ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.

 

PRIOR TO THE REGISTRATION OF ANY TRANSFER IN ACCORDANCE WITH CLAUSE (2)(D) ABOVE, THE COMPANY AND THE TRUSTEE RESERVE THE RIGHT TO REQUIRE THE DELIVERY OF SUCH LEGAL OPINIONS, CERTIFICATIONS OR OTHER EVIDENCE AS MAY REASONABLY BE REQUIRED IN ORDER TO DETERMINE THAT THE PROPOSED TRANSFER IS BEING MADE IN COMPLIANCE WITH THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS. NO REPRESENTATION IS MADE AS TO THE AVAILABILITY OF ANY EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.](2)

 

(2)  This legend is to be included only if the Security is a Restricted Security.

 

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Rambus Inc.

 

1.125% Convertible Senior Notes due 2018

 

	
No. [              ]
    	
 
    	
U.S. $[ ]
    

 

CUSIP:  [              ]

ISIN:  [              ]

 

Rambus Inc., a Delaware corporation (the “Company”, which term shall include any successor Person under the Indenture referred to on the reverse hereof), for value received, promises to pay to Cede & Co., or registered assigns, the principal amount of            Dollars ($           ), or such greater or lesser amount as is indicated on the Schedule of Exchanges of Securities on the reverse side of this Security on August 15, 2018 unless earlier converted, or repurchased, and to pay interest thereon as set forth in the manner, at the rates and to the Persons set forth in the Indenture and the reverse hereof.  Payment of the principal of this Security shall be made in the form and manner set forth in the Indenture and the reverse hereof.

 

Reference is hereby made to the further provisions of this Security set forth on the reverse side of this Security, including, without limitation, provisions giving the Holder the right to convert this Security into shares of Common Stock of the Company and to require the Company to repurchase this Security upon certain events, in each case, 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.  Capitalized terms used but not defined herein shall have such meanings as are ascribed to such terms in the Indenture.

 

This Security shall be deemed to be a contract made under the laws of the State of New York, and for all purposes shall be construed in accordance with and governed by the laws of said State.

 

This Security 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.

 

[Signature page follows]

 

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IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed.

 

 

	
 
    	
RAMBUS INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    
	
 
    	
Date:
    
	
 
    	
 
    
	
 
    	
 
    
	
TRUSTEE’S   CERTIFICATION OF AUTHENTICATION
    	
 
    
	
 
    	
 
    
	
U.S. BANK NATIONAL   ASSOCIATION, as Trustee, certifies that this is one of the Securities   described in the within-mentioned Indenture.
    	
 
    
	
 
    	
 
    
	
By:
    	
 
    	
 
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Authorized   Signatory
    	
 
    
	
Date:
    	
 
    
					

 

2

 

[FORM OF REVERSE SIDE OF SECURITY]

 

Rambus Inc.

 

1.125% Convertible Senior Notes due 2018

 

This Security is one of a duly authorized issue of 1.125% Convertible Senior Notes due 2018 (the “Securities”) of the Company issued under an Indenture, dated as of August 16, 2013 (the “Indenture”), between the Company and U.S. Bank National Association, as trustee (the “Trustee”).  The terms of the Security include those stated in the Indenture and those set forth in this Security.  This Security is subject to all such terms, and Holders are referred to the Indenture for a statement of all such terms.  To the extent permitted by applicable law, if any provision of this Security conflicts with the express provisions of the Indenture, the provisions of the Indenture shall govern and be controlling.  Capitalized terms used but not defined herein have the meanings assigned to them in the Indenture unless otherwise indicated.

 

1.                                      Interest.

 

Subject to adjustment under Section 8.04 of the Indenture, this Security shall bear interest at a rate of 1.125% per annum on the principal amount.  Interest on this Security shall accrue from the most recent date to which interest has been paid or, if no interest has been paid, from August 16, 2013.  Interest will be payable semi-annually, in arrears, on each February 15 and August 15, beginning on February 15, 2014, to holders of record at the Close of Business on the immediately preceding February 1 and August 1, respectively.  Interest will be computed on the basis of a 360-day year composed of twelve 30-day months.  If a payment date is not a Business Day, payment will be made on the next succeeding Business Day, and no interest (including Additional Interest, if any) will accrue in respect of the delay.

 

Interest (including Additional Interest, if any) will cease to accrue on the Securities upon the Maturity Date or their conversion or repurchase by the Company at the option of the Holder.

 

2.                                      Method of Payment.

 

Payment of the principal of the Securities shall be made at the Corporate Trust Office of the Trustee in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts.  The Holder must surrender this Security to a Paying Agent to collect payment of principal.  Payment of interest including Additional Interest, if any, on Certificated Securities shall be made by check mailed to the address of the Person entitled thereto as such address appears in the Register; provided, however, that Holders with Securities in an aggregate principal amount in excess of $5,000,000 shall be paid, at their written election, by wire transfer of immediately available funds.  Notwithstanding the foregoing, so long as the Securities are registered in the name of a Depositary or its nominee, all payments with respect to the Securities shall be made by wire transfer of immediately available funds to the account of the Depositary or its nominee.

 

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3.                                      Paying Agent, Registrar and Conversion Agent.

 

Initially, the Trustee will act as Paying Agent, Registrar and Conversion Agent.  The Company or any Affiliate of the Company may act as Paying Agent, Registrar or Conversion Agent.

 

4.                                      Indenture.

 

The Securities are general unsecured senior obligations of the Company.  The Indenture does not limit the ability of the Company to incur other debt, secured or unsecured.

 

5.                                      No Optional Redemption

 

The Securities shall not be redeemable by the Company prior to the Maturity Date, and no sinking fund is provided for the Securities.

 

6.                                      Purchase by the Company at the Option of the Holder Upon a Fundamental Change.

 

Subject to the terms and conditions of the Indenture, the Company shall become obligated to purchase, at the option of any Holder, all or any portion of the Securities held by such Holder upon a Fundamental Change in principal amounts of $1,000 or multiples of $1,000 at the Fundamental Change Repurchase Price.  To exercise such right, a Holder shall deliver to the Paying Agent, and the Paying Agent must receive, a Fundamental Change Repurchase Notice containing the information set forth in the Indenture, at any time prior to the Close of Business on the Business Day immediately preceding the Fundamental Change Repurchase Date, and shall deliver the Securities to the Paying Agent as set forth in the Indenture.

 

Holders have the right to withdraw (in whole or in part) any Fundamental Change Repurchase Notice by delivering to the Paying Agent a written notice of withdrawal in accordance with the provisions of the Indenture.

 

If cash sufficient to pay the Fundamental Change Repurchase Price of all Securities or portions thereof to be purchased with respect to a Fundamental Change Repurchase Date is deposited with the Paying Agent by 10:00 a.m., New York City time, on the Fundamental Change Repurchase Date, then, immediately after such Fundamental Change Repurchase Date, such Securities shall cease to be outstanding and interest (including Additional Interest, if any) on such Securities shall cease to accrue, whether or not such Securities are delivered by their Holders to the Paying Agent, and the Holders thereof shall have no other rights as such (other than the right to receive the Fundamental Change Repurchase Price upon delivery of such Securities by their Holders to the Paying Agent).

 

2

 

7.                                      Conversion.

 

Subject to the provisions of the Indenture (including without limitation the conditions of conversion of Securities set forth in Article 5 thereof), the Holder hereof has the right, at its option, prior to the Close of Business on the second Scheduled Trading Day immediately preceding the Maturity Date, to convert the principal amount hereof or any portion of such principal which is $1,000 or a multiple thereof, into cash and shares of Common Stock, at the Conversion Rate specified in the Indenture.  The initial Conversion Rate is 82.8329 shares of Common Stock per $1,000 principal amount of Securities (equivalent to an initial Conversion Price of approximately $12.07 per share of Common Stock), subject to adjustment in certain events described in the Indenture.

 

Upon conversion, the Company will pay cash up to the aggregate principal amount of the Securities to be converted, and, cash, shares of Common Stock, or a combination of cash and shares of Common Stock, at the Company’s election, in respect of the remainder, based on a Settlement Amount calculated on a proportionate basis for each day of the Conversion Reference Period, as set forth in the Indenture.  No fractional shares will be issued upon any conversion, but an adjustment and payment in cash will be made, as provided in the Indenture, in respect of any fraction of a share which would otherwise be issuable upon the surrender of any Securities for conversion.  Securities in respect of which a Holder is exercising its right to require repurchase on a Fundamental Change Repurchase Date may be converted only if such Holder withdraws its election to exercise such right in accordance with the terms of the Indenture;

 

8.                                      Denominations; Transfer; Exchange.

 

The Securities are in registered form, without coupons, in denominations of $1,000 and multiples of $1,000.  A Holder may register the transfer of or exchange Securities in accordance with the Indenture.  The Registrar may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and to pay any taxes, assessments or other governmental charges that may be imposed in relation thereto by law or permitted by the Indenture.

 

9.                                      Persons Deemed Owners.

 

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

 

10.                               Unclaimed Money or Securities.

 

The Trustee and the Paying Agent shall return to the Company upon written request any cash or securities held by them for the payment of any amount with respect to the Securities that remains unclaimed for two years, subject to applicable unclaimed property law. After return to the Company, Holders entitled to the cash or securities must look to the Company for payment as general creditors unless an applicable abandoned property law designates another Person.

 

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11.                               Amendment, Supplement and Waiver.

 

Subject to certain exceptions, the Securities or the Indenture may be amended or supplemented with the consent of the Holders of at least a majority in aggregate principal amount of the Securities then outstanding, and an existing Default or Event of Default with respect to the Securities and its consequence or compliance with any provision of the Securities or the Indenture may be waived in any instance with the consent of the Holders of at least a majority in aggregate principal amount of the Securities then outstanding.  Without the consent of or notice to any Holder, the Company and the Trustee may amend or supplement the Indenture or the Securities to, among other things, cure any ambiguity, defect, omission, mistake or inconsistency or make any change that does not adversely affect in any material respect the legal rights under the Indenture of any Holder.

 

12.                               Additional Securities.

 

Subject to the terms of the Indenture, Additional Securities may be issued by the Company, without the consent of the Holders, with the same terms and with the same CUSIP number as the Securities in an unlimited aggregate principal amount; provided, however, that no such Additional Securities may be issued unless fungible with this Security for United States Federal income tax purposes.

 

13.                               Defaults and Remedies.

 

If any Event of Default other than as a result of certain events of bankruptcy, insolvency or reorganization of the Company occurs and is continuing, the principal of all the Securities then outstanding plus accrued and unpaid interest (including Additional Interest, if any), may be declared due and payable in the manner and with the effect provided in the Indenture.  If an Event of Default occurs as a result of certain events of bankruptcy, insolvency or reorganization of the Company, the principal amount of the Securities plus accrued and unpaid interest (including Additional Interest, if any) shall become due and payable immediately without any declaration or other act on the part of the Trustee or any Holder, all to the extent provided in the Indenture.

 

14.                               No Recourse Against Others.

 

No recourse under or upon any obligation, covenant or agreement contained in the Indenture, or in this Security, or because of any indebtedness evidenced thereby or hereby, shall be had against any incorporator, as such, or against any past, present or future employee, stockholder, officer or director, as such, of the Company or of any successor, either directly or through the Company or any successor, under any rule of law, statute or constitutional provision or by the enforcement of any assessment or by any legal or equitable proceeding or otherwise, all such liability being expressly waived and released by the acceptance of the Securities by the Holders and as part of the consideration for the issuance of the Securities.

 

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15.                               Trustee Dealings with the Company.

 

Subject to certain limitations imposed by the Indenture, the Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Securities and may otherwise deal with and collect obligations owed to it by the Company or its Affiliates and may otherwise deal with the Company or its Affiliates with the same rights it would have if it were not the Trustee.

 

16.                               Authentication.

 

This Security shall not be valid until the Trustee or an authenticating agent manually signs the certificate of authentication on the other side of this Security.

 

17.                               Abbreviations.

 

Customary abbreviations may be used in the name of the Holder or an assignee, such as:  TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian) and UGMA (= Uniform Gifts to Minors Act).

 

18.                               Indenture to Control; Governing Law.

 

To the extent permitted by applicable law, if any provision of this Security conflicts with the express provisions of the Indenture, the provisions of the Indenture shall govern and be controlling.  This Security shall be governed by, and construed in accordance with, the laws of the State of New York.

 

19.                               Copies of Indenture.

 

The Company will furnish to any Holder, upon written request and without charge, a copy of the Indenture.  Requests may be made to: Rambus Inc., 1050 Enterprise Way, Suite 700, Sunnyvale, CA 94089, Facsimile No. (408) 462-8001, Attention: General Counsel.

 

5

 

SCHEDULE OF EXCHANGES OF SECURITIES(3)

 

Rambus Inc.
 1.125% Convertible Senior Notes due 2018

 

The following exchanges, purchases or conversions of a part of this Global Security have been made:

 

	
Date of
   Decrease or
   Increase
    	
 
    	
Authorized
   Signatory of
   Securities
   Custodian
    	
 
    	
Decrease in
   Principal
   Amount of this
   Global Security
    	
 
    	
Increase in
   Principal
   Amount of this
   Global Security
    	
 
    	
Principal
   Amount of this
   Global Security
   Following Such
   Decrease or
   Increase
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    

 

(3)  This schedule is to be included only if the Security is a Global Security.

 

1

 

ASSIGNMENT FORM

 

To assign this Security, fill in the form below:

 

I or we assign and transfer this Security to

 

	
 
    

 

(Insert assignee’s soc. sec. or tax ID no.)

 

	
 
    

 

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

 

and irrevocably appoint agent to transfer this Security on the books of the Company.  The agent may substitute another to act for him.

 

In connection with any transfer of the within Security occurring prior to the Resale Restriction Termination Date, as defined in the Indenture governing such Security, the undersigned confirms that such Security is being transferred:

 

o                                    To Rambus Inc. or a subsidiary thereof; or

 

o                                    Pursuant to a registration statement, if any, that has become or been declared effective under the Securities Act of 1933, as amended and is effective at the time of such transfer; or

 

o                                    Pursuant to and in compliance with Rule 144A under the Securities Act of 1933, as amended; or

 

o                                    Pursuant to and in compliance with Rule 144 under the Securities Act of 1933, as amended, or any other available exemption from the registration requirements of the Securities Act of 1933, as amended.

 

 

	
 
    	
 
    	
 
    	
Your Signature
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Date:
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
(Sign exactly as   your name appears on the other side of this Security)
    

 

 

Signature Guaranteed

 

2

 

	
 
    	
 
    	
 
    
	
Participant in a   Recognized Signature Guarantee Medallion Program
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By
    	
 
    	
 
    	
 
    
	
Authorized   Signatory
    	
 
    	
 
    
				

 

 

NOTICE:  The signature on the assignment must correspond with the name as written upon the face of the Note in every particular without alteration or enlargement or any change whatever.

 

3

 

FORM OF CONVERSION NOTICE

 

To convert this Security into the Settlement Amount, check the box o

 

To convert only part of this Security, state the principal amount to be converted (which must be $1,000 or a multiple of $1,000):

 

If you want the stock certificate, if any, made out in another person’s name fill in the form below:

 

	
 
    
	
(Insert   assignee’s soc. sec. or tax ID no.)
    

 

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

 

 

	
Dated
    	
 
    	
 
    

 

 

	
Your Signature:
    	
 
    	
 
    

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

 

Signature Guaranteed

 

 

	
 
    	
 
    
	
Participant in a   Recognized Signature Guarantee Medallion Program
    	
 
    

 

 

	
By
    	
 
    	
 
    
	
Authorized   Signatory
    	
 
    

 

1

 

FORM OF FUNDAMENTAL CHANGE REPURCHASE NOTICE

 

U.S. Bank National Association

633 West Fifth Street, 24th Floor

Los Angeles, CA 90071

Attention:  Corporate Trust Services

 

Re:                             Rambus Inc. (the “Company”)
  1.125% Convertible Senior Notes due 2018

 

This is a Fundamental Change Repurchase Notice as defined in Section 4.01(c) of the Indenture, dated as of August 16, 2013 (the “Indenture”), between the Company and U.S. Bank National Association, as Trustee.  Terms used but not defined herein shall have the meanings ascribed to them in the Indenture.

 

	
Certificate No(s).   of Securities:
    	
 
    	
 
    

 

I intend to deliver the following aggregate principal amount of Securities for purchase by the Company pursuant to Article 4 of the Indenture (in multiples of $1,000):

 

$

 

I hereby agree that the Securities will be purchased on the Fundamental Change Repurchase Date pursuant to the terms and conditions specified in the Securities and in the Indenture.

 

	
 
    	
Signed:
    	
 
    
	
 
    	
 
    
	
 
    	
NOTICE: The above   signature(s) of the Holder(s) hereof must correspond with the name   as written upon the face of the Note in every particular without alteration   or enlargement or any change whatever.
    

 

A-1Exhibit 10.1

 

EXECUTION VERSION

 

$120,000,000

 

RAMBUS INC.

 

1.125% Convertible Senior Notes due 2018

 

Purchase Agreement

 

	
 
    	
August 12,   2013
    

 

J.P. Morgan Securities LLC

Citigroup Global Markets Inc.

Jefferies LLC

As Representatives of the several Initial Purchasers listed in Schedule 1 hereto

 

c/o J.P. Morgan Securities LLC

383 Madison Avenue

New York, New York 10179

 

c/o Citigroup Global Markets Inc.

388 Greenwich Street

New York, New York 10013

 

c/o Jefferies LLC

520 Madison Avenue

New York, New York 10022

 

Ladies and Gentlemen:

 

Rambus Inc., a Delaware corporation (the “Company”), proposes to issue and sell to the several initial purchasers listed in Schedule 1 hereto (the “Initial Purchasers”), for whom you are acting as representatives (the “Representatives”), $120,000,000 aggregate principal amount of its 1.125% Convertible Senior Notes due 2018 (the “Underwritten Securities”) and, at the option of the Initial Purchasers, up to an additional $18,000,000 aggregate principal amount of its 1.125% Convertible Senior Notes due 2018 (the “Option Securities”), solely to cover overallotments, if and to the extent that the Initial Purchasers shall have determined to exercise the option to purchase such Option Securities granted to the Initial Purchasers in Section 2 hereof.  The Underwritten Securities and the Option Securities are herein referred to as the “Securities”.  The Securities will be convertible into cash, and if designated by the Company, shares (the “Underlying Securities”) of common stock of the Company, par value $0.001 per share (the “Common Stock”). The Securities will be issued pursuant to an Indenture to be dated

 

 

as of August 16, 2013 (the “Indenture”) between the Company and U.S. Bank National Association, as trustee (the “Trustee”).

 

The Company hereby confirms its agreement with the several Initial Purchasers concerning the purchase and sale of the Securities, as follows:

 

1.                                      The Securities will be sold to the Initial Purchasers without being registered under the Securities Act of 1933, as amended (the “Securities Act”), in reliance upon an exemption therefrom.  The Company has prepared a preliminary offering memorandum dated August 12, 2013 (the “Preliminary Offering Memorandum”) and will prepare an offering memorandum dated the date hereof (the “Offering Memorandum”) setting forth information concerning the Company and the Securities.  Copies of the Preliminary Offering Memorandum have been, and copies of the Offering Memorandum will be, delivered by the Company to the Initial Purchasers pursuant to the terms of this Agreement.  The Company hereby confirms that it has authorized the use of the Preliminary Offering Memorandum, the other Time of Sale Information (as defined below) and the Offering Memorandum in connection with the offering and resale of the Securities by the Initial Purchasers in the manner contemplated by this Agreement.  References herein to the Preliminary Offering Memorandum, the Time of Sale Information and the Offering Memorandum shall be deemed to refer to and include any document incorporated by reference therein.

 

At or prior to 9:10 p.m. New York City time, on August 12, 2013 (the “Time of Sale”), the Company had prepared the following information (collectively, the “Time of Sale Information”): the Preliminary Offering Memorandum, as supplemented and amended by the written communications listed on Annex C hereto.

 

2.                                      Purchase and Resale of the Securities by the Initial Purchasers.  (a)  The Company agrees to issue and sell the Underwritten Securities to the several Initial Purchasers as provided in this Agreement, and each Initial Purchaser, on the basis of the representations, warranties and agreements set forth herein and subject to the conditions set forth herein, agrees, severally and not jointly, to purchase from the Company the respective principal amount of Underwritten Securities set forth opposite such Initial Purchaser’s name in Schedule 1 hereto at a price equal to 97.5% of the principal amount thereof (the “Purchase Price”) plus accrued interest, if any, from August 16, 2013 to the Closing Date (as defined below).

 

In addition, the Company agrees to issue and sell the Option Securities to the several Initial Purchasers as provided in this Agreement, and the Initial Purchasers, on the basis of the representations, warranties and agreements set forth herein and subject to the conditions set forth herein, shall have the option to purchase, severally and not jointly, from the Company the Option Securities, solely to cover over-allotments, at the Purchase Price plus accrued interest, if any, from the Closing Date to the date of payment and delivery.

 

If any Option Securities are to be purchased, the amount of Option Securities to be purchased by each Initial Purchaser shall be the amount of Option Securities which bears the same ratio to the aggregate amount of Option Securities being purchased as the amount of

 

2

 

Underwritten Securities set forth opposite the name of such Initial Purchaser in Schedule 1 hereto (or such amount increased as set forth in Section 10 hereof) bears to the aggregate amount of Underwritten Securities being purchased from the Company by the several Initial Purchasers, subject, however, to such adjustments to eliminate Securities in denominations other than $1,000 as the Representatives in their sole discretion shall make.

 

The Initial Purchasers may exercise the option to purchase the Option Securities at any time in whole, or from time to time in part, on or before the thirtieth day following the date of this Agreement, by written notice from the Representatives to the Company.  Such notice shall set forth the aggregate amount of Option Securities as to which the option is being exercised and the date and time when the Option Securities are to be delivered and paid for which may be the same date and time as the Closing Date (as hereinafter defined) but shall not be earlier than the Closing Date nor later than the tenth full business day (as hereinafter defined) after the date of such notice (unless such time and date are postponed in accordance with the provisions of Section 10 hereof).  Any such notice shall be given at least two Business Days prior to the date and time of delivery specified therein.

 

(b)                                 The Company understands that the Initial Purchasers intend to offer the Securities for resale on the terms set forth in the Time of Sale Information.  Each Initial Purchaser, severally and not jointly, represents, warrants and agrees that:

 

(i)                                     it is a qualified institutional buyer within the meaning of Rule 144A under the Securities Act (a “QIB”) and an accredited investor within the meaning of Rule 501(a) under the Securities Act;

 

(ii)                                  it has not solicited offers for, or offered or sold, and will not solicit offers for, or offer or sell, the Securities by means of any form of general solicitation or general advertising within the meaning of Rule 502(c) of Regulation D under the Securities Act (“Regulation D”) or in any manner involving a public offering within the meaning of Section 4(2) of the Securities Act; and

 

(iii)                               it has not solicited offers for, or offered or sold, and will not solicit offers for, or offer or sell, the Securities as part of their initial offering except (A) to persons whom it reasonably believes to be QIBs in transactions pursuant to Rule 144A under the Securities Act (“Rule 144A”) and in connection with each such sale, it has taken or will take reasonable steps to ensure that the purchaser of the Securities is aware that such sale is being made in reliance on Rule 144A and (B) in accordance with the restrictions set forth in the Offering Memorandum.

 

(c)                                  Each Initial Purchaser acknowledges and agrees that the Company and, for purposes of the opinions to be delivered to the Initial Purchasers pursuant to Sections 6(f), 6(g) and 6(h), counsel for the Company, general counsel for the Company and counsel for the Initial Purchasers, respectively, may rely upon the accuracy of the representations and warranties of the Initial Purchasers, and compliance by the Initial Purchasers with their agreements, contained in paragraph (b) above, and each Initial Purchaser hereby consents to such reliance.

 

3

 

(d)                                 The Company acknowledges and agrees that the Initial Purchasers may offer and sell Securities to or through any affiliate of an Initial Purchaser and that any such affiliate may offer and sell Securities purchased by it to or through any Initial Purchaser; provided that such offers and sales shall be made in accordance with the provisions of this Agreement.

 

(e)                                  Payment for the Securities shall be made by wire transfer in immediately available funds to the account specified by the Company to the Representatives in the case of the Underwritten Securities, at the offices of Wilson Sonsini Goodrich & Rosati, Professional Corporation, 650 Page Mill Road, Palo Alto, California 94304 at 10:00 A.M. New York City time on August 16, 2013, or at such other time or place on the same or such other date, not later than the fifth business day thereafter, as the Representatives and the Company may agree upon in writing, or, in the case of the Option Securities, on the date and at the time and place specified by the Representatives in the written notice of the Initial Purchasers’ election to purchase such Option Securities.  The time and date of such payment for the Underwritten Securities  is referred to herein as the “Closing Date” and the time and date for such payment for the Option Securities, if other than the Closing Date, is herein referred to as the “Additional Closing Date”.

 

Payment for the Securities to be purchased on the Closing Date or the Additional Closing Date, as the case may be, shall be made against delivery to the nominee of The Depository Trust Company (“DTC”), for the respective accounts of the several Initial Purchasers of the Securities to be purchased on such date of one or more global notes representing the Securities (collectively, the “Global Note”), with any transfer taxes payable in connection with the sale of such Securities duly paid by the Company.  The Global Note will be made available for inspection by the Representatives at the offices of the Representatives set forth above not later than 1:00 P.M., New York City time, on the business day prior to the Closing Date or the Additional Closing Date, as the case may be.

 

(f)                                   The Company acknowledges and agrees that the Initial Purchasers are acting solely in the capacity of an arm’s length contractual counterparty to the Company with respect to the offering of Securities contemplated hereby (including in connection with determining the terms of the offering) and not as a financial advisor or a fiduciary to, or an agent of, the Company or any other person.  Additionally, neither the Representatives nor any other Initial Purchaser is advising the Company or any other person as to any legal, tax, investment, accounting or regulatory matters in any jurisdiction.  The Company shall consult with its own advisors concerning such matters and shall be responsible for making its own independent investigation and appraisal of the transactions contemplated hereby, and the Initial Purchasers shall have no responsibility or liability to the Company with respect thereto. Any review by the Initial Purchasers of the Company, the transactions contemplated hereby or other matters relating to such transactions will be performed solely for the benefit of the Initial Purchasers and shall not be on behalf of the Company.

 

3.                                      Representations and Warranties of the Company.  The Company represents and warrants to each Initial Purchaser that:

 

4

 

(a)                                 Preliminary Offering Memorandum.  The Preliminary Offering Memorandum, as of its date, did not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that the Company makes no representation and warranty with respect to any statements or omissions made in reliance upon and in conformity with information relating to any Initial Purchaser furnished to the Company in writing by such Initial Purchaser through the Representatives expressly for use in any Preliminary Offering Memorandum, it being understood and agreed that the only such information furnished by any Initial Purchaser consists of the information described as such in Section 7(b) hereof.

 

(b)                                 Time of Sale Information. The Time of Sale Information, at the Time of Sale, did not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that the Company makes no representation and warranty with respect to any statements or omissions made in reliance upon and in conformity with information relating to any Initial Purchaser furnished to the Company in writing by such Initial Purchaser through the Representatives expressly for use in such Time of Sale Information, it being understood and agreed that the only such information furnished by any Initial Purchaser consists of the information described as such in Section 7(b) hereof.  No statement of material fact included in the Offering Memorandum has been omitted from the Time of Sale Information and no statement of material fact included in the Time of Sale Information that is required to be included in the Offering Memorandum has been omitted therefrom.

 

(c)                                  Additional Written Communications.  Other than the Preliminary Offering Memorandum and the Offering Memorandum, the Company (including its agents and representatives, other than the Initial Purchasers in their capacity as such) has not made, used, prepared, authorized, approved or referred to and will not prepare, make, use, authorize, approve or refer to any “written communication” (as defined in Rule 405 under the Securities Act) that constitutes an offer to sell or solicitation of an offer to buy the Securities (each such communication by the Company or its agents and representatives (other than a communication referred to in clauses (i), (ii) and (iii) below) an “Issuer Written Communication”) other than (i) the Preliminary Offering Memorandum, (ii) the Offering Memorandum, (iii) the documents listed on Annex C hereto, including a term sheet substantially in the form of Annex D hereto, which constitute part of the Time of Sale Information, and (iv) each electronic road show and any other written communications approved in writing in advance by the Representatives.  Each such Issuer Written Communication, when taken together with the Time of Sale Information, did not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that the Company makes no representation and warranty with respect to any statements or omissions made in each such Issuer Written Communication in reliance upon and in conformity with information relating to any Initial Purchaser furnished to the Company in writing by such Initial Purchaser through the Representatives expressly for use in such Issuer Written Communication, it being understood and agreed that the only such information furnished by any Initial Purchaser consists of the information described as such in Section 7(b) hereof.  Each such Issuer Written Communication, as of its issue date and at all subsequent times through

 

5

 

the completion of the offer and sale of the Securities or until any earlier date that the Company notified or notifies the Representatives as described in Section 4(e), did not, does not and will not include any information that conflicted, conflicts or will conflict with the information contained in the Time of Sale Information or the Offering Memorandum, including any document incorporated by reference therein.

 

(d)                                 Offering Memorandum.  As of the date of the Offering Memorandum and as of the Closing Date and as of the Additional Closing Date, as the case may be, the Offering Memorandum does not and will not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that the Company makes no representation and warranty with respect to any statements or omissions made in reliance upon and in conformity with information relating to any Initial Purchaser furnished to the Company in writing by such Initial Purchaser through the Representatives expressly for use in the Offering Memorandum, it being understood and agreed that the only such information furnished by any Initial Purchaser consists of the information described as such in Section 7(b) hereof.

 

(e)                                  Incorporated Documents.  The documents incorporated by reference in the Offering Memorandum or the Time of Sale Information, when filed with the Securities and Exchange Commission (the “Commission”) conformed or will conform, as the case may be, in all material respects to the requirements of the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission thereunder (collectively, the “Exchange Act”) and such documents did not or will not, as the case may be, contain any 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, in the light of the circumstances under which they were made, not misleading.

 

(f)                                   Financial Statements.  The financial statements (which term as used in this Agreement includes the related notes and schedules thereto) included in the Time of Sale Information and the Offering Memorandum comply in all material respects with the requirements of the Act and the Exchange Act and fairly present, in all material respects, the financial position of the Company and its consolidated subsidiaries as of the dates shown and their results of operations and cash flows for the periods shown, and such financial statements have been prepared in conformity with the generally accepted accounting principles in the United States applied on a consistent basis (“GAAP”).  PricewaterhouseCoopers LLP, which has expressed its opinion with respect to and certified certain financial statements included in the Time of Sale Information and the Offering Memorandum, is an independent registered public accounting firm within the meaning of Regulation S-X under the Act and the Exchange Act.  Any non-audit services provided by PricewaterhouseCoopers LLP to the Company have been approved by the audit committee of the Company’s board of directors to the extent required by the Exchange Act.

 

(g)                                  No Material Adverse Change.  Except as disclosed in the Time of Sale Information and the Offering Memorandum, since the date of the latest audited financial statements included in the Time of Sale Information and the Offering Memorandum, there has been no material adverse change, or any development or event involving a prospective material adverse change in the condition (financial or otherwise), business, properties, operations or

 

6

 

results of operations of the Company and its subsidiaries, taken as a whole, and there has been no dividend or distribution of any kind declared, paid or made by the Company with respect to its capital stock; and there has not been any change in the capital stock of the Company (other than any change in the number of outstanding shares of Common Stock due to the issuance of shares upon the exercise of outstanding options or warrants).

 

(h)                                 Organization and Good Standing.  The Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of the State of Delaware, with power and authority (corporate and other) to own, lease and operate its properties and conduct its business as described in the Time of Sale Information and the Offering Memorandum; and the Company is duly qualified to do business as a foreign corporation in good standing in all other jurisdictions in which its ownership or lease of property or the conduct of its business requires such qualification, except to the extent that the failure to be so qualified or be in good standing would not have a Material Adverse Effect (as defined below).

 

(i)                                     Capitalization.  The Company has an authorized capitalization as set forth in the Time of Sale Information and the Offering Memorandum under the heading “Capitalization”; except as described in or expressly contemplated by the Time of Sale Information and the Offering Memorandum, there are no outstanding rights (including, without limitation, pre-emptive rights), warrants or options to acquire, or instruments convertible into or exchangeable for, any shares of capital stock or other equity interest in the Company or any of its subsidiaries, or any contract, commitment, agreement, understanding or arrangement of any kind relating to the issuance of any capital stock of the Company or any such subsidiary, any such convertible or exchangeable securities or any such rights, warrants or options; the capital stock of the Company conforms in all material respects to the description thereof contained in the Time of Sale Information and the Offering Memorandum.

 

(j)                                    Subsidiaries.  Rambus International Ltd. and Cryptography Research, Inc. are the only Significant Subsidiaries (as such term is defined in Rule 1-02 of Regulation S-X as promulgated under the Act) of the Company.

 

(k)                                 Due Authorization.  The Company has full right, power and authority to execute and deliver this Agreement, the Indenture and the Securities (collectively, the “Transaction Documents”) and to perform its obligations hereunder and thereunder; and all action required to be taken for the due and proper authorization, execution and delivery by it of each of the Transaction Documents and the consummation by it of the transactions contemplated thereby or by the Time of Sale Information and the Offering Memorandum has been duly and validly taken.

 

(l)                                     The Indenture.  The Indenture has been duly authorized by the Company and, when duly executed and delivered in accordance with its terms by each of the parties thereto, will constitute a valid and legally binding agreement of the Company enforceable against the Company in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or similar laws affecting creditors’ rights generally or by equitable principles relating to enforceability (collectively, the “Enforceability Exceptions”).

 

7

 

(m)                             Authorization of Agreement.  This Agreement has been duly authorized, executed and delivered by the Company.

 

(n)                                 The Securities.  The Securities have been duly authorized by the Company and, when duly executed, authenticated, issued and delivered as provided in the Indenture and paid for as provided herein, will be duly and validly issued and outstanding and will constitute valid and legally binding obligations of the Company enforceable against the Company in accordance with their terms, subject to the Enforceability Exceptions, and will be entitled to the benefits of the Indenture.

 

(o)                                 The Underlying Securities.  Upon issuance and delivery of the Securities in accordance with this Agreement and the Indenture, the Securities will be convertible at the option of the holder thereof into cash and, if applicable, shares of the Underlying Securities in accordance with the terms of the Securities; the Underlying Securities reserved for issuance upon conversion of the Securities have been duly authorized and reserved and, when issued upon conversion of the Securities in accordance with the terms of the Securities, will be validly issued, fully paid and non assessable, and the issuance of the Underlying Securities will not be subject to any preemptive or similar rights.

 

(p)                                 Description of the Securities and Indenture.  The Securities and the Indenture conform in all material respects to the description thereof contained in the Time of Sale Information and the Offering Memorandum.

 

(q)                                 Absence of Defaults and Conflicts.  Each of (i) the execution, delivery and performance of the Indenture and this Agreement, and (ii) the issuance and sale of the Securities and compliance with the terms and provisions thereof and (iii) the issuance and delivery from time to time of the Underlying Securities by the Company upon conversion of the Securities in accordance with the terms of the Securities and the provisions of the Indenture will not result in a breach or violation of any of the terms and provisions of, or constitute a default under, (A) any statute, any rule, regulation or order of any governmental agency or body or any court, domestic or foreign, having jurisdiction over the Company or any subsidiary of the Company or any of their properties, or (B) any agreement or instrument to which the Company or any such subsidiary is a party or by which the Company or any such subsidiary is bound or to which any of the properties of the Company or any such subsidiary is subject, or (C) the charter or by laws of the Company or any such subsidiary, except, in the case of clauses (A) and (B) above, to the extent such breach, violation or default would not reasonably be expected to have a Material Adverse Effect; and the Company has full power and authority to authorize, issue and sell the Securities.

 

(r)                                    Absence of Further Requirements.  No consent, approval, authorization, or order of, or filing or registration with, any governmental agency or body or any court is required for the consummation of the transactions contemplated by this Agreement or the Indenture in connection with the offering, issuance and sale of the Securities by the Company, except for as may be required by the securities or Blue Sky laws of various states.

 

8

 

(s)                                   Litigation.  Except as disclosed in the Time of Sale Information and the Offering Memorandum, there are no pending actions, suits or proceedings against or affecting the Company, any of its subsidiaries or any of their respective properties that, if determined adversely to the Company or any of its subsidiaries, (i) would reasonably be expected to individually or in the aggregate have a Material Adverse Effect, (ii) would materially and adversely affect the ability of the Company to perform its obligations under the Indenture or this Agreement, or (iii) which are otherwise material in the context of the sale of the Securities; and no such actions, suits or proceedings are to the Company’s knowledge threatened.

 

(t)                                    Title to Property.  Except as disclosed in the Time of Sale Information and the Offering Memorandum, the Company and its subsidiaries have good and marketable title to all real properties and all other properties and assets owned by them, in each case free from liens, encumbrances and defects that could reasonably be expected to have a Material Adverse Effect; and except as disclosed in the Time of Sale Information and the Offering Memorandum, the Company and its subsidiaries hold any leased real or personal property under valid and enforceable (as to the Company) leases with no exceptions that could reasonably be expected to have a Material Adverse Effect.

 

(u)                                 Possession of Intellectual Property.  The Company and its subsidiaries own or possess the legal right to use all trademarks, trade names, copyrights, domain names, trade secrets, and, to the Company’s knowledge, patent rights, licenses and other similar rights (collectively, “Intellectual Property Rights”) necessary to conduct their businesses as now conducted, (as described in the Time of Sale Information and the Offering Memorandum), and except as disclosed in the Time of Sale Information and the Offering Memorandum, the expected expiration of any of such Intellectual Property Rights would not reasonably be expected to result in a Material Adverse Effect.  Except as disclosed in the Time of Sale Information and the Offering Memorandum, the Intellectual Property Rights owned by the Company or its subsidiaries and, to the knowledge of the Company, the Intellectual Property Rights licensed to the Company or its subsidiaries have not been finally adjudged invalid or unenforceable, in whole or in part.  Except as disclosed in the Time of Sale Information and the Offering Memorandum, there is no pending or to the knowledge of the Company, threatened action, suit, proceeding or claim by others challenging the validity, enforceability or scope of any Intellectual Property Rights that would be reasonably expected to result in a Material Adverse Effect.  Except as disclosed in the Time of Sale Information and the Offering Memorandum, there is no pending or to the knowledge of the Company, threatened action, suit, proceeding or claim by others challenging the Company’s rights in or to any Intellectual Property Rights that would be reasonably expected to result in a Material Adverse Effect.  Except as disclosed in the Time of Sale Information and Offering Memorandum, neither the Company nor any of its subsidiaries has received any notice of a claim of infringement, misappropriation or conflict with Intellectual Property Rights of others, which infringement, misappropriation or conflict, if the subject of an unfavorable decision, would result in a Material Adverse Effect.  Except as disclosed in the Time of Sale Information and Offering Memorandum, the Company is not a party to or bound by any options, licenses or agreements with respect to the Intellectual Property Rights of any other person or entity that are required to be set forth in the Time of Sale Information and Offering Memorandum.  None of the technology or intellectual property used by

 

9

 

the Company or its subsidiaries in their businesses has been obtained or is being used by the Company or its subsidiaries (i) in violation of any contractual obligation to which the Company or its subsidiaries is a party or, (ii) to the Company’s knowledge, otherwise in material violation of the rights of any persons.  Except as disclosed in the Time of Sale Information and Offering Memorandum, the licenses that the Company has entered into in connection with its Intellectual Property and which are required to be filed with the Commission and are currently in effect, including, but not limited to, cross-license agreements, royalty-generating contracts and international licenses (the “Material Contracts”) are valid, binding (as to the Company) and, to its knowledge, the other party and remain in full force and effect and the Company has not received any notice of any material breach or any material default under such agreement which breach or default has not been cured or waived and neither the Company, nor to the knowledge of the Company, any other party to the Material Contracts, is currently in material breach or default of any Material Contract.

 

(v)                                 Investment Company Act.  The Company is not an open-end investment company, unit investment trust or face amount certificate company that is or is required to be registered under Section 8 of the United States Investment Company Act of 1940 (the “Investment Company Act”) and the Company is not and, after giving effect to the offering and sale of the Securities and the application of the proceeds thereof as described in the Time of Information and the Offering Memorandum, will not be an “investment company” as defined in the Investment Company Act.

 

(w)                               Taxes.  The Company and its subsidiaries have paid all federal, state, local and foreign taxes and filed all tax returns required to be paid or filed through the date hereof, except where the failures to pay or file would not have a Material Adverse Effect (as defined below); and except as otherwise disclosed in the Time of Sale Information and the Offering Memorandum, there is no tax deficiency that has been, or could reasonably be expected to be, asserted against the Company or any of its subsidiaries or any of their respective properties or assets, except for such tax deficiencies as would not have a Material Adverse Effect.

 

(x)                                 Licenses and Permits.  The Company and its subsidiaries possess adequate certificates, authorities or permits issued by appropriate governmental agencies or bodies necessary to conduct the business now operated by them and have not received any notice of proceedings relating to the revocation or modification of any such certificate, authority or permit that, if determined adversely to the Company or any of its subsidiaries, would individually or in the aggregate have a material adverse effect on the condition (financial or other), business, properties or results of operations of the Company and its subsidiaries taken as a whole (“Material Adverse Effect”).

 

(y)                                 No Labor Disputes.  No labor dispute with the employees of the Company or any subsidiary exists or, to the knowledge of the Company, is imminent that could reasonably be expected to result in a Material Adverse Effect.

 

(z)                                  Environmental Laws.  Except as disclosed in the Time of Sale Information and Offering Memorandum, neither the Company nor any of its subsidiaries (i) is, to the Company’s

 

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knowledge, in violation of any statute, any rule, regulation, decision or order of any governmental agency or body or any court, domestic or foreign, relating to the use, disposal or release of hazardous or toxic substances or relating to the protection or restoration of the environment or human exposure to hazardous or toxic substances  (collectively, “Environmental Laws”), (ii) owns or operates any real property that to the Company’s knowledge is contaminated with any substance that is subject to any Environmental Laws, (iii) is, to the Company’s knowledge, liable for any off site disposal or contamination pursuant to any Environmental Laws, or (iv) is, to the Company’s knowledge, subject to any claim relating to any Environmental Laws, which violation, contamination, liability or claim would reasonably be expected to individually or in the aggregate have a Material Adverse Effect; and the Company is not aware of any pending investigation which would reasonably be expected to lead to such a claim.

 

(aa)                          Internal and Disclosure Controls.  The Company maintains a system of internal accounting controls sufficient to provide reasonable assurances that (i) transactions are executed in accordance with management’s general or specific authorization; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP or any other criteria applicable to such statements and to maintain accountability for assets; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; and (iv) the recorded accountability for assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences.  The Company maintains disclosure controls and procedures (as such term is defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) sufficient to provide reasonable assurance that information required to be disclosed by the Company in the reports that it will file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the rules and forms of the Commission, including, without limitation, controls and procedures designed to reasonably ensure that information required to be disclosed by the Company in the reports that it will file or submit under the Exchange Act is accumulated and communicated to the Company’s management, including its principal executive officer or officers and its principal financial officer or officers, as appropriate to allow timely decisions regarding required disclosure.

 

(bb)                          Exchange Act Reporting.  The Company is subject to the reporting requirements of either Section 13 or Section 15(d) of the Exchange Act and files reports with the Commission on the Electronic Data Gathering, Analysis, and Retrieval (“EDGAR”) system.

 

(cc)                            Exhibit Filings.  The Company has filed all agreements or instruments required to be filed with the Commission under the Exchange Act pursuant to Item 601(b)(10) of Regulation S-K.

 

(dd)                          No Unlawful Payments.  None of the Company, its subsidiaries and, to the knowledge of the Company, any director, officer, agent, employee or other person acting on behalf of the Company or any of its subsidiaries has (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political activity; (ii) made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; (iii) violated or is in violation of any provision of the Foreign Corrupt

 

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Practices Act of 1977; or (iv) made any bribe, rebate, payoff, influence payment, kickback or other unlawful payment.

 

(ee)                            Compliance with 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 agency (collectively, the “Money Laundering Laws”) and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with respect to the Money Laundering Laws is pending or, to the knowledge of the Company, threatened.

 

(ff)                              Compliance with OFAC.  None of the Company, its subsidiaries and to the knowledge of the Company, any director, officer, agent, employee or affiliate of the Company or any of its subsidiaries is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury (“OFAC”); and the Company will not directly or indirectly use the proceeds of the offering of the Securities hereunder, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity, for the purpose of financing the activities of any person currently subject to any U.S. sanctions administered by OFAC.

 

(gg)                            Use of Proceeds. The Company intends to use the net proceeds received in connection with this offering in the manner described in the “Use of Proceeds” section of the Time of Sale Information and the Offering Memorandum.

 

(hh)                          No Finder’s Fees.  Except as disclosed in the Time of Sale Information and the Offering Memorandum, there are no contracts, agreements or understandings between the Company and any person that would give rise to a valid claim against the Company or any Initial Purchaser for a brokerage commission, finder’s fee or other like payment in connection with the transactions contemplated by this Agreement.

 

(ii)                                  Rule 144A Eligibility.  On the Closing Date, the Securities will not be of the same class as securities listed on a national securities exchange registered under Section 6 of the Exchange Act or quoted in an automated inter-dealer quotation system; and each of the Time of Sale Information, as of the Time of Sale, and the Offering Memorandum, as of its date, contains or will contain all the information that, if requested by a prospective purchaser of the Securities, would be required to be provided to such prospective purchaser pursuant to Rule 144A(d)(4) under the Securities Act.

 

(jj)                                No Integration.  Neither the Company nor any of its affiliates (as defined in Rule 501(b) of Regulation D) has, directly or through any agent, sold, offered for sale, solicited offers to buy or otherwise negotiated in respect of, any security (as defined in the Securities Act), that is or will be integrated with the sale of the Securities in a manner that would require registration of the Securities under the Securities Act.

 

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(kk)                          No General Solicitation or Directed Selling Efforts.  None of the Company, its affiliates and any other person acting on its or their behalf (other than the Initial Purchasers, as to which no representation is made) has solicited offers for, or offered or sold, the Securities by means of any form of general solicitation or general advertising within the meaning of Rule 502(c) of Regulation D or in any manner involving a public offering within the meaning of Section 4(2) of the Securities Act.

 

(ll)                                  Securities Law Exemptions.  Assuming the accuracy of the representations and warranties of the Initial Purchasers contained in Section 2(b) and their compliance with their agreements set forth therein, it is not necessary, in connection with the issuance and sale of the Securities to the Initial Purchasers and the offer, resale and delivery of the Securities by the Initial Purchasers in the manner contemplated by this Agreement, the Time of Sale Information and the Offering Memorandum, to register the Securities under the Securities Act or to qualify the Indenture under the Trust Indenture Act of 1939, as amended.

 

4.                                      Further Agreements of the Company.  The Company covenants and agrees with each Initial Purchaser that:

 

(a)                                 Delivery of Copies. Prior to completion of the initial offering of the Securities, the Company will deliver to the Initial Purchasers as many copies of the Preliminary Offering Memorandum, any other Time of Sale Information, any Issuer Written Communication and the Offering Memorandum (including all amendments and supplements thereto) as the Representatives may reasonably request.

 

(b)                                 Offering Memorandum, Amendments or Supplements.  Prior to completion of the initial offering of the Securities, before finalizing the Offering Memorandum or making or distributing any amendment or supplement to any of the Time of Sale Information or the Offering Memorandum or filing with the Commission any document that will be incorporated by reference therein, the Company will furnish to the Representatives and counsel for the Initial Purchasers a copy of the proposed Offering Memorandum or such amendment or supplement or document to be incorporated by reference therein for review, and will incorporate therein reasonable comments of the Representatives and counsel for the Initial Purchasers to the Offering Memorandum, or any such amendment or supplement.

 

(c)                                  Additional Written Communications.  Before making, preparing, using, authorizing, approving or referring to any Issuer Written Communication, the Company will furnish to the Representatives and counsel for the Initial Purchasers a copy of such written communication for review and will incorporate therein reasonable comments of the Representatives and counsel for the Initial Purchasers to any such written communication.

 

(d)                                 Notice to the Representatives.  Prior to completion of the initial offering of the Securities, the Company will advise the Representatives promptly, and confirm such advice in writing, if so requested by the Representatives, in the event that it becomes aware, (i) of the issuance by any governmental or regulatory authority of any order preventing or suspending the use of any of the Time of Sale Information, any Issuer Written Communication or the Offering

 

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Memorandum or the Company’s receipt of notification of the initiation or threatening of any proceeding for that purpose; (ii) of the occurrence of any event at any time prior to the completion of the initial offering of the Securities as a result of which any of the Time of Sale Information, any Issuer Written Communication or the Offering Memorandum as then amended or supplemented would include any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing when such Time of Sale Information, Issuer Written Communication or the Offering Memorandum is delivered to a purchaser, not misleading; and (iii) of the receipt by the Company of any notice with respect to any suspension of the qualification of the Securities for offer and sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; and the Company will use its reasonable efforts to prevent the issuance of any such order preventing or suspending the use of any of the Time of Sale Information, any Issuer Written Communication or the Offering Memorandum or suspending any such qualification of the Securities and, if any such order is issued, will use its reasonable efforts to obtain as soon as possible the withdrawal thereof.

 

(e)                                  Ongoing Compliance of the Offering Memorandum and Time of Sale Information.  (1) If at any time prior to the completion of the initial offering of the Securities (i) any event shall occur or condition shall exist as a result of which the Offering Memorandum as then amended or supplemented would include any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances existing when the Offering Memorandum is delivered to a purchaser, not misleading or (ii) it is necessary to amend or supplement the Offering Memorandum to comply with law, the Company will promptly notify the Initial Purchasers thereof and forthwith prepare and, subject to paragraph (b) above, furnish to the Initial Purchasers such amendments or supplements to the Offering Memorandum (or any document to be filed with the Commission and incorporated by reference therein) as may be necessary so that the statements in the Offering Memorandum as so amended or supplemented (or including such document to be incorporated by reference therein) will not, in the light of the circumstances existing when the Offering Memorandum is delivered to a purchaser, be misleading or so that the Offering Memorandum will comply with law and (2) if at any time prior to the Closing Date (i) any event shall occur or condition shall exist as a result of which any of the Time of Sale Information as then amended or supplemented would include any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading or (ii) it is necessary to amend or supplement any of the Time of Sale Information to comply with law, the Company will promptly notify the Initial Purchasers thereof and forthwith prepare and, subject to paragraph (b) above, furnish to the Initial Purchasers such amendments or supplements to any of the Time of Sale Information (or any document to be filed with the Commission and incorporated by reference therein) as may be necessary so that the statements in any of the Time of Sale Information as so amended or supplemented will not, in light of the circumstances under which they were made, be misleading.

 

(f)                                   Blue Sky Compliance.  The Company will use its commercially reasonable efforts to qualify the Securities for offer and sale under the securities or Blue Sky laws of such jurisdictions within the United States as the Representatives shall reasonably request and will

 

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continue such qualifications in effect so long as required for the offering and resale of the Securities; provided that the Company shall not be required to (i) qualify as a foreign corporation or other entity or as a dealer in securities in any such jurisdiction where it would not otherwise be required to so qualify, (ii) file any general consent to service of process in any such jurisdiction or (iii) take any action that would subject it to taxation in any such jurisdiction if it is not otherwise so subject.

 

(g)                                  Clear Market.  For a period of 60 days after the date of the Offering Memorandum (the “Restricted Period”), the Company will not (i) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, or otherwise transfer or dispose of, directly or indirectly, or file with the Commission a registration statement under the Securities Act relating to, any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock, or publicly disclose the intention to make any offer, sale, pledge, disposition or filing, or (ii) enter into any swap or other agreement that transfers, in whole or in part, any of the economic consequences of ownership of the Common Stock or any such other securities, whether any such transaction described in clause (i) or (ii) above is to be settled by delivery of Common Stock or such other securities, in cash or otherwise, without the prior written consent of J.P. Morgan Securities LLC and Citigroup Global Markets Inc.; provided that such restriction shall not apply to: (1) the Securities; (2) shares of Common Stock issued by the Company upon conversion of the Securities or upon the exercise or conversion of options, warrants or convertible securities, in each case outstanding on the date of this Agreement and disclosed in the Time of Sale Information; (3) employee stock options granted and shares of Common Stock issued under plans existing on the date of this Agreement; (4) the filing of any registration statement on Form S-8 to register shares of Common Stock reserved for issuance under the Company’s equity compensation plans; and (5) the issuance of or agreement to issue shares of Common Stock in connection with the Company’s or any of its subsidiaries’ acquisition of one or more businesses, products or technologies (whether by means of merger, stock purchase or asset purchase) or pursuant to an employee benefit plan assumed by the Company or any of its subsidiaries in connection with such acquisition; provided, that the Company shall not issue or agree to issue any shares of Common Stock in connection with such an acquisition during the 30 days after the date of the Offering Memorandum; provided further, that the aggregate number of shares of Common Stock that the Company may issue or agree to issue in connection with such an acquisition during the period from the 31st day to the 60th day after the date of the Offering Memorandum shall not exceed 1,000,000 shares; provided further, that the Company shall cause each recipient of such Common Stock to execute and deliver to the Representatives, on or prior to issuance of such securities a lock-up agreement in substantially the form of attached hereto as Exhibit A covering the remainder of the Restricted Period.

 

The Company shall use its reasonable efforts to maintain a program under which its executive officers and directors who are party to the lock-up letters described in Section 6(m) hereof may sell shares of Common Stock pursuant to the exemptions contained in clauses (i) and (ii) of the third paragraph of such letters.  Such program shall be reasonably designed and enforced by the Company to ensure that such officers and directors sell no more than an aggregate of 50,000 shares of Common Stock issued upon the exercise of options that will expire

 

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prior to December 31, 2013, and no more than an aggregate of 125,000 shares of Common Stock issued upon the vesting of restricted stock units, in each case during the period that such lock-up letters are in effect.  If at any time the Company has knowledge that shares of Common Stock in excess of such limitations have been sold by such officers and directors in violation of such lock-up agreements or this Agreement, the Company shall immediately notify the Initial Purchasers and take all reasonably necessary actions to prevent any such further sales.

 

(h)                                 No Stabilization.  The Company will not take, directly or indirectly, any action designed to or that could reasonably be expected to cause or result in any stabilization or manipulation of the price of the Securities and will not take any action prohibited by Regulation M under the Exchange Act in connection with the distribution of the Securities contemplated hereby.

 

(i)                                     Underlying Securities. The Company will reserve and keep available at all times, free of pre-emptive rights, shares of Common Stock for the purpose of enabling the Company to satisfy all obligations to issue the Underlying Securities upon conversion of the Securities.  The Company will use its reasonable efforts to cause the Underlying Securities to be listed on the NASDAQ Global Select Market (the “Exchange”).

 

(j)                                    Supplying Information.  While the Securities remain outstanding and are “restricted securities” within the meaning of Rule 144(a)(3) under the Securities Act, the Company will, during any period in which the Company is not subject to and in compliance with Section 13 or 15(d) of the Exchange Act, furnish to holders of the Securities, prospective purchasers of the Securities designated by such holders and securities analysts, in each case upon request, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act.

 

(k)                                 DTC.  The Company will assist the Initial Purchasers in arranging for the Securities to be eligible for clearance and settlement through DTC.

 

(l)                                     No Resales by the Company.  During the period from the Closing Date until one year after the Closing Date or the Additional Closing Date, if applicable, the Company will not, and will not permit any of its affiliates (as defined in Rule 144 under the Securities Act) to, resell any of the Securities that have been acquired by any of them, except for Securities purchased by the Company or any of its affiliates and resold in a transaction registered under the Securities Act.

 

(m)                             No Integration.  Neither the Company nor any of its affiliates (as defined in Rule 501(b) of Regulation D) will, directly or through any agent, sell, offer for sale, solicit offers to buy or otherwise negotiate in respect of, any security (as defined in the Securities Act), that is or will be integrated with the sale of the Securities in a manner that would require registration of the Securities under the Securities Act.

 

(n)                                 No General Solicitation or Directed Selling Efforts.  None of the Company or any of its affiliates or any other person acting on its or their behalf (other than the Initial Purchasers, as to which no covenant is given) will solicit offers for, or offer or sell, the Securities by means

 

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of any form of general solicitation or general advertising within the meaning of Rule 502(c) of Regulation D or in any manner involving a public offering within the meaning of Section 4(2) of the Securities Act.

 

5.                                      Certain Agreements of the Initial Purchasers.  Each Initial Purchaser hereby represents and agrees that it has not and will not use, authorize use of, refer to, or participate in the planning for use of, any written communication that constitutes an offer to sell or the solicitation of an offer to buy the Securities other than (i) the Preliminary Offering Memorandum and the Offering Memorandum, (ii) a written communication that contains no “issuer information” (as defined in Rule 433(h)(2) under the Securities Act) that was not included (including through incorporation by reference) in the Preliminary Offering Memorandum or the Offering Memorandum, (iii) any written communication listed on Annex C or prepared pursuant to Section 4(c) above (including any electronic road show), (iv) any written communication prepared by such Initial Purchaser and approved by the Company in advance in writing or (v) any written communication relating to or that contains the terms of the Securities and/or other information that was included (including through incorporation by reference) in the Preliminary Offering Memorandum or the Offering Memorandum.

 

6.                                      Conditions of Initial Purchasers’ Obligations.  The obligation of each Initial Purchaser to purchase the Underwritten Securities on the Closing Date or the Option Securities on the Additional Closing Date, as the case may be, as provided herein is subject to the performance by the Company of its covenants and other obligations hereunder and to the following additional conditions:

 

(a)                                 Representations and Warranties.  The representations and warranties of the Company contained herein shall be true and correct on the date hereof and on and as of the Closing Date or the Additional Closing Date, as the case may be; and the statements of the Company and its officers made in any certificates delivered pursuant to this Agreement shall be true and correct on and as of the Closing Date or the Additional Closing Date, as the case may be.

 

(b)                                 No Downgrade.  Subsequent to the earlier of (A) the Time of Sale and (B) the execution and delivery of this Agreement, (i) no downgrading shall have occurred in the rating accorded any securities or preferred stock of or guaranteed by the Company or any of its subsidiaries by any “nationally recognized statistical rating organization”, as such term is defined by the Commission for purposes of Rule 436(g)(2) under the Securities Act and (ii) no such organization shall have publicly announced that it has under surveillance or review, or has changed its outlook with respect to, its rating of any securities or preferred stock of or guaranteed by the Company or any of its subsidiaries (other than an announcement with positive implications of a possible upgrading).

 

(c)                                  No Material Adverse Change.  No event or condition of a type described in Section 3(g) hereof shall have occurred or shall exist, which event or condition is not described in the Time of Sale Information (excluding any amendment or supplement thereto) and the Offering Memorandum (excluding any amendment or supplement thereto) and the effect of

 

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which in the judgment of the Representatives makes it impracticable or inadvisable to proceed with the offering, sale or delivery of the Securities on the Closing Date or the Additional Closing Date, as the case may be, on the terms and in the manner contemplated by this Agreement, the Time of Sale Information and the Offering Memorandum.

 

(d)                                 Officer’s Certificate.  The Representatives shall have received on and as of the Closing Date or the Additional Closing Date, as the case may be, a certificate of the chief financial officer or chief accounting officer of the Company and one additional executive officer of the Company, to their knowledge after reasonable investigation, (i) confirming that the representations set forth in Sections 3(a) and 3(b) hereof are true and correct, (ii) confirming that the other representations and warranties of the Company in this Agreement are true and correct and that the Company has complied with all agreements and satisfied all conditions on its part to be performed or satisfied hereunder at or prior to such Closing Date and (iii) to the effect set forth in paragraphs (b) and (c) above.

 

(e)                                  Comfort Letters.  On the date of this Agreement and on the Closing Date or the Additional Closing Date, as the case may be, PricewaterhouseCoopers LLP shall have furnished to the Representatives, at the request of the Company, letters, dated the respective dates of delivery thereof and addressed to the Initial Purchasers, in form and substance reasonably satisfactory to the Representatives, containing statements and information of the type customarily included in accountants’ “comfort letters” to underwriters with respect to the financial statements and certain financial information contained or incorporated by reference in the Time of Sale Information and the Offering Memorandum; provided, that the letter delivered on the Closing Date or the Additional Closing Date, as the case may be shall use a “cut-off” date no more than three business days prior to such Closing Date or such Additional Closing Date, as the case may be.

 

(f)                                   Opinion and 10b-5 Statement of Counsel for the Company.  Wilson Sonsini Goodrich & Rosati, Professional Corporation, counsel for the Company, shall have furnished to the Representatives, at the request of the Company, their written opinion and 10b-5 statement, dated the Closing Date or the Additional Closing Date, as the case may be, and addressed to the Initial Purchasers, substantially to the effect set forth in Annex A hereto.

 

(g)                                  Opinion and 10b-5 Statement of General Counsel for the Company. The Representatives shall have received on and as of the Closing Date or the Additional Closing Date, as the case may be, an opinion and 10b-5 statement of the General Counsel of the Company, substantially to the effect set forth in Annex B hereto.

 

(h)                                 Opinion and 10b-5 Statement of Counsel for the Initial Purchasers.  The Representatives shall have received on and as of the Closing Date or the Additional Closing Date, as the case may be, an opinion and 10b-5 statement of Davis Polk & Wardwell LLP, counsel for the Initial Purchasers, with respect to such matters as the Representatives may

 

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reasonably request, and such counsel shall have received such documents and information as they may reasonably request to enable them to pass upon such matters.

 

(i)                                     No Legal Impediment to Issuance.  No action shall have been taken and no statute, rule, regulation or order shall have been enacted, adopted or issued by any federal, state or foreign governmental or regulatory authority that would, as of the Closing Date or the Additional Closing Date, as the case may be, prevent the issuance or sale of the Securities; and no injunction or order of any federal, state or foreign court shall have been issued that would, as of the Closing Date or the Additional Closing Date, as the case may be, prevent the issuance or sale of the Securities.

 

(j)                                    DTC.  The Securities shall be eligible for clearance and settlement through DTC.

 

(k)                                 Exchange Listing.  An application for the listing of the Underlying Securities shall have been submitted to the Exchange.

 

(l)                                     Lock-up Agreements.  The “lock-up” agreements, each substantially in the form of Exhibit A hereto, between you and the executive officers and directors of the Company relating to sales and certain other dispositions of shares of Common Stock or certain other securities, delivered to you on or before the date hereof, shall be in full force and effect on the Closing Date or Additional Closing Date, as the case may be.

 

(m)                             Additional Documents.  On or prior to the Closing Date or the Additional Closing Date, as the case may be, the Company shall have furnished to the Representatives such further certificates, including certificates of good standing, and documents as the Representatives may reasonably request.

 

All opinions, letters, certificates and evidence mentioned above or elsewhere in this Agreement shall be deemed to be in compliance with the provisions hereof only if they are in form and substance reasonably satisfactory to counsel for the Initial Purchasers.

 

7.                                      Indemnification and Contribution.

 

(a)                                 Indemnification of the Initial Purchasers.  The Company agrees to indemnify and hold harmless each Initial Purchaser, its affiliates, its employees, its agents, its directors and officers and each person, if any, who controls such Initial Purchaser within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, from and against any and all losses, claims, damages and liabilities (including, without limitation, legal fees and other expenses reasonably incurred), joint or several, that arise out of, or are based upon, (i) any untrue statement or alleged untrue statement of a material fact contained in the Preliminary Offering Memorandum, any of the other Time of Sale Information, any Issuer Written Communication, any road show as defined in Rule 433(h) under the Securities Act (a “road show”) or the Offering Memorandum (or any amendment or supplement thereto) or any omission or alleged omission to state therein a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading, in each case except insofar as such losses, claims, damages or liabilities arise out of, or are based upon, any untrue statement or

 

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omission or alleged untrue statement or omission made in reliance upon and in conformity with any information relating to any Initial Purchaser furnished to the Company in writing by such Initial Purchaser through the Representatives expressly for use therein, it being understood and agreed that the only such information furnished by any Initial Purchaser consists of the information described as such in subsection (b) below.

 

(b)                                 Indemnification of the Company.  Each Initial Purchaser agrees, severally and not jointly, to indemnify and hold harmless the Company, its employees, its agents, its directors, its officers and each person, if any, who controls the Company within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act to the same extent as the indemnity set forth in paragraph (a) above, but only with respect to any losses, claims, damages or liabilities that arise out of, or are based upon, any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with any information relating to such Initial Purchaser furnished to the Company in writing by such Initial Purchaser through the Representatives expressly for use in the Preliminary Offering Memorandum, any of the other Time of Sale Information (including any of the other Time of Sale Information that has subsequently been amended), any Issuer Written Communication, any road show or the Offering Memorandum (or any amendment or supplement thereto), it being understood and agreed upon that the only such information furnished by any Initial Purchaser consists of the following information in the section entitled “Plan of Distribution” in the Offering Memorandum furnished on behalf of each Initial Purchaser: the information contained in the second paragraph and in the fourth sentence of the third paragraph under the caption “New Issue of Notes” and the information contained in the first paragraph under the caption “Price Stabilization and Short Positions”.

 

(c)                                  Notice and Procedures.  If any suit, action, proceeding (including any governmental or regulatory investigation), claim or demand shall be brought or asserted against any person in respect of which indemnification may be sought pursuant to either paragraph (a) or (b) above, such person (the “Indemnified Person”) shall promptly notify the person against whom such indemnification may be sought (the “Indemnifying Person”) in writing; provided that the failure to notify the Indemnifying Person shall not relieve it from any liability that it may have under paragraph (a) or (b) above except to the extent that it has been materially prejudiced (through the forfeiture of substantive rights or defenses) by such failure; and provided, further, that the failure to notify the Indemnifying Person shall not relieve it from any liability that it may have to an Indemnified Person otherwise than under paragraph (a) or (b) above.  If any such proceeding shall be brought or asserted against an Indemnified Person and it shall have notified the Indemnifying Person thereof, the Indemnifying Person shall retain counsel reasonably satisfactory to the Indemnified Person (who shall not, without the consent of the Indemnified Person, be counsel to the Indemnifying Person) to represent the Indemnified Person in such proceeding and shall pay the fees and expenses of such counsel related to such proceeding, as incurred.  In any such proceeding, any Indemnified Person shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such Indemnified Person unless (i) the Indemnifying Person and the Indemnified Person shall have mutually agreed to the contrary; (ii) the Indemnifying Person has failed within a reasonable time to retain counsel reasonably satisfactory to the Indemnified Person; (iii) the Indemnified Person shall have reasonably

 

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concluded that there may be legal defenses available to it that are different from or in addition to those available to the Indemnifying Person; or (iv) the named parties in any such proceeding (including any impleaded parties) include both the Indemnifying Person and the Indemnified Person and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interest between them.  It is understood and agreed that the Indemnifying Person shall not, in connection with any proceeding or related proceeding in the same jurisdiction, be liable for the fees and expenses of more than one separate firm (in addition to any local counsel) for all Indemnified Persons, and that all such fees and expenses shall be paid or reimbursed as they are incurred.  Any such separate firm for any Initial Purchaser, its affiliates, directors and officers and any control persons of such Initial Purchaser shall be designated in writing by the Representatives and any such separate firm for the Company, its directors, its officers and any control persons of the Company shall be designated in writing by the Company.  The Indemnifying Person shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the Indemnifying Person agrees to indemnify each Indemnified Person from and against any loss or liability by reason of such settlement or judgment.  No Indemnifying Person shall, without the written consent of the Indemnified Person, effect any settlement of any pending or threatened proceeding in respect of which any Indemnified Person is or could have been a party and indemnification could have been sought hereunder by such Indemnified Person, unless such settlement (x) includes an unconditional release of such Indemnified Person, in form and substance reasonably satisfactory to such Indemnified Person, from all liability on claims that are the subject matter of such proceeding and (y) does not include any statement as to or any admission of fault, culpability or a failure to act by or on behalf of any Indemnified Person.

 

(d)           Contribution.  If the indemnification provided for in paragraphs (a) and (b) above is unavailable to an Indemnified Person or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then each Indemnifying Person under such paragraph, in lieu of indemnifying such Indemnified Person thereunder, shall contribute to the amount paid or payable by such Indemnified Person as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative benefits received by the Company, on the one hand, and the Initial Purchasers, on the other, from the offering of the Securities or (ii) if the allocation provided by clause (i) is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) but also the relative fault of the Company, on the one hand, and the Initial Purchasers, on the other, in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations.  The relative benefits received by the Company, on the one hand, and the Initial Purchasers, on the other, shall be deemed to be in the same respective proportions as the net proceeds (before deducting expenses but after deducting discounts and commissions) received by the Company from the sale of the Securities and the total discounts and commissions received by the Initial Purchasers in connection therewith, as provided in this Agreement, bear to the aggregate offering price of the Securities.  The relative fault of the Company, on the one hand, and the Initial Purchasers, on the other, shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or by the Initial Purchasers and the parties’ relative intent, 

 

21

 

knowledge, access to information and opportunity to correct or prevent such statement or omission.

 

(e)           Limitation on Liability.  The Company and the Initial Purchasers agree that it would not be just and equitable if contribution pursuant to this Section 7 were determined by pro rata allocation (even if the Initial Purchasers were treated as one entity for such purpose) or by any other method of allocation that does not take account of the equitable considerations referred to in paragraph (d) above.  The amount paid or payable by an Indemnified Person as a result of the losses, claims, damages and liabilities referred to in paragraph (d) above shall be deemed to include, subject to the limitations set forth above, any legal or other expenses incurred by such Indemnified Person in connection with any such action or claim.  Notwithstanding the provisions of this Section 7, in no event shall an Initial Purchaser be required to contribute any amount in excess of the amount by which the total discounts and commissions received by such Initial Purchaser with respect to the offering of the Securities exceeds the amount of any damages that such Initial Purchaser has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission.  No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.  The Initial Purchasers’ obligations to contribute pursuant to this Section 7 are several in proportion to their respective purchase obligations hereunder and not joint.

 

(f)            Non-Exclusive Remedies.  The remedies provided for in this Section 7 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any Indemnified Person at law or in equity.

 

8.             Effectiveness of Agreement.  This Agreement shall become effective upon the execution and delivery hereof by the parties hereto.

 

9.               Termination.  This Agreement may be terminated in the absolute discretion of the Representatives, by notice to the Company, if after the execution and delivery of this Agreement and prior to the Closing Date or, in the case of the Option Securities, prior to the Additional Closing Date (i) there shall have occurred any change in U.S. or international financial, political or economic conditions as would, in the judgment of the Representatives, be likely to prejudice materially the success of the proposed issue, sale or distribution of the Securities; (ii) trading generally shall have been materially suspended or materially limited on or by any of the New York Stock Exchange or the NASDAQ Global Select Market; (iii) trading of any securities issued or guaranteed by the Company shall have been suspended on any exchange or in any over-the-counter market; (iv) a general moratorium on commercial banking activities shall have been declared by federal or New York State authorities; (v) there shall have occurred any major disruption of settlements of securities or clearance services in the United States or (vi) there shall have occurred any outbreak or escalation of hostilities or any change in financial markets or any calamity or crisis, either within or outside the United States, that, in the judgment of the Representatives, is material and adverse and makes it impracticable or inadvisable to proceed with the offering, sale or payment for and delivery of the Securities on the Closing Date or the

 

22

 

Additional Closing Date, as the case may be, on the terms and in the manner contemplated by this Agreement, the Time of Sale Information and the Offering Memorandum.

 

10.          Defaulting Initial Purchaser.  (a)  If, on the Closing Date or the Additional Closing Date, as the case may be, any Initial Purchaser defaults on its obligation to purchase the Securities that it has agreed to purchase hereunder on such date, the non-defaulting Initial Purchasers may in their discretion arrange for the purchase of such Securities by other persons satisfactory to the Company on the terms contained in this Agreement.  If, within 36 hours after any such default by any Initial Purchaser, the non-defaulting Initial Purchasers do not arrange for the purchase of such Securities, then the Company shall be entitled to a further period of 36 hours within which to procure other persons satisfactory to the non-defaulting Initial Purchasers to purchase such Securities on such terms.  If other persons become obligated or agree to purchase the Securities of a defaulting Initial Purchaser, either the non-defaulting Initial Purchasers or the Company may postpone the Closing Date or the Additional Closing Date, as the case may be, for up to five full business days in order to effect any changes that in the opinion of counsel for the Company or counsel for the Initial Purchasers may be necessary in the Time of Sale Information, the Offering Memorandum or in any other document or arrangement, and the Company agrees to promptly prepare any amendment or supplement to the Time of Sale Information or the Offering Memorandum that effects any such changes.  As used in this Agreement, the term “Initial Purchaser” includes, for all purposes of this Agreement unless the context otherwise requires, any person not listed in Schedule 1 hereto that, pursuant to this Section 10, purchases Securities that a defaulting Initial Purchaser agreed but failed to purchase.

 

(b)           If, after giving effect to any arrangements for the purchase of the Securities of a defaulting Initial Purchaser or Initial Purchasers by the non-defaulting Initial Purchasers and the Company as provided in paragraph (a) above, the aggregate number of Securities that remain unpurchased on the Closing Date or the Additional Closing Date, as the case may be, does not exceed one-eleventh of the aggregate number of Securities to be purchased on such date, then the Company shall have the right to require each non-defaulting Initial Purchaser to purchase the number of Securities that such Initial Purchaser agreed to purchase hereunder on such date plus such Initial Purchaser’s pro rata share (based on the number of Securities that such Initial Purchaser agreed to purchase on such date) of the Securities of such defaulting Initial Purchaser or Initial Purchasers for which such arrangements have not been made.

 

(c)           If, after giving effect to any arrangements for the purchase of the Securities of a defaulting Initial Purchaser or Initial Purchasers by the non-defaulting Initial Purchasers and the Company as provided in paragraph (a) above, the aggregate number of Securities that remain unpurchased on the Closing Date or the Additional Closing Date, as the case may be, exceeds one-eleventh of the aggregate amount of Securities to be purchased on such date, or if the Company shall not exercise the right described in paragraph (b) above, then this Agreement or, with respect to any Additional Closing Date, the obligation of the Initial Purchasers to purchase Securities on the Additional Closing Date, as the case may be, shall terminate without liability on the part of the non-defaulting Initial Purchasers.  Any termination of this Agreement pursuant to this Section 10 shall be without liability on the part of the Company, except that the Company will continue to be liable

 

23

 

for the payment of expenses as set forth in Section 11 hereof and except that the provisions of Section 7 hereof shall not terminate and shall remain in effect.

 

(d)           Nothing contained herein shall relieve a defaulting Initial Purchaser of any liability it may have to the Company or any non-defaulting Initial Purchaser for damages caused by its default.

 

11.          Payment of Expenses.  (a)  Whether or not the transactions contemplated by this Agreement are consummated or this Agreement is terminated, the Company will pay or cause to be paid all costs and expenses incident to the performance of its obligations hereunder, including without limitation, (i) the costs incident to the authorization, issuance, sale, preparation and delivery of the Securities and any taxes payable in that connection; (ii) the costs incident to the preparation and printing of the Preliminary Offering Memorandum, any other Time of Sale Information, any Issuer Written Communication and the Offering Memorandum (including any amendments and supplements thereto) and the distribution thereof; (iii) the costs of reproducing and distributing each of the Transaction Documents; (iv) the fees and expenses of the Company’s counsel and independent accountants; (v) the fees and expenses incurred in connection with the registration or qualification and determination of eligibility for investment of the Securities under the laws of such jurisdictions as the Representatives may designate and the preparation, printing and distribution of a Blue Sky Memorandum (including the related fees and expenses of counsel for the Initial Purchasers) (such amount not to exceed $2,500); (vi) the fees and expenses of the Trustee and any paying agent (including related fees and expenses of any counsel to such parties); (vii) all expenses and application fees incurred in connection with the application for the approval of the Securities for book-entry transfer by DTC; (viii) all expenses incurred by the Company (for avoidance of doubt, excluding expenses incurred by the Initial Purchasers) in connection with any “road show” presentation to potential investors; and (ix) all expenses and application fees related to the listing of the Underlying Securities on the NASDAQ Global Select Market.

 

(b)           If (i) this Agreement is terminated pursuant to Section 9 (other than pursuant to clause (i), (ii), (iv), (v) or (vi) of Section 9), (ii) the Company for any reason fails to tender the Securities for delivery to the Initial Purchasers or (iii) the Initial Purchasers decline to purchase the Securities for any reason permitted under this Agreement other than pursuant to Section 10, the Company agrees to reimburse the Initial Purchasers for all out-of-pocket costs and expenses (including the fees and expenses of their counsel) reasonably incurred by the Initial Purchasers in connection with this Agreement and the offering contemplated hereby.

 

12.          Persons Entitled to Benefit of Agreement.  This Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective successors and the officers and directors and any controlling persons referred to in Section 7 hereof.  Nothing in this Agreement is intended or shall be construed to give any other person any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision contained herein.  No purchaser of Securities from any Initial Purchaser shall be deemed to be a successor merely by reason of such purchase.

 

24

 

13.          Survival.  The respective indemnities, rights of contribution, representations, warranties and agreements of the Company and the Initial Purchasers contained in this Agreement or made by or on behalf of the Company or the Initial Purchasers pursuant to this Agreement or any certificate delivered pursuant hereto shall survive the delivery of and payment for the Securities and shall remain in full force and effect, regardless of any termination of this Agreement or any investigation made by or on behalf of the Company or the Initial Purchasers.

 

14.          Certain Defined Terms.  For purposes of this Agreement, (a) except where otherwise expressly provided, the term “affiliate” has the meaning set forth in Rule 405 under the Securities Act; (b) the term “business day” means any day other than a day on which banks are permitted or required to be closed in New York City; (c) the term “subsidiary” has the meaning set forth in Rule 405 under the Securities Act; and (d) the term “significant subsidiary” has the meaning set forth in Rule 1-02 of Regulation S-X under the Exchange Act.

 

15.          Miscellaneous.  (a)  Authority of the Representatives.  Any action by the Initial Purchasers hereunder may be taken by the Representatives on behalf of the Initial Purchasers, and any such action taken by the Representatives shall be binding upon the Initial Purchasers.

 

(b)           Notices.  All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given if mailed or transmitted and confirmed by any standard form of telecommunication.  Notices to the Initial Purchasers shall be given to the Representatives  c/o J.P. Morgan Securities LLC, 383 Madison Avenue, New York, New York 10179 (fax: (212) 622-8358); Attention: Equity Syndicate Desk, c/o Citigroup Global Markets Inc., 388 Greenwich Street, New York, New York 10013, (fax: (212) 816-7912), Attention: General Counsel and c/o Jefferies LLC, 520 Madison Avenue, New York, New York 10022, attention of General Counsel (fax: (646) 619-4437).  Notices to the Company shall be given to it at 1050 Enterprise Way, Suite 700, Sunnyvale, California 94089, (fax: (408) 462-8001); Attention: General Counsel, with a copy to Wilson Sonsini Goodrich & Rosati, Professional Corporation, 650 Page Mill Road, Palo Alto, California 94304 (fax: (650) 493-6811), Attention: Aaron J. Alter.

 

(c)           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.

 

(d)           Counterparts.  This Agreement may be signed in counterparts (which may include counterparts delivered by any standard form of telecommunication), each of which shall be an original and all of which together shall constitute one and the same instrument.

 

(e)           Amendments or Waivers.  No amendment or waiver of any provision of this Agreement, nor any consent or approval to any departure therefrom, shall in any event be effective unless the same shall be in writing and signed by the parties hereto.

 

(f)            Headings.  The headings herein are included for convenience of reference only and are not intended to be part of, or to affect the meaning or interpretation of, this Agreement.

 

25

 

(g)           Xtract Research LLC.  The Company hereby agrees that the Initial Purchasers may provide copies of the Preliminary Offering Memorandum and the Final Offering Memorandum relating to the offering of the Securities and any other agreements or documents relating thereto, including, without limitation, any trust indentures, to Xtract Research LLC (“Xtract”) following the completion of the offering for inclusion in an online research service sponsored by Xtract, access to which is restricted to “qualified institutional buyers” as defined in Rule 144A under the Securities Act.

 

26

 

If the foregoing is in accordance with your understanding, please indicate your acceptance of this Agreement by signing in the space provided below.

 

	
 
    	
Very   truly yours,
    
	
 
    	
 
    
	
 
    	
RAMBUS   INC.
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By
    	
/s/   Satish Rishi
    
	
 
    	
 
    	
Name:   
    	
Satish   Rishi
    
	
 
    	
 
    	
Title:   
    	
Senior   Vice President, Finance and Chief Financial Officer
    
	
Accepted:    August 12, 2013
    	
 
    
	
 
    	
 
    
	
J.P. MORGAN SECURITIES LLC
    	
 
    
	
CITIGROUP   GLOBAL MARKETS INC.
    	
 
    
	
JEFFERIES   LLC
    	
 
    
	
 
    	
 
    
	
Acting   severally on behalf of themselves and the
    	
 
    
	
several   Initial Purchasers listed
    	
 
    
	
in   Schedule 1 hereto.
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
J.P.   Morgan Securities LLC
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Tim Oeljeschlager
    
	
 
    	
 
    	
Name:
    	
Tim   Oeljeschlager
    
	
 
    	
 
    	
Title:
    	
Vice   President
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
Citigroup   Global Markets Inc.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Jon Krahulik
    
	
 
    	
 
    	
Name:
    	
Jon   Krahulik
    
	
 
    	
 
    	
Title:
    	
Managing   Director
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
Jefferies   LLC
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Steven D. Abbott
    
	
 
    	
 
    	
Name:
    	
Steven   D. Abbott
    
	
 
    	
 
    	
Title:
    	
Managing   Director
    
					

 

27

 

Schedule 1

 

	
Initial Purchaser
    	
 
    	
Principal Amount
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
J.P. Morgan Securities LLC
    	
 
    	
$
    	
60,000,000
    	
 
    
	
Citigroup Global Markets Inc.
    	
 
    	
36,000,000
    	
 
    
	
Jefferies LLC
    	
 
    	
24,000,000
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Total
    	
 
    	
$
    	
120,000,000
    	
 
    

 

28

 

Annex A

 

Form of Opinion of Counsel for the Company

 

[ATTACHED]

 

29

 

Annex B

 

Form of Opinion of General Counsel for the Company

 

[ATTACHED]

 

30

 

Annex C

 

a.  Time of Sale Information

 

Term sheet containing the terms of the Securities, substantially in the form of Annex D.

 

31

 

Annex D

 

RAMBUS INC.

 

Pricing Term Sheet

 

[ATTACHED]

 

32

 

Exhibit A

 

FORM OF LOCK-UP AGREEMENT

 

	
 
    	
August     ,   2013
    

 

J.P. MORGAN SECURITIES LLC

CITIGROUP GLOBAL MARKETS INC.

JEFFERIES LLC

 

As Representatives of the several Initial Purchasers listed in Schedule 1 to the Purchase Agreement referred to below

 

c/o J.P. Morgan Securities LLC

383 Madison Avenue

New York, NY 10179

 

c/o Citigroup Global Markets Inc.

388 Greenwich Street

New York, New York 10013

 

c/o Jefferies LLC

520 Madison Avenue

New York, New York 10022

 

Ladies and Gentlemen:

 

The undersigned understands that you, as Representatives of the several Initial Purchasers, propose to enter into a Purchase Agreement (the “Purchase Agreement”) with Rambus Inc., a Delaware corporation (the “Company”), providing for the purchase and resale (the “Placement”) by the several Initial Purchasers named in Schedule 1 to the Purchase Agreement (the “Initial Purchasers”), of Convertible Senior Notes due 2018 of the Company (the “Securities”). Capitalized terms used herein and not otherwise defined shall have the meanings set forth in the Purchase Agreement.

 

In consideration of the Initial Purchasers’ agreement to purchase and make the Placement of the Securities, and for other good and valuable consideration receipt of which is hereby acknowledged, the undersigned hereby agrees that, without the prior written consent of J.P. Morgan Securities LLC and Citigroup Global Markets Inc. on behalf of the Initial Purchasers, the undersigned will not, during the period commencing on the date hereof and ending 60 days after the date of the final offering memorandum relating to the Placement (the “Lock-Up Period”), (1) offer, pledge, sell, contract to sell, sell any option or 

 

33

 

contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock, $0.001 per share par value, of the Company (the “Common Stock”) or any securities convertible into or exercisable or exchangeable for Common Stock (including without limitation, Common Stock or such other securities which may be deemed to be beneficially owned by the undersigned in accordance with the rules and regulations of the Securities and Exchange Commission and securities which may be issued upon exercise of a stock option or warrant), or publicly disclose the intention to make any offer, sale, pledge or disposition, (2) enter into any swap or other agreement that transfers, in whole or in part, any of the economic consequences of ownership of the Common Stock or such other securities, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of Common Stock or such other securities, in cash or otherwise or (3) make any demand for or exercise any right with respect to the registration of any shares of Common Stock or any security convertible into or exercisable or exchangeable for Common Stock.

 

Any Common Stock received upon exercise of options or vesting of restricted stock units granted to the undersigned also will be subject to this Letter Agreement; provided that, notwithstanding the foregoing, during the last 30 days of the Lock-Up Period, offers, sales or other dispositions by the undersigned (i) together with all other individuals subject to a lock-up agreement substantially similar hereto, of up to an aggregate of 50,000 shares of Common Stock issued upon the exercise of options during the Lock-Up Period that will expire prior to the Lock-Up Period, (ii) together with all other individuals subject to a lock-up agreement substantially similar hereto, of up to an aggregate of 125,000 shares of Common Stock issued upon the vesting of restricted stock units during the Lock-Up Period, and (iii) to the Company of Common Stock upon a vesting event to pay required withholding taxes, shall not be subject to this Letter Agreement.  Offers, sales or other dispositions of Common Stock pursuant to a written plan (a “Plan”) for trading securities in effect on the date hereof and disclosed to the Representatives will not be subject to this Letter Agreement if such Plan (i) was established pursuant to and in accordance with Rule 10b5-1(c) under the Securities Exchange Act of 1934, as amended and (ii) is not amended or modified during the Lock-Up Period.  A transfer of Common Stock (i) as a bona fide gift or (ii) to a family member or trust may be made, provided the donee or transferee, as applicable, agrees to be bound in writing by the terms of this Letter Agreement prior to such transfer and no filing by any party (donor, donee, transferor or transferee) under the Exchange Act shall be required or shall be voluntarily made in connection with such transfer (other than a filing on a Form 5 made after the expiration of the Lock-Up Period).  A transfer of Common Stock by will or intestate succession to the immediate family of one of the Company’s executive officers or directors shall not be subject to this Letter Agreement.

 

In furtherance of the foregoing, the Company, and any duly appointed transfer agent for the registration or transfer of the securities described herein, are hereby authorized to decline to make any transfer of securities if such transfer would constitute a violation or breach of this Letter Agreement.

 

The undersigned hereby represents and warrants that the undersigned has full power and authority to enter into this Letter Agreement. All authority herein conferred or agreed to be 

 

34

 

conferred and any obligations of the undersigned shall be binding upon the successors, assigns, heirs or personal representatives of the undersigned.

 

The undersigned understands that, if the Purchase Agreement does not become effective, or if the Purchase Agreement (other than the provisions thereof which survive termination) shall terminate or be terminated prior to payment for and delivery of the Common Stock to be sold thereunder, the undersigned shall be released form all obligations under this Letter Agreement.  The undersigned understands that the Initial Purchasers are entering into the Purchase Agreement and proceeding with the Placement in reliance upon this Letter Agreement.

 

This Letter Agreement and any claim, controversy or dispute arising under or related to this Letter Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard to the conflict of laws principles thereof.

 

	
 
    	
Very   truly yours,
    
	
 
    	
 
    
	
 
    	
[NAME   OF STOCKHOLDER]
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

35

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