Exhibit 99.4 Execution Copy
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NEITHER THIS NOTE NOR THE SHARES INTO WHICH THIS NOTE IS CONVERTIBLE HAVE BEEN
REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE
"ACT"), AND EXCEPT FOR ANY TRANSFERS SPECIFICALLY AUTHORIZED UNDER THE TERMS OF
THIS NOTE, NEITHER THIS NOTE NOR SUCH SHARES MAY BE OFFERED, SOLD, TRANSFERRED,
ASSIGNED, PLEDGED OR HYPOTHECATED ABSENT REGISTRATION THEREOF UNDER THE ACT OR
COMPLIANCE WITH RULE 144 OR RULE 144A PROMULGATED UNDER THE ACT, OR UNLESS
GABELLI ASSET MANAGEMENT INC. HAS RECEIVED AN OPINION OF COUNSEL, REASONABLY
SATISFACTORY TO GABELLI ASSET MANAGEMENT INC., THAT SUCH REGISTRATION IS NOT
REQUIRED. TRANSFER OF THIS NOTE OR ANY INTEREST HEREIN IS ALSO SUBJECT TO
RESTRICTIONS UNDER THE TERMS HEREOF.
CONVERTIBLE PROMISSORY NOTE
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$50,000,000.00 Dated: August 14, 2001
Rye, New York
FOR VALUE RECEIVED, the undersigned, GABELLI ASSET MANAGEMENT
INC., a New York corporation. ("Gabelli"), promises to pay to the order of
CASCADE INVESTMENT LLC, a Washington limited liability company ("Cascade"), or
its permitted registered assigns or at such other place or places as the Holder
(as defined below) may designate in writing, on August 14, 2011, the principal
sum of FIFTY MILLION and NO/100 DOLLARS ($50,000,000) minus the principal amount
converted or sold after April 1, 2005 pursuant to the Put Option (as defined
below) or the Change of Control Put Option (as defined below) (such amount, as
of any determination date, the "Unpaid Principal Amount") on or before August
14, 2011, and to pay interest thereon from and including August 14, 2001 (the
"Issue Date") or from the most recent Interest Payment Date (as defined below)
to which interest has been paid or duly provided for, semi-annually on February
14 and August 14 in each year, commencing February 14, 2002, and at Maturity
(each, an "Interest Payment Date") at the rate of (i) 6.5% per annum for the
period from and including the Issue Date to but excluding August 14, 2002, (ii)
6.0% per annum for the period from and including August 14, 2002 to but
excluding August 14, 2003, and (iii) 5.0% per annum for the period from and
including August 14, 2003 to but excluding August 14, 2011, until the principal
hereof is paid or made available for payment; provided, however, that (i) upon
the occurrence and during the continuance of an Event of Default (as defined
below) this Note and (ii) any principal and any such installment of interest
which is overdue, in each case shall bear interest at the rate of 15% per annum
(or, if less, the maximum interest rate permitted by the laws of the State of
Washington). The interest so payable, and punctually paid or duly provided for,
on any Interest Payment Date will be paid to the Person in whose name this Note
is registered at the close of business on the day immediately prior to such
Interest Payment Date (whether or not a Business Day). Payment of the principal
of and interest on this Note will be made in such coin or currency of the United
States of America as at the time of payment is legal tender for payment of
public and private debts.
Any payments in respect of this Note shall first be applied to
Enforcement Costs (as defined below), then to interest and then to principal. If
it is ever determined that any rate of interest payable in respect of this Note
exceeds the maximum rate (if any) prescribed by applicable law, then any portion
of interest payments representing any amounts in excess of said maximum shall be
applied as provided in the preceding sentence.
As used herein, "Maturity" means the date on which the
principal of this Note becomes due and payable as provided herein, whether at
its stated maturity, by declaration of acceleration or otherwise and "Holder"
means, at any time, the person in whose name this Note is registered in the Note
Register (as defined below).
This Convertible Promissory Note ("Note") was issued by
Gabelli pursuant to that certain Note Purchase Agreement, dated as of August 10,
2001, which has been amended by the First Amendment thereto, dated as of July 1,
2003, the Second Amendment thereto, dated as of August 4, 2004, and the Third
Amendment thereto, dated as of February 28, 2005 (as so amended, the "Purchase
Agreement"), among Gabelli, Cascade and the Gabelli Stockholders. Capitalized
terms not otherwise defined in this Note shall have the meaning set forth in the
Purchase Agreement, which definitions are incorporated herein.
No Redemption or Prepayment
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Gabelli agrees and acknowledges that the conversion feature of
this Note during the term of the Note is a valuable right and that the Holder
would not have purchased this Note without assurances that the Note would not be
called or prepaid by Gabelli. Accordingly, Gabelli acknowledges and agrees that
it shall not be entitled to and will not, without the consent of the Holder,
make any prepayments of principal on this Note other than pursuant to an
acceleration of this Note or Forced Conversion (as hereinafter defined), in each
case as provided below.
Events of Default
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"Event of Default", wherever used with respect to this Note,
means any one of the following events (whatever the reason for such Event of
Default and whether it shall be voluntary or involuntary or be effected by
operation of law or pursuant to any judgement, decree or order of any court or
any order, rule or regulation of any Governmental Authority):
(a) Payment Default. Gabelli shall fail to pay or cause to be paid all or
any portion of the principal of or interest on this Note when it
becomes due and payable, and, in the event of failure to pay interest
on the Note, such failure continues for 10 days and time for payment
has not been extended or deferred by the Holder; or
(b) Letter of Credit Default. The Letter of Credit Issuer shall fail to
honor a conforming draw under the Letter of Credit or Gabelli shall
breach its obligations with respect to the Letter of Credit contained
in Section 4.3 of the Purchase Agreement, and such failure continues
for 5 days and time for payment has not been extended or deferred by
the Holder; or
(c) Put Option Default. Gabelli shall fail to pay or cause to be paid all
or any portion of the Put Consideration when it becomes due and
payable, and such failure continues for 5 days and time for payment
has not been extended or deferred by the Holder; or
(d) Change of Control Put Option Default. Gabelli shall fail to pay or
cause to be paid all or any portion of the Change of Control Put
Consideration when it becomes due and payable; or
(e) Breach of Representation or Warranty. Any representation or warranty
made by Gabelli in the Purchase Agreement shall prove to have been
untrue or misleading when made in any respect that is material and
adverse to the value of the Holder's investment in the Note or the
Conversion Shares; provided, however, that this shall constitute an
Event of Default only if Cascade or one of its Affiliates (as defined
below) is the Holder and if the Holder accelerates this Note as
provided below during the period in which any such representation and
warranty survives as provided in the Purchase Agreement; or
(f) Breach of Other Covenants or Failure of any Condition. Gabelli shall
fail to perform, keep or observe any agreement or covenant contained
in this Note or the Purchase Agreement that is not covered by clauses
(a) through (e) above, and any such failure shall remain unremedied
for thirty (30) days after written notice thereof shall have been
given to Gabelli by the Holder; provided, however, that if any such
failure is not susceptible to cure within 30 days and Gabelli
commences to cure such failure within said 30-day period, then no
Event of Default shall be deemed to have occurred if Gabelli
diligently prosecutes said cure thereafter to completion and cures
said failure by the sixtieth (60th) day after the date of said notice;
or
(g) Cross Defaults (Payment and Other). Gabelli or any of its Subsidiaries
that are at the time significant subsidiaries of Gabelli within the
meaning of Rule 1-02(w) of Regulation S-X promulgated by the SEC as of
the date of this Note (each, a "Significant Subsidiary") shall be in
default under indebtedness for borrowed money with an aggregate
principal amount of twenty five million dollars ($25,000,000) or more
to any person or persons and such default (i) shall constitute a
failure to make any payment of or with respect to such indebtedness or
(ii) permits the holder thereof to accelerate the payment of such
indebtedness or otherwise causes such indebtedness to become due and
payable prior to its stated maturity. Notwithstanding the foregoing,
there shall not be an Event of Default under this section (g) until
expiration of, without cure, any period for cure contained in any
other agreement regarding such indebtedness; or
(h) Judgments. A final judgment or final order (not covered by insurance,
treating deductibles, self-insurance and retentions as not so covered)
for the payment of money in excess of $25.0 million in the aggregate
for all such judgments and orders is entered by a court or courts of
competent jurisdiction against Gabelli or any of its Significant
Subsidiaries and shall not be paid or discharged, and there shall be a
period of 60 consecutive days after the final judgment or order that
causes such aggregate amount to exceed $25.0 million during which a
stay of enforcement of such final judgment or order is not in effect;
or
(i) Involuntary Bankruptcy Events. The entry by a court having
jurisdiction in the premises of a decree or order (A) for relief in
respect of Gabelli, any of its Significant Subsidiaries or, prior to
the expiration or return to Gabelli of the Letter of Credit, the
Letter of Credit Issuer (if a substitute Letter of Credit is not
delivered by Gabelli to the Holder within 60 days of such decree or
order) (each, a "Subject Entity") in an involuntary case or proceeding
under any applicable Federal or state bankruptcy, insolvency,
reorganization or other similar law or (B) adjudging any Subject
Entity bankrupt or insolvent, or approving as properly filed a
petition seeking reorganization, arrangement, adjustment or
composition of or in respect of any Subject Entity under any
applicable Federal or state law, or appointing a custodian, receiver,
liquidator, assignee, trustee, sequestrator or other similar official
of any Subject Entity or of any substantial part of any property of
any Subject Entity, or ordering the winding up or liquidation of the
affairs of any Subject Entity, and the continuance of any such decree
or order unstayed and in effect for a period of 60 consecutive days;
or
(j) Voluntary Bankruptcy Events. Any Subject Entity commences a voluntary
case or proceeding under any applicable Federal or state bankruptcy,
insolvency, reorganization or other similar law or of any other case
or proceeding to be adjudicated as bankrupt or insolvent, or the
consent by any Subject Entity to the entry of a decree or order for
relief in respect of it in an involuntary case or proceeding under any
applicable Federal or state bankruptcy, insolvency, reorganization or
other similar law or to the commencement of any bankruptcy or
insolvency case or proceeding against it, or the filing by any Subject
Entity of a petition or answer or consent seeking reorganization or
relief under any applicable Federal or state law, or the consent by
any Subject Entity to the filing of such a petition or to the
appointment of or taking possession by a custodian, receiver,
liquidator, assignee, trustee, sequestrator or other similar official
of such Subject Entity or of any substantial part of such Subject
Entity's property, or the making by any Subject Entity of an
assignment for the benefit of creditors, or the admission by any
Subject Entity in writing of its inability to pay its debts generally
as they become due, or the taking of corporate action by any Subject
Entity in furtherance of any such action.
If an Event of Default (other than an Event of Default
specified in clause (i) or (j) above with respect to Gabelli) occurs and is
continuing, the Holder may declare the principal amount of this Note and all
accrued and unpaid interest hereon to be immediately due and payable. If an
Event of Default specified in clause (i) or (j) above occurs with respect to
Gabelli, the principal amount of the Note and all accrued and unpaid interest
hereon shall automatically become and be immediately due and payable without any
declaration or other act on the part of the Holder or any other Person.
Conversion Rights
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The Holder shall have the right to convert this Note as
provided in Exhibit A hereto, which Exhibit shall be incorporated by reference
herein.
If the Closing Price (as hereinafter defined) of the Common
Stock is at least 125%, 150%, 175% or 200%, as the case may be, of the
Conversion Price (as hereinafter defined) on each Trading Day (as hereinafter
defined) during any period of 20 consecutive Trading Days (each, a "Qualified
Trading Period") occurring within any six month period beginning on the Exercise
Date (as hereinafter defined) or any six month anniversary thereof and ending on
the next six month anniversary of the Exercise Date (each, a "Six Month
Period"), then on any date on or after the tenth Business Day following the last
trading day of any such Qualified Trading Period during such Six Month Period
(each a "Conversion Date") Gabelli may convert any portion of the Unpaid
Principal Amount which, together with the aggregate principal amount of this
Note that has been converted by the Holder on or prior to such Conversion Date
or by Gabelli pursuant to this provision with respect to such Six Month Period,
does not exceed the Maximum Conversion Amount (as defined below) with respect to
such Six Month Period, into fully paid and nonassessable shares of Common Stock
(calculated as to each conversion to the nearest full share of Common Stock) at
the Conversion Price in effect on the applicable Conversion Date by delivering
written notice to that effect to the Holder on or prior to such Conversion Date;
provided, however, that notwithstanding the foregoing to the extent that any
prior conversions by the Holder prevented Gabelli from converting the full
Maximum Conversion Amount with respect to any Six Month Period and Gabelli
caused the conversion of all of the Unpaid Principal Amount that it was
permitted to convert with respect to such Six Month Period, then to such extent
such prior conversions by the Holder shall not be taken into account in
calculating the Unpaid Principal Amount that Gabelli is entitled to convert in
any subsequent Six Month Period pursuant to the foregoing provisions. After any
conversion pursuant to the foregoing, the Holder shall have the right and option
(the "Share Put Option"), but not the obligation, exercisable by delivering a
written notice (the "Share Put Notice") to Gabelli no later than the tenth day
after the Conversion Date, to cause Gabelli to purchase up to 50% of the
Conversion Shares issued in such conversion (the "Forced Conversion Shares") for
a purchase price per share in cash equal to the average of the Closing Prices
for the five Trading Days immediately following the date on which the Share Put
Notice is delivered to Gabelli (the "Share Put Consideration"). The closing of
any Share Put Option will be held at 10:00 A.M. at the principal executive
offices of the Holder on the ninth Trading Day immediately following the date on
which the Share Put Notice is delivered to Gabelli, or at such other time and
place upon which the Holder and Gabelli shall agree. At such closing, Gabelli
shall pay the Share Put Consideration to the Holder in cash by wire transfer of
immediately available funds against the delivery to Gabelli of a certificate
representing the Forced Conversion Shares with respect to which the Share Put
Option has been exercised, duly endorsed to Gabelli or in blank, and
concurrently with such delivery Gabelli shall, or shall cause the applicable
transfer agent for such shares to, duly execute and deliver to the Holder a new
share certificate representing the number of Forced Conversion Shares with
respect to which the Share Put Option has not been exercised.
The "Maximum Conversion Amount" means, with respect to any Six
Month Period, (i) $25 million, if the Closing Price during each of the 20
consecutive Trading Days during the first Qualified Trading Period in such Six
Month Period with respect to which Gabelli has effected a conversion pursuant to
the foregoing provisions (the "Qualified Trading Price") is at least 125% but
less than 150% of the Conversion Price, (ii) $50 million, if the Qualified
Trading Price is at least 150% but less than 175% of the Conversion Price, (iii)
$75 million, if the Qualified Trading Price is at least 175% but less than 200%
of the Conversion Price, or (iv) $100 million, if the Qualified Trading Price is
at least 200% of the Conversion Price.
Except as otherwise provided above, any conversion pursuant to
the foregoing clauses (each, a "Forced Conversion") shall be made in accordance
with the provisions of Exhibit A. If Gabelli effects a Forced Conversion, then
on such Conversion Date the Holder shall surrender the Note at the principal
executive offices of Gabelli (which, if Gabelli shall so require, shall be duly
endorsed to Gabelli or in blank, or be accompanied by proper instruments of
transfer to Gabelli or in blank), accompanied by irrevocable written notice to
Gabelli specifying the name or names (with address or addresses) in which a
certificate or certificates evidencing the full number of shares of Common Stock
issuable upon such conversion are to be issued and Gabelli shall deliver such
certificate or certificates registered in the name(s) and in the denominations
set forth in such instructions, together with a cash adjustment in respect of
any fraction of a share of Common Stock and, if less than all of the Unpaid
Principal Amount is being converted, a new Note of like tenor with an Unpaid
Principal Amount equal to the portion not being converted. Any such conversion
shall be deemed to have been made as of the applicable Conversion Date, and the
person or persons entitled to receive the Common Stock deliverable upon
conversion of this Note shall be treated for all purposes as the record holder
or holders of such Common Stock on such date.
Put Option
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The Holder shall have the right and option, but not the
obligation, to cause Gabelli to purchase all or any portion of the Unpaid
Principal Amount of this Note (the "Put Option") on September 15, 2006 (the
"Exercise Date") for a purchase price in cash equal to 100% of the principal
amount of the Note to be purchased plus accrued and unpaid interest thereon to
but excluding the Exercise Date (the "Put Consideration"). The Put Consideration
shall be payable to the Holder by wire transfer of immediately available funds
on the Exercise Date against the delivery to Gabelli of this Note duly endorsed
to it or in blank; provided, however, that if only a portion of the principal
amount of this Note is being purchased, then concurrently with such delivery
Gabelli shall duly execute and deliver to the Holder a new Note of the same
tenor as this Note but with a principal amount equal to the principal amount of
this Note not being purchased. In order to exercise the Put Option, the Holder
must deliver a written notice of its election to exercise to Gabelli at least 30
days prior to the Exercise Date. The closing of any exercise of the Put Option
will be held at 10:00 A.M. at the principal executive offices of the Holder on
the Exercise Date, or at such other time and place upon which the Holder and
Gabelli shall agree.
Change of Control Put Option
----------------------------
If a Change of Control or a Key Executive Change occurs at any
time, the Holder shall have the right and option, but not the obligation, to
cause Gabelli to purchase on the Change of Control Exercise Date (as defined
below) all or any portion of the Unpaid Principal Amount of this Note (the
"Change of Control Put Option") for a purchase price in cash equal to 101% of
the principal amount of the Note to be purchased plus accrued and unpaid
interest thereon to but excluding the Change of Control Exercise Date (the
"Change of Control Put Consideration"). The Put Consideration shall be payable
to the Holder by wire transfer of immediately available funds on the Change of
Control Exercise Date against the delivery to Gabelli of this Note duly endorsed
to it or in blank; provided, however, that if only a portion of the principal
amount of this Note is being purchased, then concurrently with such delivery
Gabelli shall duly execute and deliver to the Holder a new Note of the same
tenor as this Note but with a principal amount equal to the principal amount of
this Note not being purchased. Gabelli shall give the Holder prompt written
notice if a Change of Control or a Key Executive Change occurs (a "Notice"). In
order to exercise the Change of Control Put Option with respect to any Change of
Control or Key Executive Change, the Holder must deliver a written notice of its
election to exercise to Gabelli within 30 days after it has received the Notice
relating thereto and the closing of any exercise of the Change of Control Put
Option will be held at 10:00 A.M. at the principal executive offices of the
Holder on the 30th day after Gabelli receives such written notice, or at such
other time and place upon which the Holder and Gabelli shall agree (the "Change
of Control Exercise Date").
"Change of Control" means the occurrence of any of the
following: (i) the sale, lease, transfer, conveyance or other disposition (other
than by way of merger or consolidation), in one or more related transactions, of
all or substantially all of the properties and assets of Gabelli and its
Subsidiaries, taken as a whole, to any Person or group (as such term is defined
for purposes of Rule 13d-5 under the 1934 Act or any successor rule), (ii) the
adoption of a plan relating to the liquidation or dissolution of Gabelli, (iii)
the consummation of any transaction or other event (including, without
limitation, any merger or consolidation) the result of which is that any
"person" (as defined above), other than Xxxxx X. Xxxxxxx and the Gabelli
Entities (considered as a single Person solely for this purpose), becomes the
"beneficial owner" (as such term is defined in Rule 13d-3 and Rule 13d-5 under
the 1934 Act), directly or indirectly, of more than 40% of the total voting
power of all the then outstanding shares of Voting Stock of Gabelli or any
Person with which Gabelli consolidates or into which Gabelli merges, and more of
the total voting power of all such shares than is beneficially owned at such
time by Xxxxx X. Xxxxxxx and the Gabelli Entities (considered as a single Person
solely for this purpose), or (iv) the first day on which a majority of the
members of the Board of Directors of Gabelli are not Continuing Directors.
"Continuing Directors" means, as of any date of determination,
any member of the Board of Directors of Gabelli who (i) was a member of such
Board of Directors on the Issue Date or (ii) was nominated for election or
elected to such Board of Directors with the approval, recommendation or
endorsement of a majority of the Continuing Directors who were members of such
Board of Directors at the time of such nomination or election.
"Key Executive Change" shall be deemed to have occurred at any
time that (for any reason) Xxxxx X. Xxxxxxx ceases to provide the predominant
executive leadership to Gabelli and its Subsidiaries, taken as a whole.
Information Obligations
-----------------------
Gabelli will deliver to the Holder (without duplication):
(a) as soon as available and in any event within 90 days after the end of
each fiscal year of Gabelli, a consolidated balance sheet of Gabelli
and its Subsidiaries as of the end of such fiscal year and the related
statements of operations and cash flow for such fiscal year, setting
forth in each case in comparative form the figures for the previous
fiscal year, and accompanied by a report thereon of an independent
public accountant of nationally recognized standing;
(b) as soon as available and in any event within 45 days after the end of
each of the first three quarters of each fiscal year of Gabelli, a
consolidated balance sheet of Gabelli and its Subsidiaries as of the
end of such quarter and the related statements of operations and cash
flow for such quarter and for the portion of Gabelli's fiscal year
then ended, setting forth in each case in comparative form the figures
for the corresponding quarter and the corresponding portion of
Gabelli's previous fiscal year, all certified (subject to normal
year-end adjustments) as to fairness of presentation, consistency and,
except for the absence of footnotes, generally accepted accounting
principles by the chief financial officer or the chief accounting
officer of Gabelli;
(c) promptly upon the furnishing thereof to the security holders of
Gabelli or any of its Subsidiaries generally, copies of all financial
statements, reports, proxy statements and any other information or
reports so furnished;
(d) as soon as available, all filings of Gabelli pursuant to the 1933 Act
and the 1934 Act (other than Schedules 13D and 13G, Forms 13F and
Forms 3, 4 and 5), if any, with the Securities and Exchange
Commission; and
(e) within five days after any officer of Gabelli obtains knowledge of any
Event of Default or any event which, with notice or lapse of time or
both, would constitute an Event of Default (a "Default"), if such
Event of Default or Default is then continuing, a certificate of the
chief financial officer or the chief accounting officer of Gabelli
setting forth the details thereof and the action which Gabelli is
taking or proposes to take with respect thereto.
Notwithstanding the foregoing, if Gabelli is then subject to the reporting
requirements under Section 13 or 15(d) of the 1934 Act or any successor statute,
(i) the delivery to the Holder of Gabelli's Annual Report on Form 10-K or any
successor form for the relevant fiscal year within the time periods provided for
in clause (a) shall satisfy the requirements of such clause and (ii) the
delivery to the Holder of Gabelli's Quarterly Report on Form 10-Q or any
successor form for the relevant fiscal quarter within the time periods provided
for in clause (b) shall satisfy the requirements of such clause.
Consolidation, Merger and Sale of Assets
----------------------------------------
Gabelli will not consolidate or merge with or into (whether or
not Gabelli is the surviving corporation), or directly and/or indirectly through
its Subsidiaries sell, assign, transfer, lease, convey or otherwise dispose of
all or substantially all of the properties and assets of Gabelli and its
Subsidiaries taken as a whole in one or more related transactions, to any other
Person unless:
(a) the Person formed by or surviving any such consolidation or merger (if
other than Gabelli) or to which such sale, assignment, transfer,
lease, conveyance or other disposition shall have been made (the
"Successor Company") is a corporation, partnership, limited liability
company or other similar business entity organized and validly
existing under the laws of the United States, any state thereof or the
District of Columbia;
(b) the Successor Company assumes all the obligations of Gabelli under the
Notes and the Purchase Agreement pursuant an agreement in form and
substance reasonably satisfactory to the Holder; and
(c) immediately after such transaction no Event of Default or event which,
with notice or lapse of time or both, would constitute an Event of
Default exists.
Upon any consolidation of Gabelli with, or merger of Gabelli into, any other
Person or any transfer, conveyance, sale, lease or other disposition of all or
substantially all of the properties and assets of Gabelli and its Subsidiaries
taken as a whole in one or more related transactions in accordance with this
paragraph, the Successor Company shall succeed to, and be substituted for, and
may exercise every right and power of, Gabelli under this Note and the Purchase
Agreement with the same effect as if such Successor Company had been named as
Gabelli herein, and thereafter, except in the case of a lease, Gabelli shall be
relieved of all obligations and covenants under this Note and the Purchase
Agreement.
Transfer and Related Provisions
-------------------------------
The Holder shall not offer, sell, contract to sell or
otherwise dispose of this Note without the prior written consent of Gabelli;
provided, however, that the Holder shall be permitted to transfer the Note (i)
to any of its Affiliates and (ii) to any other Person (A) in connection with a
transfer of substantially all of the investments of the original Holder, (B) if
the Holder is legally precluded from holding this Note and (C) during the
continuance of an Event of Default, provided, that such transferee agrees to be
bound by the terms contained herein.
"Affiliate" means, with respect to any specified Person, any
other Person directly or indirectly controlling or controlled by or under direct
or indirect common control with such specified Person. For purposes of this
definition, "control" (including, with correlative meanings, the terms
"controlling," "controlled by" and "under common control with"), as used with
respect to any specified Person, shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such Person, whether through the ownership of voting securities, by
agreement or otherwise.
Gabelli shall keep at its principal office a register (the
"Register") in which shall be entered the name and address of the registered
holder of this Note and particulars of this Note and of all permitted transfers
of this Note. Upon surrender for registration of a permitted transfer of this
Note to Gabelli, Gabelli shall execute and deliver, in the name of the
designated transferee or transferees, one or more new Notes, of any
denominations of $1,000,000 and multiples thereof and like aggregate principal
amount. Notwithstanding the foregoing, Gabelli shall not be required to register
the transfer of or exchange this Note unless it has been duly endorsed. All
Notes issued upon any registration of transfer or exchange of this Note shall be
the valid obligations of Gabelli, evidencing the same debt, and entitled to the
same benefits, as this Note.
No service charge shall be made for any registration of
transfer or exchange of this Note, but Gabelli may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection therewith.
Prior to due presentment of this Note for registration of a
permitted transfer, Gabelli and its agents may treat the Person in whose name it
is registered as the owner of this Note for all purposes whatsoever, whether or
not it is overdue and neither Gabelli nor any of its agents shall be affected by
notice to the contrary.
Replacement of Note
-------------------
If this Note has been mutilated and is surrendered to Gabelli,
Gabelli shall execute and deliver in exchange a new Note of the same principal
amount and bearing a number not then outstanding. If the Holder shall deliver to
Gabelli (i) evidence reasonably satisfactory to Gabelli that this Note has been
destroyed, lost or stolen and (ii) such security or indemnity as may be required
by Gabelli to hold it and its agents harmless, then, in the absence of notice
that this Note has been acquired by a bona fide purchaser, Gabelli shall execute
and deliver, in lieu of this Note, a new Note of a like principal amount and
bearing a number not then outstanding. The provisions of this paragraph are
exclusive and shall preclude (to the extent lawful) all other rights and
remedies with respect to the replacement or payment of mutilated, destroyed,
lost or stolen Notes.
Miscellaneous
-------------
Gabelli waives presentment for payment, demand, notice of
nonpayment, notice of protest and protest of this Note, and all notices in
connection with the delivery, acceptance, or dishonor of this Note.
Gabelli agrees that (a) if for any reason any amount due
hereunder is paid by cashier's, certified teller's check or other check, there
shall be no discharge of Gabelli's obligation until said check be finally paid
by the issuer thereof; and (b) the provisions of RCW 62A.3-311 shall not entitle
Gabelli to any accord and satisfaction of any now or hereafter existing claim in
dispute between the Holder and Gabelli (or any of their respective successors
and assigns), all of which provisions and rights are hereby waived.
The Holder shall not by any act or omission be deemed to waive
any of its rights or remedies under this Note or the Purchase Agreement unless
such waiver shall be in writing and signed by the Holder, and then only to the
extent specifically set forth therein.
No right or remedy herein conferred upon or reserved to the
Holder is intended to be exclusive of any other right or remedy, and every right
and remedy shall, to the extent permitted by law, be cumulative and in addition
to every other right and remedy given hereunder or now or hereafter existing at
law or in equity or otherwise. The assertion or employment of any right or
remedy hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
This Note may not be amended other than with the written
consent of the Holder and Gabelli.
Upon demand therefor, Gabelli agrees to pay to the Holder all
costs and fees arising out of enforcing this Note, whether incurred in any court
action, arbitration, or mediation, on appeal, in any bankruptcy (or state
receivership or other insolvency or similar proceedings or circumstances), in
any forfeiture, and for any post-judgment collection services (collectively,
"Enforcement Costs").
Gabelli and, by its acceptance of this Note, the Holder agree
that, subject to the specific terms hereof and to the extent that Washington law
applies, the provisions of Article 3 of the Uniform Commercial Code of
Washington pertaining to instruments shall be applied to this Note, even if this
Note is not deemed to be an "instrument" or a "negotiable instrument"
thereunder.
If this Note will at any time become subject to the Trust
Indenture Act of 1939, Gabelli will make appropriate revisions hereto and will
enter into an indenture with an appropriate trustee so as to comply fully with
such act.
Except as noted below, this Note shall be governed by and
construed in accordance with the laws of the State of Washington. In any court
proceeding, Gabelli agrees to submit to the jurisdiction of the federal court
selected by the Holder, and venue of any action concerning this Note shall be in
King County, Washington state. In the event that the federal court selected by
the Holder shall not have jurisdiction, Gabelli agrees to submit to the
jurisdiction of the Washington state court in King County selected by the
Holder. Gabelli hereby irrevocably waives to the fullest extent permitted by law
any objection which it may now or hereafter have to the laying of such venue and
any claim that any such forum is an inconvenient forum. Nothing in this Section
shall impair the right of the Holder to bring any action or proceeding against
Gabelli or its property in the courts of any other county or jurisdiction and
Gabelli irrevocably submits to the nonexclusive jurisdiction of the appropriate
courts (as selected by the Holder) of the jurisdiction in which Gabelli is
organized or any place where any property or any office of Gabelli is located.
In the event Holder transfers or assigns this Note to a person not one of its
Affiliates, then this Note shall be governed by and construed in accordance with
the laws of the State of New York and the consent to jurisdiction in the State
of Washington stated above is hereby revoked.
NOTICE: ORAL AGREEMENTS OR ORAL COMMITMENTS TO LOAN MONEY, EXTEND CREDIT, OR TO
FORBEAR FROM ENFORCING REPAYMENT OF A DEBT ARE NOT ENFORCEABLE UNDER WASHINGTON
LAW.
IN WITNESS WHEREOF, and intending to be legally bound, the undersigned
has duly executed and delivered this Note as of the date first written above.
GABELLI ASSET MANAGEMENT INC.,
a New York Corporation
By:
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Its:
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Exhibit A
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Conversion Rights
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1. Right of Conversion. At the option of the Holder, this Note or any
portion of the principal amount hereof which is $1,000,000 or an integral
multiple thereof, may be converted at the principal amount hereof, or such
portion hereof, into fully paid and nonassessable shares of the Common Stock
(calculated as to each conversion to the nearest 1/100 of a share of Common
Stock) at the Conversion Price (as hereinafter defined) in effect at the time of
conversion, or into such additional or other securities, cash or property and at
such other rates as required in accordance with the provisions set forth herein.
Such conversion right shall expire at the close of business on August 14, 2011.
2. Conversion Procedures. In order to exercise the conversion right,
the Holder shall surrender this Note at the principal executive offices of
Gabelli (which, if Gabelli shall so require, shall be duly endorsed to Gabelli
or in blank, or be accompanied by proper instruments of transfer to Gabelli or
in blank), accompanied by irrevocable written notice to Gabelli to the effect
that the Holder elects so to convert this Note or, if less than the entire
principal amount hereof is to be converted, the portion hereof to be converted
(which notice shall specify the name or names (with address or addresses) in
which a certificate or certificates evidencing the shares of Common Stock to be
issued upon such conversion are to be issued). Except as otherwise expressly set
forth herein, no payment or adjustment shall be made upon any conversion of the
Note on account of any interest accrued on this Note or on account of any
dividends accrued on the shares of Common Stock issued upon such conversion.
Gabelli shall, as soon as practicable after the surrender of
this Note at the office referred to above and compliance with the other
conditions herein contained, deliver at such office, to the person or persons
entitled thereto (as specified in the applicable written notice of conversion),
a certificate or certificates evidencing the number of full shares of Common
Stock to which such person or persons shall be entitled as aforesaid, together
with a cash adjustment in respect of any fraction of a share of Common Stock as
hereinafter provided. Such conversion shall be deemed to have been made as of
the date of such surrender of this Note (or, if later, the date of compliance
with such other conditions), and the person or persons entitled to receive the
Common Stock deliverable upon conversion of this Note shall be treated for all
purposes as the record holder or holders of such Common Stock on such date.
If this Note is to be converted in part only, upon such
conversion Gabelli shall execute deliver to the Holder, at the expense of
Gabelli, a new Note or Notes of like tenor in denominations of $1,000,000 and
any integral multiple thereof and with an aggregate principal amount equal to
the unconverted portion of the principal amount of this Note.
3. No Fractional Shares. No fractional shares of Common Stock shall be
issued upon conversion of this Note. Instead of any fractional share of Common
Stock that would otherwise be issuable to the Holder upon conversion of this
Note (or any specified portion hereof), Gabelli shall pay a cash adjustment in
respect of such fractional share in an amount equal to the same fraction of the
Closing Price (as hereinafter defined) on the day of conversion.
4. Reservation of Shares; Etc. Gabelli shall at all times reserve and
keep available, free from preemptive rights out of its authorized but unissued
Common Stock, solely for the purpose of effecting the conversion of this Note,
the full number of shares of Common Stock that would then be deliverable upon
the conversion of all of the principal amount of this Note and any other
outstanding Notes.
If any shares of Common Stock required to be reserved for
purposes of conversion of this Note require registration with or approval of any
governmental authority under any Federal or State law before such shares may be
issued or freely transferred upon conversion, Gabelli will in good faith and as
expeditiously as possible endeavor to cause such shares to be duly registered or
approved as the case may be. If the Common Stock is quoted on the New York Stock
Exchange or any other U.S. national securities exchange, Gabelli will, if
permitted by the rules of such exchange, list and keep listed on such exchange,
upon official notice of issuance, all shares of Common Stock issuable upon
conversion of this Note and any other outstanding Notes. Notwithstanding the
foregoing, the reference to free transferability in the first sentence of this
paragraph and the reference to listing in the second sentence of this paragraph
shall apply only when this Note shall have become freely transferable under the
federal securities laws.
5. Prior Notice of Certain Events. If Gabelli shall authorize any
transaction that would require an adjustment to the Conversion Price (other than
a transaction referred to in clauses (a) or (c) of Section 6 below) or there
shall be a voluntary or involuntary dissolution, liquidation or winding up of
Gabelli, then Gabelli shall notify the Holder, at least 20 days (or, in the case
of a transaction referred to in clauses (b), (d) or (e) of Section 6 below, 10
days) prior to the applicable record, expiration or consummation date
hereinafter specified, a notice stating (i) the record date fixed for the
determination of holders of Common Stock entitled to the applicable issuance,
dividend or distribution or (ii) the date of expiration of the applicable tender
or exchange offer, as the case may be.
6. Adjustment of Conversion Price.
(a) In case Gabelli shall pay or make a dividend or other distribution
on any class of Capital Stock of Gabelli payable in Common Stock, the Conversion
Price in effect at the opening of business on the day following the date fixed
for the determination of stockholders entitled to receive such dividend or other
distribution shall be reduced by multiplying such Conversion Price by a fraction
of which the numerator shall be the number of shares of Common Stock outstanding
at the close of business on the date fixed for such determination and the
denominator shall be the sum of such number of shares and the total number of
shares constituting such dividend or other distribution, such reduction to
become effective immediately after the opening of business on the day following
the date fixed for such determination. (For the purposes of determining
adjustments to the Conversion Price as set forth herein, shares of Common Stock
held in the treasury of Gabelli, and distributions or issuances in respect
thereof, shall be disregarded.)
(b) In case Gabelli shall issue rights or warrants to all or
substantially all holders of its Common Stock entitling them, for a period of
not more than 45 days, to subscribe for or purchase shares of Common Stock at a
price per share less than the Current Market Price (as hereinafter defined) on
the date fixed for the determination of stockholders entitled to receive such
rights or warrants, the Conversion Price in effect at the opening of business on
the day following the date fixed for termination of such subscription or
purchase period shall be reduced by multiplying such Conversion Price by a
fraction of which the numerator shall be the number of shares of Common Stock
outstanding at the close of business on the date fixed for such determination
plus the number of shares of Common Stock which the aggregate of the offering
price of the total number of shares of Common Stock actually purchased upon
exercise of such rights or warrants would have purchased at such Current Market
Price and the denominator shall be the number of shares of Common Stock
outstanding at the close of business on the date fixed for such determination
plus the number of shares of Common Stock actually purchased upon exercise of
such rights or warrants, such reduction to become effective immediately after
the opening of business on the day following the date fixed for such
termination.
(c) In case outstanding shares of Common Stock shall be subdivided into
a greater number of shares of Common Stock, the Conversion Price in effect at
the opening of business on the day following the day upon which such subdivision
becomes effective shall be proportionately reduced, and conversely, in case
outstanding shares of Common Stock shall each be combined into a smaller number
of shares of Common Stock, the Conversion Price in effect at the opening of
business on the day following the day upon which such combination becomes
effective shall be proportionately increased, such reduction or increase, as the
case may be, to become effective immediately after the opening of business on
the day following the day upon which such subdivision or combination becomes
effective.
(d) In case Gabelli shall, by dividend or otherwise, distribute to all
or substantially all holders of its Common Stock evidences of indebtedness,
shares of capital stock of any class or series, other securities, cash or assets
(other than Stapled Securities (as hereinafter defined), Common Stock, rights or
warrants referred to in clause (b) of this Section 6 or a dividend or
distribution payable exclusively in cash), the Conversion Price in effect
immediately prior to the close of business on the date fixed for the payment of
such distribution shall be reduced by multiplying such Conversion Price by a
fraction of which the numerator shall be the Current Market Price on the date
fixed for such payment less the then fair market value (as determined in good
faith by the Board of Directors of Gabelli (the "Board of Directors"), whose
good faith determination shall be conclusive and described in a resolution of
the Board of Directors) of the portion of such evidences of indebtedness, shares
of capital stock, other securities, cash and assets distributed per share of
Common Stock and the denominator shall be such Current Market Price, such
reduction to become effective immediately prior to the opening of business on
the day following the date fixed for such payment. If the Board of Directors
determines the fair market value of any distribution for purposes of this
paragraph by reference to the actual or when-issued trading market for any
securities comprising such distribution, in doing so it must consider the prices
in such market over the same period used in computing the Current Market Price
for such purposes.
(e) In case Gabelli shall, by dividend or otherwise, make a
distribution to all or substantially all holders of its Common Stock payable
exclusively in cash in an aggregate amount that, when combined with the
aggregate amount paid in respect of all other distributions to all or
substantially all holders of its Common Stock paid exclusively in cash within
the 12 months preceding the date fixed for the payment of such distribution to
the extent such amount has not already been applied in a prior adjustment
pursuant to this paragraph, exceeds 10% of the product of the Current Market
Price on the date fixed for such payment times the number of shares of Common
Stock on which such distribution is paid, the Conversion Price in effect
immediately prior to the close of business on the date fixed for such payment
shall be reduced by multiplying such Conversion Price by a fraction of which the
numerator shall be the Current Market Price on the date fixed for such payment
less the Per Share Distribution Amount (as hereinafter defined) paid in such
distribution and the denominator shall be such Current Market Price, such
reduction to become effective immediately prior to the opening of business on
the day following the date fixed for such payment.
(f) In case Gabelli or any of its Subsidiaries shall consummate a
tender or exchange offer for all or any portion of the Common Stock, the
Conversion Price in effect immediately prior to the close of business on the
date of expiration of such tender or exchange offer shall be reduced by
multiplying such Conversion Price by a fraction of which the numerator shall be
the Current Market Price on such date of expiration less the Per Share Premium
Amount (as hereinafter defined) paid in such tender or exchange offer and the
denominator shall be such Current Market Price, such reduction to become
effective immediately prior to the opening of business on the day following such
date of expiration.
(g) In case Gabelli shall, by dividend or otherwise, make a
distribution referred to in paragraph (d) or (e) above, the Holder converting
this Note (or any portion of the principal amount hereof) subsequent to the
close of business on the date fixed for the determination of stockholders
entitled to receive such distribution and prior to the effectiveness of the
Conversion Price adjustment in respect of such distribution shall also be
entitled to receive, for each share of Common Stock into which this Note (or
portion of the principal amount being converted), the portion of the evidences
of indebtedness, shares of capital stock, other securities, cash and assets so
distributed applicable to one share of Common Stock; provided, however, that, at
the election of Gabelli (whose election shall be evidenced by a resolution of
the Board of Directors) with respect to all holders so converting, Gabelli may,
in lieu of distributing to such holder any portion or all of such evidences of
indebtedness, shares of capital stock, other securities, cash and assets to
which such holder is entitled as set forth above, (i) pay such holder an amount
in cash equal to the fair market value thereof (as determined in good faith by
the Board of Directors, whose good faith determination shall be conclusive and
described in a resolution of the Board of Directors) or (ii) distribute to such
holder a due xxxx therefor, provided that such due xxxx (A) meets any applicable
requirements of the principal national securities exchange or other market on
which the Common Stock is then traded and (B) requires payment or delivery of
such evidences of indebtedness, shares of capital stock, other securities, cash
or assets no later than the date of payment thereof to holders of shares of
Common Stock receiving such distribution.
(h) Gabelli may make such reductions in the Conversion Price, in
addition to those required by the foregoing paragraphs, as it considers to be
advisable to avoid or diminish any income tax to holders of Common Stock or
rights to purchase Common Stock resulting from any dividend or distribution of
stock (or rights to acquire stock) or from any event treated as such for income
tax purposes. In addition, Gabelli from time to time may reduce the Conversion
Price by any amount for any period of time if the period is at least twenty
days, the reduction is irrevocable during the period, and the Board of Directors
of Gabelli shall have made a determination that such reduction would be in the
best interest of Gabelli, which determination shall be conclusive. Whenever the
Conversion Price is reduced pursuant to the preceding sentence, Gabelli shall
provide written notice to the Holder of this Note and the holders of any other
outstanding Notes of the reduction at least fifteen days prior to the date the
reduced Conversion Price takes effect, and such notice shall state the reduced
Conversion Price and the period it will be in effect.
(i) Gabelli may not engage in any transaction if, as a result thereof,
the Conversion Price would be reduced to below the par value per share of the
Common Stock.
(j) No adjustment in the Conversion Price shall be required unless such
adjustment would require an increase or decrease of at least 1% in the
Conversion Price; provided, however, that any adjustments which by reason of
this paragraph are not required to be made shall be carried forward and taken
into account in any subsequent adjustment.
(k) Whenever the Conversion Price is adjusted as herein provided,
Gabelli shall compute the adjusted Conversion Price and shall prepare a
certificate signed by the Treasurer of Gabelli setting forth the adjusted
Conversion Price and showing in reasonable detail the facts upon which such
adjustment is based, and such certificate shall be given by Gabelli to the
Holder of this Note and the holders of any other outstanding Notes.
7. Stapled Securities.
(a) Prior to a Separation Event (as hereinafter defined) with respect
to any Stapled Securities, such Stapled Securities will be deemed, for purposes
of the adjustments contemplated hereby, to comprise part of the shares of Common
Stock to which such Stapled Securities appertain, and as a result, distributions
in respect of such Stapled Securities will be deemed, for such purposes, to be
distributions in respect of such shares.
(b) If the Holder converts this Note (or any portion of the principal
amount hereof) after a Separation Event with respect to any Stapled Securities,
it shall be entitled to receive upon such conversion, in addition to the shares
of Common Stock issuable upon such conversion, the same rights to which the
Holder would have been entitled under the Stapled Securities that would have
appertained to such shares of Common Stock if the Holder had effected such
conversion before such Separation Event.
8. Consolidations, Mergers or Sales of Assets. In the event of any
consolidation of Gabelli with, or merger of Gabelli into, any other Person, any
merger of another Person into Gabelli (other than a merger which does not result
in any reclassification, conversion, exchange or cancellation of outstanding
shares of the Common Stock) or any sale or transfer of all or substantially all
of the assets Gabelli, the Person formed by such consolidation or resulting from
such merger or which acquires such assets, as the case may be, shall enter into
a written agreement with the Holder, in form and substance reasonably acceptable
to the Holder, providing that the Holder shall have the right thereafter, during
the period in which this Note shall be convertible, to convert this Note (or
portion of the principal amount hereof) only into the kind and amount of
securities, cash and other property receivable upon such consolidation, merger,
sale or transfer by a holder of the number of shares of Common Stock into which
this Note (or portion thereof) might have been converted immediately prior to
such consolidation, merger, sale or transfer, assuming the Holder (i) is not a
Person with which Gabelli consolidated or into which Gabelli merged or which
merged into Gabelli or to which such sale or transfer was made, as the case may
be, (a "Constituent Person") or an Affiliate of a Constituent Person and (ii)
failed to exercise his or her rights of election, if any, as to the kind or
amount of securities, cash and other property receivable upon such
consolidation, merger, sale or transfer; provided, however, that if the kind or
amount of securities, cash and other property receivable upon such
consolidation, merger, sale or transfer is not the same for each share of Common
Stock held immediately prior to such consolidation, merger, sale or transfer by
Persons other than a Constituent Person or an Affiliate thereof and in respect
of which such rights of election shall not have been exercised (each, a
"Non-Electing Share"), then for purposes of this Section 8 the kind and amount
of securities, cash and other property receivable upon such consolidation,
merger, sale or transfer by each Non-Electing Share shall be deemed to be the
kind and amount so receivable per share by a plurality of the Non-Electing
Shares. Such written agreement shall provide for adjustments which, for events
subsequent to the effective date of such agreement, shall be as nearly
equivalent as may be practicable to the adjustments provided for in this Exhibit
A. The provisions of this Section 8 shall similarly apply to successive
consolidations, mergers, sales or transfers. If the conversion rights of the
Holder of this Note shall be adjusted pursuant to this Section 8, then Gabelli
shall cause to be given to the Holder and any other holders of outstanding
Notes, within 5 days after consummation of the transaction triggering such
adjustment, a notice describing such adjustment in appropriate detail.
9. Taxes. Gabelli shall pay any and all stock transfer, documentary
stamp and other taxes that may be payable in respect of any issuance or delivery
of shares of Common Stock or other securities issued or delivered on conversion
of this Note. Gabelli shall not, however, be required to pay any such tax which
may be payable in respect of any transfer involved in the issuance or delivery
of shares of Common Stock or other securities in a name other than to the
Holder, and shall not be required to make any such issuance or delivery unless
and until the person otherwise entitled to such issuance or delivery has paid to
Gabelli the amount of any such tax or has established, to the satisfaction of
Gabelli, that such tax has been paid or is not payable.
10. Certain Definitions. The following definitions shall apply to terms
used in this Exhibit A:
"Closing Price" of any common stock on any day means the last
reported per share sale price, regular way, of the common stock on such day, or,
in case no such sale takes place on such day, the average of the reported
closing per share bid and asked prices, regular way, of the common stock on such
day, in each case on the New York Stock Exchange or, if the common stock is not
listed or admitted to trading on the New York Stock Exchange, on the principal
national securities exchange or quotation system on which the common stock is
listed or admitted to trading or quoted, or, if the common stock is not listed
or admitted to trading or quoted on any national securities exchange or
quotation system, the average of the closing per share bid and asked prices of
the common stock on such day in the over-the-counter market as reported by a
generally accepted national quotation service or, if not so available in such
manner, as furnished by any New York Stock Exchange member firm selected from
time to time by the Board of Directors of Gabelli for that purpose or, if not so
available in such manner, as otherwise determined in good faith by the Board of
Directors (whose good faith determination shall be conclusive and described in a
resolution of the Board of Directors).
"Common Stock" shall mean the Class A Common Stock, par value
$0.001 per share, of Gabelli or, subject to Section 8, any shares of any class
or classes resulting from any reclassifications thereof and which have no
preference in respect of dividends or of amounts payable in the event of any
voluntary or involuntary liquidation, dissolution or winding up of Gabelli and
which are not subject to redemption by Gabelli; provided, however, that if at
any time there shall be more than one such resulting class, the shares of each
such class then so issuable shall be substantially in the proportion which the
total number of shares of such class resulting from such reclassification bears
to the total number of shares of all such classes resulting from all such
reclassifications.
"Conversion Price" initially means $53.00, subject to
adjustment from time to time as set forth herein; provided, however, that
without limiting the foregoing the Conversion Price shall decrease by $1.00 as
of August 14, 2003.
"Current Market Price" on any date in question means, with
respect to any adjustment in conversion rights as set forth herein, the average
of the daily Closing Prices for the Common Stock for the five consecutive
Trading Days selected by the Board of Directors commencing not more than 20
Trading Days before, and ending not later than, the earlier of the date in
question and the day before the Ex Date with respect to the transaction
requiring such adjustment; provided, however, that (i) if any other transaction
occurs requiring a prior adjustment to the Conversion Price and the Ex Date for
such other transaction falls after the first of the five consecutive Trading
Days so selected by the Board of Directors, the Closing Price for each such
Trading Day falling prior to the Ex Date for such other transaction shall be
adjusted by multiplying such Closing Price by the same fraction by which the
Conversion Price is so required to be adjusted as a result of such other
transaction and (ii) if any other transaction occurs requiring a subsequent
adjustment to the Conversion Price and the Ex Date for such other transaction
falls on or before the last of the five consecutive Trading Days so selected by
the Board of Directors, the Closing Price for each such Trading Day falling on
or after the Ex Date for such other transaction shall be adjusted by dividing
such Closing Price by the same fraction by which the Conversion Price is so
required to be adjusted as a result of such other transaction.
"Ex Date" means (i) when used with respect to any dividend,
distribution or issuance, the first date on which the Common Stock trades
regular way on the relevant exchange or in the relevant market from which the
Closing Price is obtained without the right to receive such dividend,
distribution or issuance, (ii) when used with respect to any subdivision or
combination of shares of Common Stock, the first date on which the Common Stock
trades regular way on such exchange or in such market after the time at which
such subdivision or combination becomes effective, (iii) when used with respect
to any tender or exchange offer, the first date on which the Common Stock trades
regular way on such exchange or in such market after such tender or exchange
offer expires and (iv) when used with respect to any other transaction, the date
of consummation of such transaction.
"Per Share Distribution Amount" means, with respect to any
distribution, (i) the cash paid in such distribution divided by (ii) the number
of shares of Common Stock on which such distribution is paid.
"Per Share Premium Amount" means, with respect to any tender
or exchange offer, (i) the Premium Amount paid as part of such tender or
exchange offer divided by (ii) the Post-Tender Offer Number of Common Shares.
"Post-Tender Offer Number of Common Shares" means, with
respect to any tender or exchange offer, the number of shares of Common Stock
outstanding at the close of business on the date of expiration of such tender or
exchange offer (before giving effect to the acquisition of shares of Common
Stock pursuant thereto) minus the number of shares of Common Stock acquired
pursuant thereto.
"Premium Amount" means, with respect to any tender or exchange
offer, (i) the Tender Consideration paid in such tender or exchange offer minus
(ii) the product of the Current Market Price on the date of expiration of such
tender or exchange offer and the number of shares of Common Stock acquired
pursuant to such tender or exchange offer.
"Separation Event" has the meaning set forth in the definition
of the term "Stapled Securities" below.
"Stapled Securities" means securities issued under any plan or
agreement providing in substance that, until such securities are redeemed or the
rights thereunder are otherwise terminated or a specified event occurs (a
"Separation Event"), (i) a specified number of such securities will appertain to
each share of Common Stock then issued or to be issued in the future (including
shares issued upon conversion of this Note) and (ii) each such security will be
evidenced or represented by the certificate representing the share of Common
Stock to which it appertains and will automatically trade with such share.
"Tender Consideration" means, with respect to any tender or
exchange offer, the aggregate of the cash plus the fair market value (as
determined in good faith by the Board of Directors, whose good faith
determination shall be conclusive and described in a resolution of the Board of
Directors) of all non-cash consideration paid in respect of such tender or
exchange offer.
"Trading Day" means a day on which securities are traded on
the national securities exchange or quotation system or in the over-the-counter
market used to determine Closing Prices for the Common Stock.
