Document:

Unassociated Document

Exhibit 10.33

 STANDBY PURCHASE AGREEMENT

 

THIS AGREEMENT is made as of November 28, 2011,  BETWEEN

RESPONSE BIOMEDICAL CORP (“RBC”) - and -ORBIMED PRIVATE INVESTMENTS III, LP (“OPI III”) - and – ORBIMED ASIA PARTNERS, LP (“OAP”) - and -ORBIMED ASSOCIATES III, LP (“OrbiMed Associates” and together with OPI III and OAP, the “Standby Purchasers”)

 

WHEREAS RBC proposes to effect an offering of Rights to the holders of record of its Shares pursuant to a short form prospectus, each such Right being exercisable for 2.7532 Units;

 

AND WHEREAS the Standby Purchasers are the holder of an aggregate of 14,561,500 Shares (the “Current Shares”) and, subject to the exercise by Other Purchasers of their Basic and Additional Subscription Privileges, the Standby Purchasers propose to purchase, in aggregate, a minimum of $5 million of the Units not otherwise purchased under the Rights Offering by exercising their respective Basic Subscription Privilege, on the terms and conditions set forth in this Agreement;

 

NOW THEREFORE, in consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows.

 

ARTICLE 1 INTERPRETATION

 

1.1 Definitions.  In this Agreement, unless something in the subject matter is inconsistent therewith: “1933 Act” means the U.S. Securities Act of 1933, as amended. “1934 Act” means the U.S. Securities Exchange Act of 1934, as amended.

 

“Additional Subscription Privilege” means the entitlement of a holder of Rights, who has exercised in full the Basic Subscription Privilege attaching to its Rights, to subscribe pursuant to the Rights Offering for additional Units (if such are available), as such entitlement is further detailed in the Prospectus.

 

  

  

  

“Affiliate” for the purposes of Section 4.2 hereof only, has the meaning ascribed thereto under Rule 405 under the 1933 Act and for all other purposes has the meaning ascribed thereto under the Canada Business Corporations Act, as amended, and in the case of the Standby Purchasers or Substituted Standby Purchaser(s) includes all investment funds and other Persons that the Standby Purchasers or Substituted Standby Purchaser(s), as the case may be, or an Affiliate manages or exercises control over or in respect of which it has discretionary trading authority over such investment fund’s or Person’s investments.

 

“Agent” means Computershare Trust Company of Canada, in its capacity as subscription agent for the Rights Offering or transfer agent or warrant agent for RBC, as applicable.

 

“Agreement” means this standby purchase agreement, as such agreement may be amended, supplemented or superseded from time to time.

 

“Basic Subscription Privilege” means the entitlement of a holder of Rights to subscribe for Units pursuant to the Rights Offering, at a price equal to the Subscription Price, as such entitlement is further detailed in the Prospectus.

 

“Blue Sky States” means the state of New York.

 

“Business Day” means any day, other than a Saturday or a Sunday, upon which banks are open for business in the City of Vancouver, British Columbia.

 

“Canadian Qualifying Jurisdictions” means all of the provinces of Canada.

 

“Canadian Securities Commissions” means, collectively, the securities commissions or similar securities regulatory authorities of the Canadian Qualifying Jurisdictions.

 

“Closing Date” means one Business Days following the Expiry Date, or such other date as may be agreed by RBC and the Standby Purchasers, which in no event will be later than December 30, 2011.

 

“Current Shares” has the meaning set forth in the recitals to this Agreement.

 

“Closing Time” has the meaning set forth in Section 6.1.

 

“Exercise Price” means the Subscription Price, as adjusted pursuant to the terms of the Warrants.

 

“Expiry Date” means the date on which the Rights will expire and become null and void as set out in the Final Prospectus, such date expected to be on or about the twenty-first day following the date on which the Final Prospectus is mailed to holders of Shares as of the Record Date and which is expected to be on or about December 29, 2011.

 

“Expiry Time” means 5:00 p.m. (Eastern time) on the Expiry Date.

 

  

  

  

“Final Prospectus” means the final short form prospectus to be filed by RBC with the Securities Commissions in the Canadian Qualifying Jurisdictions in connection with the offer and sale of the Securities, as amended by any Prospectus Amendment to the Final Prospectus.

 

“Governmental Entity” means any: (i) multinational, federal, provincial, territorial, municipal, local or other governmental or public department, central bank, court, commission, board, bureau, agency or instrumentality, domestic or foreign; (ii) any subdivision or authority of any of the foregoing; or (iii) any quasi-governmental or private body exercising any regulatory, expropriation or taxing authority under or for the account of any of the above.

 

“Indemnified Party” has the meaning set forth in Section 8.3.

 

“Indemnifying Party” has the meaning set forth in Section 8.3.

 

“Laws” means any and all applicable laws including all statutes, codes, ordinances, decrees, rules, regulations, municipal by-laws, judicial or arbitral or administrative or ministerial or departmental or regulatory judgments, orders, decisions, rulings or awards, instruments, policies, guidelines, and general principles of common law and equity, binding on or affecting the Person referred to in the context in which the word is used.

 

“Material Adverse Change” means any change, development, event or occurrence with respect to the business, condition (financial or otherwise), properties, assets, liabilities (contingent or otherwise), capital, cash flow, operations, or results of operations or prospects of RBC and its subsidiaries, on a consolidated basis, that is, or would reasonably be expected to be, material and adverse to RBC and its subsidiaries, on a consolidated basis.

 

“Misrepresentation” means: (a) a “misrepresentation” as defined in Section 1(1) of the Securities Act; or (b) as to any document, any untrue statement of a material fact or omission to state any material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.

 

“NI45-101” has the meaning ascribed to it in Section 5.1(e).

 

“OAP” has the meaning given on the cover page of this Agreement.

 

“OPI III” has the meaning given on the cover page of this Agreement.

 

“OrbiMed Associates” has the meaning given on the cover page of this Agreement.

 

“Other Purchaser” means any purchaser of Rights in the Rights Offering other than the Standby Purchasers and Substituted Standby Purchaser(s).

 

“Person” means an individual, corporation, partnership, limited partnership, limited liability partnership, limited liability company, association, trust, estate, custodian, trustee, executor, administrator, nominee or other entity or organization, including (without limitation) a Governmental Entity or political subdivision or an agency or instrumentality thereof.

 

  

  

  

“Preliminary Prospectus” means the preliminary short form prospectus filed on November 14, 2011 with the Securities Commissions in the Canadian Qualifying Jurisdictions in connection with the Rights Offering, a draft copy of which has been provided to the Standby Purchasers.

 

“Prospectus” means, collectively, the Preliminary Prospectus, the Final Prospectus, and any Prospectus Amendment.

 

“Prospectus Amendment” means any amendment to the Preliminary Prospectus or the Final Prospectus.

 

“Public Document” means the Preliminary Prospectus, Final Prospectus, Annual Report on Form 20-F of RBC for the year ended December 31, 2010, as amended, all Reports of Foreign Issuer of RBC on Form 6-K filed with the SEC since December 31, 2010 and all documents incorporated by reference therein; provided for the purposes of Section 4.1(n), “Public Document” shall not included any document filed with the SEC or incorporated by reference into any of the foregoing after the date of this Agreement.

 

“Qualifying Jurisdictions” means the Canadian Qualifying Jurisdictions, the United States and the Blue Sky States.

 

“RBC” has the meaning given on the cover page of this Agreement.

 

“Record Date” means the record date for the purpose of the Rights Offering that will be established by RBC in the Final Prospectus, which is expected to be on or about December 7, 2011.

 

“Regulation D” has the meaning ascribed to it in Section 4.2(b).

 

“Regulation S” means Regulation S promulgated by the SEC pursuant to the 1933 Act.

 

“Restrictive Legend” has the meaning ascribed to it in Section 4.2(i).

 

“Rights” means the transferable rights to subscribe for Units offered by RBC in the Rights Offering pursuant to the Basic Subscription Privilege and the Additional Subscription Privilege at the Subscription Price.

 

“Rights Offering” means the offering by RBC of Rights to the holders of Shares on the Record Date, to purchase Units at the Subscription Price, as described in the Prospectus and in accordance with Article 2.

 

“Rule 144” means Rule 144 promulgated by the SEC pursuant to the 1933 Act, as such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the SEC having substantially the same effect as such Rule.

 

“Rule 144A” means Rule 144A promulgated by the SEC pursuant to the 1933 Act, as such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the SEC having substantially the same effect as such Rule.

 

  

  

  

“Sale” has the meaning ascribed to it in Section 3.1(l). “SEC” means the U.S. Securities and Exchange Commission. “Securities” means the Rights, the Shares and Warrants issuable upon exercise of the

 

	
  

	
Rights and the Underlying Shares issuable upon exercise of the Warrants.  “Securities Act” means the Securities Act (Ontario), as amended. “Securities Commissions” means, collectively, the securities commissions or similar

 

	
  

	
securities regulatory authorities of the Qualifying Jurisdictions. “Securities Laws” means all applicable securities Laws of each of the Qualifying

 

	
  

	
Jurisdictions, the applicable rules of the TSX and the rules of the OTC Bulletin Board. “Seller” has the meaning ascribed to it in Section 3.1(l). “Shares” means common shares in the capital of RBC. “Standby Commitment” has the meaning set forth in Section 2.2(d). “Standby Purchasers” has the meaning given on the cover page of this Agreement. “Standby Purchaser Common Shares” has the meaning ascribed to it in Section 3.1(l).  “Standby Units” has the meaning set forth in Section 2.2(c). “Subscription Price” means $0.0746 per Standby Unit. “Substituted Purchaser Conditions” means, in respect of an Affiliate of a Standby

 

Purchaser that such Standby Purchaser proposes to be a Substituted Standby Purchaser (the “Proposed Person”) as contemplated in Section 2.2, a Person that satisfies the following conditions:

 

(a) the Proposed Person makes each of the representations and warranties of such Standby Purchaser set forth in Sections 2.7 and 5.1 (except, if inapplicable, Section 5.1(f)) and, to the extent applicable, in (b)(i) and (ii) below, subject in each case to Section 5.2, mutatis mutandis, and agrees to be bound by the other covenants and agreements of a Standby Purchaser hereunder, pursuant to a letter of representations in form satisfactory to RBC, acting reasonably, executed and delivered by the Proposed Person and the Standby Purchaser to RBC; and

 

(b) if the Proposed Person is resident in or otherwise subject to the laws of a jurisdiction other than any of the provinces or territories of Canada,

 

(i) the purchase of the relevant Standby Units by the Proposed Person would comply with the laws of such jurisdiction; and

 

(ii) RBC would not, as a result of such purchase, be obliged to register the relevant Standby Units or any other Shares or Warrants or file a prospectus or other

  

  

  

disclosure document, or be obliged to make any filings (other than a Form D under the 1933 Act and filings required under the 1934 Act) or become subject to any reporting or disclosure obligations that it is not already obligated to make or by virtue of this transaction will be obligated to make, in each case pursuant to the laws of any jurisdiction.

 

“Substituted Standby Purchaser” means one or more Affiliates of a Standby Purchaser

(a) as such Standby Purchaser designates in a notice to RBC and (b) that satisf(y/ies) the Substituted Purchaser Conditions, in each case not less than two Business Days prior to the Closing Date.

 

“TSX” means the Toronto Stock Exchange.

 

“Underlying Shares” means the Shares issuable upon due exercise of the Warrants.

 

“Units” means the Shares and the Warrants issuable upon exercise of the Rights.

 

“Warrants” means the common share purchase warrants entitling a holder to purchase one Share for the Exercise Price for 60 months following the closing of the Rights Offering.

 

1.2 Headings, Etc. The division of this Agreement into articles, sections, paragraphs and clauses and the provision of headings are for the convenience of reference only and will not affect the construction or interpretation of this Agreement.  The terms “this Agreement”, “hereof, “hereunder” and similar expressions refer to this Agreement as a whole and not to any particular article, section, paragraph, clause or other portion hereof and include any agreement or instrument supplemental or ancillary hereto.  Unless something in the subject matter or context is inconsistent therewith, references herein to articles, sections, paragraphs or clauses are to articles, sections, paragraphs or clauses of this Agreement.

 

1.3 Plurality and Gender. Words importing the singular number only will include the plural and vice versa, words importing any gender will include all genders and the words importing Persons will include individuals, partnerships, trusts, corporations, governments and governmental authorities.

 

1.4 Currency. Unless otherwise specifically stated, all references to dollars and cents in this Agreement are to the lawful currency of Canada.

 

1.5 Governing Law. This Agreement will be governed by, interpreted and enforced in accordance with the laws of the Province of British Columbia and the federal laws of Canada applicable therein, without reference to the principles of conflicts of laws.  Each party hereby unconditionally and irrevocably submits to the exclusive jurisdiction of the courts of the Province of British Columbia in respect of all matters arising out of this Agreement.

 

1.6 Severability. If any provision of this Agreement is determined to be invalid or unenforceable in whole or in part, such invalidity or unenforceability will attach only to such provision or part thereof and the remaining part of such provision and all other provisions hereof will continue in full force and effect.  The parties hereto agree to negotiate in good faith a substitute provision which will be as close as possible to the intention of any invalid or unenforceable provision as may be valid or enforceable.  The invalidity or unenforceability of any provision in any particular jurisdiction will not affect its validity or enforceability in any other jurisdiction where it is valid or enforceable.

 

  

  

  

1.7 Statutes. Any reference to a statute, act or law will include and will be deemed to be a reference to such statute, act or law and to the rules, regulations, instruments and policies made pursuant thereto, with all amendments made thereto and in force from time to time, and to any statute, act or law that may be passed which has the effect of supplementing or superseding such statute, act or law so referred to.

 

ARTICLE 2 STANDBY COMMITMENT

 

2.1 Conduct of Rights Offering. Subject to and in accordance with the terms hereof, RBC agrees to offer, in accordance with Securities Laws and pursuant to the Prospectus, the Rights and the Units issuable upon the exercise of the Rights to Persons that are the holders of record of Shares on the Record Date: (i) with an address in the Canadian Qualifying Jurisdictions; or (ii) with an address in any other jurisdiction that RBC has satisfied itself is entitled to receive the Securities under the Rights Offering in accordance with the laws of such jurisdiction and without obliging RBC to register the Securities or file a prospectus or other disclosure document or to make any other filings (other than a Form D under the 1933 Act and filings required under the 1934 Act) or become subject to any reporting or disclosure obligations that RBC is not already obligated to make.

 

2.2 Standby Commitment.

 

(a) Subject to and in accordance with the terms hereof, the Standby Purchasers will purchase, or will cause a Substituted Standby Purchasers to purchase, from RBC, and RBC hereby agrees to sell to the Standby Purchaser or any Substituted Standby Purchaser, as the case may be, at the Subscription Price and on the Closing Date, the Standby Units, with the allocation of such Standby Units amongst the Standby Purchasers and Substituted Standby Purchasers to be made by the Standby Purchasers in their sole discretion.

 

(b) The Standby Purchasers will exercise their respective Basic Subscription Rights in accordance with Section 5.l(f).

 

(c) The aggregate number of Units to be purchased by the Standby Purchasers and the Substituted Standby Purchasers (the “Standby Units”) pursuant to this Section 2.2 will be calculated as:

 

(i) the number of Units authorized to be issued on the Record Date pursuant to the exercise of the Rights; minus

 

(ii) the aggregate number of Units subscribed for and taken up under the Rights Offering by the Standby Purchasers and Substituted Standby Purchasers pursuant to their Basic and Additional Subscription Privilege; minus

 

(iii) the number of Units subscribed for and taken up under the Rights Offering by other Persons pursuant to their Basic and Additional Subscription Privileges); provided that the number of Standby Units shall be limited such that the gross proceeds from the Rights Offering and the sale of the Standby Units will not exceed an aggregate of $8.0 million and provided further that the aggregate Subscription Price to be paid by the Standby Purchasers and the Substituted Standby Purchasers collectively with respect to the Units (including the Standby Units) will not exceed $5 million.

 

  

  

  

(d) The commitments by and agreements of, the Standby Purchasers referred to in this Section 2.2 are referred to as the “Standby Commitment”.

 

2.3 [Reserved]

 

2.4 No Fractional Shares. No fractional Shares or Warrants will be issued upon exercise of Rights. Where the exercise of Rights would appear to entitle the Standby Purchaser or the Substituted Standby Purchaser, as applicable, to fractional Shares or Warrants, such entitlement will be reduced to the next lowest whole number of Shares or Warrants, without payment for any Right that therefore cannot be exercised for a Share or Warrants.

 

2.5 Payment for Standby Units. Subject to and in accordance with the terms hereof, on the Closing Date, the Standby Purchasers will, subject to Section 2.9 hereof, pay or will cause its respective Substituted Standby Purchaser to pay, as the case may be, in immediately available funds by wire transfer to an account designated by RBC, or by certified cheque payable to RBC, the aggregate Subscription Price that is payable for the Standby Units to be purchased by it hereunder and RBC will issue the Standby Units to the Standby Purchaser or Substituted Standby Purchaser, as the case may be.

 

2.6 Restrictions on Sale. Except as contemplated by this Agreement, each of the Standby Purchasers agrees, and agrees to cause its respective Substituted Standby Purchaser(s), if any, not to sell or distribute, directly or indirectly, its Standby Units in such a manner as to:

(a) require registration by RBC of the Standby Units or the filing by RBC of a prospectus or any similar document in any jurisdiction; or (b) result in RBC becoming subject to reporting or disclosure obligations to which it is not subject as at the date of this Agreement, and to sell the Standby Units in accordance with all applicable Securities Laws.

 

2.7 Representations and Warranties of the Standby Purchasers as to Investment Intent. Each Standby Purchaser represents and warrants, severally and not jointly, to and with RBC, on its own behalf and also in respect of and on behalf of its Substituted Standby Purchaser, if any, that it and each of its Substituted Standby Purchasers, as applicable, is acquiring the Standby Units as principal and for investment and not with a view to, and has not offered or sold any Standby Units in connection with, the sale or distribution thereof.

 

2.8 No Fee to Standby Purchasers. The Standby Purchasers will not be entitled to receive any fee from RBC in connection with the Standby Commitment.

 

2.9 Rights of Set-Off. In satisfaction of all or any portion of the Subscription Price payable by the Standby Purchasers and any Substituted Standby Purchaser for the Standby Units, the Standby Purchasers shall have the right to set-off amounts owed by RBC to the Standby Purchaser on the Closing Date.

 

  

  

  

ARTICLE 3 COVENANTS OF RBC

 

3.1 Subject to and in accordance with the terms hereof, RBC undertakes and agrees with and in favour of the Standby Purchasers that:

 

(a) Final Prospectus and Qualification. RBC will file with the Canadian Securities Commissions, the Final Prospectus (in the English and French languages, as appropriate) relating to the proposed distribution of the Securities, and take all other steps and proceedings that may be necessary in order to qualify the distribution of the Securities in each of the Canadian Qualifying Jurisdictions in which the Final Prospectus has been filed.

 

(b) Supplementary Material. If required by Securities Laws in the Canadian Qualifying Jurisdictions, it will prepare any amendments to the Prospectus or any documentation supplemental thereto or any amending or supplemental documentation or any similar document required to be filed by it under the Securities Laws of the Canadian Qualifying Jurisdictions.  It will also promptly, and in any event within any applicable time limitation, comply with all applicable filing and other requirements under the Securities Laws as a result of any Material Adverse Change.

 

(c) Consents and Approvals. It will use its reasonable efforts to obtain all necessary consents, approvals or exemptions for the creation, offering and issuance of the Securities in the Canadian Qualifying Jurisdictions as contemplated herein and in the Prospectus and the entering into and performance by it of this Agreement (including, for greater certainty and without limitation, the issuance of the Rights and the Units issuable upon the exercise of such Rights, and the Underlying Shares upon the exercise of the Warrants).

 

(d) Compliance with U.S. Securities Law Requirements. It will take all action as may be required or appropriate to perfect the exemption from the registration requirements under the 1933 Act provided by Rule 506 of Regulation D thereunder, and to make such post-closing notice filings as are required under applicable state securities laws, with respect to the issuance of the Securities and the Underlying Securities in the United States.

 

(e) Cease Trade Order or Other Investigation. From the date hereof through the earlier of: (i) the Closing Date; and (ii) the termination of this Agreement, it will immediately notify the Standby Purchasers in writing of any written demand, request or inquiry (formal or informal) by any Securities Commission, the TSX, the OTC Bulletin Board or other Governmental Entity that concerns any matter relating to the affairs of RBC that may affect the Rights Offering, the transactions contemplated herein, or any other matter contemplated by this Agreement, or that relates to the issuance, or threatened issuance, by any such authority of any cease trading or similar order or ruling relating to any securities of RBC.  Any notice delivered to the Standby Purchasers as aforesaid will contain reasonable details of the demand, request, inquiry, order or ruling in question.  RBC will use its best efforts to prevent the issuance of any orders contemplated by this Section 3.1(e) and, if issued, to obtain their prompt withdrawal.

 

(f) TSX Listing. It has taken, or will take, all action as may be required and appropriate so that the Rights, the Shares issuable upon exercise of the Rights and the Underlying Shares issuable upon exercise of the Warrants, on or before the date on which the initial mailing of the Final Prospectus is made in the Canadian Qualifying Jurisdictions to RBC shareholders as of the Record Date have been conditionally approved for listing on the TSX, subject to receipt of customary final documentation.

 

(g) Securities Laws. It will take all action as may be necessary and appropriate so that the Rights Offering, the issuance and sale of the Standby Units and the transactions contemplated in this Agreement will be effected in accordance with Securities Laws.  It will consult with the Standby Purchasers and their advisors upon their reasonable request regarding the manner in which the Rights Offering, the issuance and sale of the Standby Units and the other transactions contemplated herein will comply with applicable Securities Laws, and it will provide to the Standby Purchasers and their advisors copies of any documents that are to be submitted by it to any Securities Commission or other regulatory authority for such purpose prior to being so submitted and it will give the Standby Purchasers and their advisors an opportunity to comment on same.

 

  

  

  

(h) Obtaining of Report. It will cause the Agent to deliver to the Standby Purchasers, promptly upon request during the pendency of the Rights Offering and, in any event, as soon as is practicable following the Expiry Time, details concerning the total number of Units duly subscribed and paid for by holders of Rights under the Rights Offering, including (without limitation) those Units subscribed and paid for pursuant to the Additional Subscription Privilege.

 

(i) No Issuance of Securities. Other than as contemplated by this Agreement, during the period from the date hereof until the Closing Date, RBC will not issue any Securities or securities convertible or exchangeable or exercisable into Securities other than the grant or exercise of any options and other securities outstanding under RBC’s equity incentive plan or the exercise of any other convertible, exchangeable Securities outstanding as of the date hereof.

 

(j) Cooperation. RBC will cooperate, and cause its respective Affiliates, officers, employees, agents, auditors and other representatives to cooperate, with each Standby Purchaser or Substituted Standby Purchaser or any of their respective Affiliates by providing such information and assistance at such time and to the extent reasonably requested by any such Persons (and in any event as soon as practicable following such request) in connection with the preparation and filing by any such Person of any return, declaration, report or similar statement (including any attached schedules) required to be filed by such Person with respect to its holdings, or disposition of any of its holdings, from time to time of Rights, Shares (including Underlying Shares), Warrants or other securities of RBC.

 

(k) Furnishing Information. So long as any of the Shares, Warrants or Underlying Shares held by a Standby Purchaser, Substituted Standby Purchaser or Affiliate thereof shall, at any time, constitute “restricted securities” within the meaning of Rule 144(a)(3), upon written request, RBC shall (regardless of whether RBC is at such time subject to Sections 13 or 15(d) of the 1934 Act) provide to any holder, beneficial owner or prospective purchaser of such securities, the information required to be delivered pursuant to Rule 144A(d)(4) to facilitate the resale of such securities pursuant to Rule 144A. Until the time that no Standby Purchaser or Substituted Standby Purchaser owns Shares (including Underlying Shares) or Warrants, RBC covenants to timely file (or obtain extensions in respect thereof and file within the applicable grace period) all reports required to be filed by RBC after the date hereof pursuant to the 1934 Act and the Securities Laws.  Until such time that no Standby Purchaser or Substituted Standby Purchaser owns Shares (including Underlying Shares) or Warrants, RBC shall prepare and furnish to the Standby Purchasers and Substituted Standby Purchaser(s) (i) copies of documents or reports, if any, that RBC is required to file with the SEC pursuant to Section 13 or 15(d) of the 1934 Act and (ii) the reports required to be provided to the Standby Purchasers and Substituted Standby Purchaser(s) pursuant to the Securities Laws and will deliver such reports to the Standby Purchasers and Substituted Standby Purchaser(s) in accordance with the Securities Laws.  Any such document or report that RBC files with the SEC through the SEC’s EDGAR system or SEDAR, as applicable, shall be deemed furnished to the Purchasers for purposes of this Section 3.1(k) at the time such documents are filed or furnished via the Commission’s EDGAR system or SEDAR, as applicable.

 

(l) Resales. In addition to the other covenants of RBC set forth herein, RBC agrees to the following in connection with any sale (each a “Sale”) of Shares issuable upon the exercise of Rights or Warrants (the “Standby Purchaser Common Shares”) by any Standby Purchaser or Substituted Standby Purchaser or any of their respective Affiliates (each a “Seller”) to any Person:

 

(i) RBC will not object to the Sale, provided that such Sale conducted in accordance with all applicable Securities Laws, demonstrated to the satisfaction of RBC, acting reasonably.

 

(ii) If true at such time, RBC will provide the Seller, promptly upon Seller’s request, a certificate stating that (A) the Standby Purchaser Common Shares are not of the same class as securities listed on a national securities exchange registered under Section 8 of the 1934 Act, or quoted in a U.S. automated inter-dealer quotation system, or securities convertible or exchangeable for securities so listed or quoted; (B) RBC is a “foreign issuer” within the meaning of Rule 902(e) of Regulation S; (C) RBC has not engaged in any “directed selling efforts” in the U.S. within the meaning of Rule 902(c) of Regulation S; and (D) there is no “substantial U.S. market interest” with respect to the class of securities to be offered or sold within the meaning of Rule 902(j) of Regulation S.

  

  

  

(iii) Following the closing, RBC will not engage in “directed selling efforts” in the U.S. with respect to the Standby Purchaser Common Shares.

 

(iv) RBC represents and warrants that it has reviewed this Section 3.1(l) with its attorneys and the Agent and any other party whose approval or other efforts may be necessary in order to effectuate a Sale and that all such Persons have approved the procedures set forth in this Section 3.1(l).

 

(v) RBC will use its best efforts to cause the Agent and any other Person whose approval or efforts may be necessary in order to effectuate a Sale to so approve, process and effectuate the Sale.

 

(vi) In connection with any Sale that is not effectuated on the TSX, RBC agrees, subject to compliance with applicable securities laws to use its reasonable best

  

  

  

efforts to assist the Seller in effectuating such sale, including by making available to any offerees or prospective purchasers (A) such information regarding RBC and its business, operations and financial condition as the Seller may reasonably request, (B) members of management to discuss the business, operations and financial condition of RBC, and (C) such other information as the Seller may reasonably request in order to facilitate such Sale. Notwithstanding the foregoing, RBC will not be required to (i) assist a Seller in identifying or soliciting any offerees or prospective purchasers, (ii) file any registration statement, prospectus or any similar document in any jurisdiction, (iii) take any action that would result in RBC becoming subject to reporting or disclosure obligations to which it is not already subject, or (iv) disclose any material non-public information.

 

ARTICLE 4 REPRESENTATIONS, WARRANTIES AND ADDITIONAL COVENANTS OF RBC

 

4.1 RBC represents, warrants and covenants to the Standby Purchasers that:

 

(a) RBC and each of its subsidiaries has been duly organized and is validly existing and has all requisite power to conduct its business as currently conducted and is duly qualified to transact business and is in good standing in each jurisdiction in which the material conduct of its business or its ownership or leasing of material property requires such qualification.

 

(b) The authorized capital of RBC consists of an unlimited number of Shares, of which there were, as of the Business Day immediately prior to the date hereof, 38,950,262 Shares issued and outstanding. Except as described in this subsection (b) and other than the Standby Purchasers and their respective designates as contemplated by this Agreement, no Person has any agreement or option or any right or privilege (whether by law, preemptive or contractual) capable of becoming an agreement or option for the purchase from RBC, of any Shares or other securities of RBC other than stock options granted pursuant to RBC’s equity incentive plan and other convertible, exchangeable securities outstanding as of the date hereof.

 

(c) When issued and delivered to the respective purchaser and paid for by the respective purchaser in accordance with the terms and conditions of the Rights Offering, the terms and conditions of this Agreement and/or the indenture governing the Warrants, the Securities (including the Underlying Shares) will be validly issued, fully paid and non-assessable and will be free and clear of all liens, pledges, claims, encumbrances, security interests and other restrictions, except for any restrictions on resale or transfer imposed by applicable Securities Laws. The issuance of the Securities (including the Underlying Shares) will not be subject to any pre-emptive or similar rights (it being acknowledged by the Standby Purchasers that the number of Standby Units that they may be entitled to receive pursuant to this Agreement will depend on the number of Units issued to Other Purchasers prior to the Expiry Time).

 

(d) RBC will reserve and set aside sufficient Shares and Underlying Shares in its treasury to issue the Standby Units and upon issuance thereof and receipt by RBC of payment therefor, the Shares and the Underlying Shares will, at the time of issuance be duly and validly issued as fully paid and non-assessable.

 

(e) The execution, delivery and performance by RBC of this Agreement:

 

(i) has been duly authorized by all necessary corporate action on its part;

 

(ii) does not (or would not with the giving of notice, the lapse of time or the happening of any other event or condition) violate its constating documents or by-laws or any resolution of the directors or shareholders of RBC or result in a breach of, a violation of, or constitute a default under, or conflict with, any provision of any material indenture, mortgage, note, agreement (written or oral), contract, joint venture, partnership agreement, lease, judgment, decree, order, licence or other material instrument to which RBC or any of its subsidiaries is a party or by which RBC or any of its subsidiaries or any of their respective properties or assets is bound; and

  

  

  

(iii) will not result in the violation of any applicable Law;

 

excluding such breaches, violations or conflicts that would not, individually or in the aggregate, result in a Material Adverse Change or have a material adverse effect on the Rights Offering or on the other transactions contemplated hereunder.

 

(f) This Agreement has been duly executed and delivered by RBC and constitutes a legal, valid and binding obligation of RBC, enforceable against it in accordance with its terms, subject only to:

 

(i) any limitation under applicable Laws relating to bankruptcy, insolvency, arrangements or other laws of general application affecting the enforcement of creditors’ rights; and

 

(ii) the discretion that a court may exercise in the granting of equitable remedies such as specific performance and injunction.

 

(g) RBC is a reporting issuer (or equivalent where applicable) in good standing in all of the Canadian Qualifying Jurisdictions and is in compliance in all material respects with all continuous and timely disclosure obligations under applicable Securities Laws of the Canadian Qualifying Jurisdictions, and, without limiting the generality of the foregoing, there has not occurred any Material Adverse Change since January 1, 2011 that has not been publicly disclosed, and except to the extent that information contained in a document is superseded by a document filed subsequently pursuant to Securities Laws, none of the documents filed by or on behalf of RBC pursuant to Securities Laws since January 1, 2011 contain a Misrepresentation at the date thereof.

 

(h) RBC is qualified to file a prospectus in the form of a short form prospectus pursuant to the provisions of National Instrument 44-101 — Short Form Prospectus Distributions.

 

(i) Each of the consolidated financial statements of RBC contained in the Public Documents (in each case, as amended through the date hereof), including those contained in each Public Document filed after the date hereof until the Closing Date: (i) complies or, when filed, will comply as to form in all material respects with all Securities Laws of the provinces and territories of Canada; (ii) has been or, when filed, will have been prepared in accordance with Canadian or United States generally accepted accounting principles, as applicable, applied on a consistent basis with those of the comparable prior period (except as may be indicated in the notes thereto or, in the case of unaudited interim financial statements, as may be permitted by applicable Securities Laws); and (iii) fairly presents, or when filed will fairly present, in all material respects, the consolidated financial position of RBC and its subsidiaries as at the respective dates thereof and the consolidated results of operations and cash flows for the periods indicated, except that the unaudited interim financial statements may omit notes which are not required in unaudited financial statements and are subject to normal and recurring year-end adjustments. As of the time they were filed, or as subsequently amended or superseded by a filing prior to the date of this Agreement, none of the documents publicly filed by or on behalf of RBC under RBC’s profile on SEDAR or with the SEC on or after January 1, 2011, including without limitation the Public Documents, contained any Misrepresentation.

 

(j) No order ceasing or suspending the trading of RBC’s securities is outstanding against RBC or any of its directors, officers or promoters.

 

(k) No consent, approval, order or authorization of, or declaration with any Governmental Entity or any third party is required by or with respect to RBC or any of its Affiliates in connection with the execution and delivery of this Agreement or the consummation of the transactions by RBC contemplated hereby, other than the consents, approvals, or authorizations that may be required by the Securities Laws of any Qualifying Jurisdictions, all of which will be received by RBC on or prior to the Closing Date and other than customary post-closing filings in the United States in connection with the issuance of the Standby Units all of which has been or will be timely filed.

 

  

  

  

(l) RBC is not in violation in any material respect of any of the rules and policies of the TSX, including (without limitation) the applicable listing requirements of the TSX, and its Shares are currently listed thereon.

 

(m) There are no legal or governmental proceedings pending, or to RBC’s knowledge, threatened to which RBC or any of its subsidiaries is a party and which, if determined adversely, would result in a Material Adverse Change, other than proceedings accurately described in all material respects in the Public Documents, and proceedings that would not have a material adverse effect on the power or ability of RBC to perform its obligations under this Agreement or to consummate the transactions contemplated by this Agreement.

 

(n) RBC is not in material violation of any term or provision of the constating documents or by-laws of RBC or any resolution of the directors or shareholders of RBC or any material contract, mortgage, note, indenture, joint venture or partnership arrangement, agreement (written or oral) or other material instrument to which RBC or any of its subsidiaries is a party or by which RBC or any of its subsidiaries or any of their respective properties or assets is bound or any applicable Law excluding such breaches, violations or conflicts that have been disclosed in the Public Documents or that would not individually or in the aggregate, have a material adverse effect on RBC.

 

(o) At the time of filing of the Final Prospectus and at the Closing Time on the Closing Date, the Final Prospectus will comply with Securities Laws of the Canadian Qualifying Jurisdictions and shall not contain any Misrepresentations, provided that the foregoing will not apply to any information contained in the Final Prospectus relating to any Standby Purchaser that such Standby Purchaser has provided for inclusion in such Final Prospectus.

 

4.2 Compliance with U.S. Securities Laws.

 

(a) Immediately prior to June 30, 2011, RBC was a foreign private issuer as that term is defined in Rule 405 under the 1933 Act.  On June 30, 2011, RBC determined that it failed to qualify as a foreign private issuer.

 

(b) Neither RBC, its Affiliates, or any Person acting on its or their behalf has engaged or will engage in any directed selling efforts as defined in Regulation S in the United States or has engaged or will engage in any form of general solicitation or general advertising as set forth in Regulation D under the 1933 Act (“Regulation D”) or in any conduct involving a public offering within the meaning of Section 4(2) of the 1933 Act in connection with the offer or sale of the Securities (including the Underlying Shares) in the United States.

 

(c) RBC is not, and upon the issuance and sale of the Securities (including the Underlying Shares) as herein contemplated and the application of the net proceeds therefrom as described in the Prospectus will not be, registered or required to register as an “investment company” within the meaning of the U.S. Investment Company Act of 1940, as amended, and the rules and regulations promulgated thereunder.

 

(d) Neither RBC nor any of its Affiliates has, in the past 6 months, directly or indirectly, solicited any offer to buy, sold or offered to sell or otherwise negotiated in respect of, or will solicit any offer to buy, sell or offer to sell or otherwise negotiate in respect of any security which is or would be integrated with the sale of the Securities (including the Underlying Shares) in a manner that would require the Securities (including the Underlying Shares) to be registered under the 1933 Act.

 

(e) Except with respect to offers and sales made to accredited investors in the United States in compliance with Regulation D or otherwise pursuant to an exemption from the registration requirements of the 1933 Act, neither RBC nor any of its Affiliates, nor any Person acting on their behalf, has made or will make (i) any offer to sell or any solicitation of an offer to buy any of the Securities (including the Underlying Shares) to any Person located in the United States, or (ii) any sale of the Securities (including the Underlying Shares), unless, at the time the buy order was or will be originated, the purchaser was outside of the United States or RBC, its Affiliates or any Person acting on their behalf reasonably believes that the purchaser was outside the United States.

 

  

  

  

(f) Neither RBC nor any of its Affiliates (i) has taken or will take any action that would cause the registration exemptions in Regulation S, Section 4(2) under the 1933 Act or Rule 506 of Regulation D to be unavailable for the offer and sale of Securities (including the Underlying Shares) pursuant to this Agreement, or (ii) has been subject to any order, judgment or decree of any court of competent jurisdiction temporarily, preliminarily or permanently enjoining that Person for failure to comply with Rule 503 of Regulation D.

 

(g) It is not necessary in connection with the offer, sale and delivery of the Securities (including the Underlying Shares) to the Standby Purchasers, the Substituted Standby Purchasers, if any, or their respective assignees in the manner contemplated by this Agreement and the Prospectus to register the Securities (including the Underlying Shares) under the 1933 Act.

 

(h) RBC does not believe that it was a “passive foreign investment company” within the meaning of the United States Internal Revenue Code of 1986, as amended, for the taxable year ended December 31, 2010.

 

(i) RBC agrees that upon the original issuance of the Shares, Warrants and Underlying Shares issuable on exercise of the Warrants, and until such time as is no longer required under applicable requirements of the 1933 Act or applicable state laws, all certificates issued to the Standby Purchasers and the Substituted Standby Purchasers representing such securities, and all certificates issued in exchange therefor or in substitution thereof, will bear, on the face of such certificates, the following legend (the “Restrictive Legend”):

  

  

  

“THE SECURITIES REPRESENTED HEREBY [AND IF WARRANTS, THE FOLLOWING SHALL BE INCLUDED: AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF] HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “U.S. SECURITIES ACT”) OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES.  THE HOLDER HEREOF, BY PURCHASING SUCH SECURITIES, AGREES FOR THE BENEFIT OF RESPONSE BIOMEDICAL CORPORATION THAT SUCH SECURITIES MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE U.S. SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS. THE PRESENCE OF THIS LEGEND MAY IMPAIR THE ABILITY OF THE HOLDER HEREOF TO EFFECT “GOOD DELIVERY” OF THE SECURITIES REPRESENTED HEREBY ON A CANADIAN STOCK EXCHANGE.”

 

4.3 Survival. All representations and warranties of RBC contained herein or contained in any document delivered pursuant to this Agreement or in connection with the Rights Offering herein contemplated, will survive the completion of the purchase of Standby Units by the Standby Purchasers or the Substituted Standby Purchaser(s) and will continue in full force and effect for a period of 18 months notwithstanding any investigation, inquiry or other steps which may be taken by or on behalf of the Standby Purchasers.

 

ARTICLE 5 REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE STANDBY PURCHASERS

 

5.1 Representations. Each of the Standby Purchasers represents, warrants and covenants, as applicable, on a several and not joint basis, to RBC that:

  

  

  

(a) Such Standby Purchaser is legally competent to execute this Agreement and to take all actions pursuant hereto.

(b) The execution, delivery and performance by such Standby Purchaser of this Agreement:

 

(i) has been duly authorized by all necessary action on its part;

 

(ii) does not (or would not with the giving of notice, the lapse of time or the happening of any other event or condition) result in a breach or a violation of, or conflict with, any of the terms or provisions of any agreement or instrument to which such Standby Purchaser is a party that would, individually or in the aggregate, have a material adverse effect on the ability of it to perform its obligations hereunder; and

(iii) will not result in the violation of any applicable Law that would individually or in the aggregate have a material adverse effect on the ability of it perform its obligations hereunder.

 

(c) This Agreement has been duly executed and delivered by such Standby Purchaser and constitutes a legal, valid and binding obligation of such Standby Purchaser, enforceable against it in accordance with its terms, subject only to:

 

(i) any limitation under applicable Laws relating to bankruptcy, insolvency, arrangement or other laws of general application affecting the enforcement of creditors’ rights; and

 

(ii) the discretion that a court may exercise in the granting of equitable remedies such as specific performance and injunction.

 

(d) No consent, approval, order or authorization of, or declaration with, any Governmental Entity is required by or with respect to such Standby Purchaser in connection with the execution and delivery of this Agreement or the consummation of the transactions by such Standby Purchaser contemplated hereby, other than:

 

(i) as may be required by any Securities Laws in the Canadian Qualifying Jurisdictions; and

 

(ii) as may be required by any Securities Commission in the Canadian Qualifying Jurisdictions or with any competition or antitrust authority, except where the failure to obtain such consents, approvals, orders or authorizations of, or make such declarations with, any Governmental Entity, individually or in the aggregate, would not have a material adverse effect on the ability of such Standby Purchaser to perform its obligations hereunder.

 

(e) The Standby Purchaser will provide to RBC at least three Business Days prior to the filing of the Final Prospectus with the Securities Commissions in the Canadian Qualifying Jurisdictions evidence in the form of a letter addressed to the applicable Securities

  

  

  

Commissions or such other documentation as may be reasonably required by them, that such Standby Purchaser has the financial ability to carry out the “standby commitment” (as defined under National Instrument 45-101 - Rights Offerings of the Canadian Securities Administrators (“NI45-101”)) constituted by this Agreement, as required by Part 6 of NI 45-101.

 

(f) Such Standby Purchaser will exercise its Basic Subscription Privilege in full.

(g) Subject to the provisions of this Agreement, such Standby Purchaser has had access to such information concerning RBC as such Standby Purchaser has considered necessary to enter into this Agreement and to undertake its obligations hereunder (provided that it is acknowledged and agreed that RBC shall publicly disclose on or prior to the date on which the initial mailing of the Final Prospectus is made in the Canadian Qualifying Jurisdictions to RBC shareholders as of the Record Date any such information that may theretofore constitute material nonpublic information).

 

(h) Such Standby Purchaser has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of an investment in the Securities and is able to bear the economic risks of such investment.

 

(i) If required under applicable Laws or Securities Laws or under the rules and policies of the TSX, the Standby Purchaser will execute, deliver and file and otherwise assist RBC in filing such required reports and such other required documents with respect to the issue of the Rights, Units and Standby Units, provided that RBC acknowledges and agrees that it has not engaged any Standby Purchaser to act as underwriter (as defined under applicable Securities Laws) and each Standby Purchaser will not be required to sign a certificate in the Prospectus in that capacity or any other capacity.

 

(j) it:

 

(i) understands that that any Standby Units and Underlying Shares, issuable on the exchange or exercise of such Rights and Warrants acquired by it have not been and will not be registered under the 1933 Act and that the sale to it contemplated hereby is being made in reliance on a private placement exemption pursuant to Regulation D;

 

(ii) has received a copy, for its information only, of the Prospectus;

 

(iii) is an “accredited investor” as defined in Rule 501 under the 1933 Act, as amended by the Dodd-Frank Wall Street Reform and Consumer Protection Act;

 

(iv) acknowledges that it is not purchasing the Standby Units and Underlying Shares issuable on the exercise of the Warrants as a result of any general solicitation or general advertising, including advertisements, articles, notices or other communications published in any newspaper, magazine or similar media or broadcast over radio or television, or any seminar or meeting whose attendees have been invited by general solicitation or general advertising;

 

(v) agrees that it will not offer, sell or otherwise transfer any of the Shares or Underlying Shares issuable on the exercise of the Warrants, directly or indirectly, unless:

(1) the sale is to RBC; or

 

(2) (i) the sale is to a “qualified institutional buyer” within the meaning of Rule 144A, in compliance with the requirements of Rule 144A, and (ii) a purchaser’s letter containing representations, warranties and agreements substantially similar to those contained in Section 2.7 and this Section 5.1(j) (except that such purchaser’s letter need not contain the representation set forth in paragraph 5.1(j)(ii) above, should refer to reliance upon Rule 144A instead of Regulation D, and should certify that the purchaser is a qualified institutional buyer) if executed by the purchaser and delivered to RBC prior to the sale; or

 

  

  

  

(3) the sale is made outside the U.S. in compliance with the requirements of Regulation S and in compliance with applicable local laws and regulations; or

 

(4) the sale is made pursuant to an exemption from registration by Rule 144, if available; or

 

(5) the sale is made in a transaction that does not require registration under the 1933 Act or any applicable U.S. state laws and regulations governing the offer and sale of securities;  and, in the case of subparagraphs (4) or (5), or except as provided in Section 3(m) above, subparagraph (3), it has furnished to RBC and the Agent an opinion of counsel of recognized standing reasonably satisfactory to RBC;

 

(vi) understands and acknowledges that upon the original issuance of the Shares, Warrants and Underlying Shares issuable on exercise of the Warrants, and until such time as is no longer required under applicable requirements of the 1933 Act or applicable state laws, all certificates issued to the Standby Purchasers and the Substituted Standby Purchasers representing such securities, and all certificates issued in exchange therefor or in substitution thereof, will bear, on the face of such certificates, the Restrictive Legend; provided, that if any such securities are being sold pursuant to Rule 144, the legend may be removed by delivery to Agent of an opinion of counsel, of recognized standing reasonably satisfactory to RBC, to the effect that such legend is no longer required under applicable requirements of the 1933 Act or state securities laws;

  

  

  

(vii) acknowledges that RBC has determined that it has ceased to qualify as a “foreign private issuer” as defined in Rule 405 under the 1933 Act, as of June 30, 2011, and accordingly, as of January 1, 2012, RBC will be treated as a domestic issuer under the U.S. federal securities laws. Without limiting the foregoing, beginning on January 1, 2012, the Securities and the Underlying Shares will no longer be eligible for legend removal upon sale outside the United States pursuant to Regulation S of the 1933 Act; and

 

  

  

  

(viii) acknowledges that the Warrants may not be exercised except pursuant to an exemption from the registration requirements of the 1933 Act and any applicable state securities laws.

 

5.2 Survival. All representations and warranties of the Standby Purchasers contained herein or contained in any document delivered pursuant to this Agreement or in connection with the Rights Offering herein contemplated, will survive the completion of the purchase of Securities by the Standby Purchasers and will continue in full force and effect for a period of 18 months notwithstanding any investigation, inquiry or other steps which may be taken by or on behalf of RBC.

 

ARTICLE 6 CLOSING AND CONDITIONS

 

6.1 The closing of the purchase by the Standby Purchasers and sale by RBC of the Standby Units to be purchased by the Standby Purchasers hereunder will be completed at the Vancouver offices of Borden Ladner Gervais LLP at 10:00 a.m. (Eastern time) (the “Closing Time”) on the Closing Date or at such other time and/or on such other date and/or at such other place as RBC and the Standby Purchasers may agree upon in writing.  On such date, and upon payment being made by the Standby Purchasers in accordance with Section 2.5 and Section 2.9, definitive certificates representing the number of Shares and Warrants that is equal to the number of Standby Units to be purchased by each Standby Purchaser hereunder, or other evidence of issuance of the Standby Units to the Standby Purchasers, in a form satisfactory to the Standby Purchasers, acting reasonably, will be delivered to such Standby Purchaser by RBC, such certificate to be registered in the name of such Standby Purchaser or one or more designees of such Standby Purchaser, as applicable.

 

6.2 The obligation of each Standby Purchaser to complete the closing of the transactions set out in this Agreement is subject to the following conditions being satisfied in full:

 

(a) There will not be any claims, litigation, investigations or proceedings, including (without limitation) appeals and applications for review, in progress, or to the knowledge of RBC, pending, commenced or threatened, by any Person that have a reasonable likelihood of success in the judgment of the Standby Purchasers or by any Governmental Entity, in respect of the Rights Offering that are materially adverse to RBC on a consolidated basis.

 

(b) RBC will have made and/or obtained all necessary filings, approvals, orders, rulings and consents of all relevant securities regulatory authorities and other Governmental Entities required in connection with the Rights Offering and the purchase of Standby Units by the Standby Purchasers as contemplated by this Agreement.

 

(c) The TSX shall have approved the listing of the Rights and the Shares issuable upon exercise of the Rights and Underlying Shares issuable upon exercise of the Warrants, subject to the filing of customary documents with the TSX.

 

(d) The Rights Offering will have been conducted in accordance with applicable Laws, including Securities Laws.

 

(e) The issuance of Standby Units, and the Shares and Warrants underlying the Rights will be exempt from the registration or qualification requirements of or will have been qualified for sale in the United States and the Blue Sky States.

 

(f) The terms of the Rights Offering will not have been changed without the written consent of the Standby Purchasers.

 

(g) Such Standby Purchaser will have received, with respect to such matters as are listed on Schedule A, a legal opinion dated as of the Closing Date from counsel to RBC.

 

  

  

  

(h) Each Standby Purchaser and any Substituted Standby Purchaser will have received at the Closing Time a certificate dated the Closing Date, addressed to such Standby Purchaser and any Substituted Purchaser and signed by an executive officer of RBC, certifying for and on behalf of RBC that:

 

(i) since the respective dates as of which information is given in the Final Prospectus as amended by any Prospectus Amendment there has been no material change (actual, anticipated, contemplated or threatened, whether financial or otherwise) in the business, affairs, operations, assets, liabilities (contingent or otherwise) or capital of RBC and its subsidiaries on a consolidated basis, other than as disclosed in the Final Prospectus or any Prospectus Amendment, as the case may be;

 

(ii) no order, ruling or determination, having the effect of suspending the sale or ceasing the trading of the Shares or any other securities of RBC having been issued by any Securities Commission that is continuing in effect and no inquiry, investigation (whether formal or informal) or other proceedings for that purpose having been instituted or are pending or, to the knowledge of such officers, having been contemplated or threatened under any of the Securities Laws or by any Securities Commission or other Governmental Entity;

  

  

  

(iii) RBC has duly complied in all material respects with the terms, conditions and covenants of this Agreement on its part to be complied with up until the Closing Time; and\

 

(iv) the representations and warranties of RBC contained in this Agreement are true and correct in all material respects as of the Closing Time with the same force and effect as if made at and as the Closing Date after giving effect to the transactions contemplated by this Agreement, except for such representations and warranties which are stated to be qualified as to materiality, in which case such representations and warranties will be true and correct as of the Closing Time;

 

and all such matters will in fact be true and correct as at the Closing Time.

 

6.3 RBC agrees that the conditions contained in Section 6.2 will be complied with so far as the same relate to acts to be performed or to be caused to be performed by RBC and that it will use its commercially reasonable efforts to cause such conditions to be complied with.

 

6.4 The obligation of RBC to complete the closing of the transactions set out in this Agreement is subject to the following conditions being satisfied in full:

  

  

  

(a) each Standby Purchaser will have made and/or obtained all necessary filings, approvals, orders, rulings and consents of all relevant securities regulatory authorities and other Governmental Entities required in connection with the purchase of the Standby Units as contemplated by this Agreement;

 

(b) the TSX shall have approved the listing of the Rights and the Shares issuable upon exercise of the Rights and Underlying Shares issuable upon exercise of the Warrants, subject to the filing of customary documents with the TSX.

 

(c) the Rights Offering will have been conducted in accordance with applicable Laws, including Securities Laws.

 

(d) the issuance of Standby Units, and the Shares and Warrants underlying the Rights will be exempt from the registration or qualification requirements of or will have been qualified for sale in the United States and the Blue Sky States.

 

(e) there will be no inquiry, investigation (whether formal or informal) or other proceeding commenced by a Governmental Entity pursuant to applicable Laws in relation to RBC or any of its subsidiaries or in relation to any of the directors and officers of RBC, any of which suspends or ceases trading (which suspension or cessation of trading is continuing) in the Rights or Shares or operates to prevent or restrict the lawful distribution of the Securities (which prevention or restriction is continuing); and

 

(f) there will be no order issued by a Governmental Entity pursuant to applicable Laws and no change of Law, either of which suspends or ceases trading in the Rights or Shares (which suspension or cessation of trading is continuing) or operates to prevent or restrict the lawful distribution of the Rights or Shares issuable upon the exercise of the Rights or Shares issuable upon exercise of the Rights (which prevention or restriction is continuing).

6.5 Each Standby Purchaser agrees that the conditions contained in Section 6.4 will be complied with so far as the same relate to acts to be performed or to be caused to be performed by the Standby Purchaser and that it will use its commercially reasonable efforts to cause such conditions to be complied with.

 

ARTICLE 7 TERMINATION

 

7.1 Termination by RBC. RBC will be entitled to elect to terminate this Agreement by giving written notice at any time prior to the Closing Time of such election to the Standby Purchasers, if:

 

(a) the conditions to closing in favour of RBC referred to in Section 6.4 above have not been satisfied on or before December 30, 2011;

 

(b) the Final Prospectus has not been filed in each of the Canadian Qualifying Jurisdictions on or before November 30, 2011; or

 

(c) the Rights Offering is otherwise terminated or cancelled or the closing (as contemplated in Article 6) has not occurred on or before December 30, 2011,

  

  

  

provided however that RBC will be entitled to make such election to terminate only if RBC has used reasonable efforts to comply with its obligations under this Agreement which directly or indirectly relate to the relevant termination right which are required to have been performed prior to the time of giving such notice to the Standby Purchasers.

 

7.2 Termination by the Standby Purchasers. The Standby Purchasers will be entitled by giving written notice to RBC at any time prior to the Closing Time, to terminate and cancel, without any liability on their part, their obligations under this Agreement, if,

 

(a) any inquiry, investigation (whether formal or informal) or other proceeding is commenced by a Governmental Entity pursuant to applicable Laws in relation to RBC or any of its subsidiaries, or in relation to any of the directors or officers of RBC, any of which suspends or ceases trading in the Rights or other Securities or operates to prevent or restrict the lawful distribution of the Securities;

 

(b) any order is issued by a Governmental Entity pursuant to applicable Laws, or if there is any change of Law, either of which suspends or ceases trading in any of the Rights or other Securities or operates to prevent or restrict the lawful distribution of any of the Rights or other Securities issuable upon exercise of the Rights;

 

(c) any Material Adverse Change occurs at anytime following the execution of the Agreement by the Standby Purchasers;

 

(d) the Shares or the Rights are de-listed or suspended or halted for trading for a period greater than one Business Day for any reason by the TSX at any time prior to the closing of the Rights Offering;

 

(e) the conditions to closing in favour of the Standby Purchasers referred to in Section 6.2 above have not been satisfied on or before December 30, 2011;

 

(f) the Final Prospectus has not been filed in each of the Qualifying Jurisdictions on or before November 30, 2011; or

 

(g) the Rights Offering is otherwise terminated or cancelled or the closing (as contemplated in Article 6 has not occurred on or before December 30, 2011.

Notwithstanding any other provision hereof, should RBC or the Standby Purchasers validly terminate this Agreement pursuant to, and in accordance with, this Article 7, the obligations of both RBC and the Standby Purchasers under this Agreement will terminate and there will be no further liability on the part of the Standby Purchasers to RBC or on the part of RBC to the Standby Purchasers hereunder (except for any liability of any party that exists at such time or that may arise thereafter pursuant to Article 8 or Section 10.1, which shall survive any such termination).

  

  

  

ARTICLE 8 INDEMNIFICATION

 

8.1 RBC covenants and agrees to protect, indemnify and hold harmless each of the Standby Purchasers and any Substituted Standby Purchaser for and on behalf of itself and for and on behalf of and in trust for each of its directors, officers, employees, agents and shareholders from and against any and all losses, claims, damages, liabilities, costs or expenses caused or incurred:

 

(a) by reason of or in any way arising, directly or indirectly, out of any Misrepresentation or alleged Misrepresentation in the Prospectus;

 

(b) by reason of or in any way arising, directly or indirectly, out of any order made or inquiry, investigation or proceeding commenced or threatened by any Securities Commission, or other competent authority in Canada or the United States or before or by any Governmental Entity, based upon or relating to any Misrepresentation or alleged Misrepresentation in the Prospectus, or any other document filed with the Canadian Securities Commissions in connection with the Rights Offering or the Prospectus, or relating to the Rights Offering, the issuance and sale of the Standby Units or other transactions contemplated in this Agreement including, without limitation, any actions taken or statements made by or on behalf of RBC in connection with the Rights Offering, the issuance and sale of the Standby Units or the other transactions contemplated in this Agreement other than any Misrepresentation or alleged Misrepresentation relating to the Standby Purchasers furnished in writing by the Standby Purchasers expressly for inclusion in the Prospectus;

 

(c) the non-compliance or alleged non-compliance by RBC with any requirement of the Securities Laws or any other applicable Laws in connection with the Rights Offering, the issuance and sale of the Standby Units or the other transactions contemplated in this Agreement, including (without limitation) RBC’s non-compliance with any statutory requirement to make any document available for inspection; and

 

(d) by reason of, or in any way arising, directly or indirectly, out of any breach or default of or under any representation, warranty, covenant or agreement of RBC contained herein.

8.2 Each Standby Purchaser, severally and not jointly, covenants and agrees to protect, indemnify and hold harmless RBC for and on behalf of itself and for and on behalf of and in trust for each of RBC’s directors, officers, employees and agents from and against any and all losses, claims, damages, liabilities, costs or expenses caused or incurred by reason of, or in any way arising, directly or indirectly, out of any breach or default of or under any representation, warranty, covenant or agreement of such Standby Purchaser contained herein or any misrepresentation in the information in the Prospectus provided by the Standby Purchaser.

 

8.3 In the event that any claim, action, suit or proceeding, including, without limitation, any inquiry or investigation (whether formal or informal), is brought or instituted against any of the Persons in respect of which indemnification is or might reasonably be considered to be provided for herein, such Person (an “Indemnified Party”) will promptly notify the Person from whom indemnification is being sought (being either RBC under Section

8.1 or the applicable Standby Purchaser under Section 8.2, as the case may be (the “Indemnifying Party”)) and the Indemnifying Party will promptly retain counsel who will be reasonably satisfactory to the Indemnified Party to represent the Indemnified Party in such claim, action, suit or proceeding, and the Indemnifying Party will pay all of the reasonable fees and disbursements of such counsel relating to such claim, action, suit or proceeding.

 

  

  

  

8.4 In any such claim, action, suit or proceeding, the Indemnified Party will have the right to retain other counsel to act on his or its behalf, provided that the fees and disbursements of such other counsel will be paid by the Indemnified Party unless:

 

(a) the Indemnifying Party and the Indemnified Party will have mutually agreed to the retention of such other counsel;

 

(b) the named parties to any such claim, action, suit or proceeding (including, without limitation, any added, third or impleaded parties) include both the Indemnifying Party and the Indemnified Party and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them (such as the availability of different defenses); or

 

(c) the Indemnifying Party fails to retail counsel as contemplated by Section 8.3 within 15 days of receiving notice as contemplated by Section 8.3

8.5 Subject to Section 8.4, it is understood and agreed that the Indemnifying Party will not, in connection with any claim, action, suit or proceeding referred to in Section 8.4 commenced in the same jurisdiction, be liable for the reasonable fees and expenses of more than one separate legal firm (in addition to local counsel) for all Persons in respect of which indemnification is or might reasonably be considered to be provided for herein and such firm will be designated in writing by the Indemnified Party (on behalf of itself and its directors, trustees, officers, employees and agents).

 

8.6 Notwithstanding anything herein contained, no Indemnified Party will agree to any settlement of any claim, action, suit, proceeding, inquiry or investigation in respect of which indemnification is or might reasonably be considered to be provided for herein, unless the Indemnifying Party has consented in writing thereto, and the Indemnifying Party will not be liable for any settlement of any such claim, action, suit, proceeding, inquiry or investigation unless it has consented in writing thereto.

 

8.7 If the indemnification provided for in this Article 8 is held by a court of competent jurisdiction to be unavailable to an Indemnified Party with respect to any losses, claims, damages or liabilities referred to herein, the Indemnifying Party, in lieu of indemnifying such Indemnified Party thereunder, will to the extent permitted by Law contribute to the amount paid or payable by such Indemnified Party as a result of such loss, claim, damage or liability in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party on the one hand and of the Indemnified Party on the other in connection with the act or omission that resulted in such loss, claim, damage or liability, as well as any other relevant equitable considerations. The relative fault of the Indemnifying Party and of the Indemnified Party will be determined by a court of law by reference to, among other things, whether the untrue or alleged untrue statement of material fact or the omission to state a material fact relates to information supplied by the Indemnifying Party or by the Indemnified Party and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.

 

  

  

  

8.8 The obligations of RBC and the Standby Purchasers under this Article 8 will survive completion of any offerings described herein and the termination of this Agreement.  No Indemnifying Party, in the defense of any such claim or litigation, will, except with the consent of the Indemnified Party, consent to entry of any judgment or enter into any settlement which

(i) does not include as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party of a release from all liability in respect to such claim or litigation, or

(ii) includes an admission of guilt, finding of liability or other non-monetary relief.

8.9 To the extent any indemnification by an Indemnifying Party is prohibited or limited by Law, the Indemnifying Party agrees to make the maximum contribution with respect to any amounts for which it would otherwise be liable under this Article 8 to the fullest extent permitted by Law; provided, however, that no person guilty of fraudulent misrepresentation will be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.

 

ARTICLE 9 NOTICE

 

9.1 Notice. Any notice or other communication required or permitted to be given hereunder will be in writing and will be personally delivered or sent by electronic or facsimile transmission as set forth below, or to such other address, facsimile number or Person as may be designated by notice.

 

(a) In the case of RBC:

 

Response Biomedical Corp. 1781 - 75th Avenue W. Vancouver, BC V6P 6P2 CANADA

Attention: Chief Executive Officer  Fax.: (604) 456-6066

With a copy to:

Borden Ladner Gervais LLP 1200 Waterfront Centre 200 Burrard Street

P.O. Box 48600 Vancouver, BC V7X 1T2 CANADA Attention: Warren Learmonth Fax: (604) 622-5866

 

  

  

  

(b) In the case of the Standby Purchasers:

 

OrbiMed Private Investments III, LP OrbiMed Asia Partners, LP OrbiMed Associates III, LP c/o OrbiMed Advisors, LLC 767 Third Avenue, 30th Floor New York, NY 10017

Attn: Carl L. Gordon Fax: (212) 739-6444

With a copy to:

Wilson Sonsini Goodrich & Rosati, P.C. 701 Fifth Avenue, Suite 5100 Seattle, WA 98104

Attn: Michael Nordtvedt Fax: (206) 883-2699

 

9.2 Receipt of Notice. Notice will be deemed to be given on the day of actual delivery or the day of electronic or facsimile transmission, as the case may be, or if not a Business Day, on the next Business Day.

 

ARTICLE 10 GENERAL

 

10.1 Expenses. RBC will be responsible for all expenses related to the Rights Offering, whether or not it is completed, including, without limitation, all fees and disbursements of its legal counsel, fees and disbursements of its accountants and auditors, printing costs, translation fees, filing fees and all reasonable fees and disbursements of legal counsel to the Standby Purchasers and reasonable out-of-pocket expenses incurred by the Standby Purchasers.

 

10.2 Obligations Several. RBC agrees that the obligations of the Standby Purchasers hereunder are several and not joint or joint and several.

 

10.3 Further Assurances. The parties hereto agree to do all such things and take all such actions as may be necessary or desirable to give full force and effect to the matters contemplated by this Agreement.

 

10.4 Assignment. This Agreement may not be assigned by any party hereto, by operation of law or otherwise, without the prior written consent of the other parties hereto.

 

  

  

  

10.5 Enurement. This Agreement will enure to the benefit of and be binding upon the parties hereto and their respective successors and permitted assigns.

 

10.6 Waiver. Failure by any party hereto to insist in any one or more instances upon the strict performance of any one of the covenants or rights contained herein will not be construed as a waiver or relinquishment of such covenant or right.  No waiver by either party hereto of any such covenant or right will be deemed to have been made unless expressed in writing and signed by the waiving party.

 

10.7 Amendments. No term or provision hereof may be amended, discharged or terminated except by an instrument in writing signed by the party against which the enforcement of the amendment, discharge or termination is sought.

 

10.8 Counterparts and Facsimile. This Agreement may be executed in several counterparts and by facsimile, electronic mail or other electronic transmission, each of which when so executed will be deemed to be an original and such counterparts and facsimiles, electronic mail or other electronic transmissions together will constitute one and the same instrument and notwithstanding their date of execution they will be deemed to be dated as of the date hereof.  This Agreement will be deemed to have been entered into and to have become effective at the location at which the Standby Purchasers will have signed an original, counterpart or facsimile version thereof, without regard to the place at which RBC will have signed same.

 

10.9 Time. Time will be of the essence of this Agreement.

 

10.10 Entire Agreement. This Agreement and any other agreements and other documents referred to herein and delivered in connection herewith, constitutes the entire agreement between the parties hereto pertaining to the subject matter hereof and supersedes all prior agreements, understandings, negotiations and discussions, whether oral or written, between the parties with respect to the subject matter hereof.

 

10.11 Language. The parties hereby confirm their express wish that this document and all documents and agreements directly or indirectly related thereto be drawn up in English.  Les parties reconnaissent qu’à leur demande le présent document ainsi que tous les documents et conventions qui s’y rattachent directement ou indirectement sont rédigés en langue anglaise.

 

[The rest of this page has been intentionally left blank]

 

  

  

  

IN WITNESS WHEREOF the parties hereto have caused this Agreement to be duly executed and delivered by their authorized officers as of the date first written above.

 

RESPONSE BIOMEDICAL CORP.

 

By: (signed) Lewis Shuster Name: Lewis Shuster Title: Director

 

ORBIMED PRIVATE INVESTMENTS III, LP

By: OrbiMed Capital GP III LLC, General Partner By: OrbiMed Advisors LLC, Managing Member

 

By: (signed) Carl Gordon Name: Carl Gordon Title: Member

 

ORBIMED ASIA PARTNERS, L.P.

By: OrbiMed Asia GP, L.P., General Partner By: OrbiMed Advisors Limited, General Partner

 

By: (signed) Carl Gordon Name: Carl Gordon Title: Director

 

ORBIMED ASSOCIATES III, LP

By: OrbiMed Advisors LLC, General Partner

 

By: (signed) Carl Gordon Name: Carl Gordon Title: Member Schedule A

 

  

  

  

 

FORM OF LEGAL OPINION

 

1. The Company is a corporation incorporated and existing under the laws of the Province of British Columbia.

 

2. The Company has the requisite power and capacity to carry on its business as described in the Prospectus, to enter into and carry out its obligations under the Agreement and the Warrant Indenture (the “Documents”) and to issue the Securities and the Underlying Shares as contemplated thereby.

 

3. The execution and delivery of the Prospectus and the filing of the Prospectus pursuant to applicable Securities Laws in the Canadian Qualifying Jurisdictions have been duly authorized by all necessary corporate action on the part of the Company.

 

4. All necessary corporate action has been taken by and on behalf of the Company to authorize the creation, issuance and distribution of the Securities and the Underlying Shares.

 

5. The Company’s authorized capital consists of an unlimited number of Shares, of which [ ] Shares were issued and outstanding on [date]; the Share purchase warrants issued by the Company in 2008 and 2009 (“Existing Warrants”) were duly and validly created, and all necessary corporate steps and proceedings have been taken by the Company to authorize the allotment and reservation for issuance of the Shares issuable upon the valid exercise of the Existing Warrants in accordance with their respective terms (“Warrant Shares”) and, when issued, such Existing Warrant Shares will have been validly issued as fully paid and non-assessable Shares in the capital of the Company; upon the valid exercise of stock options duly issued under the Company’s stock option plans (“Option Shares”) and receipt of payment in full for the Option Shares in respect of which such stock options have been exercised, such Option Shares will have been validly issued as fully paid and non-assessable Shares in the capital of the Company.

 

6. The Rights have been duly authorized and validly issued, and upon payment of the subscription price and the valid exercise of the Rights as contemplated in the Prospectus, the Shares will be duly authorized and validly issued as fully-paid and non-assessable in the capital of the Company; upon payment of the subscription price and the valid exercise of the Rights as contemplated in the Prospectus the Warrants will be duly authorized and validly issued; and upon the valid exercise of the Warrants as contemplated in the Warrant Indenture, the Underlying Shares will be duly authorized and validly issued as fully-paid and non-assessable in the capital of the Company.

7. Neither the execution and delivery by the Company of the Documents nor the consummation of the transactions contemplated by the Documents resulted, or will result, in the breach or violation of, or conflicted, or will conflict, with any of the terms or provisions of, or constituted, or will constitute, a default under, or resulted, or will result, in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Company or any of its subsidiaries pursuant to (i) any of the Reviewed Agreement, (ii) the constating documents, or of any resolution of the directors, of the Company or (iii) any law or statute or any judgment, order or regulation of any court or arbitrator or governmental or regulatory authority in the Canadian Qualifying Jurisdictions.

8. The Documents and the performance by the Company of its obligations thereunder have been duly authorized by the Company and each has been duly executed and delivered by the Company.

 

9. The Documents each constitutes a legal, valid and binding obligation of the Company enforceable against it in accordance with its terms.

 

10. All necessary documents have been filed, all requisite proceedings have been taken and all legal requirements have been fulfilled by the Company under applicable Securities Laws (including the requirements of the TSX) to qualify the Rights and the Units, including the Standby Units and Underlying Shares, for distribution in the province of Canadian Qualifying Jurisdictions.

 

  

  

  

11. The Company has complied with all laws of the Province of Quebec relating to the use of the French language in connection with the offering of Rights and the offer, sale and issuance of Shares and Warrants forming the Units and the Underlying Shares.

 

12. The Rights, Shares issuable upon exercise of the Rights and the Underlying Shares have been approved for listing on the TSX, subject only to such usual conditions and to the filing of usual documents in accordance with the requirements of the TSX.

 

13. Computershare Trust Company of Canada, at its principal offices in the City of Vancouver, British Columbia has been duly appointed as the registrar and transfer agent for the Shares and Warrants

 

14. The Company is not registered, and after giving effect to the offering and the sale of the Securities, and the application of the proceeds thereof as described in the Prospectus, will not be required to register as, an “investment company” pursuant to the U.S. Investment Company Act of 1940, as amended.

 

15. Based in part on the representations of the Standby Purchasers in the Agreement, the offer, sale and issuance of (i) Units to be issued in accordance with the Prospectus,

(ii) the Standby Units to be issued in accordance with the Agreement and (iii) provided that the Warrants are exercised in accordance with their terms, and no commission or other remuneration is paid or given, directly or indirectly, for soliciting such exercise, the Underlying Shares issuable upon exercise of the Warrants, are exempt from the registration requirements of Section 5 of the 1933 Act.ex4-4.htm

Exhibit 4.4

 

 

 

NOVABAY PHARMACEUTICALS, INC.,

Issuer

 

AND

 

[·],

Trustee

 

_______________

 

INDENTURE

 

Dated as of [·], 20[·]

_______________

 

Debt Securities

 

 

  

  

  

 

	ARTICLE 1          	DEFINITIONS	
1

	Section 1.01	Definitions of Terms	1
	ARTICLE 2        	ISSUE, DESCRIPTION, TERMS, EXECUTION, REGISTRATION AND EXCHANGE OF SECURITIES	5
	
Section 2.01

	
Designation and Terms of Securities

	
5

	
Section 2.02

	
Form of Securities and Trustee’s Certificate

	
8

	
Section 2.03

	
Denominations: Provisions for Payment

	
8

	
Section 2.04

	
Execution and Authentications

	
10

	
Section 2.05

	
Registration of Transfer and Exchange

	
11

	
Section 2.06

	
Temporary Securities

	
12

	
Section 2.07

	
Mutilated, Destroyed, Lost or Stolen Securities

	
12

	
Section 2.08

	
Cancellation

	
13

	
Section 2.09

	
Benefits of Indenture

	
14

	
Section 2.10

	
Authenticating Agent

	
14

	
Section 2.11

	
Global Securities

	
14

	
ARTICLE 3

	
REDEMPTION OF SECURITIES AND SINKING FUND PROVISIONS

	
15

	
Section 3.01

	
Redemption

	
15

	
Section 3.02

	
Notice of Redemption

	
16

	
Section 3.03

	
Payment Upon Redemption

	
17

	
Section 3.04

	
Sinking Fund

	
17

	
Section 3.05

	
Satisfaction of Sinking Fund Payments with Securities

	
17

	
Section 3.06

	
Redemption of Securities for Sinking Fund

	
18

	
ARTICLE 4

	
COVENANTS

	
18

	
Section 4.01

	
Payment of Principal, Premium and Interest

	
18

	
Section 4.02

	
Maintenance of Office or Agency

	
19

	
Section 4.03

	
Paying Agents

	
19

	
Section 4.04

	
Appointment to Fill Vacancy in Office of Trustee

	
20

	
Section 4.05

	
Compliance with Consolidation Provisions

	
20

	
ARTICLE 5

	
SECURITYHOLDERS’ LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE

	
20

	
Section 5.01

	
Company to Furnish Trustee Names and Addresses of Securityholders

	
20

	
Section 5.02

	
Preservation Of Information; Communications With Securityholders

	
21

 

  

i

  

 

	
Section 5.03

	
Reports by the Company

	
21

	
Section 5.04

	
Reports by the Trustee

	
22

	
ARTICLE 6

	
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS ON EVENT OF DEFAULT

	
22

	
Section 6.01

	
Events of Default

	
22

	
Section 6.02

	
Collection of Indebtedness and Suits for Enforcement by Trustee

	
24

	
Section 6.03

	
Application of Moneys Collected

	
25

	
Section 6.04

	
Limitation on Suits

	
26

	
Section 6.05

	
Rights and Remedies Cumulative; Delay or Omission Not Waiver

	
26

	
Section 6.06

	
Control by Securityholders

	
27

	
Section 6.07

	
Undertaking to Pay Costs

	
27

	
ARTICLE 7

	
CONCERNING THE TRUSTEE

	
28

	
Section 7.01

	
Certain Duties and Responsibilities of Trustee

	
28

	
Section 7.02

	
Certain Rights of Trustee

	
29

	
Section 7.03

	
Trustee Not Responsible for Recitals or Issuance or Securities

	
31

	
Section 7.04

	
May Hold Securities

	
31

	
Section 7.05

	
Moneys Held in Trust

	
31

	
Section 7.06

	
Compensation and Reimbursement

	
31

	
Section 7.07

	
Reliance on Officer’s Certificate

	
32

	
Section 7.08

	
Disqualification; Conflicting Interests

	
32

	
Section 7.09

	
Corporate Trustee Required; Eligibility

	
33

	
Section 7.10

	
Resignation and Removal; Appointment of Successor

	
33

	
Section 7.11

	
Acceptance of Appointment By Successor

	
34

	
Section 7.12

	
Merger, Conversion, Consolidation or Succession to Business

	
35

	
Section 7.13

	
Preferential Collection of Claims Against the Company

	
36

	
Section 7.14

	
Notice of Default

	
36

	
ARTICLE 8

	
CONCERNING THE SECURITYHOLDERS

	
36

	
Section 8.01

	
Evidence of Action by Securityholders

	
37

	
Section 8.02

	
Proof of Execution by Securityholders

	
37

	
Section 8.03

	
Who May be Deemed Owners

	
37

	
Section 8.04

	
Certain Securities Owned by Company Disregarded

	
37

	
Section 8.05

	
Actions Binding on Future Securityholders

	
38

 

  

ii

  

 

	
ARTICLE 9

	
SUPPLEMENTAL INDENTURES

	
38

	
Section 9.01

	
Supplemental Indentures Without the Consent of Securityholders

	
38

	
Section 9.02

	
Supplemental Indentures With Consent of Securityholders

	
39

	
Section 9.03

	
Effect of Supplemental Indentures

	
40

	
Section 9.04

	
Securities Affected by Supplemental Indentures

	
40

	
Section 9.05

	
Execution of Supplemental Indentures

	
40

	
ARTICLE 10

	
SUCCESSOR ENTITY

	
41

	
Section 10.01

	
Company May Consolidate, Etc.

	
41

	
Section 10.02

	
Successor Entity Substituted

	
41

	
ARTICLE 11

	
SATISFACTION AND DISCHARGE

	
42

	
Section 11.01

	
Satisfaction and Discharge of Indenture

	
42

	
Section 11.02

	
Discharge of Obligations

	
43

	
Section 11.03

	
Deposited Moneys to be Held in Trust

	
43

	
Section 11.04

	
Payment of Moneys Held by Paying Agents

	
43

	
Section 11.05

	
Repayment to Company

	
43

	
ARTICLE 12

	
IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS

	
44

	
Section 12.01

	
No Recourse

	
44

	
ARTICLE 13

	
MISCELLANEOUS PROVISIONS

	
44

	
Section 13.01

	
Effect on Successors and Assigns

	
44

	
Section 13.02

	
Actions by Successor

	
44

	
Section 13.03

	
Surrender of Company Powers

	
44

	
Section 13.04

	
Notices

	
45

	
Section 13.05

	
Governing Law

	
45

	
Section 13.06

	
Treatment of Securities as Debt

	
45

	
Section 13.07

	
Certificates as to Conditions Precedent

	
45

	
Section 13.08

	
Payments on Business Days

	
46

	
Section 13.09

	
Conflict with Trust Indenture Act

	
46

	
Section 13.10

	
Counterparts

	
46

	
Section 13.11

	
Separability

	
46

	
Section 13.12

	
Compliance Certificates

	
47

	
Section 13.13

	
U.S.A Patriot Act

	
47

	
Section 13.14

	
Force Majeure

	
47

	
Section 13.15

	
Table of Contents; Headings

	
47

 

	
 (1)

	
This Table of Contents does not constitute part of the Indenture and shall not have any bearing on the interpretation of any of its terms or provisions.

 

  

iii

  

 

INDENTURE

 

Indenture, dated as of [·], 20[·], among NovaBay Pharmaceuticals, Inc., a Delaware corporation (the “Company”), and [·], as trustee (the “Trustee”):

 

Whereas, for its lawful corporate purposes, the Company has duly authorized the execution and delivery of this Indenture to provide for the issuance of debt securities (hereinafter referred to as the “Securities”), in an unlimited aggregate principal amount to be issued from time to time in one or more series as in this Indenture provided, as registered Securities without coupons, to be authenticated by the certificate of the Trustee;

 

Whereas, to provide the terms and conditions upon which the Securities are to be authenticated, issued and delivered, the Company has duly authorized the execution of this Indenture; and

 

Whereas, all things necessary to make this Indenture a valid agreement of the Company, in accordance with its terms, have been done.

 

Now, Therefore, in consideration of the premises and the purchase of the Securities by the holders thereof, it is mutually covenanted and agreed as follows for the equal and ratable benefit of the holders of Securities:

 

ARTICLE 1

 

DEFINITIONS

 

Section 1.01                      Definitions of Terms.

 

The terms defined in this Section (except as in this Indenture or any indenture supplemental hereto otherwise expressly provided or unless the context otherwise requires) for all purposes of this Indenture and of any indenture supplemental hereto shall have the respective meanings specified in this Section and shall include the plural as well as the singular.  All other terms used in this Indenture that are defined in the Trust Indenture Act of 1939, as amended, or that are by reference in such Act defined in the Securities Act of 1933, as amended (except as herein or any indenture supplemental hereto otherwise expressly provided or unless the context otherwise requires), shall have the meanings assigned to such terms in said Trust Indenture Act and in said Securities Act as in force at the date of the execution of this instrument.

 

“Authenticating Agent” means an authenticating agent with respect to all or any of the series of Securities appointed by the Trustee pursuant to Section 2.10.

 

“Bankruptcy Law” means Title 11, U.S. Code, or any similar federal or state law for the relief of debtors.

 

“Board of Directors” means the Board of Directors (or the functional equivalent thereof) of the Company or any duly authorized committee of such Board.

 

  

1

  

 

“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 (or duly authorized committee thereof) and to be in full force and effect on the date of such certification.

 

“Business Day” means, with respect to any series of Securities, any day other than a day on which federal or state banking institutions in the Borough of Manhattan, the City of New York, or in the city of the Corporate Trust Office of the Trustee, are authorized or obligated by law, executive order or regulation to close.

 

“Certificate” means a certificate signed by any Officer.  The Certificate need not comply with the provisions of Section 13.07.

 

“Commission” means the Securities and Exchange Commission, as from time to time constituted, created under the Exchange Act, or, if at any time after the execution of this instrument such Commission is not existing and performing the duties now assigned to it under the Trust Indenture Act, then the body performing such duties at such time.

 

“Company” means NovaBay Pharmaceuticals, Inc., a corporation duly organized and existing under the laws of the State of Delaware, and, subject to the provisions of Article Ten, shall also include its successors and assigns.

 

“Corporate Trust Office” means the office of the Trustee at which, at any particular time, its corporate trust business shall be principally administered, which office at the date hereof is located at                                                      .

 

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

 

“Defaulted Interest” has the meaning set forth in Section 2.03.

 

“Depositary” means, with respect to Securities of any series for which the Company shall determine that such Securities will be issued as a Global Security, The Depository Trust Company, another clearing agency, or any successor registered as a clearing agency under the Exchange Act, or other applicable statute or regulation, which, in each case, shall be designated by the Company pursuant to either Section 2.01 or 2.11.

 

“Event of Default” means, with respect to Securities of a particular series, any event specified in Section 6.01, continued for the period of time, if any, therein designated.

 

“Exchange Act” means the United States Securities and Exchange Act of 1934, as amended, and the rules and regulations promulgated by the Commission thereunder.

 

“Global Security” means a Security issued to evidence all or a part of any series of Securities which is executed by the Company and authenticated and delivered by the Trustee to the Depositary or pursuant to the Depositary’s instruction, all in accordance with the Indenture, which shall be registered in the name of the Depositary or its nominee.

 

  

2

  

 

“Governmental Obligations” means securities that are (a) direct obligations of the United States of America for the payment of which its full faith and credit is pledged or (b) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America, the payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America that, in either case, are not callable or redeemable at the option of the issuer thereof at any time prior to the stated maturity of the Securities, and shall also include a depositary receipt issued by a bank or trust company as custodian with respect to any such Governmental Obligation or a specific payment of principal of or interest on any such Governmental Obligation held by such custodian for the account of the holder of such depositary receipt; provided, however, that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depositary receipt from any amount received by the custodian in respect of the Governmental Obligation or the specific payment of principal of or interest on the Governmental Obligation evidenced by such depositary receipt.

 

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

 

“Indenture” means this instrument as originally executed or as it may from time to time be supplemented or amended by one or more indentures supplemental hereto entered into in accordance with the terms hereof and shall include the terms of particular series of Securities established as contemplated by Section 2.01.

 

“Interest Payment Date”, when used with respect to any installment of interest on a Security of a particular series, means the date specified in such Security or in a Board Resolution or in an indenture supplemental hereto with respect to such series as the fixed date on which an installment of interest with respect to Securities of that series is due and payable.

 

“Officer” means, with respect to the Company, the chairman of the Board of Directors, the chief executive officer, the president, the chief financial officer, the chief operating officer, any executive vice president, any senior vice president, any vice president, the treasurer or any assistant treasurer, the controller or any assistant controller or the secretary or any assistant secretary.

 

 “Officer’s Certificate” means a certificate signed by any Officer.  Each such certificate shall include the statements provided for in Section 13.07(b), if and to the extent required by the provisions thereof.

 

“Opinion of Counsel” means an opinion in writing subject to customary exceptions of legal counsel, who may be an employee of or counsel for the Company, that is delivered to the Trustee in accordance with the terms hereof.  Each such opinion shall include the statements provided for in Section 13.07(b), if and to the extent required by the provisions thereof.

 

“Outstanding”, when used with reference to Securities of any series, means, subject to the provisions of Section 8.04, as of any particular time, all Securities of that series theretofore authenticated and delivered by the Trustee under this Indenture, except (a) Securities theretofore canceled by the Trustee or any paying agent, or delivered to the Trustee or any paying agent for cancellation or that have previously been canceled; (b) Securities or portions thereof for the payment or redemption of which moneys or Governmental Obligations in the necessary amount shall have been deposited in trust with the Trustee or with any paying agent (other than the Company) or shall have been set aside and segregated in trust by the Company (if the Company shall act as its own paying agent); provided, however, that if such Securities or portions of such Securities are to be redeemed prior to the maturity thereof, notice of such redemption shall have been given as provided in Article Three, or provision satisfactory to the Trustee shall have been made for giving such notice; and (c) Securities in lieu of or in substitution for which other Securities shall have been authenticated and delivered pursuant to the terms of Section 2.07.

 

  

3

  

 

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

 

“Predecessor Security” of any particular Security means every previous Security evidencing all or a portion of the same debt as that evidenced by such particular Security; and, for the purposes of this definition, any Security authenticated and delivered under Section 2.07 in lieu of a lost, destroyed or stolen Security shall be deemed to evidence the same debt as the lost, destroyed or stolen Security.

 

“Responsible Officer” when used with respect to the Trustee means any officer of the Trustee assigned by the Trustee to administer its corporate trust matters with respect to this Indenture (which, for the avoidance of doubt, includes without limitation any supplemental indenture hereto).

 

“Securities” has the meaning stated in the first recital of this Indenture and more particularly means any Securities authenticated and delivered under this Indenture.

 

“Securities Act” means the Securities Act of 1933, as amended.

 

“Securityholder”, “holder of Securities”, “registered holder”, or other similar term, means the Person or Persons in whose name or names a particular Security is registered on the Security Register kept for that purpose in accordance with the terms of this Indenture.

 

 “Security Register” and “Security Registrar” shall have the meanings as set forth in Section 2.05.

 

“Subsidiary” means, with respect to any Person:

 

(1)           any corporation or company a majority of whose capital stock with voting power, under ordinary circumstances, to elect directors is, at the date of determination, directly or indirectly, owned by such Person (a “subsidiary”), by one or more subsidiaries of such Person or by such Person and one or more subsidiaries of such Person;

 

  

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(2)           a partnership in which such Person or a subsidiary of such Person is, at the date of determination, a general partner of such partnership; or

 

(3)           any partnership, limited liability company or other Person in which such Person, a subsidiary of such Person or such Person and one or more subsidiaries of such Person, directly or indirectly, at the date of determination, have (x) at least a majority ownership interest or (y) the power to elect or appoint or direct the election or appointment of the managing partner or member of such Person or, if applicable, a majority of the directors or other governing body of such Person.

“Trustee” means _________________________, and, subject to the provisions of Article Seven, shall also include its successors and assigns, and, if at any time there is more than one Person acting in such capacity hereunder, “Trustee” shall mean each such Person.  The term “Trustee” as used with respect to a particular series of the Securities shall mean the trustee with respect to that series.

 

“Trust Indenture Act” means the Trust Indenture Act of 1939, as amended.

 

“U.S.A. Patriot Act” means the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Pub. L. 107-56, as amended and signed into law October 26, 2001.

 

ARTICLE 2

 

ISSUE, DESCRIPTION, TERMS, EXECUTION, REGISTRATION AND EXCHANGE OF SECURITIES

 

Section 2.01                      Designation and Terms of Securities.

 

(a)      The aggregate principal amount of Securities that may be authenticated and delivered under this Indenture is unlimited.  The Securities may be issued in one or more series up to the aggregate principal amount of Securities of that series from time to time authorized by or pursuant to a Board Resolution or pursuant to one or more indentures supplemental hereto.  Prior to the initial issuance of Securities of any series, there shall be established in or pursuant to a Board Resolution, and set forth in an Officer’s Certificate, or established in one or more indentures supplemental hereto:

 

(1)      the title of the Securities of the series (which shall distinguish the Securities of that series from all other Securities);

 

(2)      any limit upon the aggregate principal amount of the Securities of that series that may be authenticated and delivered under this Indenture (except for Securities authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Securities of that series);

 

(3)      the maturity date or dates on which the principal of the Securities of the series is payable;

 

  

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(4)      the form of the Securities of the series including the form of the certificate of authentication for such series;

 

(5)      the applicability of any guarantees;

 

(6)      whether or not the Securities will be secured or unsecured, and the terms of any secured debt;

 

(7)      whether the Securities rank as senior debt, senior subordinated debt, subordinated debt or any combination thereof, and the terms of any subordination;

 

(8)      if the price (expressed as a percentage of the aggregate principal amount thereof) at which such Securities will be issued is a price other than the principal amount thereof, the portion of the principal amount thereof payable upon declaration of acceleration of the maturity thereof, or if applicable, the portion of the principal amount of such Securities that is convertible into another security or the method by which any such portion shall be determined;

 

(9)      the interest rate or rates, which may be fixed or variable, or the method for determining the rate and the date interest will begin to accrue, the dates interest will be payable and the regular record dates for interest payment dates or the method for determining such dates;

 

(10)    the Company’s right, if any, to defer the payment of interest and the maximum length of any such deferral period;

 

(11)    if applicable, the date or dates after which, or the period or periods during which, and the price or prices at which, the Company may at its option, redeem the series of Securities pursuant to any optional or provisional redemption provisions and the terms of those redemption provisions;

 

(12)    the date or dates, if any, on which, and the price or prices at which the Company is obligated, pursuant to any mandatory sinking fund or analogous fund provisions or otherwise, to redeem, or at the Securityholder’s option to purchase, the series of Securities and the currency or currency unit in which the Securities are payable;

 

(13)    the denominations in which the Securities of the series shall be issuable, if other than denominations of one thousand U.S. dollars ($1,000) or any integral multiple thereof;

 

(14)    any and all terms, if applicable, relating to any auction or remarketing of the Securities of that series and any security for the obligations of the Company with respect to such Securities and any other terms which may be advisable in connection with the marketing of Securities of that series;

 

(15)    whether the Securities of the series shall be issued in whole or in part in the form of a Global Security or Securities; the terms and conditions, if any, upon which such Global Security or Securities may be exchanged in whole or in part for other individual Securities; and the Depositary for such Global Security or Securities;

 

  

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(16)    if applicable, the provisions relating to conversion or exchange of any Securities of the series and the terms and conditions upon which such Securities will be so convertible or exchangeable, including the conversion or exchange price, as applicable, or how it will be calculated and may be adjusted, any mandatory or optional (at the Company’s option or the holders’ option) conversion or exchange features, the applicable conversion or exchange period and the manner of settlement for any conversion or exchange, which may, without limitation, include the payment of cash as well as the delivery of securities;

 

(17)    if other than the full principal amount thereof, the portion of the principal amount of Securities of the series which shall be payable upon declaration of acceleration of the maturity thereof pursuant to Section 6.01;

 

(18)    any changes in or additions to the covenants applicable to the series of Securities being issued, including, among others, the consolidation, merger or sale covenant;

 

(19)    only additions to or changes in the Events of Default with respect to the Securities and any change in the right of the Trustee or the Securityholders to declare the principal, premium, if any, and interest, if any, with respect to such Securities to be due and payable;

 

(20)    additions to or changes in or deletions of the provisions relating to covenant defeasance and legal defeasance;

 

(21)    additions to or changes in the provisions relating to satisfaction and discharge of this Indenture;

 

(22)    additions to or changes in the provisions relating to the modification of this Indenture both with and without the consent of Securityholders of Securities issued under this Indenture;

 

(23)    the currency of payment of Securities if other than U.S. dollars and the manner of determining the equivalent amount in U.S. dollars;

 

(24)    whether interest will be payable in cash or additional Securities at the Company’s or the Securityholders’ option, the terms and conditions upon which the election may be made;

 

(25)    the terms and conditions, if any, upon which the Company shall pay amounts in addition to the stated interest, premium, if any and principal amounts of the Securities of the series to any Securityholder that is not a “United States person” for federal tax purposes;

 

(26)    any restrictions on transfer, sale or assignment of the Securities of the series; and

 

  

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(27)    any other specific terms, preferences, rights or limitations of, or restrictions on, the Securities, any other additions or changes in the provisions of this Indenture, and any terms that may be required by us or advisable under applicable laws or regulations.

 

(b)      All Securities of any one series shall be substantially identical except as may otherwise be provided in or pursuant to any such Board Resolution or in any indentures supplemental hereto.

 

If any of the terms of the series are established by action taken pursuant to a Board Resolution of the Company, a copy of an appropriate record of such action shall be certified by the secretary or an assistant secretary of the Company and delivered to the Trustee at or prior to the delivery of the Officer’s Certificate of the Company setting forth the terms of the series.

 

Securities of any particular series may be issued at various times, with different dates on which the principal or any installment of principal is payable, with different rates of interest, if any, or different methods by which rates of interest may be determined, with different dates on which such interest may be payable and with different redemption dates.

 

Section 2.02                      Form of Securities and Trustee’s Certificate.

 

The Securities of any series and the Trustee’s certificate of authentication to be borne by such Securities shall be substantially of the tenor and purport as set forth in one or more indentures supplemental hereto or as provided in a Board Resolution, and set forth in an Officer’s Certificate, and they may have such letters, numbers or other marks of identification or designation and such legends or endorsements printed, lithographed or engraved thereon as the Company may deem appropriate and as are not inconsistent with the provisions of this Indenture, or as may be required to comply with any law or with any rule or regulation made pursuant thereto or with any rule or regulation of any securities exchange on which Securities of that series may be listed, or to conform to usage.

 

Section 2.03                      Denominations: Provisions for Payment.

 

The Securities shall be issuable as registered Securities and in the denominations of one thousand U.S. dollars ($1,000) or any integral multiple thereof, subject to Section 2.01(a)(13).  The Securities of a particular series shall bear interest payable on the dates and at the rate specified with respect to that series.  Subject to Section 2.01(a)(23), the principal of and the interest on the Securities of any series, as well as any premium thereon in the case of a redemption or repurchase thereof prior to maturity, and any cash amount due upon the conversion or exchange thereof, shall be payable in the coin or currency of the United States of America that at the time is legal tender for public and private debt, at the office or agency of the Company in the continental United States of America maintained for that purpose.  Each Security shall be dated the date of its authentication.  Interest on the Securities shall be computed on the basis of a 360-day year composed of twelve 30-day months.

 

  

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The interest installment on any Security that is payable, and is punctually paid or duly provided for, on any Interest Payment Date for Securities of that series shall be paid to the Person in whose name said Security (or one or more Predecessor Securities) is registered at the close of business on the regular record date for such interest installment.  In the event that any Security of a particular series or portion thereof is called for redemption and the redemption date is subsequent to a regular record date with respect to any Interest Payment Date and prior to such Interest Payment Date, interest on such Security will be paid upon presentation and surrender of such Security as provided in Section 3.03.

 

Any interest on any Security that is payable, but is not punctually paid or duly provided for, on any Interest Payment Date for Securities of the same series (herein called “Defaulted Interest”) shall forthwith cease to be payable to the registered holder on the relevant regular record date by virtue of having been such holder; and such Defaulted Interest shall be paid by the Company, at its election, as provided in clause (1) or clause (2) below:

 

(1)      The Company may make payment of any Defaulted Interest on Securities to the Persons in whose names such Securities (or their respective Predecessor Securities) are registered at the close of business on a special record date for the payment of such Defaulted Interest, which shall be fixed in the following manner: the Company shall notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on each such Security and the date of the proposed payment, and at the same time the Company shall deposit with the Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as in this clause provided.  Thereupon the Trustee shall fix a special record date for the payment of such Defaulted Interest which shall not be more than 15 nor less than 10 days prior to the date of the proposed payment and not less than 10 days after the receipt by the Trustee of the notice of the proposed payment.  The Trustee shall promptly notify the Company of such special record date and, in the name and at the expense of the Company, shall cause notice of the proposed payment of such Defaulted Interest and the special record date therefor to be mailed, first class postage prepaid, to each Securityholder at his or her address as it appears in the Security Register (as hereinafter defined), not less than 10 days prior to such special record date.  Notice of the proposed payment of such Defaulted Interest and the special record date therefor having been mailed as aforesaid, such Defaulted Interest shall be paid to the Persons in whose names such Securities (or their respective Predecessor Securities) are registered on such special record date.

 

(2)      The Company may make payment of any Defaulted Interest on any Securities in any other lawful manner not inconsistent with the requirements of any securities exchange on which such Securities may be listed, and upon such notice as may be required by such exchange, if, after notice given by the Company to the Trustee of the proposed payment pursuant to this clause, such manner of payment shall be deemed practicable by the Trustee.

 

Unless otherwise set forth in a Board Resolution or one or more indentures supplemental hereto establishing the terms of any series of Securities pursuant to Section 2.01 hereof, the term “regular record date” as used in this Section with respect to a series of Securities and any Interest Payment Date for such series shall mean either the fifteenth day of the month immediately preceding the month in which an Interest Payment Date established for such series pursuant to Section 2.01 hereof shall occur, if such Interest Payment Date is the first day of a month, or the first day of the month in which an Interest Payment Date established for such series pursuant to Section 2.01 hereof shall occur, if such Interest Payment Date is the fifteenth day of a month, whether or not such date is a Business Day.

 

  

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Subject to the foregoing provisions of this Section, each Security of a series delivered under this Indenture upon transfer of or in exchange for or in lieu of any other Security of such series shall carry the rights to interest accrued and unpaid, and to accrue, that were carried by such other Security.

 

Section 2.04                      Execution and Authentications.

 

The Securities shall be signed on behalf of the Company by one of its Officers.  Signatures may be in the form of a manual or facsimile signature.

 

The Company may use the facsimile signature of any Person who shall have been an Officer (at the time of execution), notwithstanding the fact that at the time the Securities shall be authenticated and delivered or disposed of such Person shall have ceased to be such an officer of the Company.  The Securities may contain such notations, legends or endorsements required by law, stock exchange rule or usage.  Each Security shall be dated the date of its authentication by the Trustee.

 

A Security shall not be valid until authenticated manually by an authorized signatory of the Trustee, or by an Authenticating Agent.  Such signature shall be conclusive evidence that the Security so authenticated has been duly authenticated and delivered hereunder and that the holder is entitled to the benefits of this Indenture.  At any time and from time to time after the execution and delivery of this Indenture, the Company may deliver Securities of any series executed by the Company to the Trustee for authentication, together with a written order of the Company for the authentication and delivery of such Securities, signed by an Officer, and the Trustee in accordance with such written order shall authenticate and deliver such Securities.

 

Upon the Company’s delivery of any such authentication order to the Trustee at any time after the initial issuance of Securities under this Indenture, the Trustee shall be provided with, and (subject to Sections 315(a) through 315(d) of the Trust Indenture Act) shall be fully protected in relying upon, (1) an Opinion of Counsel or reliance letter and (2) an Officer’s Certificate stating that all conditions precedent to the execution, authentication and delivery of such Securities are in conformity with the provisions of this Indenture.

 

The Trustee shall not be required to authenticate such Securities if the issue of such Securities pursuant to this Indenture will affect the Trustee’s own rights, duties or immunities under the Securities and this Indenture or otherwise in a manner that is not reasonably acceptable to the Trustee.

 

Section 2.05                      Registration of Transfer and Exchange.

 

(a)      Securities of any series may be exchanged upon presentation thereof at the office or agency of the Company in the continental United States of America designated for such purpose, for other Securities of such series of authorized denominations, and for a like aggregate principal amount, upon payment of a sum sufficient to cover any tax or other governmental charge in relation thereto, all as provided in this Section.  In respect of any Securities so surrendered for exchange, the Company shall execute, the Trustee shall authenticate and such office or agency shall deliver in exchange therefor the Security or Securities of the same series that the Securityholder making the exchange shall be entitled to receive, bearing numbers not contemporaneously outstanding.

 

  

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(b)      The Company shall keep, or cause to be kept at its office or agency  in the continental United States of America designated for such purpose a register or registers (herein referred to as the “Security Register”) in which, subject to such reasonable regulations as it may prescribe, the Company shall register the Securities and the transfers of Securities as in this Article provided and which at all reasonable times shall be open for inspection by the Trustee.  The registrar for the purpose of registering Securities and transfer of Securities as herein provided shall be appointed as authorized by Board Resolution (the “Security Registrar”).

 

Upon surrender for transfer of any Security at the office or agency of the Company designated for such purpose, the Company shall execute, the Trustee shall authenticate and such office or agency shall deliver in the name of the transferee or transferees a new Security or Securities of the same series as the Security presented for a like aggregate principal amount.

 

All Securities presented or surrendered for exchange or registration of transfer, as provided in this Section, shall be accompanied (if so required by the Company or the Security Registrar) by a written instrument or instruments of transfer, in form satisfactory to the Company or the Security Registrar, duly executed by the registered holder or by such holder’s duly authorized attorney in writing.

 

(c)      Except as provided pursuant to Section 2.01 pursuant to a Board Resolution, and set forth in an Officer’s Certificate, or established in one or more indentures supplemental to this Indenture, no service charge shall be made for any exchange or registration of transfer of Securities, or issue of new Securities in case of partial redemption of any series or repurchase, conversion or exchange of less than the entire principal amount of a Security, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge in relation thereto, other than exchanges pursuant to Section 2.06, Section 3.03(b) and Section 9.04 not involving any transfer.

 

(d)      The Company shall not be required (i) to issue, exchange or register the transfer of any Securities during a period beginning at the opening of business 15 days before the day of the mailing of a notice of redemption of less than all the Outstanding Securities of the same series and ending at the close of business on the day of such mailing, nor (ii) to register the transfer of or exchange any Securities of any series or portions thereof called for redemption or surrendered for repurchase, but not validly withdrawn, other than the unredeemed portion of any such Securities being redeemed in part or not surrendered for repurchase, as the case may be.  The provisions of this Section 2.05 are, with respect to any Global Security, subject to Section 2.11 hereof.

 

The Trustee shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Indenture or under applicable law with respect to any transfer of any interest in any Security (including any transfers between or among depositary participants or beneficial owners of interests in any Global Security) other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by the terms of, this Indenture, and to examine the same to determine substantial compliance as to form with the express requirements hereof.

 

  

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Section 2.06                      Temporary Securities.

 

Pending the preparation of definitive Securities of any series, the Company may execute, and the Trustee shall authenticate and deliver, temporary Securities (printed, lithographed or typewritten) of any authorized denomination.  Such temporary Securities shall be substantially in the form of the definitive Securities in lieu of which they are issued, but with such omissions, insertions and variations as may be appropriate for temporary Securities, all as may be determined by the Company.  Every temporary Security of any series shall be executed by the Company and be authenticated by the Trustee upon the same conditions and in substantially the same manner, and with like effect, as the definitive Securities of such series.  Without unnecessary delay the Company will execute and will furnish definitive Securities of such series and thereupon any or all temporary Securities of such series may be surrendered in exchange therefor (without charge to the holders), at the office or agency of the Company  in the continental United States of America designated for the purpose, and the Trustee shall authenticate and such office or agency shall deliver in exchange for such temporary Securities an equal aggregate principal amount of definitive Securities of such series, unless the Company advises the Trustee to the effect that definitive Securities need not be executed and furnished until further notice from the Company.  Until so exchanged, the temporary Securities of such series shall be entitled to the same benefits under this Indenture as definitive Securities of such series authenticated and delivered hereunder.

 

Section 2.07                      Mutilated, Destroyed, Lost or Stolen Securities.

 

In case any temporary or definitive Security shall become mutilated or be destroyed, lost or stolen, the Company (subject to the next succeeding sentence) shall execute, and upon the Company’s request the Trustee (subject as aforesaid) shall authenticate and deliver, a new Security of the same series, bearing a number not contemporaneously outstanding, in exchange and substitution for the mutilated Security, or in lieu of and in substitution for the Security so destroyed, lost or stolen.  In every case the applicant for a substituted Security shall furnish to the Company and the Trustee such security or indemnity as may be required by them to save each of them harmless, and, in every case of destruction, loss or theft, the applicant shall also furnish to the Company and the Trustee evidence to their satisfaction of the destruction, loss or theft of the applicant’s Security and of the ownership thereof.  The Trustee may authenticate any such substituted Security and deliver the same upon the written request or authorization of any officer of the Company.  Upon the issuance of any substituted Security, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Trustee) connected therewith.

 

In case any Security that has matured or is about to mature shall become mutilated or be destroyed, lost or stolen, the Company may, instead of issuing a substitute Security, pay or authorize the payment of the same (without surrender thereof except in the case of a mutilated Security) if the applicant for such payment shall furnish to the Company and the Trustee such security or indemnity as they may require to save them harmless, and, in case of destruction, loss or theft, evidence to the satisfaction of the Company and the Trustee of the destruction, loss or theft of such Security and of the ownership thereof.

 

  

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Every replacement Security issued pursuant to the provisions of this Section shall constitute an additional contractual obligation of the Company whether or not the mutilated, destroyed, lost or stolen Security shall be found at any time, or be enforceable by anyone, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Securities of the same series duly issued hereunder.  All Securities shall be held and owned upon the express condition that the foregoing provisions are exclusive with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities, and shall preclude (to the extent lawful) any and all other rights or remedies, notwithstanding any law or statute existing or hereafter enacted to the contrary with respect to the replacement or payment of negotiable instruments or other securities without their surrender.

 

Section 2.08                      Cancellation.

 

All Securities surrendered for the purpose of payment, redemption, repurchase, exchange, registration of transfer or conversion or exchange shall, if surrendered to the Company or any paying agent (or any other applicable agent), be delivered to the Trustee for cancellation, or, if surrendered to the Trustee, shall be cancelled by it, and no Securities shall be issued in lieu thereof except as expressly required or permitted by any of the provisions of this Indenture.  On request of the Company at the time of such surrender, the Trustee shall deliver to the Company canceled Securities held by the Trustee.  In the absence of such request the Trustee may dispose of canceled Securities in accordance with its standard procedures and deliver a certificate of disposition to the Company.  If the Company shall otherwise acquire any of the Securities, however, such acquisition shall not operate as a redemption or satisfaction of the indebtedness represented by such Securities unless and until the same are delivered to the Trustee for cancellation.

 

Section 2.09                      Benefits of Indenture.

 

Nothing in this Indenture or in the Securities, express or implied, shall give or be construed to give to any Person, other than the parties hereto and the holders of the Securities, any legal or equitable right, remedy or claim under or in respect of this Indenture, or under any covenant, condition or provision herein contained; all such covenants, conditions and provisions being for the sole benefit of the parties hereto and of the holders of the Securities.

 

Section 2.10                      Authenticating Agent.

 

So long as any of the Securities of any series remain Outstanding there may be an Authenticating Agent for any or all such series of Securities which the Trustee shall have the right to appoint.  Said Authenticating Agent shall be authorized to act on behalf of the Trustee to authenticate Securities of such series issued upon exchange, transfer or partial redemption, repurchase or conversion thereof, and Securities so authenticated shall be entitled to the benefits of this Indenture and shall be valid and obligatory for all purposes as if authenticated by the Trustee hereunder.  All references in this Indenture to the authentication of Securities by the Trustee shall be deemed to include authentication by an Authenticating Agent for such series.  Each Authenticating Agent shall be acceptable to the Company and shall be a corporation that has a combined capital and surplus, as most recently reported or determined by it, sufficient under the laws of any jurisdiction under which it is organized or in which it is doing business to conduct a trust business, and that is otherwise authorized under such laws to conduct such business and is subject to supervision or examination by federal or state authorities.  If at any time any Authenticating Agent shall cease to be eligible in accordance with these provisions, it shall resign immediately.

 

  

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Any Authenticating Agent may at any time resign by giving written notice of resignation to the Trustee and to the Company.  The Trustee may at any time (and upon request by the Company shall) terminate the agency of any Authenticating Agent by giving written notice of termination to such Authenticating Agent and to the Company.  Upon resignation, termination or cessation of eligibility of any Authenticating Agent, the Trustee may appoint an eligible successor Authenticating Agent acceptable to the Company.  Any successor Authenticating Agent, upon acceptance of its appointment hereunder, shall become vested with all the rights, powers and duties of its predecessor hereunder as if originally named as an Authenticating Agent pursuant hereto.

 

Section 2.11                      Global Securities.

 

(a)      If the Company shall establish pursuant to Section 2.01 that the Securities of a particular series are to be issued as a Global Security, then the Company shall execute and the Trustee shall, in accordance with Section 2.04, authenticate and deliver, a Global Security that (i) shall represent, and shall be denominated in an amount equal to the aggregate principal amount of, all of the Outstanding Securities of such series, (ii) shall be registered in the name of the Depositary or its nominee, (iii) shall be delivered by the Trustee to the Depositary or pursuant to the Depositary’s instruction (or if the Depositary names the Trustee as its custodian, retained by the Trustee) and (iv) shall bear a legend substantially to the following effect: “Except as otherwise provided in Section 2.11 of the Indenture, this Security may be transferred, in whole but not in part, only to another nominee of the Depositary or to a successor Depositary or to a nominee of such successor Depositary.”

 

(b)      Notwithstanding the provisions of Section 2.05, the Global Security of a series may be transferred, in whole but not in part and in the manner provided in Section 2.05, only to another nominee of the Depositary for such series, or to a successor Depositary for such series selected or approved by the Company or to a nominee of such successor Depositary.

 

(c)      If at any time the Depositary for a series of the Securities notifies the Company that it is unwilling or unable to continue as Depositary for such series or if at any time the Depositary for such series shall no longer be registered or in good standing under the Exchange Act, or other applicable statute or regulation, and a successor Depositary for such series is not appointed by the Company within 90 days after the Company receives such notice or becomes aware of such condition, as the case may be, or if an Event of Default has occurred and is continuing and the Company has received a request from the Depositary or from the Trustee, this Section 2.11 shall no longer be applicable to the Securities of such series and the Company will execute, and subject to Section 2.04, the Trustee will authenticate and deliver the Securities of such series in definitive registered form without coupons, in authorized denominations, and in an aggregate principal amount equal to the principal amount of the Global Security of such series in exchange for such Global Security.  In addition, the Company may at any time determine that the Securities of any series shall no longer be represented by a Global Security and that the provisions of this Section 2.11 shall no longer apply to the Securities of such series.  In such event the Company will execute and, subject to Section 2.04, the Trustee, upon receipt of an Officer’s Certificate evidencing such determination by the Company, will authenticate and deliver the Securities of such series in definitive registered form without coupons, in authorized denominations, and in an aggregate principal amount equal to the principal amount of the Global Security of such series in exchange for such Global Security.  Upon the exchange of the Global Security for such Securities in definitive registered form without coupons, in authorized denominations, the Global Security shall be canceled by the Trustee.  Such Securities in definitive registered form issued in exchange for the Global Security pursuant to this Section 2.11(c) shall be registered in such names and in such authorized denominations as the Depositary, pursuant to instructions from its direct or indirect participants or otherwise, shall instruct the Trustee.  The Trustee shall deliver such Securities to the Depositary for delivery to the Persons in whose names such Securities are so registered.

 

  

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ARTICLE 3

 

REDEMPTION OF SECURITIES AND SINKING FUND PROVISIONS

 

Section 3.01                      Redemption.

 

The Company may redeem the Securities of any series issued hereunder on and after the dates and in accordance with the terms established for such series pursuant to Section 2.01 hereof.

 

Section 3.02                      Notice of Redemption.

 

(a)      In case the Company shall desire to exercise such right to redeem all or, as the case may be, a portion of the Securities of any series in accordance with any right the Company reserved for itself to do so pursuant to Section 2.01 hereof, the Company shall, or shall cause the Trustee to, give notice of such redemption to holders of the Securities of such series to be redeemed by mailing, first class postage prepaid (or with regard to any Global Security held in book entry form, by electronic mail), a notice of such redemption not less than 30 days and not more than 60 days before the date fixed for redemption of that series to such holders at their last addresses as they shall appear upon the Security Register, unless a shorter period is specified in the Securities to be redeemed.  Any notice that is mailed in the manner herein provided shall be conclusively presumed to have been duly given, whether or not the registered holder receives the notice.  In any case, failure duly to give such notice to the holder of any Security of any series designated for redemption in whole or in part, or any defect in the notice, shall not affect the validity of the proceedings for the redemption of any other Securities of such series or any other series.  In the case of any redemption of Securities prior to the expiration of any restriction on such redemption provided in the terms of such Securities or elsewhere in this Indenture, the Company shall furnish the Trustee with an Officer’s Certificate evidencing compliance with any such restriction.

 

  

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Each such notice of redemption shall specify the date fixed for redemption and the redemption price at which Securities of that series are to be redeemed, and shall state that payment of the redemption price of such Securities to be redeemed will be made at the office or agency of the Company in the continental United States of America, upon presentation and surrender of such Securities, that interest accrued to the date fixed for redemption will be paid as specified in said notice, that from and after said date interest will cease to accrue and that the redemption is from a sinking fund, if such is the case.  If less than all the Securities of a series are to be redeemed, the notice to the holders of Securities of that series to be redeemed in part shall specify the particular Securities to be so redeemed.

 

In case any Security is to be redeemed in part only, the notice that relates to such Security shall state the portion of the principal amount thereof to be redeemed, and shall state that on and after the redemption date, upon surrender of such Security, a new Security or Securities of such series in principal amount equal to the unredeemed portion thereof will be issued.

 

(b)      If less than all the Securities of a series are to be redeemed, the Company shall give the Trustee at least 45 days’ notice (unless a shorter notice shall be satisfactory to the Trustee) in advance of the date fixed for redemption as to the aggregate principal amount of Securities of the series to be redeemed, and thereupon the Trustee shall select, by lot or in such other manner as it shall deem appropriate and fair in its discretion and that may provide for the selection of a portion or portions (equal to one thousand U.S. dollars ($1,000) or any integral multiple thereof) of the principal amount of such Securities of a denomination larger than $1,000, the Securities to be redeemed and shall thereafter promptly notify the Company in writing of the numbers of the Securities to be redeemed, in whole or in part.  The Company may, if and whenever it shall so elect, by delivery of instructions signed on its behalf by an Officer, instruct the Trustee or any paying agent to call all or any part of the Securities of a particular series for redemption and to give notice of redemption in the manner set forth in this Section, such notice to be in the name of the Company or its own name as the Trustee or such paying agent may deem advisable.  In any case in which notice of redemption is to be given by the Trustee or any such paying agent, the Company shall deliver or cause to be delivered to, or permit to remain with, the Trustee or such paying agent, as the case may be, such Security Register, transfer books or other records, or suitable copies or extracts therefrom, sufficient to enable the Trustee or such paying agent to give any notice by mail that may be required under the provisions of this Section.

 

Section 3.03                      Payment Upon Redemption.

 

(a)      If the giving of notice of redemption shall have been completed as above provided, the Securities or portions of Securities of the series to be redeemed specified in such notice shall become due and payable on the date and at the place stated in such notice at the applicable redemption price, together with interest accrued to the date fixed for redemption and interest on such Securities or portions of Securities shall cease to accrue on and after the date fixed for redemption, unless the Company shall default in the payment of such redemption price and accrued interest with respect to any such Security or portion thereof.  On presentation and surrender of such Securities on or after the date fixed for redemption at the place of payment specified in the notice, said Securities shall be paid and redeemed at the applicable redemption price for such series, together with interest accrued thereon to the date fixed for redemption (but if the date fixed for redemption is an Interest Payment Date, the interest installment payable on such date shall be payable to the registered holder at the close of business on the applicable record date pursuant to Section 2.03).

 

  

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(b)      Upon presentation of any Security of such series that is to be redeemed in part only, the Company shall execute and the Trustee shall authenticate and the office or agency where the Security is presented shall deliver to the holder thereof, at the expense of the Company, a new Security of the same series of authorized denominations in principal amount equal to the unredeemed portion of the Security so presented.

 

Section 3.04                      Sinking Fund.

 

The provisions of Sections 3.04, 3.05 and 3.06 shall be applicable to any sinking fund for the retirement of Securities of a series, except as otherwise specified as contemplated by Section 2.01 for Securities of such series.

 

The minimum amount of any sinking fund payment provided for by the terms of Securities of any series is herein referred to as a “mandatory sinking fund payment,” and any payment in excess of such minimum amount provided for by the terms of Securities of any series is herein referred to as an “optional sinking fund payment”.  If provided for by the terms of Securities of any series, the cash amount of any sinking fund payment may be subject to reduction as provided in Section 3.05.  Each sinking fund payment shall be applied to the redemption of Securities of any series as provided for by the terms of Securities of such series.

 

Section 3.05                      Satisfaction of Sinking Fund Payments with Securities.

 

The Company (i) may deliver Outstanding Securities of a series and (ii) may apply as a credit Securities of a series that have been redeemed either at the election of the Company pursuant to the terms of such Securities or through the application of permitted optional sinking fund payments pursuant to the terms of such Securities, in each case in satisfaction of all or any part of any sinking fund payment with respect to the Securities of such series required to be made pursuant to the terms of such Securities as provided for by the terms of such series, provided that such Securities have not been previously so credited.  Such Securities shall be received and credited for such purpose by the Trustee at the redemption price specified in such Securities for redemption through operation of the sinking fund and the amount of such sinking fund payment shall be reduced accordingly.

 

Section 3.06                      Redemption of Securities for Sinking Fund.

 

Not less than 45 days prior to each sinking fund payment date for any series of Securities (unless a shorter period shall be satisfactory to the Trustee), the Company will deliver to the Trustee an Officer’s Certificate specifying the amount of the next ensuing sinking fund payment for that series pursuant to the terms of the series, the portion thereof, if any, that is to be satisfied by delivering and crediting Securities of that series pursuant to Section 3.05 and the basis for such credit and will, together with such Officer’s Certificate, deliver to the Trustee any Securities to be so delivered.  Not less than 30 days before each such sinking fund payment date the Trustee shall select the Securities to be redeemed upon such sinking fund payment date in the manner specified in Section 3.02 and cause notice of the redemption thereof to be given in the name of and at the expense of the Company in the manner provided in Section 3.02.  Such notice having been duly given, the redemption of such Securities shall be made upon the terms and in the manner stated in Section 3.03.

 

  

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ARTICLE 4

 

COVENANTS

 

Section 4.01                      Payment of Principal, Premium and Interest.

 

The Company will duly and punctually pay or cause to be paid the principal of (and premium, if any), interest on, and any redemption price or repurchase price for the Securities of that series at the time and place and in the manner provided herein and established with respect to such Securities. Payments of the principal of, redemption price for or repurchase price for, the Securities may be made at the time provided herein and established with respect to such Securities by U.S. dollar check drawn on and mailed to the address of the Securityholder entitled thereto as such address shall appear in the Security Register, or U.S. dollar wire transfer to, a U.S. dollar account if such Securityholder shall have furnished wire instructions to the Trustee no later than 15 days prior to the relevant payment date. Payments of interest on the Securities may be made at the time provided herein and established with respect to such Securities by U.S. dollar check mailed to the address of the Securityholder entitled thereto as such address shall appear in the Security Register, or U.S. dollar wire transfer to, a U.S. dollar account if such Securityholder shall have furnished wire instructions in writing to the Security Registrar and the Trustee no later than 15 days prior to the relevant payment date.

 

Section 4.02                      Maintenance of Office or Agency.

 

So long as any series of the Securities remain Outstanding, the Company agrees to maintain an office or agency in the continental United States of America with respect to each such series and at such other location or locations as may be designated as provided in this Section 4.02, where (i) Securities of that series may be presented for payment, (ii) Securities of that series may be presented as herein above authorized for registration of transfer and exchange, and (iii) notices and demands to or upon the Company in respect of the Securities of that series and this Indenture may be given or served, such designation to continue with respect to such office or agency until the Company shall, by written notice signed by any officer authorized to sign an Officer’s Certificate and delivered to the Trustee, designate some other office or agency for such purposes or any of them.  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, notices and demands may be made or served at the Corporate Trust Office of the Trustee, and the Company hereby appoints the Trustee as its agent to receive all such presentations, notices and demands.  The Company initially appoints the Trustee as its paying agent with respect to the Securities.

 

  

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Section 4.03                      Paying Agents.

 

(a)      If the Company shall appoint one or more paying agents for all or any series of the Securities, other than the Trustee, the Company will cause each such paying agent to execute and deliver to the Trustee an instrument in which such agent shall agree with the Trustee, subject to the provisions of this Section:

 

(1)      that it will hold all sums held by it as such agent for the payment of the principal of (and premium, if any) or interest on the Securities of that series (whether such sums have been paid to it by the Company or by any other obligor of such Securities) in trust for the benefit of the Persons entitled thereto;

 

(2)      that it will give the Trustee notice of any failure by the Company (or by any other obligor of such Securities) to make any payment of the principal of (and premium, if any) or interest on the Securities of that series when the same shall be due and payable;

 

(3)      that it will, at any time during the continuance of any failure referred to in the preceding paragraph (a)(2) above, upon the written request of the Trustee, forthwith pay to the Trustee all sums so held in trust by such paying agent; and

 

(4)      that it will perform all other duties of paying agent as set forth in this Indenture.

 

(b)      If the Company shall act as its own paying agent with respect to any series of the Securities, it will on or before each due date of the principal of (and premium, if any) or interest on Securities of that series, set aside, segregate and hold in trust for the benefit of the Persons entitled thereto a sum sufficient to pay such principal (and premium, if any) or interest so becoming due on Securities of that series until such sums shall be paid to such Persons or otherwise disposed of as herein provided and will promptly notify the Trustee of such action, or any failure (by it or any other obligor on such Securities) to take such action.  Whenever the Company shall have one or more paying agents for any series of Securities, it will, prior to each due date of the principal of (and premium, if any) or interest on any Securities of that series, deposit with the paying agent a sum sufficient to pay the principal (and premium, if any) or interest so becoming due, such sum to be held in trust for the benefit of the Persons entitled to such principal, premium or interest, and (unless such paying agent is the Trustee) the Company will promptly notify the Trustee of this action or failure so to act.

 

(c)      Notwithstanding anything in this Section to the contrary, (i) the agreement to hold sums in trust as provided in this Section is subject to the provisions of Section 11.05, and (ii) the Company may at any time, for the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, pay, or direct any paying agent to pay, to the Trustee all sums held in trust by the Company or such paying agent, such sums to be held by the Trustee upon the same terms and conditions as those upon which such sums were held by the Company or such paying agent; and, upon such payment by the Company or any paying agent to the Trustee, the Company or such paying agent shall be released from all further liability with respect to such money.

 

  

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Section 4.04                      Appointment to Fill Vacancy in Office of Trustee.

 

The Company, whenever necessary to avoid or fill a vacancy in the office of Trustee, will appoint, in the manner provided in Section 7.10, a Trustee, so that there shall at all times be a Trustee hereunder.

 

Section 4.05                      Compliance with Consolidation Provisions.

 

The Company will not, while any of the Securities remain Outstanding, consolidate with or merge into any other Person, in either case where the Company is not the survivor of such transaction, or sell or convey all or substantially all of its property to any other Person unless the provisions of Article Ten hereof are complied with.

 

ARTICLE 5

 

SECURITYHOLDERS’ LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE

 

Section 5.01                      Company to Furnish Trustee Names and Addresses of Securityholders.

 

The Company will furnish or cause to be furnished to the Trustee (a) within 15 days after each regular record date (as defined in Section 2.03) a list, in such form as the Trustee may reasonably require, of the names and addresses of the holders of each series of Securities as of such regular record date, provided that the Company shall not be obligated to furnish or cause to furnish such list at any time that the list shall not differ in any respect from the most recent list furnished to the Trustee by the Company and (b) at such other times as the Trustee may request in writing within 30 days after the receipt by the Company of any such request, a list of similar form and content as of a date not more than 15 days prior to the time such list is furnished; provided, however, that, in either case, no such list need be furnished for any series for which the Trustee shall be the Security Registrar.

 

Section 5.02                      Preservation Of Information; Communications With Securityholders.

 

(a)      The Trustee shall preserve, in as current a form as is reasonably practicable, all information as to the names and addresses of the holders of Securities contained in the most recent list furnished to it as provided in Section 5.01 and as to the names and addresses of holders of Securities received by the Trustee in its capacity as Security Registrar (if acting in such capacity).

 

(b)      The Trustee may destroy any list furnished to it as provided in Section 5.01 upon receipt of a new list so furnished.

 

(c)      Securityholders may communicate as provided in Section 312(b) of the Trust Indenture Act with other Securityholders with respect to their rights under this Indenture or under the Securities, and, in connection with any such communications, the Trustee shall satisfy its obligations under Section 312(b) of the Trust Indenture Act in accordance with the provisions of Section 312(b) of the Trust Indenture Act.

 

  

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Section 5.03                      Reports by the Company.

 

(a)      The Company covenants and agrees to provide (which delivery may be via electronic mail) to the Trustee within 30 days, after the Company files the same with the Commission, copies of the annual reports and of the information, documents and other reports (or copies of such portions of any of the foregoing as the Commission may from time to time by rules and regulations prescribe) that the Company is required to file with the Commission pursuant to Section 13 or Section 15(d) of the Exchange Act; provided, however, the Company shall not be required to deliver to the Trustee any correspondence filed with the SEC or any materials for which the Company has sought and received confidential treatment by the Commission; and provided further, that so long as such filings by the Company are available on the Commission’s Electronic Data Gathering, Analysis and Retrieval System (EDGAR), or any successor system, such filings shall be deemed to have been filed with the Trustee for purposes hereof without any further action required by the Company.  For the avoidance of doubt, a failure by the Company to file annual reports, information and other reports with the SEC within the time period prescribed thereof by the Commission shall not be deemed a breach of this Section 5.03.

 

(b)      Delivery of reports, information and documents to the Trustee under Section 5.03 is for informational purposes only and the information 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 thereunder (as to which the Trustee is entitled to rely exclusively on an Officer’s Certificate).

 

Section 5.04                      Reports by the Trustee.

 

(a)      If required by Section 313(a) of the Trust Indenture Act, the Trustee, within sixty (60) days after each ______ __, commencing ______ __, 20__, shall transmit by mail, first class postage prepaid, to the Securityholders, as their names and addresses appear upon the Security Register, a brief report dated as of such ______ __, which complies with Section 313(a) of the Trust Indenture Act.

 

(b)      The Trustee shall comply with Section 313(b) and 313(c) of the Trust Indenture Act.

 

(c)      A copy of each such report shall, at the time of such transmission to Securityholders, be filed by the Trustee with the Company, with each securities exchange upon which any Securities are listed (if so listed) and also with the Commission.  The Company agrees to notify the Trustee when any Securities become listed on any securities exchange.

 

  

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ARTICLE 6

 

REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS ON EVENT OF DEFAULT

 

Section 6.01                      Events of Default.

 

(a)      Whenever used herein with respect to Securities of a particular series, “Event of Default” means any one or more of the following events that has occurred and is continuing:

 

(1)      the Company defaults in the payment of any installment of interest upon any of the Securities of that series, as and when the same shall become due and payable, and such default continues for a period of 90 days; provided, however, that a valid extension of an interest payment period by the Company in accordance with the terms of any indenture supplemental hereto shall not constitute a default in the payment of interest for this purpose;

 

(2)      the Company defaults in the payment of the principal of (or premium, if any, on) any of the Securities of that series as and when the same shall become due and payable whether at maturity, upon redemption, by declaration or otherwise, or in any payment required by any sinking or analogous fund established with respect to that series; provided, however, that a valid extension of the maturity of such Securities in accordance with the terms of any indenture supplemental hereto shall not constitute a default in the payment of principal or premium, if any;

 

(3)      the Company fails to observe or perform any other of its covenants or agreements with respect to that series contained in this Indenture or otherwise established with respect to that series of Securities pursuant to Section 2.01 hereof (other than a covenant or agreement that has been expressly included in this Indenture solely for the benefit of one or more series of Securities other than such series) for a period of 90 days after the date on which written notice of such failure, requiring the same to be remedied and stating that such notice is a “Notice of Default” hereunder, shall have been given to the Company by the Trustee, by registered or certified mail, or to the Company and the Trustee by the holders of at least 25% in principal amount of the Securities of that series at the time Outstanding;

 

(4)      the Company pursuant to or within the meaning of any Bankruptcy Law (i) commences a voluntary case, (ii) consents to the entry of an order for relief against it in an involuntary case, (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

 

(5)      a court of competent jurisdiction enters an order under any Bankruptcy Law that (i) is for relief against the Company in an involuntary case, (ii) appoints a Custodian of the Company for all or substantially all of its property or (iii) orders the liquidation of the Company, and the order or decree remains unstayed and in effect for 90 days.

 

(b)      In each and every such case (other than an Event of Default specified in clause (4) or clause (5) above), unless the principal of all the Securities of that series shall have already become due and payable, either the Trustee or the holders of not less than 25% in aggregate principal amount of the Securities of that series then Outstanding hereunder, by notice in writing to the Company (and to the Trustee if given by such Securityholders), may declare the principal of (and premium, if any, on) and accrued and unpaid interest on all the Securities of that series to be due and payable immediately, and upon any such declaration the same shall become and shall be immediately due and payable.  If an Event of Default specified in clause (4) or clause (5) above occurs, the principal of and accrued and unpaid interest on all the Securities of that series shall automatically be immediately due and payable without any declaration or other act on the part of the Trustee or the holders of the Securities.

 

  

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(c)      At any time after the principal of (and premium, if any, on) and accrued and unpaid interest on the Securities of that series shall have been so declared due and payable, and before any judgment or decree for the payment of the moneys due shall have been obtained or entered as hereinafter provided, the holders of a majority in aggregate principal amount of the Securities of that series then Outstanding hereunder, by written notice to the Company and the Trustee, may rescind and annul such declaration and its consequences if: (i) the Company has paid or deposited with the Trustee a sum sufficient to pay all matured installments of interest upon all the Securities of that series and the principal of (and premium, if any, on) any and all Securities of that series that shall have become due otherwise than by acceleration (with interest upon such principal and premium, if any, and, to the extent that such payment is enforceable under applicable law, upon overdue installments of interest, at the rate per annum expressed in the Securities of that series to the date of such payment or deposit) and the amount payable to the Trustee under Section 7.06, and (ii) any and all Events of Default under the Indenture with respect to such series, other than the nonpayment of principal on (and premium, if any, on) and accrued and unpaid interest on Securities of that series that shall not have become due by their terms, shall have been remedied or waived as provided in Section 6.06.

 

No such rescission and annulment shall extend to or shall affect any subsequent default or impair any right consequent thereon.

 

(d)      In case the Trustee shall have proceeded to enforce any right with respect to Securities of that series under this Indenture and such proceedings shall have been discontinued or abandoned because of such rescission or annulment or for any other reason or shall have been determined adversely to the Trustee, then and in every such case, subject to any determination in such proceedings, the Company and the Trustee shall be restored respectively to their former positions and rights hereunder, and all rights, remedies and powers of the Company and the Trustee shall continue as though no such proceedings had been taken.

 

Section 6.02                      Collection of Indebtedness and Suits for Enforcement by Trustee.

 

(a)      The Company covenants that (i) in case it shall default in the payment of any installment of interest on any of the Securities of a series, or in any payment required by any sinking or analogous fund established with respect to that series as and when the same shall have become due and payable, and such default shall have continued for a period of 90 days, or (ii) in case it shall default in the payment of the principal of (or premium, if any, on) any of the Securities of a series when the same shall have become due and payable, whether upon maturity of the Securities of a series or upon redemption or upon declaration or otherwise then, upon demand of the Trustee, the Company will pay to the Trustee, for the benefit of the holders of the Securities of that series, the whole amount that then shall have been become due and payable on all such Securities for principal (and premium, if any) or interest, or both, as the case may be, with interest upon the overdue principal (and premium, if any) and (to the extent that payment of such interest is enforceable under applicable law) upon overdue installments of interest at the rate per annum expressed in the Securities of that series; and, in addition thereto, such further amount as shall be sufficient to cover the costs and expenses of collection, and the amount payable to the Trustee under Section 7.06.

 

  

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(b)      If the Company shall fail to pay such amounts forthwith upon such demand, the Trustee, in its own name and as trustee of an express trust, shall be entitled and empowered to institute any action or proceedings at law or in equity for the collection of the sums so due and unpaid, and may prosecute any such action or proceeding to judgment or final decree, and may enforce any such judgment or final decree against the Company or other obligor upon the Securities of that series and collect the moneys adjudged or decreed to be payable in the manner provided by law or equity out of the property of the Company or other obligor upon the Securities of that series, wherever situated.

 

(c)      In case of any receivership, insolvency, liquidation, bankruptcy, reorganization, readjustment, arrangement, composition or judicial proceedings affecting the Company, or its creditors or property, the Trustee shall have power to intervene in such proceedings and take any action therein that may be permitted by the court and shall (except as may be otherwise provided by law) be entitled to file such proofs of claim and other papers and documents as may be necessary or advisable in order to have the claims of the Trustee and of the holders of Securities of such series allowed for the entire amount due and payable by the Company under the Indenture at the date of institution of such proceedings and for any additional amount that may become due and payable by the Company after such date, and to collect and receive any moneys or other property payable or deliverable on any such claim, and to distribute the same after the deduction of the amount payable to the Trustee under Section 7.06; and any receiver, assignee or trustee in bankruptcy or reorganization is hereby authorized by each of the holders of Securities of such series to make such payments to the Trustee, and, in the event that the Trustee shall consent to the making of such payments directly to such Securityholders, to pay to the Trustee any amount due it under Section 7.06.

 

(d)      All rights of action and of asserting claims under this Indenture, or under any of the terms established with respect to Securities of that series, may be enforced by the Trustee without the possession of any of such Securities, or the production thereof at any trial or other proceeding relative thereto, and any such suit or proceeding instituted by the Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment shall, after provision for payment to the Trustee of any amounts due under Section 7.06, be for the ratable benefit of the holders of the Securities of such series.

 

In case of an Event of Default hereunder, the Trustee may in its discretion proceed to protect and enforce the rights vested in it by this Indenture by such appropriate judicial proceedings as the Trustee shall deem most effectual to protect and enforce any of such rights, either at law or in equity or in bankruptcy or otherwise, whether for the specific enforcement of any covenant or agreement contained in the Indenture or in aid of the exercise of any power granted in this Indenture, or to enforce any other legal or equitable right vested in the Trustee by this Indenture or by law.

 

  

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

 

Section 6.03                      Application of Moneys Collected.

 

Any moneys collected by the Trustee pursuant to this Article with respect to a particular series of Securities shall be applied in the following order, at the date or dates fixed by the Trustee and, in case of the distribution of such moneys on account of principal (or premium, if any) or interest, upon presentation of the Securities of that series, and notation thereon of the payment, if only partially paid, and upon surrender thereof if fully paid:

 

FIRST: To the payment of reasonable costs and expenses of collection and of all amounts payable to the Trustee under Section 7.06;

 

SECOND: To the payment of the amounts then due and unpaid upon Securities of such series for principal (and premium, if any) and interest, in respect of which or for the benefit of which such money has been collected, ratably, without preference or priority of any kind, according to the amounts due and payable on such Securities for principal (and premium, if any) and interest, respectively; and

 

THIRD: To the payment of the remainder, if any, to the Company or any other Person lawfully entitled thereto.

 

Section 6.04                      Limitation on Suits.

 

No holder of any Security of any series shall have any right by virtue or by availing of any provision of this Indenture to institute any suit, action or proceeding in equity or at law upon or under or with respect to this Indenture or for the appointment of a receiver or trustee, or for any other remedy hereunder, unless (i) such holder previously shall have given to the Trustee written notice of an Event of Default and of the continuance thereof with respect to the Securities of such series specifying such Event of Default, as hereinbefore provided; (ii) the holders of not less than 25% in aggregate principal amount of the Securities of such series then Outstanding shall have made written request upon the Trustee to institute such action, suit or proceeding in its own name as Trustee hereunder; (iii) such holder or holders shall have offered to the Trustee such reasonable indemnity as it may require against the costs, expenses and liabilities to be incurred therein or thereby; (iv) the Trustee for 90 days after its receipt of such notice, request and offer of indemnity, shall have failed to institute any such action, suit or proceeding and (v) during such 90 day period, the holders of a majority in principal amount of the Securities of that series do not give the Trustee a direction inconsistent with the request.

 

  

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Notwithstanding anything contained herein to the contrary or any other provisions of this Indenture, the right of any holder of any Security to receive payment of the principal of (and premium, if any) and interest on such Security, as therein provided, on or after the respective due dates expressed in such Security (or in the case of redemption, on the redemption date), or to institute suit for the enforcement of any such payment on or after such respective dates or redemption date, shall not be impaired or affected without the consent of such holder and by accepting a Security hereunder it is expressly understood, intended and covenanted by the taker and holder of every Security of such series with every other such taker and holder and the Trustee, that no one or more holders of Securities of such series shall have any right in any manner whatsoever by virtue or by availing of any provision of this Indenture to affect, disturb or prejudice the rights of the holders of any other of such Securities, or to obtain or seek to obtain priority over or preference to any other such holder, or to enforce any right under this Indenture, except in the manner herein provided and for the equal, ratable and common benefit of all holders of Securities of such series.  For the protection and enforcement of the provisions of this Section, each and every Securityholder and the Trustee shall be entitled to such relief as can be given either at law or in equity.

 

Section 6.05                      Rights and Remedies Cumulative; Delay or Omission Not Waiver.

 

(a)      Except as otherwise provided in Section 2.07, all powers and remedies given by this Article to the Trustee or to the Securityholders shall, to the extent permitted by law, be deemed cumulative and not exclusive of any other powers and remedies available to the Trustee or the holders of the Securities, by judicial proceedings or otherwise, to enforce the performance or observance of the covenants and agreements contained in this Indenture or otherwise established with respect to such Securities.

 

(b)      No delay or omission of the Trustee or of any holder of any of the Securities to exercise any right or power accruing upon any Event of Default occurring and continuing as aforesaid shall impair any such right or power, or shall be construed to be a waiver of any such default or an acquiescence therein; and, subject to the provisions of Section 6.04, every power and remedy given by this Article or by law to the Trustee or the Securityholders may be exercised from time to time, and as often as shall be deemed expedient, by the Trustee or by the Securityholders.

 

Section 6.06                      Control by Securityholders.

 

The holders of a majority in aggregate principal amount of the Securities of any series at the time Outstanding, determined in accordance with Section 8.04, shall have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on the Trustee with respect to such series; provided, however, that such direction shall not be in conflict with any rule of law or with this Indenture or subject the Trustee in its sole discretion to personal liability.  Subject to the provisions of Section 7.01, the Trustee shall have the right to decline to follow any such direction if the Trustee in good faith shall, by a Responsible Officer or officers of the Trustee, determine that the proceeding so directed, subject to the Trustee’s duties under the Trust Indenture Act, would involve the Trustee in personal liability or might be unduly prejudicial to the Securityholders not involved in the proceeding.  The holders of a majority in aggregate principal amount of the Securities of any series at the time Outstanding affected thereby, determined in accordance with Section 8.04, may on behalf of the holders of all of the Securities of such series waive any past default in the performance of any of the covenants contained herein or established pursuant to Section 2.01 with respect to such series and its consequences, except a default in the payment of the principal of, or premium, if any, or interest on, any of the Securities of that series as and when the same shall become due by the terms of such Securities otherwise than by acceleration (unless such default has been cured and a sum sufficient to pay all matured installments of interest and principal and any premium has been deposited with the Trustee (in accordance with Section 6.01(c)).  Upon any such waiver, the default covered thereby shall be deemed to be cured for all purposes of this Indenture and the Company, the Trustee and the holders of the Securities of such series shall be restored to their former positions and rights hereunder, respectively; but no such waiver shall extend to any subsequent or other default or impair any right consequent thereon.

 

  

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Section 6.07                      Undertaking to Pay Costs.

 

All parties to this Indenture agree, and each holder of any Securities by such holder’s acceptance thereof shall be deemed to have agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture, or in any suit against the Trustee for any action taken or omitted by it as Trustee, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorneys’ fees, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by such party litigant; but the provisions of this Section shall not apply to any suit instituted by the Trustee, to any suit instituted by any Securityholder, or group of Securityholders, holding more than 10% in aggregate principal amount of the Outstanding Securities of any series, or to any suit instituted by any Securityholder for the enforcement of the payment of the principal of (or premium, if any) or interest on any Security of such series, on or after the respective due dates expressed in such Security or established pursuant to this Indenture.

 

ARTICLE 7

 

CONCERNING THE TRUSTEE

 

Section 7.01                      Certain Duties and Responsibilities of Trustee.

 

(a)        The Trustee, prior to the occurrence of an Event of Default with respect to the Securities of a series and after the curing of all Events of Default with respect to the Securities of that series that may have occurred, shall undertake to perform with respect to the Securities of such series 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 of a series has occurred (that has not been cured or waived), the Trustee shall exercise with respect to Securities of that series 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:

 

  

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

 

(A)      the duties and obligations of the Trustee shall with respect to the Securities of such series be determined solely by the express provisions of this Indenture, and the Trustee shall not be liable with respect to the Securities of such series 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 of such series 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 requirements of this Indenture;

 

(ii)        the Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer or Responsible 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 of any series at the time Outstanding 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 of that series; 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 7.02                      Certain Rights of Trustee.

 

Except as otherwise provided in Section 7.01:

 

(a)        The Trustee may 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 Board Resolution or an instrument signed in the name of the Company by any authorized officer of the Company (unless other evidence in respect thereof is specifically prescribed herein);

 

  

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(c)        The Trustee may consult with counsel and the written advice of such counsel or, if requested, 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 Securityholders pursuant to the provisions of this Indenture, unless such Securityholders 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 a series of the Securities (that has not been cured or waived), to exercise with respect to Securities of that series such of the rights and powers vested in it by this Indenture, and to 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;

 

(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 of the particular series affected thereby (determined as provided in Section 8.04); 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)        In no event shall the Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation, strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services; it being understood that the Trustee shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances;

 

  

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(i)        In no event shall the Trustee be responsible or liable for special, indirect, or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether the Trustee has been advised of the likelihood of such loss or damage and regardless of the form of action; and

 

(j)        The Trustee agrees to accept and act upon instructions or directions pursuant to this Indenture sent by unsecured e-mail, facsimile transmission or other similar unsecured electronic methods; provided, however, that (a) the party providing such written instructions, subsequent to such transmission of written instructions, shall provide the originally executed instructions or directions to the Trustee in a timely manner, and (b) such originally executed instructions or directions shall be signed by an authorized representative of the party providing such instructions or directions.  If the party elects to give the Trustee e-mail or facsimile instructions (or instructions by a similar electronic method) and the Trustee in its sole discretion elects to act upon such instructions, the Trustee’s understanding of such instructions shall be deemed controlling.  The Trustee shall not be liable for any losses, costs or expenses arising directly or indirectly from the Trustee’s reliance upon and compliance with such instructions notwithstanding such instructions conflict or are inconsistent with a subsequent written instruction.  The party providing electronic instructions agrees to assume all risks arising out of the use of such electronic methods to submit instructions and directions to the Trustee, including without limitation the risk of the Trustee acting on unauthorized instructions, and the risk or interception and misuse by third parties.

 

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

 

In addition, the Trustee shall not be deemed to have knowledge of an Event of Default other than an Event of Default relating to the failure to pay the interest on, or the principal of, the Securities, until the Trustee shall have received written notification in the manner set forth in this Indenture or a Responsible Officer of the Trustee shall have obtained actual knowledge.

 

Section 7.03                      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.

 

(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 established pursuant to Section 2.01, or for the use or application of any moneys received by any paying agent other than the Trustee.

 

  

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Section 7.04                      May Hold Securities.

 

The Trustee or any paying agent or Security Registrar, 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, paying agent or Security Registrar.

 

Section 7.05                      Moneys Held in Trust.

 

Subject to the provisions of Section 11.05, 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 to in writing with the Company to pay thereon.

 

Section 7.06                      Compensation and Reimbursement.

 

(a)      The Company covenants and agrees to pay to the Trustee, and the Trustee shall be entitled to, such reasonable 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 and except as the Company and Trustee may from time to time agree in writing.  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.

 

(b)      The obligations of the Company under this Section 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 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.

 

(c)      To ensure the Company’s payment obligations in this Section, the Trustee shall have a lien prior to the Securities on all funds or property held or collected by the Trustee, except that held in trust to pay principal of or interest on particular Securities.  When the Trustee incurs expenses or renders services in connection with an Event of Default specified in Section 6.01(4) or (5), the expenses (including the reasonable fees and expenses of its counsel) and the compensation for services in connection therewith are to constitute expenses of administration under any bankruptcy law.  The provisions of this Section 7.06 shall survive the termination of this Indenture and the resignation or removal of the Trustee.

 

  

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Section 7.07                      Reliance on Officer’s Certificate.

 

Except as otherwise provided in Section 7.01, whenever in the administration of the provisions of this Indenture the Trustee shall deem it reasonably 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 7.08                      Disqualification; Conflicting Interests.

 

If the Trustee has or shall acquire any “conflicting interest” within the meaning of Section 310(b) of the Trust Indenture Act, the Trustee and the Company shall in all respects comply with the provisions of Section 310(b) of the Trust Indenture Act.

 

Section 7.09                      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 Commission, authorized under such laws to exercise corporate trust powers, having a combined capital and surplus of at least fifty 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 or other Person 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, the combined capital and surplus of such corporation or other Person 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, the Trustee shall resign immediately in the manner and with the effect specified in Section 7.10.

 

Section 7.10                      Resignation and Removal; Appointment of Successor.

 

(a)      The Trustee or any successor hereafter appointed may at any time resign with respect to the Securities of one or more series by giving written notice thereof to the Company and by transmitting notice of resignation by mail, first class postage prepaid, to the Securityholders of such series, as their names and addresses appear upon the Security Register.  Upon receiving such notice of resignation, the Company shall promptly appoint a successor trustee with respect to Securities of such series by written instrument, in duplicate, executed by order of the Board of Directors, one copy of which instrument shall be delivered to the resigning Trustee and one copy to the successor trustee.  If no successor trustee shall have been so appointed and have accepted appointment within 30 days after the 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 of such series, or any Securityholder of that series 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.

  

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(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 7.08 after written request therefor by the Company or by any Securityholder 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 7.09 and shall fail to resign after written request therefor by the Company or by any such Securityholder; 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 all Securities and appoint a successor trustee by written instrument, in duplicate, executed by order of the Board of Directors, one copy of which instrument shall be delivered to the Trustee so removed and one copy to the successor trustee, or any Securityholder 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 of any series at the time Outstanding may at any time remove the Trustee with respect to such series by so notifying the Trustee and the Company and may appoint a successor Trustee for such series with the consent of the Company.

 

(d)      Any resignation or removal of the Trustee and appointment of a successor trustee with respect to the Securities of a series pursuant to any of the provisions of this Section shall become effective upon acceptance of appointment by the successor trustee as provided in Section 7.11.

 

(e)      Any successor trustee appointed pursuant to this Section may be appointed with respect to the Securities of one or more series or all of such series, and at any time there shall be only one Trustee with respect to the Securities of any particular series.

 

  

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Section 7.11                      Acceptance of Appointment By Successor.

 

(a)      In case of the appointment hereunder of a successor trustee with respect to all Securities, every such successor trustee so appointed shall execute, acknowledge and 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)      In case of the appointment hereunder of a successor trustee with respect to the Securities of one or more (but not all) series, the Company, the retiring Trustee and each successor trustee with respect to the Securities of one or more series shall execute and deliver an indenture supplemental hereto wherein each successor trustee shall accept such appointment and which (i) shall contain such provisions as shall be necessary or desirable to transfer and confirm to, and to vest in, each successor trustee all the rights, powers, trusts and duties of the retiring Trustee with respect to the Securities of that or those series to which the appointment of such successor trustee relates, (ii) shall contain such provisions as shall be deemed necessary or desirable to confirm that all the rights, powers, trusts and duties of the retiring Trustee with respect to the Securities of that or those series as to which the retiring Trustee is not retiring shall continue to be vested in the retiring Trustee, and (iii) shall add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, it being understood that nothing herein or in such supplemental indenture shall constitute such Trustees co-trustees of the same trust, that each such Trustee shall be trustee of a trust or trusts hereunder separate and apart from any trust or trusts hereunder administered by any other such Trustee and that no Trustee shall be responsible for any act or failure to act on the part of any other Trustee hereunder; and upon the execution and delivery of such supplemental indenture the resignation or removal of the retiring Trustee shall become effective to the extent provided therein, such retiring Trustee shall with respect to the Securities of that or those series to which the appointment of such successor trustee relates have no further responsibility for the exercise of rights and powers or for the performance of the duties and obligations vested in the Trustee under this Indenture, and each such successor trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee with respect to the Securities of that or those series to which the appointment of such successor trustee relates; but, on request of the Company or any successor trustee, such retiring Trustee shall duly assign, transfer and deliver to such successor trustee, to the extent contemplated by such supplemental indenture, the property and money held by such retiring Trustee hereunder with respect to the Securities of that or those series to which the appointment of such successor trustee relates.

 

  

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(c)      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) or (b) of this Section, as the case may be.

 

(d)      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.

 

(e)      Upon acceptance of appointment by a successor trustee as provided in this Section, the Company shall transmit notice of the succession of such trustee hereunder by mail, first class postage prepaid, to the Securityholders, as their names and addresses appear upon the Security 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 7.12                      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 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 7.08 and eligible under the provisions of Section 7.09, 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.

 

Section 7.13                      Preferential Collection of Claims Against the Company.

 

The Trustee shall comply with Section 311(a) of the Trust Indenture Act, excluding any creditor relationship described in Section 311(b) of the Trust Indenture Act.  A Trustee who has resigned or been removed shall be subject to Section 311(a) of the Trust Indenture Act to the extent included therein.

 

Section 7.14                      Notice of Default

 

If any Event of Default occurs and is continuing and if such Event of Default is actually known to a Responsible Officer of the Trustee, the Trustee shall mail to each Securityholder in the manner and to the extent provided in Section 313(c) of the Trust Indenture Act notice of the Event of Default within 90 days after it occurs or, if later, after it is known to a Responsible Officer of the Trustee or written notice of it is received by the Trustee, unless such Event of Default has been cured; provided, however, that, except in the case of a default in the payment of the principal of (or premium, if any) or interest on any Security, the Trustee shall be protected in withholding such notice if and so long as the board of directors, the executive committee or a trust committee of directors and/or Responsible Officers of the Trustee in good faith determine that the withholding of such notice is in the interest of the Securityholders.

 

  

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ARTICLE 8

 

CONCERNING THE SECURITYHOLDERS

 

Section 8.01                      Evidence of Action by Securityholders.

 

Whenever in this Indenture it is provided that the holders of a majority or specified percentage in aggregate principal amount of the Securities of a particular series may take any action (including the making of any demand or request, the giving of any notice, consent or waiver or the taking of any other action), the fact that at the time of taking any such action the holders of such majority or specified percentage of that series have joined therein may be evidenced by any instrument or any number of instruments of similar tenor executed by such holders of Securities of that series in person or by agent or proxy appointed in writing.

 

If the Company shall solicit from the Securityholders of any series any request, demand, authorization, direction, notice, consent, waiver or other action, the Company may, at its option, as evidenced by an Officer’s Certificate, fix in advance a record date for such series for the determination of Securityholders entitled to give such request, demand, authorization, direction, notice, consent, waiver or other action, but the Company shall have no obligation to do so.  If such a record date is fixed, such request, demand, authorization, direction, notice, consent, waiver or other action may be given before or after the record date, but only the Securityholders of record at the close of business on the record date shall be deemed to be Securityholders for the purposes of determining whether Securityholders of the requisite proportion of Outstanding Securities of that series have authorized or agreed or consented to such request, demand, authorization, direction, notice, consent, waiver or other action, and for that purpose the Outstanding Securities of that series shall be computed as of the record date; provided, however, that no such authorization, agreement or consent by such Securityholders on the record date shall be deemed effective unless it shall become effective pursuant to the provisions of this Indenture not later than six months after the record date.

 

Section 8.02                      Proof of Execution by Securityholders.

 

Subject to the provisions of Section 7.01, proof of the execution of any instrument by a Securityholder (such proof will not require notarization) or his agent or proxy and proof of the holding by any Person of any of the Securities shall be sufficient if made in the following manner:

 

(a)      The fact and date of the execution by any such Person of any instrument may be proved in any reasonable manner acceptable to the Trustee.

 

  

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(b)      The ownership of Securities shall be proved by the Security Register of such Securities or by a certificate of the Security Registrar thereof.

 

The Trustee may require such additional proof of any matter referred to in this Section as it shall deem necessary.

 

Section 8.03                      Who May be Deemed Owners.

 

Prior to the due presentment for registration of transfer of any Security, the Company, the Trustee, any paying agent and any Security Registrar may deem and treat the Person in whose name such Security shall be registered upon the books of the Security Registrar as the absolute owner of such Security (whether or not such Security shall be overdue and notwithstanding any notice of ownership or writing thereon made by anyone other than the Security Registrar) for the purpose of receiving payment of or on account of the principal of, premium, if any, and (subject to Section 2.03) interest on such Security and for all other purposes; and neither the Company nor the Trustee nor any paying agent nor any Security Registrar shall be affected by any notice to the contrary.

 

Section 8.04                      Certain Securities Owned by Company Disregarded.

 

In determining whether the holders of the requisite aggregate principal amount of Securities of a particular series have concurred in any direction, consent or waiver under this Indenture, the Securities of that series that are owned by the Company or any other obligor on the Securities of that series or by any Person directly or indirectly controlling or controlled by or under common control with the Company or any other obligor on the Securities of that series shall be disregarded and deemed not to be Outstanding for the purpose of any such determination, except that for the purpose of determining whether the Trustee shall be protected in relying on any such direction, consent or waiver, only Securities of such series that the Trustee actually knows are so owned shall be so disregarded.  The Securities so owned that have been pledged in good faith may be regarded as Outstanding for the purposes of this Section, if the pledgee shall establish to the satisfaction of the Trustee the pledgee’s right so to act with respect to such Securities and that the pledgee is not a Person directly or indirectly controlling or controlled by or under direct or indirect common control with the Company or any such other obligor.  In case of a dispute as to such right, any decision by the Trustee taken upon the advice of counsel shall be full protection to the Trustee.

 

Section 8.05                      Actions Binding on Future Securityholders.

 

At any time prior to (but not after) the evidencing to the Trustee, as provided in Section 8.01, of the taking of any action by the holders of the majority or percentage in aggregate principal amount of the Securities of a particular series specified in this Indenture in connection with such action, any holder of a Security of that series that is shown by the evidence to be included in the Securities the holders of which have consented to such action may, by filing written notice with the Trustee, and upon proof of holding as provided in Section 8.02, revoke such action so far as concerns such Security.  Except as aforesaid any such action taken by the holder of any Security shall be conclusive and binding upon such holder and upon all future holders and owners of such Security, and of any Security issued in exchange therefor, on registration of transfer thereof or in place thereof, irrespective of whether or not any notation in regard thereto is made upon such Security.  Any action taken by the holders of the majority or percentage in aggregate principal amount of the Securities of a particular series specified in this Indenture in connection with such action shall be conclusively binding upon the Company, the Trustee and the holders of all the Securities of that series.

 

  

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ARTICLE 9

 

SUPPLEMENTAL INDENTURES

 

Section 9.01                      Supplemental Indentures Without the Consent of Securityholders.

 

In addition to any supplemental indenture otherwise authorized by this Indenture, the Company and the Trustee may from time to time and at any time enter into an indenture or indentures supplemental hereto (which shall conform to the provisions of the Trust Indenture Act as then in effect), without the consent of any Securityholders, for one or more of the following purposes:

 

(a)      to cure any ambiguity, defect, or inconsistency in this Indenture or in the Securities of any series;

 

(b)      to comply with Article Ten;

 

(c)      to provide for uncertificated Securities in addition to or in place of certificated Securities;

 

(d)      to add to the covenants, restrictions, conditions or provisions such new covenants, restrictions, conditions or provisions for the benefit of the Securityholders, to make the occurrence, or the occurrence and the continuance, of a default in any such additional covenants, restrictions, conditions or provisions an Event of Default, or to surrender any right or power conferred upon the Company in this Indenture;

 

(e)      to add to, delete from, or revise the conditions, limitations, and restrictions on the authorized amount, terms, or purposes of issue, authentication, and delivery of Securities, as set forth in this Indenture;

 

(f)      to make any change that does not adversely affect the rights of any Securityholder in any material respect;

 

(g)      to provide for the issuance of and establish the form and terms and conditions of the Securities of any series as provided in Section 2.01, to establish the form of any certifications required to be furnished pursuant to the terms of this Indenture or any series of Securities, or to add to the rights of the holders of any series of Securities;

 

(h)      to evidence and provide for the acceptance of appointment under this Indenture by a successor trustee; or

 

  

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(i)      to comply with any requirements of the Commission with the qualification of this Indenture under the Trust Indenture Act.

 

The Trustee is hereby authorized to join with the Company in the execution of any such supplemental indenture, and to make any further appropriate agreements and stipulations that may be therein contained, but the Trustee shall not be obligated to enter into any such supplemental indenture that affects the Trustee’s own rights, duties or immunities under this Indenture or otherwise.

 

Any supplemental indenture authorized by the provisions of this Section may be executed by the Company and the Trustee without the consent of the holders of any of the Securities at the time Outstanding, notwithstanding any of the provisions of Section 9.02.

 

Section 9.02                      Supplemental Indentures With Consent of Securityholders.

 

With the written consent of the holders of at least a majority in aggregate principal amount of the Securities of each series affected by such supplemental indenture or indentures at the time Outstanding, the Company, when authorized by a Board Resolution, and the Trustee may from time to time and at any time enter into an indenture or indentures supplemental hereto (which shall conform to the provisions of the Trust Indenture Act as then in effect) for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Indenture or of any supplemental indenture or of modifying in any manner not covered by Section 9.01 the rights of the holders of the Securities of such series under this Indenture; provided, however, that no such supplemental indenture shall, without the consent of the holders of each Security then Outstanding and affected thereby, (a) extend the fixed maturity of any Securities of any series, (b) reduce the principal amount, reduce the rate of or extend the time of payment of interest, or reduce any premium payable upon the redemption of any series of Securities or (b) reduce the percentage of Securities, the holders of which are required to consent to any amendment, supplement, modification or waiver.

 

It shall not be necessary for the consent of the Securityholders of any series affected thereby under this Section to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if such consent shall approve the substance thereof.

 

Section 9.03                      Effect of Supplemental Indentures.

 

Upon the execution of any supplemental indenture pursuant to the provisions of this Article or of Section 10.01, this Indenture shall, with respect to such series, be and be deemed to be modified and amended in accordance therewith and the respective rights, limitations of rights, obligations, duties and immunities under this Indenture of the Trustee, the Company and the holders of Securities of the series affected thereby shall thereafter be determined, exercised and enforced hereunder subject in all respects to such modifications and amendments, and all the terms and conditions of any such supplemental indenture shall be and be deemed to be part of the terms and conditions of this Indenture for any and all purposes.

 

  

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Section 9.04                      Securities Affected by Supplemental Indentures.

 

Securities of any series affected by a supplemental indenture, authenticated and delivered after the execution of such supplemental indenture pursuant to the provisions of this Article or of Section 10.01, may bear a notation in form approved by the Company, provided such form meets the requirements of any securities exchange upon which such series may be listed, as to any matter provided for in such supplemental indenture.  If the Company shall so determine, new Securities of that series so modified as to conform, in the opinion of the Board of Directors, to any modification of this Indenture contained in any such supplemental indenture may be prepared by the Company, authenticated by the Trustee and delivered in exchange for the Securities of that series then Outstanding.

 

Section 9.05                      Execution of Supplemental Indentures.

 

Upon the request of the Company, accompanied by its Board Resolutions authorizing the execution of any such supplemental indenture, and upon the filing with the Trustee of evidence of the consent of Securityholders required to consent thereto as aforesaid, the Trustee shall join with the Company in the execution of such supplemental indenture unless such supplemental indenture affects the Trustee’s own rights, duties or immunities under this Indenture or otherwise, in which case the Trustee may in its discretion but shall not be obligated to enter into such supplemental indenture. The Trustee, subject to the provisions of Sections 7.01 and 7.02, shall receive an Officer’s Certificate upon request and an Opinion of Counsel as conclusive evidence that any supplemental indenture executed pursuant to this Article is authorized or permitted by the terms of this Article, that all conditions precedent to the execution of the supplemental indenture have been complied with and the Supplemental Indenture is a valid and legally binding instrument enforceable against the Company.

 

Promptly after the execution by the Company and the Trustee of any supplemental indenture pursuant to the provisions of this Section, the Company shall (or shall direct the Trustee to) transmit by mail, first class postage prepaid, a notice, setting forth in general terms the substance of such supplemental indenture, to the Securityholders of all series affected thereby .as their names and addresses appear upon the Security Register. Any failure of the Company to mail, or cause the mailing of, such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such supplemental indenture.

 

ARTICLE 10

 

SUCCESSOR ENTITY

 

Section 10.01                    Company May Consolidate, Etc.

 

Nothing contained in this Indenture shall prevent any consolidation or merger of the Company with or into any other Person (whether or not affiliated with the Company) or successive consolidations or mergers in which the Company or its successor or successors shall be a party or parties, or shall prevent any sale, conveyance, transfer or other disposition of the property of the Company or its successor or successors as an entirety, or substantially as an entirety, to any other corporation (whether or not affiliated with the Company or its successor or successors) authorized to acquire and operate the same; provided, however, (a) the Company hereby covenants and agrees that, upon any such consolidation or merger (in each case, if the Company is not the survivor of such transaction), sale, conveyance, transfer or other disposition, the due and punctual payment of the principal of (premium, if any) and interest on all of the Securities of all series in accordance with the terms of each series, according to their tenor, and the due and punctual performance and observance of all the covenants and conditions of this Indenture with respect to each series or established with respect to such series pursuant to Section 2.01 to be kept or performed by the Company shall be expressly assumed, by supplemental indenture (which shall conform to the provisions of the Trust Indenture Act, as then in effect) reasonably satisfactory in form to the Trustee executed and delivered to the Trustee by the entity formed by such consolidation, or into which the Company shall have been merged, or by the entity which shall have acquired such property and (b) in the event that the Securities of any series then Outstanding are convertible into or exchangeable for shares of common stock or other securities of the Company, such entity shall, by such supplemental indenture, make provision so that the Securityholders of Securities of that series shall thereafter be entitled to receive upon conversion or exchange of such Securities the number of securities or property to which a holder of the number of shares of common stock or other securities of the Company deliverable upon conversion or exchange of those Securities would have been entitled had such conversion or exchange occurred immediately prior to such consolidation, merger, sale, conveyance, transfer or other disposition.

 

  

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Section 10.02                    Successor Entity Substituted.

 

(a)      In case of any such consolidation, merger, sale, conveyance, transfer or other disposition and upon the assumption by the successor entity by supplemental indenture, executed and delivered to the Trustee and satisfactory in form to the Trustee, of the obligations set forth under Section 10.01 on all of the Securities of all series Outstanding, such successor entity shall succeed to and be substituted for the Company with the same effect as if it had been named as the Company herein, and thereupon the predecessor corporation shall be relieved of all obligations and covenants under this Indenture and the Securities.

 

(b)      In case of any such consolidation, merger, sale, conveyance, transfer or other disposition, such changes in phraseology and form (but not in substance) may be made in the Securities thereafter to be issued as may be appropriate.

 

(c)      Nothing contained in this Article shall require any action by the Company in the case of a consolidation or merger of any Person into the Company where the Company is the survivor of such transaction, or the acquisition by the Company, by purchase or otherwise, of all or any part of the property of any other Person (whether or not affiliated with the Company).

 

  

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ARTICLE 11

 

SATISFACTION AND DISCHARGE

 

Section 11.01                    Satisfaction and Discharge of Indenture.

 

If at any time: (a) the Company shall have delivered to the Trustee for cancellation all Securities of a series theretofore authenticated and not delivered to the Trustee for cancellation (other than any Securities that shall have been destroyed, lost or stolen and that shall have been replaced or paid as provided in Section 2.07 and Securities for whose payment money or Governmental Obligations have theretofore been deposited in trust or segregated and held in trust by the Company and thereupon repaid to the Company or discharged from such trust, as provided in Section 11.05); or (b) all such Securities of a particular series not theretofore delivered to the Trustee for cancellation shall have become due and payable, or are by their terms to become due and payable within one year or are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption, and the Company shall deposit or cause to be deposited with the Trustee as trust funds the entire amount in moneys or Governmental Obligations or a combination thereof, sufficient in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee, to pay at maturity or upon redemption all Securities of that series not theretofore delivered to the Trustee for cancellation, including principal (and premium, if any) and interest due or to become due to such date of maturity or date fixed for redemption, as the case may be, and if the Company shall also pay or cause to be paid all other sums payable hereunder with respect to such series by the Company then this Indenture shall thereupon cease to be of further effect with respect to such series except for the provisions of Sections 2.03, 2.05, 2.07, 4.01, 4.02, 4.03 and 7.10, that shall survive until the date of maturity or redemption date, as the case may be, and Sections 7.06 and 11.05, that shall survive to such date and thereafter, and the Trustee, on demand of the Company and at the cost and expense of the Company shall execute proper instruments acknowledging satisfaction of and discharging this Indenture with respect to such series.

 

Section 11.02                    Discharge of Obligations.

 

If at any time all such Securities of a particular series not heretofore delivered to the Trustee for cancellation or that have not become due and payable as described in Section 11.01 shall have been paid by the Company by depositing irrevocably with the Trustee as trust funds moneys or an amount of Governmental Obligations sufficient to pay at maturity or upon redemption all such Securities of that series not theretofore delivered to the Trustee for cancellation, including principal (and premium, if any) and interest due or to become due to such date of maturity or date fixed for redemption, as the case may be, and if the Company shall also pay or cause to be paid all other sums payable hereunder by the Company with respect to such series, then after the date such moneys or Governmental Obligations, as the case may be, are deposited with the Trustee the obligations of the Company under this Indenture with respect to such series shall cease to be of further effect except for the provisions of Sections 2.03, 2.05, 2.07, 4,01, 4.02, 4,03, 7.06, 7.10 and 11.05 hereof that shall survive until such Securities shall mature and be paid.

 

  

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Thereafter, Sections 7.06 and 11.05 shall survive.

 

Section 11.03                    Deposited Moneys to be Held in Trust.

 

All moneys or Governmental Obligations deposited with the Trustee pursuant to Sections 11.01 or 11.02 shall be held in trust and shall be available for payment as due, either directly or through any paying agent (including the Company acting as its own paying agent), to the holders of the particular series of Securities for the payment or redemption of which such moneys or Governmental Obligations have been deposited with the Trustee.

 

Section 11.04                    Payment of Moneys Held by Paying Agents.

 

In connection with the satisfaction and discharge of this Indenture all moneys or Governmental Obligations then held by any paying agent under the provisions of this Indenture shall, upon demand of the Company, be paid to the Trustee and thereupon such paying agent shall be released from all further liability with respect to such moneys or Governmental Obligations.

 

Section 11.05                    Repayment to Company.

 

Any moneys or Governmental Obligations deposited with any paying agent or the Trustee, or then held by the Company, in trust for payment of principal of or premium, if any, or interest on the Securities of a particular series that are not applied but remain unclaimed by the holders of such Securities for at least two years after the date upon which the principal of (and premium, if any) or interest on such Securities shall have respectively become due and payable, or such other shorter period set forth in applicable escheat or abandoned or unclaimed property law, shall be repaid to the Company on May 31 of each year or upon the Company’s request or (if then held by the Company) shall be discharged from such trust; and thereupon the paying agent and the Trustee shall be released from all further liability with respect to such moneys or Governmental Obligations, and the holder of any of the Securities entitled to receive such payment shall thereafter, as a general creditor, look only to the Company for the payment thereof.

 

ARTICLE 12

 

IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS

 

Section 12.01                    No Recourse.

 

No recourse under or upon any obligation, covenant or agreement of this Indenture, or of any Security, or for any claim based thereon or otherwise in respect thereof, shall be had against any incorporator, stockholder, officer or director, past, present or future as such, of the Company or of any predecessor or successor corporation, either directly or through the Company or any such predecessor or successor corporation, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise; it being expressly understood that this Indenture and the obligations issued hereunder are solely corporate obligations, and that no such personal liability whatever shall attach to, or is or shall be incurred by, the incorporators, stockholders, officers or directors as such, of the Company or of any predecessor or successor corporation, or any of them, because of the creation of the indebtedness hereby authorized, or under or by reason of the obligations, covenants or agreements contained in this Indenture or in any of the Securities or implied therefrom; and that any and all such personal liability of every name and nature, either at common law or in equity or by constitution or statute, of, and any and all such rights and claims against, every such incorporator, stockholder, officer or director as such, because of the creation of the indebtedness hereby authorized, or under or by reason of the obligations, covenants or agreements contained in this Indenture or in any of the Securities or implied therefrom, are hereby expressly waived and released as a condition of, and as a consideration for, the execution of this Indenture and the issuance of such Securities.

 

  

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ARTICLE 13

 

MISCELLANEOUS PROVISIONS

 

Section 13.01                    Effect on Successors and Assigns.

 

All the covenants, stipulations, promises and agreements in this Indenture made by or on behalf of the Company shall bind its successors and assigns, whether so expressed or not.

 

Section 13.02                    Actions by Successor.

 

Any act or proceeding by any provision of this Indenture authorized or required to be done or performed by any board, committee or officer of the Company shall and may be done and performed with like force and effect by the corresponding board, committee or officer of any corporation that shall at the time be the lawful successor of the Company.

 

Section 13.03                    Surrender of Company Powers.

 

The Company by instrument in writing executed by authority of its Board of Directors and delivered to the Trustee may surrender any of the powers reserved to the Company, and thereupon such power so surrendered shall terminate both as to the Company and as to any successor corporation.

 

Section 13.04                    Notices.

 

Except as otherwise expressly provided herein, any notice, request or demand that by any provision of this Indenture is required or permitted to be given, made or served by the Trustee, the Security Registrar, any paying or other agent under this Indenture, the holders of Securities or any other Person pursuant to this Indenture to or on the Company, may be given or served by being in writing and sent by electronic transmission or deposited in first class mail, postage prepaid, addressed (until another address is filed in writing by the Company with the Trustee), to the Company as follows: NovaBay Pharmaceuticals, Inc., 5980 Horton Street, Suite 550, Emeryville, California 94608, Attention: [●]. Any notice, election, request or demand by the Company or any Securityholder or by any other Person pursuant to this Indenture to or upon the Trustee shall be deemed to have been sufficiently given or made, for all purposes, if given or made in writing at the Corporate Trust Office of the Trustee.

 

  

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Section 13.05                    Governing Law.

 

This Indenture and each Security shall be deemed to be a contract made under the internal laws of the State of New York, and for all purposes shall be construed in accordance with the laws of said State, except to the extent that the Trust Indenture Act is applicable.

 

In addition, the Company: (a) agrees that any suit, action or proceeding against it arising out of or relating to this Indenture or any Securities, as the case may be, may be instituted in any U.S. federal court with applicable subject matter jurisdiction sitting in The City of New York; (b) waives, to the fullest extent permitted by applicable law, any objection which it may now or hereafter have to the laying of venue of any such suit, action or proceeding, and any claim that any suit, action or proceeding in such a court has been brought in an inconvenient forum; and (c) submits to the non-exclusive jurisdiction of such courts in any suit, action or proceeding.

 

Section 13.06                    Treatment of Securities as Debt.

 

It is intended that the Securities will be treated as indebtedness and not as equity for federal income tax purposes.  The provisions of this Indenture shall be interpreted to further this intention.

 

Section 13.07                    Certificates as to Conditions Precedent.

 

(a)      Upon any application or demand by the Company to the Trustee to take any action under any of the provisions of this Indenture (except with respect to the initial issuance of Securities), the Company shall furnish to the Trustee an Officer’s Certificate and an Opinion of Counsel or reliance letter, upon request, stating that all conditions precedent provided for in this Indenture (other than the certificate to be delivered pursuant to Section 13.12 or Section 314(a)(4) of the Trust Indenture Act) relating to the proposed action have been complied with, except that in the case of any such application or demand as to which the furnishing of such documents is specifically required by any provision of this Indenture relating to such particular application or demand, no additional certificate need be furnished; provided, however, that no Opinion of Counsel or reliance letter shall be required in connection with the issuance of Securities on the date on which the Securities are originally issued or deemed issued as set forth on the face of such Securities.

 

(b)      Each certificate or opinion provided for in this Indenture and delivered to the Trustee with respect to compliance with a condition or covenant in this Indenture (other than the certificate to be delivered pursuant to Section 13.12 or Section 314(a)(4) of the Trust Indenture Act) 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 contained in such certificate or opinion are based; (iii) a statement that, in the opinion of such Person, he has made such examination or investigation as is reasonably necessary to enable him 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.

 

  

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Section 13.08                    Payments on Business Days.

 

Except as provided pursuant to Section 2.01 pursuant to a Board Resolution, and set forth in an Officer’s Certificate, established in one or more indentures supplemental to this Indenture, or otherwise explicitly stated, in any case where the date of maturity of interest or principal of any Security, or the date for the repurchase of any Security or for the redemption of any Security shall not be a Business Day, then payment of interest, principal (and premium, if any), redemption price or repurchase price due on such date may be made on the next succeeding Business Day with the same force and effect as if made on the nominal date of maturity, repurchase or redemption, and no interest shall accrue for the period after such nominal date as a result of such delay.

 

Section 13.09                    Conflict with Trust Indenture Act.

 

If and to the extent that any provision of this Indenture limits, qualifies or conflicts with the duties imposed by Sections 310 to 317, inclusive, of the Trust Indenture Act, such imposed duties shall control.

 

Section 13.10                    Counterparts.

 

This Indenture may be executed in any number of counterparts, each of which shall be an original, but such counterparts shall together constitute but one and the same instrument.

 

Section 13.11                    Separability.

 

In case any one or more of the provisions contained in this Indenture or in the Securities of any series shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provisions of this Indenture or of such Securities, but this Indenture and such Securities shall be construed as if such invalid or illegal or unenforceable provision had never been contained herein or therein.

 

Section 13.12                    Compliance Certificates.

 

The Company shall deliver to the Trustee, within 120 days after the end of each fiscal year during which any Securities of any series were outstanding, an officer’s certificate stating whether or not the signers know of any Event of Default that occurred during such fiscal year. Such certificate shall contain a certification from the principal executive officer, principal financial officer or principal accounting officer of the Company that a review has been conducted of the activities of the Company and the Company’s performance under this Indenture and that the Company has complied with all conditions and covenants under this Indenture. For purposes of this Section 13.12, such compliance shall be determined without regard to any period of grace or requirement of notice provided under this Indenture. If the officer of the Company signing such certificate has knowledge of such an Event of Default, the certificate shall describe any such Event of Default and its status.

 

  

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Section 13.13                    U.S.A Patriot Act.

 

The parties hereto acknowledge that in accordance with Section 326 of the U.S.A. Patriot Act, the Trustee, like all financial institutions and in order to help fight the funding of terrorism and money laundering, is required to obtain, verify, and record information that identifies each person or legal entity that establishes a relationship or opens an account with the Trustee.  The parties to this Indenture agree that they will provide the Trustee with such information as it may request in order for the Trustee to satisfy the requirements of the U.S.A. Patriot Act.

 

Section 13.14                    Force Majeure.

 

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

 

Section 13.15                    Table of Contents; Headings

 

The table of contents and headings of the articles and sections of this Indenture have been inserted for convenience of reference only, are not intended to be considered a part hereof, and will not modify or restrict any of the terms or provisions hereof.

 

  

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In Witness Whereof, the parties hereto have caused this Indenture to be duly executed all as of the day and year first above written.

 

NovaBay Pharmaceuticals, Inc.

 

By:                                                                               

 

Name:                                                                         

 

Title:                                                                           

 

[●], as Trustee

 

By:                                                                               

 

Name:                                                                         

 

Title:                                                                           

 

                                

  

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CROSS-REFERENCE TABLE (1)

 

 

	

Section of Trust Indenture Act of 1939, as Amended

	 	

Section of Indenture

	
310(a)

	 	
7.09

	
310(b)

	 	
7.08

	  	 	
7.10

	
310(c)

	 	
Inapplicable

	
311(a)

	 	
7.13

	
311(b)

	 	
7.13

	
311(c)

	 	
Inapplicable

	
312(a)

	 	
5.01

	  	 	
5.02(a)

	
312(b)

	 	
5.02(c)

	
312(c)

	 	
5.02(c)

	
313(a)

	 	
5.04(a)

	
313(b)

	 	
5.04(b)

	
313(c)

	 	
5.04(a)

	  	 	
5.04(b)

	
313(d)

	 	
5.04(c)

	
314(a)

	 	
5.03

	  	 	
13.12

	
314(b)

	 	
Inapplicable

	
314(c)

	 	
13.07(a)

	
314(d)

	 	
Inapplicable

	
314(e)

	 	
13.07(b)

	
314(f)

	 	
Inapplicable

	
315(a)

	 	
7.01(a)

	  	 	
7.01(b)

	
315(b)

	 	
7.14

	
315(c)

	 	
7.01

	
315(d)

	 	
7.01(b)

	
315(e)

	 	
6.07

	
316(a)

	 	
6.06

	  	 	
8.04

	
316(b)

	 	
6.04

	
316(c)

	 	
8.01

	
317(a)

	 	
6.02

	
317(b)

	 	
4.03

	
318(a)

	 	
13.09

_________________

 

	
(1)

	
This Cross-Reference Table does not constitute part of the Indenture and shall not have any bearing on the interpretation of any of its terms or provisions.

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