AS
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER 2,
2009
Registration No.
333-
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
S-3
REGISTRATION
STATEMENT
UNDER
THE
SECURITIES ACT OF 1933
Lexicon
Pharmaceuticals, Inc.
(Exact
name of registrant as specified in its charter)
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Delaware
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76-0474169
|
|
(State
or other jurisdiction of incorporation or organization)
|
(I.R.S.
Employer Identification Number)
|
____________
8800
Technology Forest Place
The
Woodlands, Texas
77381-1160
(281)
863-3000
(Address,
including zip code, and telephone number, including area code, of registrant’s
principal executive offices)
____________
Arthur
T. Sands, M.D., Ph.D.
President
and Chief Executive Officer
8800
Technology Forest Place
The
Woodlands, Texas 77381-1160
(281)
863-3000
(Name,
address, including zip code, and telephone number, including area code, of agent
for service)
____________
Copies
to:
|
David P.
Oelman
Vinson &
Elkins L.L.P.
2300
First City Tower
1001
Fannin
Houston,
Texas 77002-6760
(713)
758-3708
|
Jeffrey
L. Wade
Executive
Vice President and General Counsel
Lexicon
Pharmaceuticals, Inc.
8800
Technology Forest Place
The
Woodlands, Texas 77381-1160
(281)
863-3000
|
Approximate
date of commencement of proposed sale to the public:
From time
to time after this registration statement becomes effective, subject to market
conditions and other factors.
If the
only securities being registered on this Form are being offered pursuant to
dividend or interest reinvestment plans, check the following
box. □
If any of the securities
being registered on this Form are to be offered on a delayed or continuous basis
pursuant to Rule 415 under the Securities Act of 1933, other than securities
offered only in connection with dividend or interest reinvestment plans, check
the following
box. þ
If this
Form is filed to register additional securities for an offering pursuant to Rule
462(b) under the Securities Act, please check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering.□
If this
Form is a post-effective amendment filed pursuant to Rule 462(c) under the
Securities Act, check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same
offering. □
If this
Form is a registration statement pursuant to General Instruction I.D. or a
post-effective amendment thereto that shall become effective upon filing with
the Commission pursuant to Rule 462(e) under the Securities Act, check the
following box. □
If this
Form is a post-effective amendment to a registration statement filed pursuant to
General Instruction I.D. filed to register additional securities or classes of
securities pursuant to Rule 413(b) under the Securities Act, check the following
box. □
Indicate by check mark
whether the registrant is a large accelerated filer, an accelerated filer, a
non-accelerated filer, or a smaller reporting company. See the
definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange
Act. Large accelerated filer
□ Accelerated filer þ Non-accelerated
filer (Do not check if a smaller reporting company) □ Smaller
reporting company □
CALCULATION
OF REGISTRATION FEE
|
Title
of Each Class of
Securities
to be Registered
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Amount
to be Registered (1) (3)
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Proposed
Maximum
Aggregate
Offering
Price
Per Unit (2) (3)
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Proposed
Maximum
Aggregate
Offering
Price (3)
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Amount
of
Registration
Fee
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Common
Stock, par value $0.001
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N/A
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|||
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Preferred
Stock, par value $0.01
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N/A
|
|||
|
Debt
Securities
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N/A
|
|||
|
Warrants
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N/A
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|||
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Rights
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N/A
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|||
|
Units
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N/A
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|||
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Total
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$150,000,000
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$150,000,000
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$
8,370 (4)
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(1)
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There
are
being registered hereunder such indeterminate (i) number of shares of
common stock and preferred stock, (ii) principal amount of debt
securities, (iii) number of warrants to purchase common stock, preferred
stock or debt securities, (iv) number of rights to purchase common stock,
preferred stock or debt securities and (v) number of units as shall have
an aggregate initial offering price not to exceed
$150,000,000. If any debt securities are issued at an original
issued discount, then the offering price of such debt
securities shall be in such greater principal amount as shall result in an
aggregate initial offering price not to exceed $150,000,000, less the
aggregate dollar amount of all securities previously issued
hereunder. Any securities registered hereunder may be sold
separately or as units with other securities registered
hereunder. The securities registered also include such
indeterminate numbers of shares of common stock and preferred stock and
amount of debt securities as may be issued upon conversion of or exchange
for preferred stock or debt securities that provide for conversion or
exchange, upon exercise of warrants or rights or pursuant to the
antidilution provisions of any such securities. The securities
registered also include, pursuant to Rule 416 under the Securities Act,
such additional number of shares of common stock that may become issuable
as a result of any stock split, stock dividends or
similarevent.
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(2)
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The
proposed
maximum initial offering price per security or unit will be determined,
from time to time, by the registrant in connection with the issuance by
the registrant of the securities registered
hereunder.
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(3)
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The
amount
to be registered, proposed maximum aggregate offering price per unit and
proposed maximum aggregate offering price are not specified as to each
class of security pursuant to General Instruction II.D. of Form S-3 under
the Securities Act.
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(4)
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Calculated
pursuant
to Rule 457(o) under the Securities Act. As the $12,514
previously paid with respect to unsold securities registered on Form S-3
(Registration No. 333 122214) filed by the registrant on January 21, 2005
exceeds the amount of registration fee due hereunder, no fee is being paid
herewith pursuant to Rule 457(p) under the Securities
Act.
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The registrant
hereby
amends this registration statement on such date or dates as may be necessary to
delay its effective date until the registrant shall file a further amendment
which specifically states that this registration statement shall thereafter
become effective in accordance with Section 8(a) of the Securities Act of 1933,
as amended, or until the registration statement shall become effective on such
date as the Commission, acting pursuant to said Section 8(a), may
determine.
The
information in this prospectus is not complete and may be changed. We
may not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an offer
to sell these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.
SUBJECT
TO COMPLETION, DATED SEPTEMBER 2, 2009
$150,000,000
Lexicon
Pharmaceuticals, Inc.
Common
Stock
Preferred
Stock
Debt
Securities
Warrants
Rights
Units
We may
offer common stock, preferred stock, debt securities, warrants and/or rights,
either individually or in units, from time to time in one or more offerings in
amounts, at prices and on terms to be determined in light of market conditions
at the time of sale. We may also offer common stock or preferred
stock upon conversion of debt securities, common stock upon conversion of
preferred stock or common stock, preferred stock or debt securities upon the
exercise of warrants or rights.
Each time
we sell these securities, we will provide a supplement to this prospectus that
contains specific information about the offering. The supplement may
also add, update or change information contained in this
prospectus. You should carefully read this prospectus and any
supplement before you invest.
Our
common stock is listed on The Nasdaq Global Market under the symbol
“LXRX”. The prospectus supplement will contain information, where
applicable, regarding any other listing on The Nasdaq Global Market or any
securities exchange of the securities covered by the prospectus
supplement. The last reported sale price of our common stock
on September 1, 2009 was $1.35 per share.
Investing
in our securities involves risks. See “Risk Factors” on page
4.
Neither the
Securities and Exchange Commission nor any state securities commission has
approved or disapproved of these securities or determined if this prospectus is
truthful or complete. Any representation to the contrary is a criminal
offense.
The date
of this prospectus
is ,
2009.
TABLE
OF CONTENTS
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Page
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Page
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Lexicon
Pharmaceuticals,
Inc.
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3
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Ratio
of Earnings to Fixed Charges
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21
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Risk
Factors
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4
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Use
of
Proceeds
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22
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Description
of Capital
Stock
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4
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Plan
of
Distribution
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22
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Description
of Debt
Securities
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9
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Legal
Matters
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24
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Description
of
Warrants
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14
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Experts
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24
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Description
of
Rights
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16
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Where
You Can Find More Information
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24
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Description
of
Units
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17
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Documents
Incorporated by Reference
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24
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Legal
Ownership of
Securities
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18
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Special
Note Regarding Forward Looking
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Statements
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21
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You
should rely only on the information contained in this prospectus and documents
incorporated into this prospectus by reference. We have not
authorized anyone to provide you with information different from that contained
in this prospectus or the documents incorporated by reference
herein. This prospectus may only be used where it is legal to sell
these securities. The information contained in this prospectus, the
documents incorporated by reference herein and any supplements to this
prospectus is accurate only as of the dates of their respective covers or
earlier dates as specified therein, regardless of the time of delivery of this
prospectus or any supplement to this prospectus or of any sale of our common
stock.
In this
prospectus, “Lexicon,” “Lexicon Pharmaceuticals,” “we,” “us” and “our” refer to
Lexicon Pharmaceuticals, Inc. and its subsidiaries.
The
Lexicon name and logo, LexVision® and
OmniBank® are
registered trademarks and Genome5000™ is a
trademark of Lexicon Pharmaceuticals, Inc.
LEXICON
PHARMACEUTICALS, INC.
Lexicon
Pharmaceuticals, Inc. is a biopharmaceutical company focused on the discovery
and development of breakthrough treatments for human disease. We have
used our proprietary gene knockout technology and an integrated platform of
advanced medical technologies to systematically study the physiological and
behavioral functions of almost 5,000 genes in mice and assessed the utility of
the proteins encoded by the corresponding human genes as potential drug
targets. We have identified and validated in living animals, or in vivo, more than 100
targets with promising profiles for drug discovery. For targets that
we believe have high pharmaceutical value, we engage in programs for the
discovery and development of potential new drugs, focusing in the core
therapeutic areas of immunology, metabolism, cardiology and
ophthalmology.
We are
presently conducting Phase 2 clinical trials of our four most advanced drug
candidates: LX1031, an orally-delivered small molecule compound that we are
developing as a potential treatment for irritable bowel syndrome and other
gastrointestinal disorders; LX1032, an orally-delivered small molecule compound
that we are developing as a potential treatment for the symptoms associated with
carcinoid syndrome; LX2931, an orally-delivered small molecule compound that we
are developing as a potential treatment for rheumatoid arthritis and other
autoimmune diseases; and LX4211, an orally-delivered small molecule compound
that we are developing as a potential treatment for Type 2
diabetes. We have advanced one other drug candidate into preclinical
development: LX7101, a topically-delivered small molecule compound that we are
developing as a potential treatment for glaucoma. We have small
molecule compounds from a number of additional drug discovery programs in
various stages of preclinical research and believe that our systematic, target
biology-driven approach to drug discovery will enable us to substantially expand
our clinical pipeline.
We are
working both independently and through strategic collaborations and alliances to
capitalize on our technology, drug target discoveries and drug discovery and
development programs. Consistent with this approach, we seek to
retain exclusive rights to the benefits of certain of our small molecule drug
programs by developing and commercializing drug candidates from such programs
internally and to collaborate with third parties with respect to the discovery,
development and commercialization of small molecule and biotherapeutics drug
candidates for other targets, particularly when the collaboration provides us
with access to expertise and resources that we do not possess internally or are
complementary to our own. We have established drug discovery and
development collaborations with a number of leading pharmaceutical and
biotechnology companies which have enabled us to generate near-term cash while
offering us the potential to retain economic participation in products our
collaborators develop through the collaboration. In addition, we have
established collaborations and license agreements with other leading
pharmaceutical and biotechnology companies, research institutes and academic
institutions under which we receive fees and, in some cases, are eligible to
receive milestone and royalty payments, in return for granting access to some of
our technologies and discoveries for use in the other organization’s own drug
discovery efforts.
Lexicon
Pharmaceuticals, Inc. was incorporated in Delaware in July 1995, and commenced
operations in September 1995. Our corporate headquarters are located
at 8800 Technology Forest Place, The Woodlands, Texas 77381, and our telephone
number is (281) 863-3000.
Our
annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on
Form 8-K, and amendments to those reports filed or furnished pursuant to Section
13(a) or 15(d) of the Securities Exchange Act of 1934, or Exchange Act, are made
available free of charge on our corporate website located at www.lexpharma.com
as soon as reasonably practicable after the filing of those reports with the
Securities and Exchange Commission, or SEC. Information found on our
website should not be considered part of this prospectus.
3
RISK
FACTORS
You
should carefully consider the risk factors and all other information contained
in this prospectus and any prospectus supplement and incorporated herein by
reference before purchasing our securities. Investing in our
securities involves a high degree of risk.
For a
discussion of these risks, please see:
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·
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Our
most recent annual report on Form 10-K,
and
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Our
other filings with the SEC that are incorporated by reference into this
prospectus.
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For more
information about our SEC filings, please see “Where You Can Find More
Information” and “Documents Incorporated By Reference” on page 24 of this
prospectus. See also “Special Note Regarding Forward-Looking
Statements” on page 21 of this prospectus.
DESCRIPTION
OF CAPITAL STOCK
Our
authorized capital stock consists of 900 million shares of common stock, $0.001
par value, and five million shares of preferred stock, $0.01 par
value. As of September 1, 2009, there were 137,262,363 shares of our
common stock issued and outstanding, 67,891 shares of our common stock issued
and held in treasury and no shares of preferred stock outstanding.
The
following summary description of our capital stock is based on the provisions of
our restated certificate of incorporation, as amended, restated bylaws and the
applicable provisions of the Delaware General Corporation Law. This
information may not be complete in all respects and is qualified entirely by
reference to the provisions of our restated certificate of incorporation, as
amended, restated bylaws and the Delaware General Corporation Law. For
information on how to obtain copies of our restated certificate of
incorporation, as amended, and restated bylaws, see “Where You Can Find More
Information” on page 24 of this prospectus.
Common
Stock
The
holders of common stock are entitled to one vote for each share held of record
on all matters submitted to a vote of the stockholders and do not have
cumulative voting rights. Accordingly, holders of a majority of the shares of
common stock entitled to vote in any election of directors may elect all of the
directors standing for election. Subject to preferences that may be applicable
to any outstanding shares of preferred stock, the holders of common stock are
entitled to receive ratably such dividends as may be declared by the board of
directors out of funds legally available therefor. Upon the liquidation,
dissolution or winding up of Lexicon, holders of our common stock are entitled
to share ratably in all assets remaining after payment of liabilities and the
liquidation preferences of any outstanding shares of preferred stock. Holders of
common stock have no preemptive rights and no right to convert their common
stock into any other securities. There are no redemption or sinking fund
provisions applicable to our common stock. All outstanding shares of our common
stock are, and all shares of common stock that may be issued under this
prospectus will be, fully paid and non-assessable.
Preferred
Stock
Pursuant
to our restated certificate of incorporation, our board of directors has the
authority, without further action by the stockholders, to issue up to five
million shares of preferred stock, in one or more series. Our board of directors
is authorized to fix or alter from time to time the designation, powers,
preferences and rights of the shares of each series of preferred stock,
including dividend rights, conversion rights, voting rights, terms of
redemption, liquidation preferences and sinking fund terms. Our board of
directors may also establish from time to time the number of shares constituting
any series of preferred stock, and to increase or decrease the number of shares
of any series subsequent to the issuance of shares of that series, but not below
the number of shares of any series then outstanding.
We will
fix the rights, preferences, privileges and restrictions of the preferred stock
of each series in the certificate of designation relating to that series. We
will incorporate by reference as an exhibit to the registration statement that
includes this prospectus or as an exhibit to a report filed under the Exchange
Act, the form of any certificate of designation that describes the terms of the
series of preferred stock we are offering before the issuance of the related
series of preferred stock. This description will include:
4
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the
title and stated value;
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·
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the
number of shares we are offering;
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·
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the
liquidation preference per share;
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·
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the
purchase price;
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the
dividend rate, period and payment date and method of calculation for
dividends;
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whether
dividends will be cumulative or non-cumulative and, if cumulative, the
date from which dividends will
accumulate;
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·
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the
provisions for a sinking fund, if
any;
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·
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the
provisions for redemption or repurchase, if applicable, and any
restrictions on our ability to exercise those redemption and repurchase
rights;
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whether
the preferred stock will be convertible into our common stock, and, if
applicable, the conversion price, or how it will be calculated, and the
conversion period;
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whether
the preferred stock will be exchangeable into debt securities, and, if
applicable, the exchange price, or how it will be calculated, and the
exchange period;
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voting
rights, if any, of the preferred
stock;
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preemption
rights, if any;
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restrictions
on transfer, sale or other assignment, if
any;
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the
relative ranking and preferences of the preferred stock as to dividend
rights and rights if we liquidate, dissolve or wind up our
affairs;
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any
limitations on issuance of any class or series of preferred stock ranking
senior to or on a parity with the series of preferred stock as to dividend
rights and rights if we liquidate, dissolve or wind up our affairs;
and
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·
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any
other specific terms, preferences, rights or limitations of, or
restrictions on, the preferred
stock.
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If we
issue shares of preferred stock under this prospectus, the shares will be fully
paid and non-assessable and will not have, or be subject to, any preemptive or
similar rights.
The
Delaware General Corporation Law provides that the holders of preferred stock
will have the right to vote separately as a class on any proposal involving
fundamental changes in the rights of holders of that preferred stock. This right
is in addition to any voting rights that may be provided for in the applicable
certificate of designation.
The
issuance of preferred stock could adversely affect the voting power, conversion
or other rights of holders of common stock. Preferred stock could be issued
quickly with terms designed to delay or prevent a change in control of our
company or make removal of management more difficult. Additionally, the issuance
of preferred stock may have the effect of decreasing the market price of our
common stock.
Arrangements
with Invus, L.P.
In June
2007, we entered into a securities purchase agreement with Invus, L.P, pursuant
to which Invus purchased 50,824,986 shares of our common stock for approximately
$205.4 million in August 2007. This purchase resulted in Invus’
ownership of 40% of the post-transaction outstanding shares of our common
stock. Pursuant to the securities purchase agreement, Invus, at its
option, also has the right to require us to initiate up to two pro rata rights
offerings to our stockholders, which would provide all stockholders with
non-transferable rights to acquire shares of our common stock, in an aggregate
amount of up to $344.5 million, less the proceeds of any “qualified offerings”
that we may complete in the interim involving the sale of our common stock at
prices above $4.50 per share. Invus may exercise its right to require
us to conduct the first rights offering by giving us notice within a period of
90 days beginning on November 28, 2009 (which we refer to as the first rights
offering trigger date), although we and Invus may agree to change the first
rights offering trigger date with the approval of the members of our board of
directors who are not affiliated with Invus. Invus may exercise its
right to require us to conduct the second rights offering by giving us notice
within a period of 90 days beginning on the date that is 12 months after Invus’
exercise of its right to require us to conduct the first rights offering or, if
Invus does not exercise its right to require us to conduct the first rights
offering, within a period of 90 days beginning on the first anniversary of the
first rights offering trigger date. The initial investment and
subsequent rights offerings, combined with any qualified offerings, were
designed to achieve up to $550 million in proceeds to us. Invus would
participate in each rights offering for up to its pro rata portion of the
offering, and would commit to purchase the entire portion of the offering not
subscribed for by other stockholders.
5
Board of
Directors. Concurrently with the execution of the securities
purchase agreement, we entered into a stockholders’ agreement with Invus under
which Invus has the right to designate the greater of three members or 30% (or
the percentage of all the outstanding shares of our common stock owned by Invus
and its affiliates, if less than 30%) of all members of our board of directors,
rounded up to the nearest whole number of directors, and pursuant to which Invus
has designated Philippe J. Amouyal, Raymond Debbane and Christopher J.
Sobecki.
In the
event that the number of shares of our common stock owned by Invus and its
affiliates ever exceeds 50% of the total number of shares of our common stock
then outstanding (not counting for such purpose any shares acquired by Invus
from third parties in excess of 40% (or, if higher, its then pro rata amount) of
the total number of outstanding shares of common stock, as permitted by the
standstill provisions of the stockholders’ agreement), from and after that time,
Invus will have the right to designate a number of directors equal to the
percentage of all the outstanding shares of our common stock owned by Invus and
its affiliates (not counting for such purpose any shares acquired by Invus from
third parties in excess of 40% (or, if higher, its then pro rata amount) of the
total number of outstanding shares of common stock, as permitted by the
standstill provisions of the stockholders’ agreement), rounded up to the nearest
whole number of directors. The directors appointed by Invus have
proportionate representation on the compensation committee and corporate
governance committee of our board of directors.
Invus’
rights with respect to the designation of members of our board of directors and
its compensation and corporate governance committees will terminate if the
percentage of all the outstanding shares of our common stock owned by Invus and
its affiliates falls below 10%. Invus will also have the right to
terminate these provisions at any time following the date on which the
percentage of all the outstanding shares of our common stock owned by Invus and
its affiliates exceeds 50% (not counting for such purpose any shares acquired by
Invus and its affiliates from third parties in excess of 40% (or, if higher, its
then pro rata amount) of the total number of outstanding shares of our common
stock, as permitted by the standstill provisions of the stockholders’
agreement).
Preemptive
Rights. Invus has preemptive rights under the stockholders’
agreement to participate in future equity issuances by us (including any
qualified offering), subject to certain exceptions, so as to maintain its
then-current percentage ownership of our capital stock. Subject to
certain limitations, Invus will be required to exercise its preemptive rights in
advance with respect to certain marketed offerings, in which case it will be
obligated to buy its pro rata share of the number of shares being offered in
such marketed offering, including any overallotment (or such lesser amount
specified in its exercise of such rights), so long as the sale
of the shares were priced within a range within 10% above or below the market
price on the date we notified Invus of the offering and we met certain other
conditions.
The
provisions of the stockholders’ agreement relating to preemptive rights will
terminate on the earlier to occur of August 28, 2017 and the date on which the
percentage of all the outstanding shares of our common stock owned by Invus and
its affiliates falls below 10%.
Standstill
Provisions. Invus is subject to standstill provisions
restricting its ability to purchase or otherwise acquire additional shares of
common stock from third parties to an amount that would result in its ownership
of our common stock not exceeding 49% of the total number of shares
outstanding. These standstill provisions will not apply to the
acquisitions of securities by way of stock splits, stock dividends,
reclassifications, recapitalizations, or other distributions by us, acquisitions
contemplated by the securities purchase agreement and the stockholders’
agreement, including in the rights offerings and upon Invus’ exercise of
preemptive rights under the stockholders’ agreement.
Except
for acquisitions pursuant to the provisions described above, and subject to
certain exceptions, Invus has agreed that it will not, and will cause its
affiliates not to, without the approval of our unaffiliated board, directly or
indirectly:
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solicit
proxies to vote any of our voting securities or any voting securities of
our subsidiaries;
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6
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submit
to our board of directors a written proposal for any merger,
recapitalization, reorganization, business combination or other
extraordinary transaction involving an acquisition of us or any of our
subsidiaries or any of our or our subsidiaries’ securities or assets by
Invus and its affiliates;
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enter
into discussions, negotiations, arrangements or understandings with any
third party with respect to any of the foregoing;
or
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request
us or any of our representatives, directly or indirectly, to amend or
waive any of these standstill
provisions.
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The
standstill provisions of the stockholders’ agreement will terminate on the
earliest to occur of (a) August 28, 2017, (b) the date on which the percentage
of all the outstanding shares of our common stock owned by Invus and its
affiliates falls below 10%, (c) the date on which the percentage of all of the
outstanding shares of our common stock owned by Invus and its affiliates exceeds
50% (not counting for such purpose any shares acquired by Invus from third
parties in excess of 40% (or, if higher, its then pro rata amount) of the total
number of outstanding shares of common stock, as permitted by the standstill
provisions of the stockholders’ agreement), (d) the date on which any third
party makes a public proposal to acquire (by purchase, exchange, merger or
otherwise) assets or business constituting 50% or more of our revenues, net
income or assets or 50% of any class of our equity securities or our board of
directors recommends or approves, or proposes to recommend or approve, any such
transaction or (e) the date on which any third party acquires beneficial
ownership (by purchase, exchange, merger or otherwise) of assets or business
constituting 20% or more of our revenues, net income or assets or 20% of any
class of our equity securities or our board of directors recommends or approves,
or proposes to recommend or approve, any such transaction.
Sales to Third
Parties. Subject to certain exceptions, Invus has agreed that
neither it nor its affiliates will sell any shares of common stock to third
parties that are not affiliated with Invus if, to Invus’ knowledge, such
transfer would result in any such third party (or any person or group
including such third party) owning more than 14.9% of the total number of
outstanding shares of our common stock.
The
provisions of the stockholders’ agreement relating to sales to third parties
will terminate on the earliest to occur of (a) August 28, 2017,
(b) the date on which the percentage of all the outstanding shares of our
common stock owned by Invus and its affiliates falls below 10%, and (c) the
date on which the percentage of all the outstanding shares of our common stock
owned by Invus and its affiliates exceeds 50% (not counting for such purpose any
shares acquired by Invus and its affiliates from third parties in excess of 40%
(or, if higher, its then pro rata amount) of the total number of outstanding
shares of our common stock, as permitted by the standstill provisions of the
stockholders’ agreement).
Voting of
Shares. In any election of persons to serve on our board of
directors, Invus will be obligated to vote all of the shares of common stock
held by it and its affiliates in favor of the directors nominated by our board
of directors, as long as we have complied with our obligation with respect to
the designation of members of our board of directors described above and the
individuals designated by Invus for election to our board of directors have been
nominated, and, if applicable, are serving on our board of
directors. With respect to all other matters submitted to a vote of
the holders of our common stock, Invus will be obligated to vote any shares that
it acquired from third parties in excess of 40% (or, if higher, its then pro
rata amount) of the total number of outstanding shares of common stock, as
permitted by the standstill provisions of the stockholders’ agreement, in the
same proportion as all the votes cast by other holders of our common stock,
unless Invus and we (acting with the approval of the unaffiliated board) agree
otherwise. Invus may vote all other shares of our common stock held
by it in its sole discretion.
The
provisions of the stockholders’ agreement relating to voting will terminate on
the earliest to occur of (a) August 28, 2017, (b) the date on which
the percentage of all the outstanding shares of our common stock held by Invus
and its affiliates falls below 10%, (c) the date on which the percentage of
all outstanding shares of our common stock owned by Invus and its affiliates
exceeds 50% (not counting for such purpose any shares acquired by Invus from
third parties in excess of 40% (or, if higher, its then pro rata amount) of the
total number of outstanding shares of our common stock, as permitted by the
provisions of the stockholders’ agreement), and (d) the termination of the
standstill provisions in accordance with the stockholders’
agreement.
Minority
Protections. Invus is entitled to certain minority
protections, including consent rights over (a) the creation or issuance of any
new class or series of shares of our capital stock (or securities convertible
into or exercisable for shares of our capital stock) having rights, preferences
or privileges senior to or on parity with our common stock, (b) any amendment to
our certificate of incorporation or bylaws, or amendment to the certificate of
incorporation or bylaws of any of our subsidiaries, in a manner adversely
affecting Invus’ rights under the securities purchase agreement and the related
agreements, (c) the repurchase, retirement, redemption or other acquisition of
our or our subsidiaries’ capital stock (or securities convertible into or
exercisable for shares of our or our subsidiaries’ capital stock), (d) any
increase in the size of our board of directors to more than 12 members and (e)
the adoption or proposed adoption of any stockholders’ rights plan, “poison
pill” or other similar plan or agreement, unless Invus is exempt from the
provisions of such plan or agreement.
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The
provisions of the stockholders’ agreement relating to minority protections will
terminate on the earlier to occur of August 28, 2017 and the date on which Invus
and its affiliates hold less than 15% of the total number of outstanding shares
of our common stock.
Registration
Rights. Concurrently with the execution of the securities
purchase agreement, we entered into a registration rights agreement with Invus,
pursuant to which Invus has certain registration rights with respect to shares
of our common stock acquired by Invus under the securities purchase
agreement. These registration rights require, among other things,
that if we propose to register any of our securities under the Securities Act of
1933, or Securities Act, either for our own account or for the account of
others, Invus is entitled to notice of the registration and is entitled to
include, at our expense, its shares of common stock in the registration and any
related underwriting, provided, among other conditions, that the underwriters
may limit the number of shares to be included in the registration and in some
cases exclude these shares entirely. Invus has waived these
registration rights with respect to any offerings of our securities pursuant to
this prospectus. In addition, Invus may require us, at our expense
and subject to certain limitations, to file a registration statement under the
Securities Act with respect to its shares of our common stock.
Anti-Takeover
Effects of Provisions of Delaware Law and Our Charter Documents
Delaware Takeover Statute. We
are subject to the provisions of Section 203 of the Delaware General Corporation
Law. In general, the statute prohibits a publicly-held Delaware corporation such
as Lexicon from engaging in a business combination with an interested
stockholder for a period of three years after the date of the transaction in
which the person became an interested stockholder, unless the business
combination is approved in a prescribed manner. For purposes of Section 203, a
business combination includes a merger, asset sale or other transaction
resulting in a financial benefit to the interested stockholder. An
interested stockholder is a person who, together with affiliates and associates,
owns (or within three years prior, did own) 15% or more of our voting
stock.
Charter Documents. Our
restated certificate of incorporation, as amended, requires that any action
required or permitted to be taken by our stockholders must be effected at a duly
called annual or special meeting of stockholders and may not be effected by a
consent in writing. Additionally, our restated certificate of incorporation, as
amended:
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does
not provide for the use of cumulative voting in the election of
directors;
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provides
for a board of directors, classified into three classes of
directors;
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provides
that the authorized number of directors may be changed only by resolution
of our board of directors; and
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provides
for the authority of our board of directors to issue up to five million
shares of “blank check” preferred stock and to determine the price,
powers, preferences and rights of these shares, without stockholder
approval.
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Our
restated bylaws provide that candidates for director may be nominated only by
our board of directors or by a stockholder who gives written notice to us not
less than 120 days nor more than 150 days in advance of the first anniversary of
the date of our proxy statement relating to the previous year’s annual meeting
of stockholders. The authorized number of directors is fixed in accordance with
our restated certificate of incorporation, as amended. Our board of directors
currently consists of ten members, divided into three classes. As a result, a
portion of the board of directors will be elected each year. The board of
directors may appoint new directors to fill vacancies or newly created
directorships. Our restated bylaws also limit who may call a special meeting of
stockholders.
Delaware
law and these charter provisions may have the effect of deterring hostile
takeovers or delaying changes in control of our management, which could depress
the market price of our common stock.
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Transfer
Agent and Registrar
The
transfer agent and registrar for our common stock is BNY Mellon Shareowner
Services. The transfer agent for any series of preferred stock will
be named and described in the prospectus supplement for that
series.
DESCRIPTION
OF DEBT SECURITIES
The
following description, together with the additional information we may include
in any applicable prospectus supplements, summarizes the material terms and
provisions of the debt securities that we may offer under this prospectus and
the related indenture. While the terms summarized below will apply
generally to any debt securities we may offer under this prospectus, we will
describe the particular terms of any debt securities that we may offer in more
detail in the applicable prospectus supplement. If we indicate in the
prospectus supplement, the terms of any debt securities offered under that
prospectus supplement may differ from the terms described
below. However, no prospectus supplement shall fundamentally change
the terms that are set forth in this prospectus or offer a security that is not
registered and described in this prospectus at the time of its
effectiveness.
We may
offer debt securities in the form of either senior debt securities or
subordinated debt securities. Unless otherwise specified in a
supplement to this prospectus, the debt securities will be our direct, unsecured
obligations and will rank equally with all of our other unsecured and
unsubordinated indebtedness.
The debt
securities will be issued under an indenture between us and a
trustee. The following summary of the general features of the debt
securities to be governed by the indenture is subject to, and qualified in its
entirety by reference to, the provisions of the indenture applicable to a
particular series of debt securities. We have filed a form of
indenture as an exhibit to the registration statement which includes this
prospectus. Capitalized terms used in the summary have the meanings
specified in the indenture.
General
The terms
of each series of debt securities will be established by or pursuant to a
resolution of our board of directors, or a committee thereof, and set forth or
determined in the manner provided in an officer’s certificate or by a
supplemental indenture. The particular terms of each series of debt securities
will be described in a prospectus supplement relating to such series, including
any pricing supplement.
We can
issue an unlimited amount of debt securities under the indenture that may be in
one or more series with the same or various maturities, at par, at a premium or
at a discount. We will set forth in a prospectus supplement, including any
pricing supplement, relating to any series of debt securities being offered, the
aggregate principal amount and the following terms of the debt
securities:
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the
title of the debt securities;
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the
price or prices (expressed as a percentage of the principal amount) at
which we will sell the debt
securities;
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any
limit on the aggregate principal amount of the debt
securities;
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the
date or dates on which we will pay the principal on the debt
securities;
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the
rate or rates (which may be fixed or variable) per annum or the method
used to determine the rate or rates (including any commodity, commodity
index, stock exchange index or financial index) at which the debt
securities will bear interest, the date or dates from which interest will
accrue, the date or dates on which interest will commence and be payable
and any regular record date for the interest payable on any interest
payment date;
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the
place or places where principal of, and premium and interest on, the debt
securities will be payable;
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the
terms and conditions upon which we may redeem the debt
securities;
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any
obligation we have to redeem or purchase the debt securities pursuant to
any sinking fund or analogous provisions or at the option of a holder of
debt securities;
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the
dates on which and the price or prices at which we will repurchase debt
securities at the option of the holders of debt securities and other
detailed terms and provisions of these repurchase
obligations;
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the
denominations in which the debt securities will be issued, if other than
denominations of $1,000 and any integral multiple
thereof;
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whether
the debt securities will be issued in the form of certificated debt
securities or global debt
securities;
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the
portion of principal amount of the debt securities payable upon
declaration of acceleration of the maturity date, if other than the
principal amount;
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the
currency of denomination of the debt
securities;
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the
designation of the currency, currencies or currency units in which payment
of principal of, and premium and interest on, the debt securities will be
made;
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if
payments of principal of, or premium or interest on, the debt securities
will be made in one or more currencies or currency units other than that
or those in which the debt securities are denominated, the manner in which
the exchange rate with respect to these payments will be
determined;
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the
manner in which the amounts of payment of principal of, or premium or
interest on, the debt securities will be determined, if these amounts may
be determined by reference to an index based on a currency or currencies
other than that in which the debt securities are denominated or designated
to be payable or by reference to a commodity, commodity index, stock
exchange index or financial index;
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any
provisions relating to any security provided for the debt
securities;
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any
addition to or change in the events of default described in this
prospectus or in the indenture with respect to the debt securities and any
change in the acceleration provisions described in this prospectus or in
the indenture with respect to the debt
securities;
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any
addition to or change in the covenants described in this prospectus or in
the indenture with respect to the debt
securities;
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any
conversion provisions, including the conversion price, the conversion
period, provisions as to whether conversion will be mandatory, at the
option of the holder or at our option, the events requiring an adjustment
of the conversion price and provisions affecting conversion if such series
of debt securities are redeemed;
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whether
the debt securities will be senior debt securities or subordinated debt
securities and, if applicable, a description of the subordination terms
thereof;
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any
depositaries, interest rate calculation agents, exchange rate calculation
agents or other agents with respect to the debt securities;
and
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any
other terms of the debt securities, which may modify, delete, supplement
or add to any provision of the indenture as it applies to that
series.
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We may
issue debt securities that provide for an amount less than their stated
principal amount to be due and payable upon declaration of acceleration of their
maturity pursuant to the terms of the indenture. We will provide you with
information on the federal income tax considerations and other special
considerations applicable to any of these debt securities in the applicable
prospectus supplement.
If we
denominate the purchase price of any of the debt securities in a foreign
currency or currencies or a foreign currency unit or units, or if the principal
of, and premium and interest on, any series of debt securities is payable in a
foreign currency or currencies or a foreign currency unit or units, we will
provide you with information on the restrictions, elections, general tax
considerations, specific terms and other information with respect to that issue
of debt securities and such foreign currency or currencies or foreign currency
unit or units in the applicable prospectus supplement.
Transfer
and Exchange
Each debt
security will be represented by either one or more global securities registered
in the name of The Depository Trust Company, as Depositary, or a nominee (we
will refer to any debt security represented by a global debt security as a
“book-entry debt security”), or a certificate issued in definitive registered
form (we will refer to any debt security represented by a certificated security
as a “certificated debt security”) as set forth in the applicable prospectus
supplement. Except as set forth under the heading “Legal Ownership of
Securities” below, book-entry securities will not be issuable in certificated
form.
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You may
transfer or exchange certificated debt securities at any office we maintain for
this purpose in accordance with the terms of the indenture. No service charge
will be made for any transfer or exchange of certificated debt securities, but
we may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection with a transfer or
exchange.
You may
effect the transfer of certificated debt securities and the right to receive the
principal of, and any premium and interest on, certificated debt securities only
by surrendering the certificate representing those certificated debt securities
and either reissuance by us or the trustee of the certificate to the new holder
or the issuance by us or the trustee of a new certificate to the new
holder.
No
Protection in the Event of a Change of Control
Unless we
state otherwise in the applicable prospectus supplement, the debt securities
will not contain any provisions which may afford holders of the debt securities
protection in the event we have a change in control or in the event of a highly
leveraged transaction (whether or not such transaction results in a change in
control) which could adversely affect holders of debt securities.
Covenants
We will
set forth in the applicable prospectus supplement any restrictive covenants
applicable to any issue of debt securities.
Consolidation,
Merger and Sale of Assets
We may
not consolidate with or merge with or into, or convey, transfer or lease all or
substantially all of our properties and assets to, any person, which we refer to
as a successor person, unless:
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we
are the surviving corporation or the successor person (if other than
Lexicon) is organized and validly existing under the laws of any U.S.
domestic jurisdiction and expressly assumes our obligations on the debt
securities and under the indenture;
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immediately
after giving effect to the transaction, no event of default, and no event
which, after notice or lapse of time, or both, would become an event of
default, shall have occurred and be continuing under the indenture;
and
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certain
other conditions are met.
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Events
of Default
Event of
default means, with respect to any series of debt securities, any of the
following:
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default
in the payment of any interest upon any debt security of that series when
it becomes due and payable, and continuance of that default for a period
of 30 days (unless the entire amount of the payment is deposited by us
with the trustee or with a paying agent prior to the expiration of the
30-day period);
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default
in the payment of principal of or premium on any debt security of that
series when due and payable;
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default
in the deposit of any sinking fund payment, when and as due in respect of
any debt security of that series;
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default
in the performance or breach of any other covenant or warranty by us in
the indenture (other than a covenant or warranty that has been included in
the indenture solely for the benefit of a series of debt securities other
than that series), which default continues uncured for a period of 90 days
after we receive written notice from the trustee or we and the trustee
receive written notice from the holders of not less than a majority in
principal amount of the outstanding debt securities of that series as
provided in the indenture;
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certain
events of bankruptcy, insolvency or reorganization of our company;
and
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any
other event of default provided with respect to debt securities of that
series that is described in the applicable prospectus supplement
accompanying this prospectus.
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No event
of default with respect to a particular series of debt securities (except as to
certain events of bankruptcy, insolvency or reorganization) necessarily
constitutes an event of default with respect to any other series of debt
securities. The occurrence of an event of default may constitute an event of
default under our bank credit agreements in existence from time to time. In
addition, the occurrence of certain events of default or an acceleration under
the indenture may constitute an event of default under certain of our other
indebtedness outstanding from time to time.
If an
event of default with respect to debt securities of any series at the time
outstanding occurs and is continuing, then the trustee or the holders of not
less than a majority in principal amount of the outstanding debt securities of
that series may, by a notice in writing to us (and to the trustee if given by
the holders), declare to be due and payable immediately the principal (or, if
the debt securities of that series are discount securities, that portion of the
principal amount as may be specified in the terms of that series) of, and
accrued and unpaid interest, if any, on all debt securities of that series. In
the case of an event of default resulting from certain events of bankruptcy,
insolvency or reorganization, the principal (or such specified amount) of and
accrued and unpaid interest, if any, on all outstanding debt securities will
become and be immediately due and payable without any declaration or other act
on the part of the trustee or any holder of outstanding debt securities. At any
time after a declaration of acceleration with respect to debt securities of any
series has been made, but before a judgment or decree for payment of the money
due has been obtained by the trustee, the holders of a majority in principal
amount of the outstanding debt securities of that series may rescind and annul
the acceleration if all events of default, other than the non-payment of
accelerated principal and interest, if any, with respect to debt securities of
that series, have been cured or waived as provided in the indenture. We refer
you to the prospectus supplement relating to any series of debt securities that
are discount securities for the particular provisions relating to acceleration
of a portion of the principal amount of such discount securities upon the
occurrence of an event of default.
The
indenture provides that the trustee will be under no obligation to exercise any
of its rights or powers under the indenture at the request of any holder of
outstanding debt securities, unless the trustee receives indemnity satisfactory
to it against any loss, liability or expense. Subject to certain rights of the
trustee, the holders of a majority in principal amount of the outstanding debt
securities of any series will have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the trustee or
exercising any trust or power conferred on the trustee with respect to the debt
securities of that series.
No holder
of any debt security of any series will have any right to institute any
proceeding, judicial or otherwise, with respect to the indenture or for the
appointment of a receiver or trustee, or for any remedy under the indenture,
unless:
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that
holder has previously given to the trustee written notice of a continuing
event of default with respect to debt securities of that series;
and
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the
holders of at least a majority in principal amount of the outstanding debt
securities of that series have made written request, and offered
reasonable indemnity, to the trustee to institute the proceeding as
trustee, and the trustee has not received from the holders of a majority
in principal amount of the outstanding debt securities of that series a
direction inconsistent with that request and has failed to institute the
proceeding within 60 days.
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Notwithstanding
the foregoing, the holder of any debt security will have an absolute and
unconditional right to receive payment of the principal of, and any premium and
interest on, that debt security on or after the due dates expressed in that debt
security and to institute suit for the enforcement of payment.
If any
securities are outstanding under the indenture, the indenture requires us,
within 120 days after the end of our fiscal year, to furnish to the trustee a
statement as to compliance with the indenture. The indenture provides that the
trustee may withhold notice to the holders of debt securities of any series of
any default or event of default (except in payment on any debt securities of
that series) with respect to debt securities of that series if it in good faith
determines that withholding notice is in the interest of the holders of those
debt securities.
Modification
and Waiver
We may
modify and amend the indenture with the consent of the holders of at least a
majority in principal amount of the outstanding debt securities of each series
affected by the modifications or amendments. We may not make any modification or
amendment without the consent of the holders of each affected debt security then
outstanding if that amendment will:
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reduce
the amount of debt securities whose holders must consent to an amendment
or waiver;
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reduce
the rate of or extend the time for payment of interest (including default
interest) on any debt security;
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reduce
the principal of or premium on or change the fixed maturity of any debt
security or reduce the amount of, or postpone the date fixed for, the
payment of any sinking fund or analogous obligation with respect to any
series of debt securities;
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reduce
the principal amount of discount securities payable upon acceleration of
maturity;
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waive
a default in the payment of the principal of, or premium or interest on,
any debt security (except a rescission of acceleration of the debt
securities of any series by the holders of at least a majority in
aggregate principal amount of the then outstanding debt securities of that
series and a waiver of the payment default that resulted from such
acceleration);
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make
the principal of, or premium or interest on, any debt security payable in
currency other than that stated in the debt
security;
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make
any change to certain provisions of the indenture relating to, among other
things, the right of holders of debt securities to receive payment of the
principal of, and premium and interest on, those debt securities and to
institute suit for the enforcement of any such payment and to waivers or
amendments; or
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waive
a redemption payment with respect to any debt
security.
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Except
for certain specified provisions, the holders of at least a majority in
principal amount of the outstanding debt securities of any series may on behalf
of the holders of all debt securities of that series waive our compliance with
provisions of the indenture. The holders of a majority in principal amount of
the outstanding debt securities of any series may on behalf of the holders of
all the debt securities of such series waive any past default under the
indenture with respect to that series and its consequences, except a default in
the payment of the principal of, or any premium or interest on, any debt
security of that series or in respect of a covenant or provision, which cannot
be modified or amended without the consent of the holder of each outstanding
debt security of the series affected; provided, however, that the
holders of a majority in principal amount of the outstanding debt securities of
any series may rescind an acceleration and its consequences, including any
related payment default that resulted from the acceleration.
Defeasance
of Debt Securities and Certain Covenants in Certain Circumstances
Legal
Defeasance. The indenture provides that, unless otherwise
provided by the terms of the applicable series of debt securities, we may be
discharged from any and all obligations in respect of the debt securities of any
series (except for certain obligations to register the transfer or exchange of
debt securities of such series, to replace stolen, lost or mutilated debt
securities of such series, and to maintain paying agencies and certain
provisions relating to the treatment of funds held by paying agents). We will be
so discharged upon the deposit with the trustee, in trust, of money and/or U.S.
government obligations or, in the case of debt securities denominated in a
single currency other than U.S. dollars, foreign government obligations, that,
through the payment of interest and principal in accordance with their terms,
will provide money in an amount sufficient in the opinion of a nationally
recognized firm of independent public accountants to pay and discharge each
installment of principal of, premium and interest on and any mandatory sinking
fund payments in respect of the debt securities of that series on the stated
maturity of those payments in accordance with the terms of the indenture and
those debt securities.
This
discharge may occur only if, among other things, we have delivered to the
trustee an opinion of counsel stating that we have received from, or there has
been published by, the United States Internal Revenue Service a ruling or, since
the date of execution of the indenture, there has been a change in the
applicable United States federal income tax law, in either case to the effect
that, and based thereon such opinion shall confirm that, the holders of the debt
securities of that series will not recognize income, gain or loss for United
States federal income tax purposes as a result of the deposit, defeasance and
discharge and will be subject to United States federal income tax on the same
amounts and in the same manner and at the same times as would have been the case
if the deposit, defeasance and discharge had not occurred.
Defeasance of Certain
Covenants. The indenture provides that, unless otherwise
provided by the terms of the applicable series of debt securities, upon
compliance with certain conditions:
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we
may omit to comply with the covenant described under the heading
“Consolidation, Merger and Sale of Assets” and certain other covenants set
forth in the indenture, as well as any additional covenants which may be
set forth in the applicable prospectus supplement;
and
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any
omission to comply with those covenants will not constitute a default or
an event of default with respect to the debt securities of that series, or
covenant defeasance.
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The
conditions include:
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depositing
with the trustee money and/or U.S. government obligations or, in the case
of debt securities denominated in a single currency other than U.S.
dollars, foreign government obligations, that, through the payment of
interest and principal in accordance with their terms, will provide money
in an amount sufficient in the opinion of a nationally recognized firm of
independent public accountants to pay and discharge each installment of
principal of, premium and interest on and any mandatory sinking fund
payments in respect of the debt securities of that series on the stated
maturity of those payments in accordance with the terms of the indenture
and those debt securities; and
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delivering
to the trustee an opinion of counsel to the effect that the holders of the
debt securities of that series will not recognize income, gain or loss for
United States federal income tax purposes as a result of the deposit and
related covenant defeasance and will be subject to United States federal
income tax on the same amounts and in the same manner and at the same
times as would have been the case if the deposit and related covenant
defeasance had not occurred.
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Covenant Defeasance and Events of
Default. In the event we exercise our option to effect
covenant defeasance with respect to any series of debt securities and the debt
securities of that series are declared due and payable because of the occurrence
of any event of default, the amount of money and/or U.S. government obligations
or foreign government obligations on deposit with the trustee will be sufficient
to pay amounts due on the debt securities of that series at the time of their
stated maturity but may not be sufficient to pay amounts due on the debt
securities of that series at the time of the acceleration resulting from the
event of default. In such a case, we would remain liable for those
payments.
“Foreign Government
Obligations” means, with respect to debt securities of any series that
are denominated in a currency other than U.S. dollars:
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direct
obligations of the government that issued or caused to be issued such
currency for the payment of which obligations its full faith and credit is
pledged which are not callable or redeemable at the option of the issuer
thereof; or
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obligations
of a person controlled or supervised by or acting as an agency or
instrumentality of that government the timely payment of which is
unconditionally guaranteed as a full faith and credit obligation by that
government which are not callable or redeemable at the option of the
issuer thereof.
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Governing
Law
The
indenture and the debt securities will be governed by and construed in
accordance with the laws of the State of New York.
DESCRIPTION
OF WARRANTS
The
following description, together with the additional information we may include
in any applicable prospectus supplements, summarizes the material terms and
provisions of the warrants that we may offer under this prospectus and the
related warrant agreements and warrant certificates. While the terms summarized
below will apply generally to any warrants that we may offer under this
prospectus, we will describe the particular terms of any series of warrants that
we may offer in more detail in the applicable prospectus supplement. If we
indicate in the prospectus supplement, the terms of any warrants offered under
that prospectus supplement may differ from the terms described below. However,
no prospectus supplement shall fundamentally change the terms that are set forth
in this prospectus or offer a security that is not registered and described in
this prospectus at the time of its effectiveness. Specific warrant agreements
will contain additional important terms and provisions and will be incorporated
by reference as an exhibit to the registration statement that includes this
prospectus or as an exhibit to a report filed under the Exchange
Act.
14
General
We will
describe in the applicable prospectus supplement the terms of the series of
warrants, including:
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the
offering price and aggregate number of warrants
offered;
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the
currency for which the warrants may be
purchased;
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·
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if
applicable, the designation and terms of the securities with which the
warrants are issued and the number of warrants issued with each such
security or each principal amount of such
security;
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·
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if
applicable, the date on and after which the warrants and the related
securities will be separately
transferable;
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in
the case of warrants to purchase common stock or preferred stock, the
number of shares of common stock or preferred stock, as the case may be,
purchasable upon the exercise of one warrant and the price at which these
shares may be purchased upon such
exercise;
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in
the case of warrants to purchase debt securities, the principal amount of
debt securities purchasable upon exercise of one warrant and the price at,
and currency in which, this principal amount of debt securities may be
purchased upon such exercise;
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the
effect of any merger, consolidation, sale or other disposition of our
business on the warrant agreements and the
warrants;
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the
terms of any rights to redeem or call the
warrants;
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any
provisions for changes to or adjustments in the exercise price or number
of securities issuable upon exercise of the
warrants;
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the
dates on which the right to exercise the warrants will commence and
expire;
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the
manner in which the warrant agreements and warrants may be
modified;
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federal
income tax consequences of holding or exercising the
warrants;
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the
terms of the securities issuable upon exercise of the warrants;
and
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any
other specific terms, preferences, rights or limitations of or
restrictions on the warrants.
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Before
exercising their warrants, holders of warrants will not have any of the rights
of holders of the securities purchasable upon such exercise,
including:
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in
the case of warrants to purchase common stock or preferred stock, the
right to receive dividends, if any, or, payments upon our liquidation,
dissolution or winding up or to exercise voting rights, if any;
or
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in
the case of warrants to purchase debt securities, the right to receive
payments of principal of, or premium, if any, or interest on, the debt
securities purchasable upon exercise or to enforce covenants in the
applicable indenture.
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Exercise
of Warrants
Each
warrant will entitle the holder to purchase the securities that we specify in
the applicable prospectus supplement at the exercise price that we describe in
the applicable prospectus supplement. Unless we otherwise specify in the
applicable prospectus supplement, holders of the warrants may exercise the
warrants at any time up to the specified time on the expiration date that we set
forth in the applicable prospectus supplement. After the close of business on
the expiration date, unexercised warrants will become void.
Holders
of the warrants may exercise the warrants by delivering the warrant certificate
representing the warrants to be exercised together with specified information,
and paying the required amount to the warrant agent in immediately available
funds, as provided in the applicable prospectus supplement. We will set forth on
the reverse side of the warrant certificate and in the applicable prospectus
supplement the information that the holder of the warrant will be required to
deliver to the warrant agent.
15
Upon
receipt of the required payment and the warrant certificate properly completed
and duly executed at the corporate trust office of the warrant agent or any
other office indicated in the applicable prospectus supplement, we will issue
and deliver the securities purchasable upon such exercise. If fewer than all of
the warrants represented by the warrant certificate are exercised, then we will
issue a new warrant certificate for the remaining amount of warrants. If we so
indicate in the applicable prospectus supplement, holders of the warrants may
surrender securities as all or part of the exercise price for
warrants.
Governing
Law
The
warrants and warrant agreements will be governed by and construed in accordance
with the laws of the State of New York.
Enforceability
of Rights by Holders of Warrants
Each
warrant agent will act solely as our agent under the applicable warrant
agreement and will not assume any obligation or relationship of agency or trust
with any holder of any warrant. A single bank or trust company may act as
warrant agent for more than one issue of warrants. A warrant agent will have no
duty or responsibility in case of any default by us under the applicable warrant
agreement or warrant, including any duty or responsibility to initiate any
proceedings at law or otherwise, or to make any demand upon us. Any holder of a
warrant may, without the consent of the related warrant agent or the holder of
any other warrant, enforce by appropriate legal action its right to exercise,
and receive the securities purchasable upon exercise of, its
warrants.
DESCRIPTION
OF RIGHTS
The
following description, together with the additional information we may include
in any applicable prospectus supplements, summarizes the material terms and
provisions of the rights that we may offer under this prospectus and the related
rights agreements. While the terms summarized below will apply generally to any
rights that we may offer under this prospectus, we will describe the particular
terms of any series of rights that we may offer in more detail in the applicable
prospectus supplement. If we indicate in the prospectus supplement, the terms of
any rights offered under that prospectus supplement may differ from the terms
described below. However, no prospectus supplement shall fundamentally change
the terms that are set forth in this prospectus or offer a security that is not
registered and described in this prospectus at the time of its effectiveness.
Specific rights agreements will contain additional important terms and
provisions and will be incorporated by reference as an exhibit to the
registration statement that includes this prospectus or as an exhibit to a
report filed under the Exchange Act.
General
We may
issue rights to purchase common stock, preferred stock, debt securities or other
securities. These rights may be issued independently or together with any other
security offered hereby and may or may not be transferable by the stockholder
receiving the rights in such offering. In connection with any offering of such
rights, we may enter into a standby arrangement with one or more underwriters or
other purchasers pursuant to which the underwriters or other purchasers may be
required to purchase any securities remaining unsubscribed for after such
offering.
Each
series of rights will be issued under a separate rights agreement which we will
enter into with a bank or trust company, as rights agent, all as set forth in
the applicable prospectus supplement. The rights agent will act solely as our
agent in connection with the certificates relating to the rights and will not
assume any obligation or relationship of agency or trust with any holders of
rights certificates or beneficial owners of rights. We will file the rights
agreement and the rights certificates relating to each series of rights with the
SEC, and incorporate them by reference as an exhibit to the registration
statement of which this prospectus is a part on or before the time we issue a
series of rights.
We will
describe in the applicable prospectus supplement the terms of the series of
rights, including:
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the
date of determining the stockholders entitled to the rights
distribution;
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the
number of rights issued or to be issued to each
stockholder;
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the
exercise price payable for each share of common stock, preferred stock,
debt securities or other securities upon the exercise of the
rights;
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16
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the
number and terms of the shares of common stock, preferred stock, debt
securities or other securities which may be purchased per each
right;
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the
extent to which the rights are
transferable;
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the
date on which the holder’s ability to exercise the rights shall commence,
and the date on which the rights shall
expire;
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the
extent to which the rights may include an over-subscription privilege with
respect to unsubscribed securities;
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if
applicable, the material terms of any standby underwriting or purchase
arrangement entered into by us in connection with the offering of such
rights; and
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any
other terms of the rights, including the terms, procedures, conditions and
limitations relating to the exchange and exercise of the
rights.
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The
description in the applicable prospectus supplement of any rights that we may
offer will not necessarily be complete and will be qualified in its entirety by
reference to the applicable rights certificate, which will be filed with the
SEC.
Exercise
of Rights
Each
right will entitle the holder of the right to purchase for cash such amount of
shares of common stock, preferred stock, debt securities or other securities at
such exercise price as shall in each case be set forth in, or be determinable as
set forth in, the prospectus supplement relating to the rights offered thereby.
Rights may be exercised at any time up to the close of business on the
expiration date for such rights set forth in the prospectus supplement. After
the close of business on the expiration date, all unexercised rights will become
void.
Rights
may be exercised as set forth in the prospectus supplement relating to the
rights offered thereby. Upon receipt of payment and the rights certificate
properly completed and duly executed at the corporate trust office of the rights
agent or any other office indicated in the prospectus supplement, we will
forward, as soon as practicable, the shares of common stock, preferred stock,
debt securities or other securities purchasable upon such exercise. We may
determine to offer any unsubscribed offered securities directly to persons other
than stockholders, to or through agents, underwriters or dealers or through a
combination of such methods, including pursuant to standby underwriting
arrangements, as set forth in the applicable prospectus supplement.
Governing
Law
The
rights and rights agreements will be governed by and construed in accordance
with the laws of the State of New York.
DESCRIPTION
OF UNITS
The
following description, together with the additional information we may include
in any applicable prospectus supplements, summarizes the material terms and
provisions of the units that we may offer under this prospectus and the related
unit agreements. While the terms summarized below will apply generally to any
units that we may offer under this prospectus, we will describe the particular
terms of any series of units that we may offer in more detail in the applicable
prospectus supplement. If we indicate in the prospectus supplement, the terms of
any units offered under that prospectus supplement may differ from the terms
described below. However, no prospectus supplement shall fundamentally change
the terms that are set forth in this prospectus or offer a security that is not
registered and described in this prospectus at the time of its effectiveness.
Specific unit agreements will contain additional important terms and provisions
and will be incorporated by reference as an exhibit to the registration
statement that includes this prospectus or as an exhibit to a report filed under
the Exchange Act.
General
We may
issue units comprised of one or more shares of common stock, shares of preferred
stock, debt securities and warrants in any combination. Each unit will be issued
so that the holder of the unit is also the holder of each security included in
the unit. Thus, the holder of a unit will have the rights and obligations of a
holder of each included security. The unit agreement under which a unit is
issued may provide that the securities included in the unit may not be held or
transferred separately, at any time or at any time before a specified
date.
17
We will
describe in the applicable prospectus supplement the terms of the series of
units, including:
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the
designation and terms of the units and of the securities comprising the
units, including whether and under what circumstances those securities may
be held or transferred separately;
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any
provisions of the governing unit agreement that differ from those
described below; and
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any
provisions for the issuance, payment, settlement, transfer or exchange of
the units or of the securities comprising the
units.
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The
provisions described in this section, as well as those described under
“Description of Capital Stock,” “Description of Debt Securities” and
“Description of Warrants” will apply to each unit and to any common stock,
preferred stock, debt security or warrant included in each unit,
respectively.
Issuance
in Series
We may
issue units in such amounts and in numerous distinct series as we
determine.
Enforceability
of Rights by Holders of Units
Each unit
agent will act solely as our agent under the applicable unit agreement and will
not assume any obligation or relationship of agency or trust with any holder of
any unit. A single bank or trust company may act as unit agent for more than one
series of units. A unit agent will have no duty or responsibility in case of any
default by us under the applicable unit agreement or unit, including any duty or
responsibility to initiate any proceedings at law or otherwise, or to make any
demand upon us. Any holder of a unit may, without the consent of the related
unit agent or the holder of any other unit, enforce by appropriate legal action
its rights as holder under any security included in the unit.
Title
Lexicon,
the unit agents and any of their agents may treat the registered holder of any
unit certificate as an absolute owner of the units evidenced by that certificate
for any purpose and as the person entitled to exercise the rights attaching to
the units so requested, despite any notice to the contrary. See “Legal Ownership
of Securities.”
LEGAL
OWNERSHIP OF SECURITIES
We can
issue securities in registered form or in the form of one or more global
securities. We describe global securities in greater detail below. We refer to
those persons who have securities registered in their own names on the books
that we or any applicable trustee maintain for this purpose as the “holders” of
those securities. These persons are the legal holders of the securities. We
refer to those persons who, indirectly through others, own beneficial interests
in securities that are not registered in their own names, as “indirect holders”
of those securities. As we discuss below, indirect holders are not legal
holders, and investors in securities issued in book-entry form or in street name
will be indirect holders.
Book-Entry
Holders
We may
issue securities in book-entry form only, as we will specify in the applicable
prospectus supplement. This means securities may be represented by one or more
global securities registered in the name of a financial institution that holds
them as depositary on behalf of other financial institutions that participate in
the depositary’s book-entry system. These participating institutions, which are
referred to as participants, in turn, hold beneficial interests in the
securities on behalf of themselves or their customers.
Only the
person in whose name a security is registered is recognized as the holder of
that security. Securities issued in global form will be registered in the name
of the depositary or its nominee. Consequently, for securities issued in global
form, we will recognize only the depositary as the holder of the securities, and
we will make all payments on the securities to the depositary. The depositary
passes along the payments it receives to its participants, which in turn pass
the payments along to their customers who are the beneficial owners. The
depositary and its participants do so under agreements they have made with one
another or with their customers; they are not obligated to do so under the terms
of the securities.
18
As a
result, investors in a book-entry security will not own securities directly.
Instead, they will own beneficial interests in a global security, through a
bank, broker or other financial institution that participates in the
depositary’s book-entry system or holds an interest through a participant. As
long as the securities are issued in global form, investors will be indirect
holders, and not holders, of the securities.
Street
Name Holders
We may
terminate a global security or issue securities in non-global form. In these
cases, investors may choose to hold their securities in their own names or in
“street name.” Securities held by an investor in street name would be registered
in the name of a bank, broker or other financial institution that the investor
chooses, and the investor would hold only a beneficial interest in those
securities through an account he or she maintains at that
institution.
For
securities held in street name, we will recognize only the intermediary banks,
brokers and other financial institutions in whose names the securities are
registered as the holders of those securities, and we will make all payments on
those securities to them. These institutions pass along the payments they
receive to their customers who are the beneficial owners, but only because they
agree to do so in their customer agreements or because they are legally required
to do so. Investors who hold securities in street name will be indirect holders,
not holders, of those securities.
Legal
Holders
Our
obligations, as well as the obligations of any applicable trustee and of any
third parties employed by us or a trustee, run only to the legal holders of the
securities. We do not have obligations to investors who hold beneficial
interests in global securities, in street name or by any other indirect means.
This will be the case whether an investor chooses to be an indirect holder of a
security or has no choice because we are issuing the securities only in global
form.
For
example, once we make a payment or give a notice to the holder, we have no
further responsibility for the payment or notice even if that holder is
required, under agreements with depositary participants or customers or by law,
to pass it along to the indirect holders but does not do so. Similarly, we may
want to obtain the approval of the holders to amend an indenture, to relieve us
of the consequences of a default or of our obligation to comply with a
particular provision of the indenture or for other purposes. In such an event,
we would seek approval only from the holders, and not the indirect holders, of
the securities. Whether and how the holders contact the indirect holders is up
to the holders.
Special
Considerations for Indirect Holders
If you
hold securities through a bank, broker or other financial institution, either in
book-entry form or in street name, you should check with your own institution to
find out:
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how
it handles securities payments and
notices;
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whether
it imposes fees or charges;
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how
it would handle a request for the holders’ consent, if ever
required;
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whether
and how you can instruct it to send you securities registered in your own
name so you can be a holder, if that is permitted in the
future;
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how
it would exercise rights under the securities if there were a default or
other event triggering the need for holders to act to protect their
interests; and
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if
the securities are in book-entry form, how the depositary’s rules and
procedures will affect these
matters.
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Global
Securities
A global
security is a security that represents one or any other number of individual
securities held by a depositary. Generally, all securities represented by the
same global securities will have the same terms.
Each
security issued in book-entry form will be represented by a global security that
we deposit with and register in the name of a financial institution or its
nominee that we select. The financial institution that we select for this
purpose is called the depositary. Unless we specify otherwise in the applicable
prospectus supplement, The Depository Trust Company, New York, New York, known
as DTC, will be the depositary for all securities issued in book-entry
form.
19
A global
security may not be transferred to or registered in the name of anyone other
than the depositary, its nominee or a successor depositary, unless special
termination situations arise. We describe those situations below under “Special
Situations When a Global Security Will Be Terminated.” As a result of these
arrangements, the depositary, or its nominee, will be the sole registered owner
and holder of all securities represented by a global security, and investors
will be permitted to own only beneficial interests in a global security.
Beneficial interests must be held by means of an account with a broker, bank or
other financial institution that in turn has an account with the depositary or
with another institution that does. Thus, an investor whose security is
represented by a global security will not be a holder of the security, but only
an indirect holder of a beneficial interest in the global security.
If the
prospectus supplement for a particular security indicates that the security will
be issued in global form only, then the security will be represented by a global
security at all times unless and until the global security is terminated. If
termination occurs, we may issue the securities through another book-entry
clearing system or decide that the securities may no longer be held through any
book-entry clearing system.
Special
Considerations for Global Securities
As an
indirect holder, an investor’s rights relating to a global security will be
governed by the account rules of the investor’s financial institution and of the
depositary, as well as general laws relating to securities transfers. We do not
recognize an indirect holder as a holder of securities and instead deal only
with the depositary that holds the global security.
If
securities are issued only in the form of a global security, an investor should
be aware of the following:
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An
investor cannot cause the securities to be registered in his or her name,
and cannot obtain non-global certificates for his or her interest in the
securities, except in the special situations we describe
below;
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An
investor will be an indirect holder and must look to his or her own bank
or broker for payments on the securities and protection of his or her
legal rights relating to the securities, as we describe
above;
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An
investor may not be able to sell interests in the securities to some
insurance companies and to other institutions that are required by law to
own their securities in non-book-entry
form;
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An
investor may not be able to pledge his or her interest in a global
security in circumstances where certificates representing the securities
must be delivered to the lender or other beneficiary of the pledge in
order for the pledge to be
effective;
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The
depositary’s policies, which may change from time to time, will govern
payments, transfers, exchanges and other matters relating to an investor’s
interest in a global security. We and any applicable trustee have no
responsibility for any aspect of the depositary’s actions or for its
records of ownership interests in a global security. We and the trustee
also do not supervise the depositary in any
way;
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The
depositary may, and we understand that DTC will, require that those who
purchase and sell interests in a global security within its book-entry
system use immediately available funds, and your broker or bank may
require you to do so as well; and
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Financial
institutions that participate in the depositary’s book-entry system, and
through which an investor holds its interest in a global security, may
also have their own policies affecting payments, notices and other matters
relating to the securities. There may be more than one financial
intermediary in the chain of ownership for an investor. We do not monitor
and are not responsible for the actions of any of those
intermediaries.
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Special
Situations When a Global Security Will Be Terminated
In a few
special situations described below, the global security will terminate and
interests in it will be exchanged for physical certificates representing those
interests. After that exchange, the choice of whether to hold securities
directly or in street name will be up to the investor. Investors must consult
their own banks or brokers to find out how to have their interests in securities
transferred to their own name, so that they will be direct holders. We have
described the rights of holders and street name investors above.
20
The
global security will terminate when the following special situations
occur:
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if
the depositary notifies us that it is unwilling, unable or no longer
qualified to continue as depositary for that global security and we do not
appoint another institution to act as depositary within 90
days;
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if
we notify any applicable trustee that we wish to terminate that global
security; or
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if
an event of default has occurred with regard to securities represented by
that global security and has not been cured or
waived.
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The
prospectus supplement may also list additional situations for terminating a
global security that would apply only to the particular series of securities
covered by the prospectus supplement. When a global security terminates, the
depositary, and not we or any applicable trustee, is responsible for deciding
the names of the institutions that will be the initial direct
holders.
SPECIAL
NOTE REGARDING FORWARD-LOOKING STATEMENTS
This
prospectus and the documents incorporated by reference into this prospectus
contain certain information regarding our financial projections, plans and
strategies that are forward-looking statements within the meaning of Section 27A
of the Securities Act and 21E of the Exchange Act. We have attempted
to identify forward-looking statements by terminology including “anticipate,”
“believe,” “can,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,”
“plan,” “potential,” “predict,” “should” or “will” or the negative of these
terms or other comparable terminology. These statements, which are
only predictions and involve known and unknown risks, uncertainties and other
important factors may include, among other things, statements which address our
strategy and operating performance, events or developments that we expect or
anticipate will occur in the future, such as projections of our future results
of operations or of our financial condition, the status of any collaborative
agreements, our research and development efforts and anticipated trends in our
business.
We have
based these forward-looking statements on our current expectations and
projections about future events. However, there may be events in the
future that we are not able to predict accurately or which we do not fully
control that could cause actual results to differ materially from those
expressed or implied in our forward-looking statements. Many
important factors could cause actual results to differ materially from those
expressed or implied by these forward-looking statements, including those
discussed under “Risk Factors” in this prospectus and any prospectus supplement
and other sections of the documents incorporated by reference into this
prospectus. We undertake no obligation to publicly release any
revisions to the forward-looking statements or reflect events or circumstances
after the date of this prospectus.
RATIO
OF EARNINGS TO FIXED CHARGES
Our
earnings were insufficient to cover fixed charges in each of the years in the
five-year period ended December 31, 2008 and in the six-month period ended
June 30, 2009. “Fixed charges” consist of interest expense, the
estimated interest included in rental expense and accretion on redeemable
convertible preferred stock. The following table sets forth the
computation of our ratio of earnings to fixed charges for the periods
indicated:
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Six
months
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ended
June 30,
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Fiscal
years ended December 31,
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2009
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2008
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2007
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2006
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2005
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2004
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Ratio
of earnings to fixed charges (1)
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—
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—
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—
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—
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—
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—
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(1)
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For
the six months ended June 30, 2009, and the fiscal years ended
December 31, 2008, 2007, 2006, 2005 and 2004, our earnings were
insufficient to cover fixed charges by $41.6 million,
$76.9 million, $58.8 million, $54.4 million,
$36.2 million, and $47.2 million,
respectively.
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For the
periods indicated above, we had no outstanding shares of preferred stock with
required dividend payments. Therefore, our ratios of earnings to
combined fixed charges and preferred stock dividends for the periods indicated
are identical to the ratios presented in the table above.
21
USE
OF PROCEEDS
Except as
otherwise described in the prospectus supplement relating to an offering, we
intend to use the net proceeds from the sale(s) of securities offered pursuant
to this prospectus and any prospectus supplement for research and development
and general corporate purposes, including capital expenditures and working
capital needs. We may also use some or all of the net proceeds to
acquire or invest in businesses, products and technologies that are
complementary to our own.
The
amounts that we actually expend for working capital purposes, investments or
acquisitions will vary significantly depending on a number of factors, including
future revenue growth, if any, the amount of cash we generate from operations
and the progress of our product development efforts. Accordingly, our
management will retain broad discretion in the allocation of the net proceeds
from the sale(s) of the offered securities. If we elect at the time
of the issuance of the securities to make different or more specific use of
proceeds other than as described in this prospectus, the change in use of
proceeds will be described in the applicable prospectus supplement.
PLAN
OF DISTRIBUTION
We may
sell securities under this prospectus from time to time in any one or more of
the following ways:
|
|
·
|
to
or through underwriters;
|
|
|
·
|
through
brokers or dealers;
|
|
|
·
|
directly
to other purchasers; or
|
|
|
·
|
through
agents.
|
We may
sell securities under this prospectus from time to time in one or more
transactions:
|
|
·
|
at
a fixed price or prices, which may be
changed;
|
|
|
·
|
at
market prices prevailing at the time of
sale;
|
|
|
·
|
at
prices related to such prevailing market prices;
or
|
|
|
·
|
at
negotiated prices.
|
The
prospectus supplement relating to the securities will set forth the terms of the
offering of such securities, including the name or names of any underwriters,
brokers, dealers or agents, the name or names of any managing underwriter or
underwriters, the purchase price of the securities and the net proceeds to us
from such sale, any delayed delivery arrangements, any underwriting discounts
and commissions and other items constituting underwriters’ compensation, any
public offering price, any discounts or concessions allowed or reallowed or paid
to dealers, any commissions paid to agents and any securities exchange or market
on which the securities may be listed.
If we use
underwriters in the sale of securities, the underwriters will acquire the
securities for their own account. The underwriters may resell the
securities from time to time in one or more transactions, including negotiated
transactions, at a fixed public offering price or at varying prices determined
at the time of sale. Underwriters may offer securities to the public
either through underwriting syndicates represented by one or more managing
underwriters or directly by one or more firms acting as
underwriters. Unless we inform you otherwise in the prospectus
supplement, the obligations of the underwriters to purchase the securities will
be subject to certain conditions, and the underwriters will be obligated to
purchase all of the offered securities if they purchase any of
them. The underwriters may change from time to time any public
offering price and any discounts or concessions allowed or reallowed or paid to
dealers.
In
connection with the sale of our securities, underwriters, brokers, dealers or
agents may receive compensation from us or purchasers of securities for whom
they may act as agents, in the form of discounts, concessions or
commissions. Underwriters, dealers and agents that participate in the
distribution of our securities may be deemed to be underwriters, and any
discounts or commissions received by them from us and any profit on the resale
of securities by them may be deemed to be underwriting discounts and commissions
under the Securities Act. Any person who may be deemed to be an
underwriter will be identified, and the compensation received from us will be
described, in the prospectus supplement.
22
During
and after an offering through underwriters, the underwriters may purchase and
sell the securities in the open market. These transactions may
include over-allotment and stabilizing transactions and purchases to cover
syndicate short positions created in connection with the
offering. The underwriters may also impose a penalty bid, whereby
selling concessions allowed to syndicate members or other broker-dealers for the
securities sold for their account may be reclaimed by the syndicate if those
securities are repurchased by the syndicate in stabilizing or covering
transactions. These activities may stabilize, maintain or otherwise
affect the market price of the securities, which may be higher than the price
that might otherwise prevail in the open market, and, if commenced, may be
discontinued at any time.
If
dealers or brokers acting as dealers are used in the sale of the securities, we
will sell the securities to such dealers or brokers as
principals. The dealers or brokers acting as dealers may then resell
such securities to the public at varying prices to be determined by such dealers
or brokers at the time of resale. The names of dealers or brokers
acting as dealers and the terms of the transaction will be set forth in the
prospectus supplement relating to such securities. We may sell the
securities directly or through agents designated by us from time to
time. Any agent involved in the offer or sale of the securities will
be named, and any commissions that we pay to such agent will be set forth, in
the prospectus supplement relating to such securities. Unless
otherwise indicated in the prospectus supplement, any such agent will be acting
on a best efforts basis for the period of its appointment.
We may
sell securities directly, in which case no underwriters or agents would be
involved. We may sell securities directly to institutional investors
or others who may be deemed to be underwriters within the meaning of the
Securities Act with respect to any sale of those securities.
We may
offer securities through agents in connection with a distribution to our
stockholders of rights to purchase such securities. The terms of any
such sales will be described in the prospectus supplement relating
thereto. Pursuant to any standby underwriting agreement entered into
in connection with a rights offering to our stockholders, persons acting as
standby underwriters may receive a commitment fee for all securities underlying
the rights that the underwriter commits to purchase on a standby
basis. Additionally, prior to the expiration date with respect to any
rights, any standby underwriters in a rights offering to our stockholders may
offer such securities on a when-issued basis, including securities to be
acquired through the purchase and exercise of rights, at prices set from time to
time by the standby underwriters. After the expiration date with
respect to such rights, the underwriters may offer securities of the type
underlying the rights, whether acquired pursuant to a standby underwriting
agreement, the exercise of the rights or the purchase of such securities in the
market, to the public at a price or prices to be determined by the
underwriters. The standby underwriters may thus realize profits or
losses independent of the underwriting discounts or commissions paid by
us. If we do not enter into a standby underwriting agreement in
connection with a rights offering to our stockholders, we may elect to retain a
dealer-manager to manage such a rights offering for us. Any such
dealer-manager may offer securities of the type underlying the rights acquired
or to be acquired pursuant to the purchase and exercise of rights and may thus
realize profits or losses independent of any dealer-manager fee paid by
us.
All
securities we offer, other than common stock and other securities issued upon a
reopening of a previous series, will be new issues of securities with no
established trading market. Any underwriters may make a market in
these securities, but will not be obligated to do so and may discontinue any
market making at any time without notice. We cannot guarantee the
liquidity of the trading markets for any securities.
If so
indicated in the prospectus supplement, we will authorize agents, underwriters,
brokers or dealers to solicit offers from certain types of institutions to
purchase securities at the public offering price set forth in the prospectus
supplement pursuant to delayed delivery contracts providing for payment and
delivery on a specified date in the future. Such contracts will be
subject only to those conditions set forth in the prospectus supplement, and the
prospectus supplement will set forth also the commission payable for
solicitation of such contracts.
We may
have agreements with the underwriters, dealers and agents to indemnify them
against specific civil liabilities, including liabilities under the Securities
Act, or to contribute with respect to payments which the underwriters, dealers
or agents may be required to make as a result of those specific civil
liabilities.
Underwriters
and agents and their affiliates may be customers of, engage in transactions
with, or perform services for us or our subsidiaries in the ordinary course of
their businesses.
23
LEGAL
MATTERS
The
validity of the issuance of the securities offered by this prospectus has been
passed upon for us by Vinson & Elkins L.L.P., Houston,
Texas.
EXPERTS
Ernst
& Young LLP, independent registered public accounting firm, has audited our
consolidated financial statements for the year ended December 31, 2008 included
in our Current Report on Form 8-K filed on September 2, 2009, as set forth in
their report, which is incorporated by reference in this prospectus and
elsewhere in the registration statement. Our financial statements are
incorporated by reference in reliance on Ernst & Young LLP's report, given
on their authority as experts in accounting and auditing.
WHERE
YOU CAN FIND MORE INFORMATION
We have
filed with the SEC a registration statement on Form S-3 under the Securities Act
regarding the offer and sale of securities under this prospectus. This
prospectus, which constitutes a part of the registration statement, does not
contain all of the information contained in the registration statement or the
exhibits to the registration statement, as permitted by the rules and
regulations of the SEC. For further information about us and our
common stock, please review the registration statement and the exhibits filed as
a part of it. Statements made in this prospectus that describe
documents may not necessarily be complete. We recommend that you
review the documents that we have filed with the registration statement to
obtain a more complete understanding of these documents. A copy of
the registration statement, including the exhibits filed as a part of it, may be
inspected without charge at the SEC’s Public Reference Room, 100 F Street, N.E.,
Washington, D.C. 20549, and copies of all or any part of the registration
statement may be obtained from the SEC upon the payment of fees prescribed by
it. You may obtain information on the Public Reference Room by
calling the SEC at 1-800-SEC-0330. The SEC maintains a website at
www.sec.gov that contains reports, proxy and information statements and other
information regarding companies that file electronically with it.
We are
subject to the information and reporting requirements of the Exchange Act and
will file periodic reports, proxy statements and other information with the SEC.
You may inspect any of these documents as described in the preceding
paragraph.
DOCUMENTS
INCORPORATED BY REFERENCE
The SEC
allows us to “incorporate by reference” into this prospectus information that we
file with the SEC in other documents. This means that we can disclose
important information to you by referring to other documents that contain that
information. The information incorporated by reference is considered
to be part of this prospectus, except for information superseded by information
in this prospectus. We incorporate by reference the documents listed
below that we have previously filed with the SEC and any future filings we make
with the SEC under Sections 13(a), 13(c), 14 or 15(d) (other than information
furnished to the SEC under Item 2.02 and 9.01 of Form 8-K) of the Securities
Exchange Act of 1934, prior to the termination of the offering of the securities
covered by this prospectus:
|
|
·
|
our
annual report on Form 10-K for the year ended December 31,
2008;
|
|
|
·
|
our
quarterly reports on Form 10-Q for the quarterly periods ended March 31
and June 30, 2009;
|
|
|
·
|
our
current reports on Form 8-K dated January 27, February 12, April 23,
May 4, June 8 (as amended on September 2) and September 2, 2009;
and
|
|
|
·
|
the
description of our common stock contained in our registration statement on
Form 8-A filed with the SEC on March 27, 2000 pursuant to Section 12
of the Securities Exchange Act of 1934, including any amendments and
reports filed for the purpose of updating such
description.
|
Any
statement contained in a document incorporated or deemed to be incorporated by
reference in this prospectus will be deemed to be modified or superseded for
purposes of this prospectus to the extent that a statement contained in this
prospectus or in any other subsequently filed document which also is or is
deemed to be incorporated by reference in this prospectus modifies or supersedes
that statement. Any statement that is modified or superseded will not
constitute a part of this prospectus, except as so modified or
superseded. You may rely on any statement contained in this
prospectus or in documents incorporated or deemed to be incorporated in this
prospectus, unless that statement has been subsequently modified or superseded
as described above prior to the time you make your investment
decision.
24
Upon your
written or oral request, we will provide you at no cost a copy of any or all of
the documents incorporated by reference in this prospectus, other than the
exhibits to those documents, unless the exhibits are specifically incorporated
by reference into this prospectus. You may request a copy of these
documents by contacting:
Investor
Relations
Lexicon
Pharmaceuticals, Inc.
8800
Technology Forest Place
The
Woodlands, Texas 77381-1160
Telephone:
(281) 863-3000
25
PART
II
INFORMATION
NOT REQUIRED IN PROSPECTUS
Item
14. Other
Expenses of Issuance and Distribution.
The
estimated expenses payable by the Registrant in connection with the issuance and
distribution of the securities being registered (other than underwriting
discounts and commissions) are as follows:
|
SEC
Registration Fee
|
$ | 8,370 | ||
|
Printing
Expenses
|
25,000 | |||
|
Accounting
Fees and Expenses
|
25,000 | |||
|
Legal
Fees and Expenses
|
100,000 | |||
|
Transfer
Agent and Registrar Fees
|
3,000 | |||
|
Miscellaneous
Expenses
|
3,630 | |||
|
Total
|
$ | 165,000 |
Item 15. Indemnification of Directors and Officers.
Section
145 of the Delaware General Corporation Law (“DGCL”) provides that a corporation
may indemnify any person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action, suit or proceeding whether
civil, criminal, administrative or investigative (other than an action by or in
the right of the corporation) by reason of the fact that he is or was a
director, officer, employee or agent of the corporation, or is or was serving at
the request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorneys’ fees), judgments, fines and amounts paid
in settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. Section 145 further
provides that a corporation similarly may indemnify any such person serving in
any such capacity who was or is a party or is threatened to be made a party to
any threatened, pending or completed action or suit by or in the right of the
corporation to procure a judgment in its favor by reason of the fact that he is
or was a director, officer, employee or agent of the corporation or is or was
serving at the request of the corporation as a director, officer, employee or
agent of another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys’ fees) actually and reasonably
incurred in connection with the defense or settlement of such action or suit if
he acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the corporation and except that no
indemnification shall be made in respect of any claim, issue or matter as to
which such person shall have been adjudged to be liable to the corporation
unless and only to the extent that the Delaware Court of Chancery or such other
court in which such action or suit was brought shall determine upon application
that, despite the adjudication of liability but in view of all of the
circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the Delaware Court of Chancery or such other
court shall deem proper.
Lexicon’s
restated certificate of incorporation, as amended, and restated bylaws provide
that indemnification shall be to the fullest extent permitted by the DGCL for
all current or former directors or officers. As permitted by the DGCL, the
restated certificate of incorporation provides that directors of Lexicon shall
have no personal liability to Lexicon or its stockholders for monetary damages
for breach of fiduciary duty as a director, except (1) for any breach of the
director’s duty of loyalty to Lexicon or its stockholders, (2) for acts or
omissions not in good faith or which involve intentional misconduct or knowing
violation of law, (3) under Section 174 of the DGCL or (4) for any transaction
from which a director derived an improper personal benefit.
Lexicon
has entered into indemnification agreements with each of its officers and
directors. These agreements, among other things, require Lexicon to
indemnify each officer and director for all expenses, including attorneys’ fees,
liabilities, judgments, fines, penalties, excise taxes and settlement amounts
incurred by any such person in any claim, action, suit or proceeding, including
any action by or in the right of Lexicon, arising out of the person’s services
as a director, officer, employee, agent or fiduciary to Lexicon, any subsidiary
of Lexicon or to any other company or enterprise for which the person provides
services at Lexicon’s request.
II-1
At
present, there is no pending litigation or proceeding involving a director or
officer of Lexicon as to which indemnification is being sought nor is Lexicon
aware of any threatened litigation that may result in claims for indemnification
by any officer or director.
Item
16. Exhibits.
|
Exhibit No.
|
Description
|
|||
|
*1.1
|
—
|
Form
of Underwriting Agreement.
|
||
|
3.1
|
—
|
Restated
Certificate of Incorporation (filed as Exhibit 3.1 to the Company’s
Registration Statement on Form S-1 (Registration No. 333-96469)
and incorporated by reference herein).
|
||
|
3.2
|
—
|
First
Certificate of Amendment to Restated Certificate of Incorporation (filed
as Exhibit 3.2 to the Company’s Annual Report on Form 10-K for the period
ended December 31, 2007 and incorporated by reference
herein).
|
||
|
3.3
|
—
|
Second
Certificate of Amendment to Restated Certificate of Incorporation (filed
as Exhibit 3.3 to the Company’s Annual Report on Form 10-K for the period
ended December 31, 2007 and incorporated by reference
herein).
|
||
|
3.4
|
—
|
Third
Certificate of Amendment to Restated Certificate of Incorporation (filed
as Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q for the
period ended June 30, 2009 and incorporated by reference
herein).
|
||
|
3.5
|
—
|
Restated
Bylaws (filed as Exhibit 3.2 to the Company’s Registration Statement
on Form S-1 (Registration No. 333-96469) and incorporated by
reference herein).
|
||
|
4.1
|
—
|
Securities
Purchase Agreement, dated June 17, 2007, with Invus, L.P. (filed as
Exhibit 10.1 to the Company’s Current Report on Form 8-K dated June 17,
2007 and incorporated by reference herein).
|
||
|
4.2
|
—
|
Registration
Rights Agreement, dated June 17, 2007, with Invus, L.P. (filed as Exhibit
10.3 to the Company’s Current Report on Form 8-K dated June 17, 2007 and
incorporated by reference herein).
|
||
|
4.3
|
—
|
Stockholders’
Agreement, dated June 17, 2007, with Invus, L.P. (filed as Exhibit 10.4 to
the Company’s Current Report on Form 8-K dated June 17, 2007 and
incorporated by reference herein).
|
||
|
*4.4
|
—
|
Form
of Certificate of Designation of Preferred Stock.
|
||
|
4.5
|
—
|
Form
of Indenture.
|
||
|
*4.6
|
—
|
Form
of Note.
|
||
|
*4.7
|
—
|
Form
of Common Stock Warrant Agreement and Warrant
Certificate.
|
||
|
*4.8
|
—
|
Form
of Preferred Stock Warrant Agreement and Warrant
Certificate.
|
||
|
*4.9
|
—
|
Form
of Debt Securities Warrant Agreement and Warrant
Certificate.
|
||
|
*4.10
|
—
|
Form
of Rights Agreement and Rights Certificate.
|
||
|
*4.11
|
—
|
Form
of Unit Agreement.
|
||
|
5.1
|
—
|
Opinion
of Vinson & Elkins L.L.P.
|
||
|
12.1
|
—
|
Statement
of Computation of Ratio of Earnings to Fixed Charges.
|
||
|
23.1
|
—
|
Consent
of Independent Registered Public Accounting Firm.
|
||
|
23.2
|
—
|
Consent
of Vinson & Elkins L.L.P. (contained in Exhibit
5.1).
|
||
|
24.1
|
—
|
Power
of Attorney (contained in signature page).
|
||
|
*25.1
|
—
|
Statement
of Eligibility of Trustee under the
Indenture.
|
||
|
|
*
|
To
be filed by amendment, as an exhibit to a report filed under the
Securities Exchange Act of 1934, as amended, or as otherwise required by
regulation of the Securities and Exchange Commission, and incorporated by
reference herein.
|
Item
17. Undertakings.
The
undersigned Registrant hereby undertakes:
(a) To
file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
II-2
(i) to
include any prospectus required by Section 10(a)(3) of the Securities Act of
1933, as amended (the “Securities Act”);
(ii) to
reflect in the prospectus any facts or events arising after the effective date
of this registration statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate, represent a fundamental change
in the information set forth in this registration statement. Notwithstanding the
foregoing, any increase or decrease in the volume of securities offered (if the
total dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated maximum
offering range may be reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume
and price represent no more than a 20 percent change in the maximum aggregate
offering price set forth in the “Calculation of Registration Fee” table in the
effective registration statement; and
(iii) to
include any material information with respect to the plan of distribution not
previously disclosed in this Registration Statement or any material change to
such information in this Registration Statement;
provided, however, that
paragraphs (a)(i) and (a)(ii) do not apply if the information required to be
included in a post-effective amendment by those paragraphs is contained in
periodic reports filed by the Registrant pursuant to Section 13 or Section 15(d)
of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that
are incorporated by reference in this registration statement.
(b) That,
for the purpose of determining any liability under the Securities Act, each such
post-effective amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
(c) To
remove from registration by means of a post-effective amendment any of the
securities being registered which remain unsold at the termination of the
offering.
The
Registrant hereby undertakes that, for purposes of determining any liability
under the Securities Act, each filing of the Registrant’s annual report pursuant
to Section 13(a) or 15(d) of the Exchange Act (and, where applicable, each
filing of an employee benefit plan’s annual report pursuant to Section 15(d) of
the Exchange Act) that is incorporated by reference in this registration
statement shall be deemed to be a new registration statement relating to the
securities offered therein and the offering of such securities at the time shall
be deemed to be the initial bona fide offering thereof.
Insofar
as indemnification for liabilities arising under the Securities Act may be
permitted to directors, officers and controlling persons of the Registrant
pursuant to the foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
The
Registrant hereby undertakes to file an application for the purpose of
determining the eligibility of the trustee to act under subsection (a) of
Section 310 of the Trust Indenture Act (the “Act”) in accordance with the rules
and regulations prescribed by the Commission under Section 305(b)(2) of the
Act.
II-3
SIGNATURES
Pursuant
to the requirements of the Securities Act of 1933, the Registrant certifies that
it has reasonable grounds to believe that it meets all of the requirements for
filing on Form S-3 and has duly caused this Registration Statement to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of The
Woodlands, in the State of Texas, on September 2, 2009.
| Lexicon Pharmaceuticals, Inc. | |||
|
|
By:
|
/s/ Arthur T. Sands | |
| Arthur T. Sands, M.D., Ph.D. | |||
| President and Chief Executive Officer | |||
POWER
OF ATTORNEY
Each
person whose signature appears below appoints Arthur T. Sands and Jeffrey L.
Wade, and each of them, any of whom may act without the joinder of the other, as
his true and lawful attorneys-in-fact and agents with full power of substitution
and resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign any and all amendments (including post-effective amendments)
to this Registration Statement and any Registration Statement (including any
amendment thereto) for this offering that is to be effective upon filing
pursuant to Rule 462(b) under the Securities Act of 1933, as amended, and to
file the same, with all exhibits thereto, and all other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents full power and authority to do and perform each and
every act and thing requisite and necessary to be done, as fully to all intents
and purposes as he might or would do in person, hereby ratifying and confirming
all that said attorneys-in-fact and agents or any of them or their or his
substitute and substitutes, may lawfully do or cause to be done by virtue
hereof.
PURSUANT
TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED, THIS REGISTRATION
STATEMENT HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS IN THE CAPACITIES AND
ON THE DATES INDICATED BELOW.
|
Signature
|
Title
|
Date
|
|
|
/s/
Arthur T. Sands
|
President,
Chief Executive Officer and Director
|
September
2, 2009
|
|
|
Arthur
T. Sands, M.D., Ph.D.
|
(principal
executive officer)
|
||
|
/s/
Ajay Bansal
|
Executive
Vice President, Corporate Development
|
September
2, 2009
|
|
|
Ajay
Bansal
|
and
Chief Financial Officer (principal financial
|
||
|
officer)
|
|||
|
/s/
James F. Tessmer
|
Vice
President, Finance and Accounting (principal
|
September
2, 2009
|
|
|
James
F. Tessmer
|
accounting
officer)
|
||
|
/s/
Samuel L. Barker
|
Chairman
of the Board of Directors
|
September
2, 2009
|
|
|
Samuel
L. Barker, Ph.D.
|
|||
|
/s/
Philippe J. Amouyal
|
Director
|
September
2, 2009
|
|
|
Philippe
J. Amouyal
|
|||
|
/s/
Raymond Debbane
|
Director
|
September
2, 2009
|
|
|
Raymond
Debbane
|
|||
|
/s/
Robert J. Lefkowitz
|
Director
|
September
2, 2009
|
|
|
Robert
J. Lefkowitz, M.D.
|
|||
|
/s/
Alan S. Nies
|
Director
|
September
2, 2009
|
|
|
Alan
S. Nies, M.D.
|
|||
|
/s/
Frank Palantoni
|
Director
|
September
2, 2009
|
|
|
Frank
Palantoni
|
II-4
|
/s/
Christopher J. Sobecki
|
Director
|
September
2, 2009
|
|
|
Christopher
J. Sobecki
|
|||
|
/s/
Judith L. Swain
|
Director
|
September
2, 2009
|
|
|
Judith
L. Swain, M.D.
|
|||
|
/s/
Kathleen M. Wiltsey
|
Director
|
September
2, 2009
|
|
|
Kathleen
M. Wiltsey
|
|||
II-5
EXHIBIT
INDEX
|
Exhibit No.
|
Description
|
|||
|
*1.1
|
—
|
Form
of Underwriting Agreement.
|
||
|
3.1
|
—
|
Restated
Certificate of Incorporation (filed as Exhibit 3.1 to the Company’s
Registration Statement on Form S-1 (Registration No. 333-96469)
and incorporated by reference herein).
|
||
|
3.2
|
—
|
First
Certificate of Amendment to Restated Certificate of Incorporation (filed
as Exhibit 3.2 to the Company’s Annual Report on Form 10-K for the period
ended December 31, 2007 and incorporated by reference
herein).
|
||
|
3.3
|
—
|
Second
Certificate of Amendment to Restated Certificate of Incorporation (filed
as Exhibit 3.3 to the Company’s Annual Report on Form 10-K for the period
ended December 31, 2007 and incorporated by reference
herein).
|
||
|
3.4
|
—
|
Third
Certificate of Amendment to Restated Certificate of Incorporation (filed
as Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q for the
period ended June 30, 2009 and incorporated by reference
herein).
|
||
|
3.5
|
—
|
Restated
Bylaws (filed as Exhibit 3.2 to the Company’s Registration Statement
on Form S-1 (Registration No. 333-96469) and incorporated by
reference herein).
|
||
|
4.1
|
—
|
Securities
Purchase Agreement, dated June 17, 2007, with Invus, L.P. (filed as
Exhibit 10.1 to the Company’s Current Report on Form 8-K dated June 17,
2007 and incorporated by reference herein).
|
||
|
4.2
|
—
|
Registration
Rights Agreement, dated June 17, 2007, with Invus, L.P. (filed as Exhibit
10.3 to the Company’s Current Report on Form 8-K dated June 17, 2007 and
incorporated by reference herein).
|
||
|
4.3
|
—
|
Stockholders’
Agreement, dated June 17, 2007, with Invus, L.P. (filed as Exhibit 10.4 to
the Company’s Current Report on Form 8-K dated June 17, 2007 and
incorporated by reference herein).
|
||
|
*4.4
|
—
|
Form
of Certificate of Designation of Preferred Stock.
|
||
|
4.5
|
—
|
Form
of Indenture.
|
||
|
*4.6
|
—
|
Form
of Note.
|
||
|
*4.7
|
—
|
Form
of Common Stock Warrant Agreement and Warrant
Certificate.
|
||
|
*4.8
|
—
|
Form
of Preferred Stock Warrant Agreement and Warrant
Certificate.
|
||
|
*4.9
|
—
|
Form
of Debt Securities Warrant Agreement and Warrant
Certificate.
|
||
|
*4.10
|
—
|
Form
of Rights Agreement and Rights Certificate.
|
||
|
*4.11
|
—
|
Form
of Unit Agreement.
|
||
|
5.1
|
—
|
Opinion
of Vinson & Elkins L.L.P.
|
||
|
12.1
|
—
|
Statement
of Computation of Ratio of Earnings to Fixed Charges.
|
||
|
23.1
|
—
|
Consent
of Independent Registered Public Accounting Firm.
|
||
|
23.2
|
—
|
Consent
of Vinson & Elkins L.L.P. (contained in Exhibit
5.1).
|
||
|
24.1
|
—
|
Power
of Attorney (contained in signature page).
|
||
|
*25.1
|
—
|
Statement
of Eligibility of Trustee under the
Indenture.
|
||
|
|
*
|
To
be filed by amendment, as an exhibit to a report filed under the
Securities Exchange Act of 1934, as amended, or as otherwise required by
regulation of the Securities and Exchange Commission, and incorporated by
reference herein.
|
Exhibit
4.5
LEXICON
PHARMACEUTICALS, INC.
INDENTURE
Dated
as of ____________ ___, 200__
_______________________________,
as
Trustee
|
ARTICLE
1. DEFINITIONS AND INCORPORATION BY
REFERENCE
|
1
|
||
|
Section
1.1
|
1
|
||
|
Section
1.2
|
4
|
||
|
Section
1.3
|
5
|
||
|
Section
1.4
|
5
|
||
|
ARTICLE
2. THE SECURITIES
|
6
|
||
|
Section
2.1
|
6
|
||
|
Section
2.2
|
6
|
||
|
Section
2.3
|
8
|
||
|
Section
2.4
|
9
|
||
|
Section
2.5
|
9
|
||
|
Section
2.6
|
10
|
||
|
Section
2.7
|
10
|
||
|
Section
2.8
|
10
|
||
|
Section
2.9
|
11
|
||
|
Section
2.10
|
11
|
||
|
Section
2.11
|
11
|
||
|
Section
2.12
|
12
|
||
|
Section
2.13
|
12
|
||
|
Section
2.14
|
12
|
||
|
Section
2.15
|
13
|
||
|
ARTICLE
3. REDEMPTION
|
13
|
||
|
Section
3.1
|
13
|
||
|
Section
3.2
|
14
|
||
|
Section
3.3
|
14
|
||
|
Section
3.4
|
14
|
||
|
Section
3.5
|
15
|
||
|
Section
3.6
|
15
|
||
|
ARTICLE
4. COVENANTS
|
15
|
||
|
Section
4.1
|
15
|
||
|
Section
4.2
|
15
|
||
|
Section
4.3
|
15
|
||
|
Section
4.4
|
16
|
||
|
Section
4.5
|
16
|
||
|
Section
4.6
|
16
|
||
|
ARTICLE
5. SUCCESSORS
|
16
|
||
|
Section
5.1
|
16
|
||
|
Section
5.2
|
16
|
||
|
ARTICLE
6. DEFAULTS AND REMEDIES
|
17
|
||
|
Section
6.1
|
17
|
||
|
Section
6.2
|
18
|
||
|
Section
6.3
|
18
|
||
i
|
Section
6.4
|
19
|
||
|
Section
6.5
|
20
|
||
|
Section
6.6
|
20
|
||
|
Section
6.7
|
20
|
||
|
Section
6.8
|
21
|
||
|
Section
6.9
|
21
|
||
|
Section
6.10
|
21
|
||
|
Section
6.11
|
21
|
||
|
Section
6.12
|
21
|
||
|
Section
6.13
|
22
|
||
|
Section
6.14
|
22
|
||
|
ARTICLE
7. TRUSTEE
|
22
|
||
|
Section
7.1
|
22
|
||
|
Section
7.2
|
23
|
||
|
Section
7.3
|
24
|
||
|
Section
7.4
|
25
|
||
|
Section
7.5
|
25
|
||
|
Section
7.6
|
25
|
||
|
Section
7.7
|
25
|
||
|
Section
7.8
|
26
|
||
|
Section
7.9
|
27
|
||
|
Section
7.10
|
27
|
||
|
Section
7.11
|
27
|
||
|
ARTICLE
8. SATISFACTION AND DISCHARGE;
DEFEASANCE
|
27
|
||
|
Section
8.1
|
27
|
||
|
Section
8.2
|
28
|
||
|
Section
8.3
|
28
|
||
|
Section
8.4
|
30
|
||
|
Section
8.5
|
31
|
||
|
ARTICLE
9. AMENDMENTS AND WAIVERS
|
31
|
||
|
Section
9.1
|
31
|
||
|
Section
9.2
|
31
|
||
|
Section
9.3
|
32
|
||
|
Section
9.4
|
32
|
||
|
Section
9.5
|
32
|
||
|
Section
9.6
|
33
|
||
|
Section
9.7
|
33
|
||
|
ARTICLE
10. MISCELLANEOUS
|
33
|
||
|
Section
10.1
|
33
|
||
|
Section
10.2
|
33
|
||
|
Section
10.3
|
34
|
||
|
Section
10.4
|
34
|
||
|
Section
10.5
|
34
|
||
|
Section
10.6
|
35
|
||
|
Section
10.7
|
35
|
||
|
Section
10.8
|
35
|
||
|
Section
10.9
|
35
|
||
ii
|
Section
10.10
|
35
|
||
|
Section
10.11
|
35
|
||
|
Section
10.12
|
35
|
||
|
Section
10.13
|
36
|
||
|
Section
10.14
|
36
|
||
|
Section
10.15
|
36
|
||
|
Section
10.16
|
36
|
||
|
ARTICLE
11. SINKING FUNDS
|
37
|
||
|
Section
11.1
|
37
|
||
|
Section
11.2
|
37
|
||
|
Section
11.3
|
38
|
||
iii
LEXICON
PHARMACEUTICALS, INC.
RECONCILIATION
AND TIE BETWEEN TRUST INDENTURE ACT OF 1939 AND
INDENTURE,
DATED AS OF __________ __, 200_
|
Section
|
310(a)(1)
|
7.10
|
|
(a)(2)
|
7.10
|
|
|
(a)(3)
|
NOT
APPLICABLE
|
|
|
(a)(4)
|
NOT
APPLICABLE
|
|
|
(a)(5)
|
7.10
|
|
|
(b)
|
7.10
|
|
|
Section
|
311(a)
|
7.11
|
|
(b)
|
7.11
|
|
|
(c)
|
NOT
APPLICABLE
|
|
|
Section
|
312(a)
|
2.6
|
|
(b)
|
10.3
|
|
|
(c)
|
10.3
|
|
|
Section
|
313(a)
|
7.6
|
|
(b)(1)
|
7.6
|
|
|
(b)(2)
|
7.6
|
|
|
(c)(1)
|
7.6
|
|
|
(d)
|
7.6
|
|
|
Section
|
314(a)
|
4.2,
10.5
|
|
(b)
|
NOT
APPLICABLE
|
|
|
(c)(1)
|
10.4
|
|
|
(c)(2)
|
10.4
|
|
|
(c)(3)
|
NOT
APPLICABLE
|
|
|
(d)
|
NOT
APPLICABLE
|
|
|
(e)
|
10.5
|
|
|
(f)
|
.NOT
APPLICABLE
|
|
|
Section
|
315(a)
|
7.1
|
|
(b)
|
7.5
|
|
|
(c)
|
7.1
|
|
|
(d)
|
7.1
|
|
|
(e)
|
6.14
|
|
|
Section
|
316(a)
|
2.10
|
|
(a)(1)(a)
|
6.12
|
|
|
(a)(1)(b)
|
6.13
|
|
|
(b)
|
6.8
|
|
|
Section
|
317(a)(1)
|
6.3
|
|
(a)(2)
|
6.4
|
|
|
(b)
|
2.5
|
|
|
Section
|
318(a)
|
10.1
|
Note:
This reconciliation and tie shall not, for any purpose, be deemed to be part of
the Indenture.
iv
Indenture
dated as of _______ ___, 200__ between Lexicon Pharmaceuticals, Inc., a Delaware
corporation (“Company”), and ________________________________, as trustee
(“Trustee”).
Each
party agrees as follows for the benefit of the other party and for the equal and
ratable benefit of the Holders of the Securities issued under this
Indenture.
DEFINITIONS
AND INCORPORATION BY REFERENCE
Section
1.1 Definitions.
“Additional Amounts” means
any additional amounts which are required hereby or by any Security, under
circumstances specified herein or therein, to be paid by the Company in respect
of certain taxes imposed on Holders specified herein or therein and which are
owing to such Holders.
“Affiliate” of any specified
person means any other person directly or indirectly controlling or controlled
by or under direct or indirect common control with such specified person. For
the purposes of this definition, “control” (including, with correlative
meanings, the terms “controlled by” and “under common control with”), as used
with respect to any person, shall mean the possession, directly or indirectly,
of the power to direct or cause the direction of the management or policies of
such person, whether through the ownership of voting securities or by agreement
or otherwise.
“Agent” means any Registrar,
Paying Agent or Service Agent.
“Authorized Newspaper” means
a newspaper in an official language of the country of publication customarily
published at least once a day for at least five days in each calendar week and
of general circulation in the place in connection with which the term is used.
If it shall be impractical in the opinion of the Trustee to make any publication
of any notice required hereby in an Authorized Newspaper, any publication or
other notice in lieu thereof that is made or given by the Trustee shall
constitute a sufficient publication of such notice.
“Bearer” means anyone in
possession from time to time of a Bearer Security.
“Bearer Security” means any
Security, including any interest coupon appertaining thereto, that does not
provide for the identification of the Holder thereof.
“Board of Directors” means
the Board of Directors of the Company or any duly authorized committee
thereof.
“Board Resolution” means a
copy of a resolution certified by the Secretary or an Assistant Secretary of the
Company to have been adopted by the Board of Directors or pursuant to
authorization by the Board of Directors and to be in full force and effect on
the date of the certificate and delivered to the Trustee.
“Business Day” means, unless
otherwise provided by Board Resolution, Officers’ Certificate or supplemental
indenture hereto for a particular Series, any day except a Saturday, Sunday or a
legal holiday in The City of New York on which banking institutions are
authorized or required by law, regulation or executive order to
close.
“Capital Stock” means any and
all shares, interests, participations, rights or other equivalents (however
designated) of corporate stock.
“Company” means the party
named as such above until a successor replaces it and thereafter means the
successor.
“Company Order” means a
written order signed in the name of the Company by two Officers, one of whom
must be the Company’s principal executive officer, principal financial officer
or principal accounting officer.
“Company Request” means a
written request signed in the name of the Company by its Chief Executive
Officer, the President or a Vice President, and by its Treasurer, an Assistant
Treasurer, its Secretary or an Assistant Secretary, and delivered to the
Trustee.
“Corporate Trust Office”
means the office of the Trustee at which at any particular time its corporate
trust business shall be principally administered.
“Default” means any event
which is, or after notice or passage of time or both would be, an Event of
Default.
“Depository” means, with
respect to the Securities of any Series issuable or issued in whole or in part
in the form of one or more Global Securities, the person designated as
Depository for such Series by the Company, which Depository shall be a clearing
agency registered under the Exchange Act; and if at any time there is more than
one such person, “Depository” as used with respect to the Securities of any
Series shall mean the Depository with respect to the Securities of such
Series.
“Discount Security” means any
Security that provides for an amount less than the stated principal amount
thereof to be due and payable upon declaration of acceleration of the maturity
thereof pursuant to Section 6.2.
“Dollars” and “$” means the currency of The
United States of America.
“ECU” means the European
Currency Unit as determined by the Commission of the European
Union.
“Exchange Act” means the
Securities Exchange Act of 1934, as amended.
“Foreign Currency” means any
currency or currency unit issued by a government other than the government of
The United States of America.
“Foreign Government
Obligations” means, with respect to Securities of any Series that are
denominated in a Foreign Currency, (i) direct obligations of the government that
issued or caused to be issued such currency for the payment of which obligations
its full faith and credit is pledged or (ii) obligations of a person controlled
or supervised by or acting as an agency or instrumentality of such government
the timely payment of which is unconditionally guaranteed as a full faith and
credit obligation by such government, which, in either case under clauses (i) or
(ii), are not callable or redeemable at the option of the issuer
thereof.
“GAAP” means generally
accepted accounting principles set forth in the opinions and pronouncements of
the Accounting Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting
Standards Board or in such other statements by such other entity as have been
approved by a significant segment of the accounting profession, which are in
effect as of the date of determination.
“Global Security” or “Global Securities” means a
Security or Securities, as the case may be, in the form established pursuant to
Section 2.2 evidencing all or part of a Series of Securities, issued to the
Depository for such Series or its nominee, and registered in the name of such
Depository or nominee.
“Holder” or “Securityholder” means a
person in whose name a Security is registered or the holder of a Bearer
Security.
“Indenture” means this
Indenture as amended or supplemented, from time to time and shall include the
form and terms of particular Series of Securities established as contemplated
hereunder.
“interest,” with respect to
any Discount Security which by its terms bears interest only after Maturity,
means interest payable after Maturity.
“Maturity,” when used with
respect to any Security or installment of principal thereof, means the date on
which the principal of such Security or such installment of principal becomes
due and payable as therein or herein provided, whether at the Stated Maturity or
by declaration of acceleration, call for redemption or otherwise.
“Officer” means the Chief
Executive Officer, the President, any Vice-President, the Treasurer, the
Secretary, any Assistant Treasurer or any Assistant Secretary of the
Company.
“Officers’ Certificate” means
a certificate signed by two Officers, one of whom must be the Company’s
principal executive officer, principal financial officer or principal accounting
officer.
“Opinion of Counsel” means a
written opinion of legal counsel who is acceptable to the Trustee. The counsel
may be an employee of or counsel to the Company.
“person” means any
individual, corporation, partnership, joint venture, association, limited
liability company, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
“principal” of a Security
means the principal of the Security plus, when appropriate, the premium, if any,
on, and any Additional Amounts in respect of, the Security.
“Responsible Officer” means
any officer of the Trustee in its Corporate Trust Office with direct
responsibility for the administration of this Indenture and also means, with
respect to a particular corporate trust matter, any other officer to whom any
corporate trust matter is referred because of his or her knowledge of and
familiarity with a particular subject.
“SEC” means the Securities
and Exchange Commission.
“Securities” means the
debentures, notes or other debt instruments of the Company of any Series
authenticated and delivered under this Indenture.
“Series” or “Series of Securities” means
each series of debentures, notes or other debt instruments of the Company
created pursuant to Sections 2.1 and 2.2 hereof.
“Stated Maturity,” when used
with respect to any Security or any installment of principal thereof or interest
thereon, means the date specified in such Security as the fixed date on which
the principal of such Security or such installment of principal or interest is
due and payable.
“Subsidiary” of any specified
person means any corporation, association or other business entity of which more
than 50% of the total voting power of shares of Capital Stock entitled (without
regard to the occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof is at the time owned or controlled,
directly or indirectly, by such person or one or more of the other Subsidiaries
of that person or a combination thereof.
“TIA” means the Trust
Indenture Act of 1939 (15 U.S. Code Sections 77aaa-77bbbb) as in effect on the
date of this Indenture; provided, however, that in the event the Trust Indenture
Act of 1939 is amended after such date, “TIA” means, to the extent required by
any such amendment, the Trust Indenture Act as so amended.
“Trustee” means the person
named as the “Trustee” in the first paragraph of this instrument until a
successor Trustee shall have become such pursuant to the applicable provisions
of this Indenture, and thereafter “Trustee” shall mean each person who is then a
Trustee hereunder, and if at any time there is more than one such person,
“Trustee” as used with respect to the Securities of any Series shall mean the
Trustee with respect to Securities of that Series.
“U.S. Government Obligations”
means securities which are (i) direct obligations of The United States of
America for the payment of which its full faith and credit is pledged or (ii)
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, and which in the case of both (i) and (ii) are not callable
or redeemable at the option of the issuer thereof, and shall also include a
depository receipt issued by a bank or trust company as custodian with respect
to any such U.S. Government Obligation or a specific payment of interest on or
principal of any such U.S. Government Obligation held by such custodian for the
account of the holder of a depository receipt, provided that (except as required
by law) such custodian is not authorized to make any deduction from the amount
payable to the holder of such depository receipt from any amount received by the
custodian in respect of the U.S. Government Obligation evidenced by such
depository receipt.
Section
1.2 Other
Definitions.
|
Term
|
Defined in Section
|
|
|
“Bankruptcy
Law”
|
6.1
|
|
|
“Custodian”
|
6.1
|
|
|
“Event
of Default”
|
6.1
|
|
|
“Journal”
|
10.15
|
|
|
“Judgment
Currency”
|
10.16
|
|
|
“Legal
Holiday”
|
10.7
|
|
|
“mandatory
sinking fund payment”
|
11.1
|
|
|
“Market
Exchange Rate”
|
10.15
|
|
|
“New
York Banking Day”
|
10.16
|
|
|
“optional
sinking fund payment”
|
11.1
|
|
|
“Paying
Agent”
|
2.4
|
|
|
“Registrar”
|
2.4
|
|
|
“Required
Currency”
|
10.16
|
|
|
“Service
Agent”
|
2.4
|
|
|
“successor
person”
|
5.1
|
Section
1.3 Incorporation
by Reference of Trust Indenture Act.
Whenever
this Indenture refers to a provision of the TIA, the provision is incorporated
by reference in and made a part of this Indenture. The following TIA terms used
in this Indenture have the following meanings:
“Commission” means the
SEC.
“indenture securities” means
the Securities.
“indenture security holder”
means a Securityholder.
“indenture to be qualified”
means this Indenture.
“indenture trustee” or “institutional trustee” means
the Trustee.
“obligor” on the indenture
securities means the Company and any successor obligor upon the
Securities.
All other
terms used in this Indenture that are defined by the TIA, defined by TIA
reference to another statute or defined by SEC rule under the TIA and not
otherwise defined herein are used herein as so defined.
Section
1.4 Rules
of Construction.
Unless
the context otherwise requires:
(a) a
term has the meaning assigned to it;
(b) an
accounting term not otherwise defined has the meaning assigned to it in
accordance with generally accepted accounting principles;
(c) references
to “generally accepted accounting principles” and “GAAP” shall mean generally
accepted accounting principles in effect as of the time when and for the period
as to which such accounting principles are to be applied;
(d) “or”
is not exclusive;
(e) words
in the singular include the plural, and in the plural include the singular;
and
(f) provisions
apply to successive events and transactions.
THE
SECURITIES
Section
2.1 Issuable
in Series.
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. All Securities of a Series shall be identical except as may be set forth
or determined in the manner provided in a Board Resolution, supplemental
indenture or Officers’ Certificate detailing the adoption of the terms thereof
pursuant to authority granted under a Board Resolution. In the case of
Securities of a Series to be issued from time to time, the Board Resolution,
Officers’ Certificate or supplemental indenture detailing the adoption of the
terms thereof pursuant to authority granted under a Board Resolution may provide
for the method by which specified terms (such as interest rate, maturity date,
record date or date from which interest shall accrue) are to be determined.
Securities may differ between Series in respect of any matters, provided that
all Series of Securities shall be equally and ratably entitled to the benefits
of the Indenture.
Section
2.2 Establishment
of Terms of Series of Securities.
At or
prior to the issuance of any Securities within a Series, the following shall be
established (as to the Series generally, in the case of Subsection 2.2.1 and
either as to such Securities within the Series or as to the Series generally in
the case of Subsections 2.2.2 through 2.2.23) by or pursuant to a Board
Resolution, and set forth or determined in the manner provided in a Board
Resolution, supplemental indenture or an Officers’ Certificate:
2.2.1 the
title of the Series (which shall distinguish the Securities of that particular
Series from the Securities of any other Series);
2.2.2 the
price or prices (expressed as a percentage of the principal amount thereof) at
which the Securities of the Series will be issued;
2.2.3 any
limit upon the aggregate principal amount of the Securities of the Series which
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 the Series pursuant to Section 2.7, 2.8,
2.11, 3.6 or 9.6);
2.2.4 the
date or dates on which the principal of the Securities of the Series is
payable;
2.2.5 the
rate or rates (which may be fixed or variable) per annum or, if applicable, the
method used to determine such rate or rates (including, but not limited to, any
commodity, commodity index, stock exchange index or financial index) at which
the Securities of the Series shall bear interest, if any, the date or dates from
which such interest, if any, shall accrue, the date or dates on which such
interest, if any, shall commence and be payable and any regular record date for
the interest payable on any interest payment date;
2.2.6 the
place or places where the principal of and interest, if any, on the Securities
of the Series shall be payable, where the Securities of such Series may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Company in respect of the Securities of such Series and
this Indenture may be served, and the method of such payment, if by wire
transfer, mail or other means;
2.2.7 if
applicable, the period or periods within which, the price or prices at which and
the terms and conditions upon which the Securities of the Series may be
redeemed, in whole or in part, at the option of the Company;
2.2.8 the
obligation, if any, of the Company to redeem or purchase the Securities of the
Series pursuant to any sinking fund or analogous provisions or at the option of
a Holder thereof and the period or periods within which, the price or prices at
which and the terms and conditions upon which Securities of the Series shall be
redeemed or purchased, in whole or in part, pursuant to such
obligation;
2.2.9 the
dates, if any, on which and the price or prices at which the Securities of the
Series will be repurchased by the Company at the option of the Holders thereof
and other detailed terms and provisions of such repurchase
obligations;
2.2.10 if
other than denominations of $1,000 and any integral multiple thereof, the
denominations in which the Securities of the Series shall be
issuable;
2.2.11 the
forms of the Securities of the Series in bearer or fully registered form (and,
if in fully registered form, whether the Securities will be issuable as Global
Securities);
2.2.12 if
other than the principal amount thereof, the portion of the principal amount of
the Securities of the Series that shall be payable upon declaration of
acceleration of the maturity thereof pursuant to Section 6.2;
2.2.13 the
currency of denomination of the Securities of the Series, which may be Dollars
or any Foreign Currency, including, but not limited to, the ECU, and if such
currency of denomination is a composite currency other than the ECU, the agency
or organization, if any, responsible for overseeing such composite
currency;
2.2.14 the
designation of the currency, currencies or currency units in which payment of
the principal of and interest, if any, on the Securities of the Series will be
made;
2.2.15 if
payments of principal of or interest, if any, on the Securities of the Series
are to be made in one or more currencies or currency units other than that or
those in which such Securities are denominated, the manner in which the exchange
rate with respect to such payments will be determined;
2.2.16 the
manner in which the amounts of payment of principal of or interest, if any, on
the Securities of the Series will be determined, if such amounts may be
determined by reference to an index based on a currency or currencies or by
reference to a commodity, commodity index, stock exchange index or financial
index;
2.2.17 the
provisions, if any, relating to any security provided for the Securities of the
Series;
2.2.18 any
addition to or change in the Events of Default which applies to any Securities
of the Series and any change in the right of the Trustee or the requisite
Holders of such Securities to declare the principal amount thereof due and
payable pursuant to Section 6.2;
2.2.19 any
addition to or change in the covenants set forth in Articles IV or V which
applies to Securities of the Series;
2.2.20 the
provisions, if any, relating to conversion of any Securities of such Series,
including, if applicable, the conversion price, the conversion period,
provisions as to whether conversion will be mandatory, at the option of the
Holders or at the option of the Company, the events requiring an adjustment of
the conversion price and provisions affecting conversion if such Series of
Securities are redeemed;
2.2.21 whether
the Securities of such Series will be senior debt securities or subordinated
debt securities and, if applicable, a description of the subordination terms
thereof;
2.2.22 any
depositories, interest rate calculation agents, exchange rate calculation agents
or other agents with respect to Securities of such Series if other than those
appointed herein; and
2.2.23 any
other terms of the Securities of the Series (which may modify or delete any
provision of this Indenture insofar as it applies to such Series).
All
Securities of any one Series need not be issued at the same time and may be
issued from time to time, consistent with the terms of this Indenture, if so
provided by or pursuant to the Board Resolution, supplemental indenture hereto
or Officers’ Certificate referred to above, and the authorized principal amount
of any Series may not be increased to provide for issuances of additional
Securities of such Series, unless otherwise provided in such Board Resolution,
supplemental indenture or Officers’ Certificate.
Section
2.3 Execution
and Authentication.
Two
Officers shall sign the Securities for the Company by manual or facsimile
signature.
If an
Officer whose signature is on a Security no longer holds that office at the time
the Security is authenticated, the Security shall nevertheless be
valid.
A
Security shall not be valid until authenticated by the manual signature of the
Trustee or an authenticating agent. The signature shall be conclusive evidence
that the Security has been authenticated under this Indenture.
The
Trustee shall at any time, and from time to time, authenticate Securities for
original issue in the principal amount provided in the Board Resolution,
supplemental indenture hereto or Officers’ Certificate, upon receipt by the
Trustee of a Company Order. Such Company Order may authorize authentication and
delivery pursuant to oral or electronic instructions from the Company or its
duly authorized agent or agents, which oral instructions shall be promptly
confirmed in writing. Each Security shall be dated the date of its
authentication unless otherwise provided by a Board Resolution, a supplemental
indenture hereto or an Officers’ Certificate.
The
aggregate principal amount of Securities of any Series outstanding at any time
may not exceed any limit upon the maximum principal amount for such Series set
forth in the Board Resolution, supplemental indenture hereto or Officers’
Certificate delivered pursuant to Section 2.2, except as provided in Section
2.8.
Prior to
the issuance of Securities of any Series, the Trustee shall have received and
(subject to Section 7.2) shall be fully protected in relying on: (a) the Board
Resolution, supplemental indenture hereto or Officers’ Certificate establishing
the form of the Securities of that Series or of Securities within that Series
and the terms of the Securities of that Series or of Securities within that
Series, (b) an Officers’ Certificate complying with Section 10.4 and (c) an
Opinion of Counsel complying with Section 10.4.
The
Trustee shall have the right to decline to authenticate and deliver any
Securities of such Series: (a) if the Trustee, being advised by counsel,
determines that such action may not be taken lawfully; or (b) if the Trustee in
good faith by its board of directors or trustees, executive committee or a trust
committee of directors and/or vice-presidents shall determine that such action
would expose the Trustee to personal liability to Holders of any then
outstanding Series of Securities.
The
Trustee may appoint an authenticating agent acceptable to the Company to
authenticate Securities. An authenticating agent may authenticate Securities
whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with the Company or
an Affiliate of the Company.
Section
2.4 Registrar
and Paying Agent.
The
Company shall maintain, with respect to each Series of Securities, at the place
or places specified with respect to such Series pursuant to Section 2.2, an
office or agency where Securities of such Series may be presented or surrendered
for payment (“Paying Agent”), where Securities of such Series may be surrendered
for registration of transfer or exchange (“Registrar”) and where notices and
demands to or upon the Company in respect of the Securities of such Series and
this Indenture may be served (“Service Agent”). The Registrar shall keep a
register with respect to each Series of Securities and to their transfer and
exchange. The Company will give prompt written notice to the Trustee of the name
and address, and any change in the name or address, of each Registrar, Paying
Agent or Service Agent. If at any time the Company shall fail to maintain any
such required Registrar, Paying Agent or Service Agent or shall fail to furnish
the Trustee with the name and address thereof, such presentations, surrenders,
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, surrenders, notices and demands.
The
Company may also from time to time designate one or more co-registrars,
additional paying agents or additional service agents and may from time to time
rescind such designations; provided, however, that no such designation or
rescission shall in any manner relieve the Company of its obligations to
maintain a Registrar, Paying Agent and Service Agent in each place so specified
pursuant to Section 2.2 for Securities of any Series for such purposes. The
Company will give prompt written notice to the Trustee of any such designation
or rescission and of any change in the name or address of any such co-registrar,
additional paying agent or additional service agent. The term “Registrar”
includes any co-registrar; the term “Paying Agent” includes any additional
paying agent; and the term “Service Agent” includes any additional service
agent.
The
Company hereby appoints the Trustee as the initial Registrar, Paying Agent and
Service Agent for each Series unless another Registrar, Paying Agent or Service
Agent, as the case may be, is appointed prior to the time Securities of that
Series are first issued.
Section
2.5 Paying
Agent to Hold Money in Trust.
The
Company shall require each Paying Agent other than the Trustee to agree in
writing that the Paying Agent will hold in trust, for the benefit of
Securityholders of any Series of Securities, or the Trustee, all money held by
the Paying Agent for the payment of principal of or interest on the Series of
Securities, and will notify the Trustee of any default by the Company in making
any such payment. While any such default continues, the Trustee may require a
Paying Agent to pay all money held by it to the Trustee. The Company at any time
may require a Paying Agent to pay all money held by it to the Trustee. Upon
payment over to the Trustee, the Paying Agent (if other than the Company or a
Subsidiary of the Company) shall have no further liability for the money. If the
Company or a Subsidiary of the Company acts as Paying Agent, it shall segregate
and hold in a separate trust fund for the benefit of Securityholders of any
Series of Securities all money held by it as Paying Agent.
Section
2.6 Securityholder
Lists.
The
Trustee shall preserve in as current a form as is reasonably practicable the
most recent list available to it of the names and addresses of Securityholders
of each Series of Securities and shall otherwise comply with TIA Section 312(a).
If the Trustee is not the Registrar, the Company shall furnish to the Trustee at
least ten (10) days before each interest payment date and at such other times as
the Trustee may request in writing a list, in such form and as of such date as
the Trustee may reasonably require, of the names and addresses of
Securityholders of each Series of Securities.
Section
2.7 Transfer
and Exchange.
Where
Securities of a Series are presented to the Registrar or a co-registrar with a
request to register a transfer or to exchange them for an equal principal amount
of Securities of the same Series, the Registrar shall register the transfer or
make the exchange if its requirements for such transactions are met. To permit
registrations of transfers and exchanges, the Trustee shall authenticate
Securities at the Registrar’s request. No service charge shall be made for any
registration of transfer or exchange (except as otherwise expressly permitted
herein), but the Company may require payment of a sum sufficient to cover any
transfer tax or similar governmental charge payable in connection therewith
(other than any such transfer tax or similar governmental charge payable upon
exchanges pursuant to Sections 2.11, 3.6 or 9.6).
Neither
the Company nor the Registrar shall be required (a) to issue, register the
transfer of, or exchange Securities of any Series for the period beginning at
the opening of business fifteen days immediately preceding the mailing of a
notice of redemption of Securities of that Series selected for redemption and
ending at the close of business on the day of such mailing, or (b) to register
the transfer of or exchange Securities of any Series selected, called or being
called for redemption as a whole or the portion being redeemed of any such
Securities selected, called or being called for redemption in part.
Section
2.8 Mutilated,
Destroyed, Lost and Stolen Securities.
If any
mutilated Security is surrendered to the Trustee, the Company shall execute and
the Trustee shall authenticate and make available for delivery in exchange
therefor a new Security of the same Series and of like tenor and principal
amount and bearing a number not contemporaneously outstanding.
If there
shall be delivered to the Company and the Trustee (i) evidence to their
satisfaction of the destruction, loss or theft of any Security and (ii) such
security or indemnity as may be required by them to save each of them and any
agent of either of them harmless, then, in the absence of notice to the Company
or the Trustee that such Security has been acquired by a bona fide purchaser,
the Company shall execute and upon its request the Trustee shall authenticate
and make available for delivery, in lieu of any such destroyed, lost or stolen
Security, a new Security of the same Series and of like tenor and principal
amount and bearing a number not contemporaneously outstanding.
In case
any such mutilated, destroyed, lost or stolen Security has become or is about to
become due and payable, the Company in its discretion may, instead of issuing a
new Security, pay such Security.
Upon the
issuance of any new Security under this Section, 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.
Every new
Security of any Series issued pursuant to this Section in lieu of any destroyed,
lost or stolen Security shall constitute an original additional contractual
obligation of the Company, whether or not the destroyed, lost or stolen Security
shall be at any time enforceable by anyone, and shall be entitled to all the
benefits of this Indenture equally and proportionately with any and all other
Securities of that Series duly issued hereunder.
The
provisions of this Section 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 Securities.
Section
2.9 Outstanding
Securities.
The
Securities outstanding at any time are all the Securities authenticated by the
Trustee except for those canceled by it, those delivered to it for cancellation,
those reductions in the interest on a Global Security effected by the Trustee in
accordance with the provisions hereof and those described in this Section as not
outstanding.
If a
Security is replaced pursuant to Section 2.8, it ceases to be outstanding until
the Trustee receives proof satisfactory to it that the replaced Security is held
by a bona fide purchaser.
If the
Paying Agent (other than the Company, a Subsidiary of the Company or an
Affiliate of the Company) holds on the Maturity of Securities of a Series money
sufficient to pay such Securities payable on that date, then on and after that
date such Securities of the Series cease to be outstanding and interest on them
ceases to accrue.
A
Security does not cease to be outstanding because the Company or an Affiliate of
the Company holds the Security.
In
determining whether the Holders of the requisite principal amount of outstanding
Securities have given any request, demand, authorization, direction, notice,
consent or waiver hereunder, the principal amount of a Discount Security that
shall be deemed to be outstanding for such purposes shall be the amount of the
principal thereof that would be due and payable as of the date of such
determination upon a declaration of acceleration of the Maturity thereof
pursuant to Section 6.2.
Section
2.10 Treasury
Securities.
In
determining whether the Holders of the required principal amount of Securities
of a Series have concurred in any request, demand, authorization, direction,
notice, consent or waiver, Securities of a Series owned by the Company shall be
disregarded, except that for the purposes of determining whether the Trustee
shall be protected in relying on any such request, demand, authorization,
direction, notice, consent or waiver, only Securities of a Series that the
Trustee knows are so owned shall be so disregarded.
Section
2.11 Temporary
Securities.
Until
definitive Securities are ready for delivery, the Company may prepare and the
Trustee shall authenticate temporary Securities upon a Company Order. Temporary
Securities shall be substantially in the form of definitive Securities but may
have variations that the Company considers appropriate for temporary Securities.
Without unreasonable delay, the Company shall prepare and the Trustee upon
request shall authenticate definitive Securities of the same Series and date of
maturity in exchange for temporary Securities. Until so exchanged, temporary
securities shall have the same rights under this Indenture as the definitive
Securities.
Section
2.12 Cancellation.
The
Company at any time may deliver Securities to the Trustee for cancellation. The
Registrar and the Paying Agent shall forward to the Trustee any Securities
surrendered to them for registration of transfer, exchange or payment. The
Trustee shall cancel all Securities surrendered for registration of transfer,
exchange, payment, replacement or cancellation and deliver such canceled
Securities to the Company, unless the Company otherwise directs; provided that
the Trustee shall not be required to destroy Securities. The Company may not
issue new Securities to replace Securities that it has paid or delivered to the
Trustee for cancellation.
Section
2.13 Defaulted
Interest.
If the
Company defaults in a payment of interest on a Series of Securities, it shall
pay the defaulted interest, plus, to the extent permitted by law, any interest
payable on the defaulted interest, to the persons who are Securityholders of the
Series on a subsequent special record date. The Company shall fix the record
date and payment date. At least ten (10) days before the record date, the
Company shall mail to the Trustee and to each Securityholder of the Series a
notice that states the record date, the payment date and the amount of interest
to be paid. The Company may pay defaulted interest in any other lawful
manner.
Section
2.14 Global
Securities.
2.14.1 Terms of Securities. A Board
Resolution, a supplemental indenture hereto or an Officers’ Certificate shall
establish whether the Securities of a Series shall be issued in whole or in part
in the form of one or more Global Securities and the Depository for such Global
Security or Securities.
2.14.2 Transfer and Exchange.
Notwithstanding any provisions to the contrary contained in Section 2.7 of the
Indenture and in addition thereto, any Global Security shall be exchangeable
pursuant to Section 2.7 of the Indenture for Securities registered in the names
of Holders other than the Depository for such Security or its nominee only if
(i) such Depository notifies the Company that it is unwilling or unable to
continue as Depository for such Global Security or if at any time such
Depository ceases to be a clearing agency registered under the Exchange Act,
and, in either case, the Company fails to appoint a successor Depository
registered as a clearing agency under the Exchange Act within 90 days of such
event, (ii) the Company executes and delivers to the Trustee an Officers’
Certificate to the effect that such Global Security shall be so exchangeable or
(iii) an Event of Default with respect to The Securities represented by such
Global Security shall have happened and be continuing. Any Global Security that
is exchangeable pursuant to the preceding sentence shall be exchangeable for
Securities registered in such names as the Depository shall direct in writing in
an aggregate principal amount equal to the principal amount of the Global
Security with like tenor and terms.
Except as
provided in this Section 2.14.2, a Global Security may not be transferred except
as a whole by the Depository with respect to such Global Security to a nominee
of such Depository, by a nominee of such Depository to such Depository or
another nominee of such Depository or by the Depository or any such nominee to a
successor Depository or a nominee of such a successor Depository.
2.14.3 Legend. Any Global Security
issued hereunder shall bear a legend in substantially the following
form:
“This
Security is a Global Security within the meaning of the Indenture hereinafter
referred to and is registered in the name of the Depository or a nominee of the
Depository. This Security is exchangeable for Securities registered in the name
of a person other than the Depository or its nominee only in the limited
circumstances described in the Indenture, and may not be transferred except as a
whole by the Depository to a nominee of the Depository, by a nominee of the
Depository to the Depository or another nominee of the Depository or by the
Depository or any such nominee to a successor Depository or a nominee of such a
successor Depository.”
2.14.4 Acts of Holders. The
Depository, as a Holder, may appoint agents and otherwise authorize participants
to give or take any request, demand, authorization, direction, notice, consent,
waiver or other action which a Holder is entitled to give or take under the
Indenture.
2.14.5 Payments. Notwithstanding the
other provisions of this Indenture, unless otherwise specified as contemplated
by Section 2.2, payment of the principal of and interest, if any, on any Global
Security shall be made to the Holder thereof.
2.14.6 Consents, Declaration and
Directions. Except as provided in Section 2.14.5, the Company, the
Trustee and any Agent shall treat a person as the Holder of such principal
amount of outstanding Securities of such Series represented by a Global Security
as shall be specified in a written statement of the Depository with respect to
such Global Security, for purposes of obtaining any consents, declarations,
waivers or directions required to be given by the Holders pursuant to this
Indenture.
Section
2.15 CUSIP
Numbers.
The
Company in issuing the Securities may use “CUSIP” numbers (if then generally in
use), and, if so, the Trustee shall use “CUSIP” numbers in notices of redemption
as a convenience to Holders; provided that any such notice may state that no
representation is made as to the correctness of such numbers either as printed
on the Securities or as contained in any notice of a redemption and that
reliance may be placed only on the other elements of identification printed on
the Securities, and any such redemption shall not be affected by any defect in
or omission of such numbers.
REDEMPTION
Section
3.1 Notice
to Trustee.
The
Company may, with respect to any Series of Securities, reserve the right to
redeem and pay the Series of Securities or may covenant to redeem and pay the
Series of Securities or any part thereof prior to the Stated Maturity thereof at
such time and on such terms as provided for in such Securities. If a Series of
Securities is redeemable and the Company wants or is obligated to redeem prior
to the Stated Maturity thereof all or part of the Series of Securities pursuant
to the terms of such Securities, it shall notify the Trustee of the redemption
date and the principal amount of Series of Securities to be redeemed. The
Company shall give the notice at least 40 days before the redemption date (or
such shorter notice as may be acceptable to the Trustee).
Section
3.2 Selection
of Securities to be Redeemed.
Unless
otherwise indicated for a particular Series by a Board Resolution, a
supplemental indenture or an Officers’ Certificate, if less than all the
Securities of a Series are to be redeemed, the Trustee shall select the
Securities of the Series to be redeemed in any manner that the Trustee deems
fair and appropriate. The Trustee shall make the selection from Securities of
the Series outstanding not previously called for redemption. The Trustee may
select for redemption portions of the principal of Securities of the Series that
have denominations larger than $1,000. Securities of the Series and portions of
them it selects shall be in amounts of $1,000 or whole multiples of $1,000 or,
with respect to Securities of any Series issuable in other denominations
pursuant to Section 2.2.10, the minimum principal denomination for each Series
and integral multiples thereof. Provisions of this Indenture that apply to
Securities of a Series called for redemption also apply to portions of
Securities of that Series called for redemption.
Section
3.3 Notice
of Redemption.
Unless
otherwise indicated for a particular Series by Board Resolution, a supplemental
indenture hereto or an Officers’ Certificate, at least 30 days but not more than
60 days before a redemption date, the Company shall mail a notice of redemption
by first-class mail to each Holder whose Securities are to be redeemed and, if
any Bearer Securities are outstanding, publish on one occasion a notice in an
Authorized Newspaper.
The
notice shall identify the Securities of the Series to be redeemed and shall
state:
(a) the
redemption date;
(b) the
redemption price;
(c) the
name and address of the Paying Agent;
(d) that
Securities of the Series called for redemption must be surrendered to the Paying
Agent to collect the redemption price;
(e) that
interest on Securities of the Series called for redemption ceases to accrue on
and after the redemption date;
(f) the
CUSIP number, if any; and
(g) any
other information as may be required by the terms of the particular Series or
the Securities of a Series being redeemed.
At the
Company’s request, the Trustee shall give the notice of redemption in the
Company’s name and at its expense.
Section
3.4 Effect
of Notice of Redemption.
Once
notice of redemption is mailed or published as provided in Section 3.3,
Securities of a Series called for redemption become due and payable on the
redemption date and at the redemption price. A notice of redemption may not be
conditional. Upon surrender to the Paying Agent, such Securities shall be paid
at the redemption price plus accrued interest to the redemption date; provided
that installments of interest whose Stated Maturity is on or prior to the
redemption date shall be payable to the Holders of such Securities (or one or
more predecessor Securities) registered at the close of business on the relevant
record date therefor according to their terms and the terms of this
Indenture.
Section
3.5 Deposit
of Redemption Price.
On or
before 10:00 a.m., New York City time, on the redemption date, the Company shall
deposit with the Paying Agent money sufficient to pay the redemption price of
and accrued interest, if any, on all Securities to be redeemed on that
date.
Section
3.6 Securities
Redeemed In Part.
Upon
surrender of a Security that is redeemed in part, the Trustee shall authenticate
for the Holder a new Security of the same Series and the same maturity equal in
principal amount to the unredeemed portion of the Security
surrendered.
COVENANTS
Section
4.1 Payment
Of Principal and Interest.
The
Company covenants and agrees for the benefit of the Holders of each Series of
Securities that it will duly and punctually pay the principal of and interest,
if any, on the Securities of that Series in accordance with the terms of such
Securities and this Indenture.
Section
4.2 SEC
Reports.
The
Company shall, so long as any of the Securities are outstanding, deliver to the
Trustee within 15 days after it files them with the SEC 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 SEC may by rules and regulations
prescribe) which the Company is required to file with the SEC pursuant to
Section 13 or 15(d) of the Exchange Act. The Company also shall comply with the
other provisions of TIA Section 314(a). Delivery of such reports, information
and documents to the Trustee is for informational purposes only and the
Trustee’s receipt of such shall not constitute constructive notice of any
information contained therein or determinable from information contained
therein, including the Company’s compliance with any of its covenants hereunder
(as to which the Trustee is entitled to rely exclusively on an Officers’
Certificate).
Section
4.3 Compliance
Certificate.
The
Company shall, so long as any of the Securities are outstanding, deliver to the
Trustee, within 120 days after the end of each fiscal year of the Company, an
Officers’ Certificate stating whether or not to the knowledge of the signers
thereof the Company is in default in the performance or observance of any of the
terms, provisions and conditions hereof (without regard to any period of grace
or requirement of notice provided hereunder), and if a Default or Event of
Default shall have occurred, specifying all such Defaults or Events of Default
and the nature and status thereof of which they may have knowledge.
The
Company will, so long as any of the Securities are outstanding, deliver to the
Trustee, within thirty (30) days after becoming aware of any Default or Event of
Default, an Officers’ Certificate specifying such Default or Event of Default
and what action the Company is taking or proposes to take with respect
thereto.
Section
4.4 Stay,
Extension and Usury Laws.
The
Company covenants (to the extent that it may lawfully do so) that it will not at
any time insist upon, plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay, extension or usury law wherever enacted, now
or at any time hereafter in force, which may affect the covenants or the
performance of this Indenture or the Securities and the Company (to the extent
it may lawfully do so) hereby expressly waives all benefit or advantage of any
such law and covenants that it will not, by resort to any such law, hinder,
delay or impede the execution of any power herein granted to the Trustee, but
will suffer and permit the execution of every such power as though no such law
has been enacted.
Section
4.5 Corporate
Existence.
Subject
to Article V, the Company will do or cause to be done all things necessary to
preserve and keep in full force and effect its corporate existence and the
rights (charter and statutory), licenses and franchises of the Company;
provided, however, that the Company shall not be required to preserve any such
right, license or franchise if the Board of Directors shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Company and its Subsidiaries taken as a whole and that the loss thereof is
not adverse in any material respect to the Holders.
Section
4.6 Taxes.
The
Company shall pay prior to delinquency all taxes, assessments and governmental
levies, except as contested in good faith and by appropriate
proceedings.
SUCCESSORS
Section
5.1 When
Company May Merge, Etc.
The
Company shall not consolidate with or merge with or into, or convey, transfer or
lease all or substantially all of its properties and assets to, any person (a
“successor person”) unless:
(a) the
Company is the surviving corporation or the successor person (if other than the
Company) is organized and validly existing under the laws of any U.S. domestic
jurisdiction and expressly assumes the Company’s obligations on the Securities
and under this Indenture; and
(b) immediately
after giving effect to the transaction, no Default or Event of Default shall
have occurred and be continuing.
The
Company shall deliver to the Trustee prior to the consummation of the proposed
transaction an Officers’ Certificate to the foregoing effect and an Opinion of
Counsel stating that the proposed transaction and any supplemental indenture
comply with this Indenture.
Section
5.2 Successor
Corporation Substituted.
Upon any
consolidation or merger, or any sale, lease, conveyance or other disposition of
all or substantially all of the assets of the Company in accordance with Section
5.1, the successor corporation formed by such consolidation or into or with
which the Company is merged or to which such sale, lease, conveyance or other
disposition is made shall succeed to, and be substituted for, and may exercise
every right and power of, the Company under this Indenture with the same effect
as if such successor person has been named as the Company herein; provided,
however, that the predecessor Company in the case of a sale, conveyance or other
disposition (other than a lease) shall be released from all obligations and
covenants under this Indenture and the Securities.
DEFAULTS
AND REMEDIES
Section
6.1 Events
of Default.
“Event of
Default,” wherever used herein with respect to Securities of any Series, means
any one of the following events, unless in the establishing Board Resolution,
supplemental indenture or Officers’ Certificate, it is provided that such Series
shall not have the benefit of said Event of Default:
(a) default
in the payment of any interest on any Security of that Series when it becomes
due and payable, and continuance of such default for a period of 30 days (unless
the entire amount of such payment is deposited by the Company with the Trustee
or with a Paying Agent prior to the expiration of such period of 30 days);
or
(b) default
in the payment of principal of any Security of that Series at its Maturity;
or
(c) default
in the deposit of any sinking fund payment, when and as due in respect of any
Security of that Series; or
(d) default
in the performance or breach of any covenant or warranty of the Company in this
Indenture (other than a covenant or warranty for which the consequences of
nonperformance or breach are addressed elsewhere in this Section 6.1 and other
than a covenant or warranty that has been included in this Indenture solely for
the benefit of Series of Securities other than that Series), which default
continues uncured for a period of 90 days after there has been given, by
registered or certified mail, to the Company by the Trustee or to the Company
and the Trustee by the Holders of not less than a majority in principal amount
of the outstanding Securities of that Series a written notice specifying such
default or breach and requiring it to be remedied and stating that such notice
is a “Notice of Default” hereunder; or
(e) 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,
(iv) makes
a general assignment for the benefit of its creditors, or
(v) generally
is unable to pay its debts as the same become due; or
(f) a
court of competent jurisdiction enters an order or decree under any Bankruptcy
Law that:
(i) is
for relief against the Company in an involuntary case,
(ii) appoints
a Custodian of the Company or 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; or
(g) any
other Event of Default provided with respect to Securities of that Series, which
is specified in a Board Resolution, a supplemental indenture hereto or an
Officers’ Certificate, in accordance with Section 2.2.18.
The term
“Bankruptcy Law” means Title 11 of the U.S. Code or any similar federal or state
law for the relief of debtors. The term “Custodian” means any receiver, trustee,
assignee, liquidator or similar official under any Bankruptcy Law.
Section
6.2 Acceleration
of Maturity; Rescission and Annulment.
If an
Event of Default with respect to Securities of any Series at the time
outstanding occurs and is continuing (other than an Event of Default referred to
in Section 6.1(e) or (f)), then in every such case the Trustee or the Holders of
not less than a majority in principal amount of the outstanding Securities of
that Series may declare the principal amount (or, if any Securities of that
Series are Discount Securities, such portion of the principal amount as may be
specified in the terms of such Securities) of and accrued and unpaid interest,
if any, on all of the Securities of that Series to be due and payable
immediately, by a notice in writing to the Company (and to the Trustee if given
by Holders), and upon any such declaration such principal amount (or specified
amount) and accrued and unpaid interest, if any, shall become immediately due
and payable. If an Event of Default specified in Section 6.1(e) or (f) shall
occur, the principal amount (or specified amount) of and accrued and unpaid
interest, if any, on all outstanding Securities shall ipso facto become and be
immediately due and payable without any declaration or other act on the part of
the Trustee or any Holder.
At any
time after such a declaration of acceleration with respect to any Series has
been made and before a judgment or decree for payment of the money due has been
obtained by the Trustee as hereinafter in this Article provided, the Holders of
a majority in principal amount of the outstanding Securities of that Series, by
written notice to the Company and the Trustee, may rescind and annul such
declaration and its consequences if all Events of Default with respect to
Securities of that Series, other than the non-payment of the principal and
interest, if any, of Securities of that Series which have become due solely by
such declaration of acceleration, have been cured or waived as provided in
Section 6.13.
No such
rescission shall affect any subsequent Default or impair any right consequent
thereon.
Section
6.3 Collection
of Indebtedness and Suits for Enforcement by Trustee.
The
Company covenants that if:
(a) default
is made in the payment of any interest on any Security when such interest
becomes due and payable and such default continues for a period of 30 days,
or
(b) default
is made in the payment of principal of any Security at the Maturity thereof,
or
(c) default
is made in the deposit of any sinking fund payment when and as due by the terms
of a Security,
then the
Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities the whole amount then due and payable on such
Securities for principal and interest and, to the extent that payment of such
interest shall be legally enforceable, interest on any overdue principal and any
overdue interest at the rate or rates prescribed therefor in such Securities
and, in addition thereto, such further amount as shall be sufficient to cover
the costs and expenses of collection, including the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and
counsel.
If the
Company fails to pay such amounts forthwith upon such demand, the Trustee, in
its own name and as trustee of an express trust, may institute a judicial
proceeding for the collection of the sums so due and unpaid, may prosecute such
proceeding to judgment or final decree and may enforce the same against the
Company or any other obligor upon such Securities and collect the moneys
adjudged or deemed to be payable in the manner provided by law out of the
property of the Company or any other obligor upon such Securities, wherever
situated.
If an
Event of Default with respect to any Securities of any Series occurs and is
continuing, the Trustee may in its discretion proceed to protect and enforce its
rights and the rights of the Holders of Securities of such Series by such
appropriate judicial proceedings as the Trustee shall deem most effectual to
protect and enforce any such rights, whether for the specific enforcement of any
covenant or agreement in this Indenture or in aid of the exercise of any power
granted herein, or to enforce any other proper remedy.
Section
6.4 Trustee
May File Proofs of Claim.
In case
of the pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to the Company or any other obligor upon the Securities or
the property of the Company or of such other obligor or their creditors, the
Trustee (irrespective of whether the principal of the Securities shall then be
due and payable as therein expressed or by declaration or otherwise and
irrespective of whether the Trustee shall have made any demand on the Company
for the payment of overdue principal or interest) shall be entitled and
empowered, by intervention in such proceeding or otherwise,
(a) to
file and prove a claim for the whole amount of principal and interest owing and
unpaid in respect of the Securities and to file such other papers or documents
as may be necessary or advisable in order to have the claims of the Trustee
(including any claim for the reasonable compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel) and of the Holders allowed
in such judicial proceeding, and
(b) to
collect and receive any moneys or other property payable or deliverable on any
such claims and to distribute the same, and any custodian, receiver, assignee,
trustee, liquidator, sequestrator or other similar official in any such judicial
proceeding is hereby authorized by each Holder to make such payments to the
Trustee and, in the event that the Trustee shall consent to the making of such
payments directly to the Holders, to pay to the Trustee any amount due it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.7.
Nothing
herein contained shall be deemed to authorize the Trustee to authorize or
consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
Section
6.5 Trustee
May Enforce Claims Without Possession of Securities.
All
rights of action and claims under this Indenture or the Securities may be
prosecuted and enforced by the Trustee without the possession of any of the
Securities or the production thereof in any proceeding relating thereto, and any
such proceeding instituted by the Trustee shall be brought in its own name as
trustee of an express trust, and any recovery of judgment shall, after provision
for the payment of the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, be for the ratable benefit of
the Holders of the Securities in respect of which such judgment has been
recovered.
Section
6.6 Application
of Money Collected.
Any money
collected by the Trustee pursuant to this Article shall be applied in the
following order, at the date or dates fixed by the Trustee and, in case of the
distribution of such money on account of principal or interest, upon
presentation of the Securities and the notation thereon of the payment if only
partially paid and upon surrender thereof if fully paid:
First: To
the payment of all amounts due the Trustee under Section 7.7; and
Second:
To the payment of the amounts then due and unpaid for principal of and interest
on the Securities 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 interest,
respectively; and
Third: To
the Company.
Section
6.7 Limitation
on Suits.
No Holder
of any Security of any Series shall have any right to institute any proceeding,
judicial or otherwise, with respect to this Indenture, or for the appointment of
a receiver or trustee, or for any other remedy hereunder, unless:
(a) such
Holder has previously given written notice to the Trustee of a continuing Event
of Default with respect to the Securities of that Series;
(b) the
Holders of at least a majority in principal amount of the outstanding Securities
of that Series shall have made written request to the Trustee to institute
proceedings in respect of such Event of Default in its own name as Trustee
hereunder;
(c) such
Holder or Holders have offered to the Trustee reasonable indemnity against the
costs, expenses and liabilities to be incurred in compliance with such
request;
(d) the
Trustee for 60 days after its receipt of such notice, request and offer of
indemnity has failed to institute any such proceeding; and
(e) no
direction inconsistent with such written request has been given to the Trustee
during such 60-day period by the Holders of a majority in principal amount of
the outstanding Securities of that Series;
it being
understood and intended that no one or more of such Holders shall have any right
in any manner whatever by virtue of, or by availing of, any provision of this
Indenture to affect, disturb or prejudice the rights of any other of such
Holders, or to obtain or to seek to obtain priority or preference over any other
of such Holders or to enforce any right under this Indenture, except in the
manner herein provided and for the equal and ratable benefit of all such
Holders.
Section
6.8 Unconditional
Right of Holders to Receive Principal and Interest.
Notwithstanding
any other provision in this Indenture, the Holder of any Security shall have the
right, which is absolute and unconditional, to receive payment of the principal
of and interest, if any, on such Security on the Stated Maturity or Stated
Maturities expressed in such Security (or, in the case of redemption, on the
redemption date) and to institute suit for the enforcement of any such payment,
and such rights shall not be impaired without the consent of such
Holder.
Section
6.9 Restoration
of Rights and Remedies.
If the
Trustee or any Holder has instituted any proceeding to enforce any right or
remedy under this Indenture and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to the Trustee or to
such Holder, then and in every such case, subject to any determination in such
proceeding, the Company, the Trustee and the Holders shall be restored severally
and respectively to their former positions hereunder and thereafter all rights
and remedies of the Trustee and the Holders shall continue as though no such
proceeding had been instituted.
Section
6.10 Rights
and Remedies Cumulative.
Except as
otherwise provided with respect to the replacement or payment of mutilated,
destroyed, lost or stolen Securities in Section 2.8, no right or remedy herein
conferred upon or reserved to the Trustee or to the Holders 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, to the extent permitted by law, prevent the concurrent
assertion or employment of any other appropriate right or remedy.
Section
6.11 Delay
or Omission Not Waiver.
No delay
or omission of the Trustee or of any Holder of any Securities to exercise any
right or remedy accruing upon any Event of Default shall impair any such right
or remedy or constitute a waiver of any such Event of Default or an acquiescence
therein. Every right and remedy given by this Article or by law to the Trustee
or to the Holders may be exercised from time to time, and as often as may be
deemed expedient, by the Trustee or by the Holders, as the case may
be.
Section
6.12 Control
by Holders.
The
Holders of a majority in principal amount of the outstanding Securities of any
Series shall have the right to direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee, or exercising any trust
or power conferred on the Trustee, with respect to the Securities of such
Series, provided that:
(a) such
direction shall not be in conflict with any rule of law or with this
Indenture,
(b) the
Trustee may take any other action deemed proper by the Trustee which is not
inconsistent with such direction, and
(c) subject
to the provisions of Section 6.1, the Trustee shall have the right to decline to
follow any such direction if the Trustee in good faith shall, by a Responsible
Officer of the Trustee, determine that the proceeding so directed would involve
the Trustee in personal liability.
Section
6.13 Waiver
of Past Defaults.
The
Holders of not less than a majority in principal amount of the outstanding
Securities of any Series may on behalf of the Holders of all the Securities of
such Series waive any past Default hereunder with respect to such Series and its
consequences, except a Default (i) in the payment of the principal of or
interest on any Security of such Series (provided, however, that the Holders of
a majority in principal amount of the outstanding Securities of any Series may
rescind an acceleration and its consequences, including any related payment
default that resulted from such acceleration) or (ii) in respect of a covenant
or provision hereof which cannot be modified or amended without the consent of
the Holder of each outstanding Security of such Series affected. Upon any such
waiver, such Default shall cease to exist, and any Event of Default arising
therefrom shall be deemed to have been cured, for every purpose of this
Indenture; but no such waiver shall extend to any subsequent or other Default or
impair any right consequent thereon.
Section
6.14 Undertaking
for Costs.
All
parties to this Indenture agree, and each Holder of any Security by his
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,
suffered 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
Company, to any suit instituted by the Trustee, to any suit instituted by any
Holder, or group of Holders, holding in the aggregate more than 10% in principal
amount of the outstanding Securities of any Series, or to any suit instituted by
any Holder for the enforcement of the payment of the principal of or interest on
any Security on or after the Stated Maturity or Stated Maturities expressed in
such Security (or, in the case of redemption, on the redemption
date).
TRUSTEE
Section
7.1 Duties
of Trustee.
(a) If
an Event of Default has occurred and is continuing, the Trustee shall exercise
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 man would exercise or use under
the circumstances in the conduct of his own affairs.
(b) Except
during the continuance of an Event of Default:
(i) The
Trustee need perform only those duties that are specifically set forth in this
Indenture and no others.
(ii) In
the absence of bad faith on its part, the Trustee may conclusively rely, as to
the truth of the statements and the correctness of the opinions expressed
therein, upon Officers’ Certificates or Opinions of Counsel furnished to the
Trustee and conforming to the requirements of this Indenture; however, in the
case of any such Officers’ Certificates or Opinions of Counsel which by any
provisions hereof are specifically required to be furnished to the Trustee, the
Trustee shall examine such Officers’ Certificates and Opinions of Counsel to
determine whether or not they conform to the requirements of this
Indenture.
(c) The
Trustee may not be relieved from liability for its own negligent action, its own
negligent failure to act or its own willful misconduct, except
that:
(i) This
paragraph does not limit the effect of paragraph (b) of this
Section.
(ii) The
Trustee shall not be liable for any error of judgment made in good faith by a
Responsible Officer, unless it is proved that the Trustee was negligent in
ascertaining the pertinent facts.
(iii) The
Trustee shall not be liable with respect to any action taken, suffered or
omitted to be taken by it with respect to Securities of any Series in good faith
in accordance with the direction of the Holders of a majority in principal
amount of the outstanding Securities of such Series 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 such Series.
(d) Every
provision of this Indenture that in any way relates to the Trustee is subject to
paragraph (a), (b) and (c) of this Section.
(e) The
Trustee may refuse to perform any duty or exercise any right or power at the
request or direction of any Holder unless it receives indemnity satisfactory to
it against any loss, liability or expense.
(f) The
Trustee shall not be liable for interest on any money received by it except as
the Trustee may agree in writing with the Company. Money held in trust by the
Trustee need not be segregated from other funds except to the extent required by
law.
(g) No
provision of this Indenture shall require the Trustee to risk its own funds or
otherwise incur any financial liability in the performance of any of its duties,
or in the exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
such risk is not reasonably assured to it.
(h) The
Paying Agent, the Registrar and any authenticating agent shall be entitled to
the protections, immunities and standard of care as are set forth in paragraphs
(a), (b) and (c) of this Section with respect to the Trustee.
Section
7.2 Rights
of Trustee.
(a) The
Trustee may rely on and shall be protected in acting or refraining from acting
upon any document believed by it to be genuine and to have been signed or
presented by the proper person. The Trustee need not investigate any fact or
matter stated in the document.
(b) Before
the Trustee acts or refrains from acting, it may require an Officers’
Certificate. The Trustee shall not be liable for any action it takes or omits to
take in good faith in reliance on such Officers’ Certificate.
(c) The
Trustee may act through agents and shall not be responsible for the misconduct
or negligence of any agent appointed with due care. No Depository shall be
deemed an agent of the Trustee and the Trustee shall not be responsible for any
act or omission by any Depository.
(d) The
Trustee shall not be liable for any action it takes or omits to take in good
faith which it believes to be authorized or within its rights or powers,
provided that the Trustee’s conduct does not constitute negligence or bad
faith.
(e) The
Trustee may consult with counsel and the advice of such counsel or any Opinion
of Counsel shall be full and complete authorization and protection in respect of
any action taken, suffered or omitted by it hereunder without negligence and in
good faith and in reliance thereon.
(f) The
Trustee shall be under no obligation to exercise any of the rights or powers
vested in it by this Indenture at the request or direction of any of the Holders
of Securities unless such Holders shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction.
(g) The
Trustee may consult with counsel of its selection and the advice of such counsel
or any Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it hereunder
without negligence and in good faith and in reliance thereon.
(h) The
Trustee shall not be bound to make any investigation into the facts or matters
stated in any resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document, but the Trustee, in its
discretion, may make such further inquiry or investigation into such facts or
matters as it may see fit.
(i) The
Trustee shall not be deemed to have notice of any Default or Event of Default
unless a Responsible Officer of the Trustee has actual knowledge thereof or
unless written notice of any event which is in fact such a default is received
by the Trustee at the Corporate Trust Office of the Trustee, and such notice
references the Securities generally or the Securities of a particular Series and
this Indenture.
Section
7.3 Individual
Rights of Trustee.
The
Trustee in its individual or any other capacity may become the owner or pledgee
of Securities and may otherwise deal with the Company or an Affiliate of the
Company with the same rights it would have if it were not Trustee. Any Agent may
do the same with like rights. The Trustee is also subject to Sections 7.10 and
7.11.
Section
7.4 Trustee’s
Disclaimer.
The
Trustee makes no representation as to the validity or adequacy of this Indenture
or the Securities, it shall not be accountable for the Company’s use of the
proceeds from the Securities, and it shall not be responsible for any statement
in the Securities other than its authentication.
Section
7.5 Notice
of Defaults.
If a
Default or Event of Default occurs and is continuing with respect to the
Securities of any Series and if it is known to a Responsible Officer of the
Trustee, the Trustee shall mail to each Securityholder of the Securities of that
Series and, if any Bearer Securities are outstanding, publish on one occasion in
an Authorized Newspaper, notice of a Default or Event of Default within 90 days
after it occurs or, if later, after a Responsible Officer of the Trustee has
knowledge of such Default or Event of Default. Except in the case of a Default
or Event of Default in payment of principal of or interest on any Security of
any Series, the Trustee may withhold the notice if and so long as its corporate
trust committee or a committee of its Responsible Officers in good faith
determines that withholding the notice is in the interests of Securityholders of
that Series.
Section
7.6 Reports
by Trustee to Holders.
Within 60
days after May 15 in each year, the Trustee shall transmit by mail to all
Securityholders, as their names and addresses appear on the register kept by the
Registrar and, if any Bearer Securities are outstanding, publish in an
Authorized Newspaper, a brief report dated as of such May 15, in accordance
with, and to the extent required under, TIA Section 313.
A copy of
each report at the time of its mailing to Securityholders of any Series shall be
filed with the SEC and each stock exchange on which the Securities of that
Series are listed. The Company shall promptly notify the Trustee when Securities
of any Series are listed on any stock exchange.
Section
7.7 Compensation
and Indemnity.
The
Company shall pay to the Trustee from time to time compensation for its services
as the Company and the Trustee shall from time to time agree upon in writing.
The Trustee’s compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Company shall reimburse the Trustee upon
request for all reasonable out-of-pocket expenses incurred by it. Such expenses
shall include the reasonable compensation and expenses of the Trustee’s agents
and counsel.
The
Company shall indemnify each of the Trustee and any predecessor Trustee
(including the cost of defending itself) against any loss, liability or expense,
including taxes (other than taxes based upon, measured by or determined by the
income of the Trustee) incurred by it except as set forth in the next paragraph
in the performance of its duties under this Indenture as Trustee or Agent. The
Trustee shall notify the Company promptly of any claim for which it may seek
indemnity. The Company shall defend the claim and the Trustee shall cooperate in
the defense. The Trustee may have one separate counsel and the Company shall pay
the reasonable fees and expenses of such counsel. The Company need not pay for
any settlement made without its consent, which consent shall not be unreasonably
withheld. This indemnification shall apply to officers, directors, employees,
shareholders and agents of the Trustee.
The
Company need not reimburse any expense or indemnify against any loss or
liability incurred by the Trustee or by any officer, director, employee,
shareholder or agent of the Trustee through negligence or bad
faith.
To secure
the Company’s payment obligations in this Section, the Trustee shall have a lien
prior to the Securities of any Series on all money or property held or collected
by the Trustee, except that held in trust to pay principal of and interest on
particular Securities of that Series.
When the
Trustee incurs expenses or renders services after an Event of Default specified
in Section 6.1(e) or (f) occurs, the expenses and the compensation for the
services are intended to constitute expenses of administration under any
Bankruptcy Law.
The
provisions of this Section shall survive the termination of this
Indenture.
Section
7.8 Replacement
of Trustee.
A
resignation or removal of the Trustee and appointment of a successor Trustee
shall become effective only upon the successor Trustee’s acceptance of
appointment as provided in this Section.
The
Trustee may resign with respect to the Securities of one or more Series by so
notifying the Company at least 30 days prior to the date of the proposed
resignation. The Holders of a majority in principal amount of the Securities of
any Series may remove the Trustee with respect to that Series by so notifying
the Trustee and the Company. The Company may remove the Trustee with respect to
Securities of one or more Series if:
(a) the
Trustee fails to comply with Section 7.10;
(b) the
Trustee is adjudged bankrupt or insolvent or an order for relief is entered with
respect to the Trustee under any Bankruptcy Law;
(c) a
Custodian or public officer takes charge of the Trustee or its property;
or
(d) the
Trustee becomes incapable of acting.
If the
Trustee resigns or is removed or if a vacancy exists in the office of Trustee
for any reason, the Company shall promptly appoint a successor Trustee. Within
one year after the successor Trustee takes office, the Holders of a majority in
principal amount of the then outstanding Securities may appoint a successor
Trustee to replace the successor Trustee appointed by the Company.
If a
successor Trustee with respect to the Securities of any one or more Series does
not take office within 60 days after the retiring Trustee resigns or is removed,
the retiring Trustee, the Company or the Holders of at least a majority in
principal amount of the Securities of the applicable Series may petition any
court of competent jurisdiction for the appointment of a successor
Trustee.
A
successor Trustee shall deliver a written acceptance of its appointment to the
retiring Trustee and to the Company. Immediately after that, the retiring
Trustee shall transfer all property held by it as Trustee to the successor
Trustee subject to the lien provided for in Section 7.7, the resignation or
removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee with respect
to each Series of Securities for which it is acting as Trustee under this
Indenture. A successor Trustee shall mail a notice of its succession to each
Securityholder of each such Series and, if any Bearer Securities are
outstanding, publish such notice on one occasion in an Authorized Newspaper.
Notwithstanding replacement of the Trustee pursuant to this Section 7.8, the
Company’s obligations under Section 7.7 hereof shall continue for the benefit of
the retiring Trustee with respect to expenses and liabilities incurred by it
prior to such replacement.
Section
7.9 Successor
Trustee by Merger, Etc.
If the
Trustee consolidates with, merges or converts into, or transfers all or
substantially all of its corporate trust business to, another corporation, the
successor corporation without any further act shall be the successor
Trustee.
Section
7.10 Eligibility;
Disqualification.
This
Indenture shall always have a Trustee who satisfies the requirements of TIA
Section 310(a)(1), (2) and (5). The Trustee shall always have a combined capital
and surplus of at least $25,000,000 as set forth in its most recent published
annual report of condition. The Trustee shall comply with TIA Section
310(b).
Section
7.11 Preferential
Collection of Claims Against Company.
The
Trustee is subject to TIA Section 311(a), excluding any creditor relationship
listed in TIA Section 311(b). A Trustee who has resigned or been removed shall
be subject to TIA Section 311(a) to the extent indicated.
SATISFACTION
AND DISCHARGE; DEFEASANCE
Section
8.1 Satisfaction
and Discharge of Indenture.
This
Indenture shall upon Company Order cease to be of further effect (except as
hereinafter provided in this Section 8.1), and the Trustee, at the expense of
the Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
(a) either
of the following shall have occurred:
(i) all
Securities theretofore authenticated and delivered (other than Securities that
have been destroyed, lost or stolen and that have been replaced or paid) have
been delivered to the Trustee for cancellation; or
(ii) all
such Securities not theretofore delivered to the Trustee for
cancellation
(1) have
become due and payable, or
(2)
will become due and payable at their Stated Maturity within one year,
or
(3) are
to be called for redemption within one year under arrangements satisfactory to
the Trustee for the giving of notice of redemption by the Trustee in the name,
and at the expense, of the Company;
and the
Company has irrevocably deposited or caused to be deposited with the Trustee as
trust funds in trust an amount sufficient for the purpose of paying and
discharging the entire indebtedness on such Securities not theretofore delivered
to the Trustee for cancellation, for principal and interest to the date of such
deposit (in the case of Securities which have become due and payable on or prior
to the date of such deposit) or to the Stated Maturity or redemption date, as
the case may be;
(b) the
Company has paid or caused to be paid all other sums payable hereunder by the
Company; and
(c) the
Company has delivered to the Trustee an Officers’ Certificate and an Opinion of
Counsel, each stating that all conditions precedent herein provided for relating
to the satisfaction and discharge of this Indenture have been complied
with.
Notwithstanding
the satisfaction and discharge of this Indenture, the obligations of the Company
to the Trustee under Section 7.7 and, if money shall have been deposited with
the Trustee pursuant to clause (a) of this Section, the provisions of Sections
2.4, 2.7, 2.8, 8.1, 8.2 and 8.5 shall survive.
Section
8.2 Application
of Trust Funds; Indemnification.
(a) Subject
to the provisions of Section 8.5, all money deposited with the Trustee pursuant
to Section 8.1, all money and U.S. Government Obligations or Foreign Government
Obligations deposited with the Trustee pursuant to Section 8.3 or 8.4 and all
money received by the Trustee in respect of U.S. Government Obligations or
Foreign Government Obligations deposited with the Trustee pursuant to Section
8.3 or 8.4, shall be held in trust and applied by it, in accordance with the
provisions of the Securities and this Indenture, to the payment, either directly
or through any Paying Agent (other than the Company acting as its own Paying
Agent) as the Trustee may determine, to the persons entitled thereto, of the
principal and interest for whose payment such money has been deposited with or
received by the Trustee or to make mandatory sinking fund payments or analogous
payments as contemplated by Sections 8.3 or 8.4.
(b) The
Company shall pay and shall indemnify the Trustee against any tax, fee or other
charge imposed on or assessed against U.S. Government Obligations or Foreign
Government Obligations deposited pursuant to Sections 8.3 or 8.4 or the interest
and principal received in respect of such obligations other than any payable by
or on behalf of Holders.
(c) The
Trustee shall deliver or pay to the Company from time to time upon Company
Request any U.S. Government Obligations or Foreign Government Obligations or
money held by it as provided in Sections 8.3 or 8.4 which, in the opinion of a
nationally recognized firm of independent certified public accountants expressed
in a written certification thereof delivered to the Trustee, are then in excess
of the amount thereof which then would have been required to be deposited for
the purpose for which such U.S. Government Obligations or Foreign Government
Obligations or money were deposited or received. This provision shall not
authorize the sale by the Trustee of any U.S. Government Obligations or Foreign
Government Obligations held under this Indenture.
Section
8.3 Legal
Defeasance of Securities of Any Series.
Unless
this Section 8.3 is otherwise specified, pursuant to Section 2.2.23, to be
inapplicable to Securities of any Series, the Company shall be deemed to have
paid and discharged the entire indebtedness on all the outstanding Securities of
any Series on the 91st day after the date of the deposit referred to in
subparagraph (d) hereof, and the provisions of this Indenture, as it relates to
such outstanding Securities of such Series, shall no longer be in effect (and
the Trustee, at the expense of the Company, shall, at Company Request, execute
proper instruments acknowledging the same), except as to:
(a) the
rights of Holders of Securities of such Series to receive, from the trust funds
described in subparagraph (d) hereof, (i) payment of the principal of and each
installment of principal of and interest on the outstanding Securities of such
Series on the Stated Maturity of such principal or installment of principal or
interest and (ii) the benefit of any mandatory sinking fund payments applicable
to the Securities of such Series on the day on which such payments are due and
payable in accordance with the terms of this Indenture and the Securities of
such Series;
(b) the
provisions of Sections 2.4, 2.7, 2.8, 8.2, 8.3, and 8.5; and
(c) the
rights, powers, trust and immunities of the Trustee hereunder;
provided
that, the following conditions shall have been satisfied:
(d) the
Company shall have deposited or caused to be irrevocably deposited (except as
provided in Section 8.2(c)) with the Trustee as trust funds in trust for the
purpose of making the following payments, specifically pledged as security for
and dedicated solely to the benefit of the Holders of such Securities (i) in the
case of Securities of such Series denominated in Dollars, cash in Dollars and/or
U.S. Government Obligations, or (ii) in the case of Securities of such Series
denominated in a Foreign Currency (other than a composite currency), money
and/or Foreign Government Obligations, which through the payment of interest and
principal in respect thereof in accordance with their terms, will provide (and
without reinvestment and assuming no tax liability will be imposed on such
Trustee), not later than one day before the due date of any payment of money, an
amount in cash, 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 and discharge each installment of principal of
and interest, if any, on and any mandatory sinking fund payments in respect of
all the Securities of such Series on the dates such installments of interest or
principal and such sinking fund payments are due;
(e) such
deposit will not result in a breach or violation of, or constitute a default
under, this Indenture or any other agreement or instrument to which the Company
is a party or by which it is bound;
(f) no
Default or Event of Default with respect to the Securities of such Series shall
have occurred and be continuing on the date of such deposit or during the period
ending on the 91st day after such date;
(g) the
Company shall have delivered to the Trustee an Officers’ Certificate and an
Opinion of Counsel to the effect that (i) the Company has received from, or
there has been published by, the Internal Revenue Service a ruling, or (ii)
since the date of execution of this Indenture, there has been a change in the
applicable Federal income tax law, in either case to the effect that, and based
thereon such Opinion of Counsel shall confirm that, the Holders of the
Securities of such Series will not recognize income, gain or loss for Federal
income tax purposes as a result of such deposit, defeasance and discharge and
will be subject to Federal income tax on the same amounts and in the same manner
and at the same times as would have been the case if such deposit, defeasance
and discharge had not occurred;
(h) the
Company shall have delivered to the Trustee an Officers’ Certificate stating
that the deposit was not made by the Company with the intent of preferring the
Holders of the Securities of such Series over any other creditors of the Company
or with the intent of defeating, hindering, delaying or defrauding any other
creditors of the Company; and
(i) the
Company shall have delivered to the Trustee an Officers’ Certificate and an
Opinion of Counsel, each stating that all conditions precedent provided for
relating to the defeasance contemplated by this Section have been complied
with.
Section
8.4 Covenant
Defeasance.
Unless
this Section 8.4 is otherwise specified pursuant to Section 2.2.23 to be
inapplicable to Securities of any Series, on and after the 91st day after the
date of the deposit referred to in subparagraph (a) hereof, the Company may omit
to comply with respect to the Securities of any Series with any term, provision
or condition set forth under Sections 4.2, 4.3, 4.4, 4.6 and 5.1 as well as any
additional covenants specified in a supplemental indenture for such Series of
Securities or a Board Resolution or an Officers’ Certificate delivered pursuant
to Section 2.2.23 (and the failure to comply with any such covenants shall not
constitute a Default or Event of Default with respect to such Series under
Section 6.1) and the occurrence of any event specified in a supplemental
indenture for such Series of Securities or a Board Resolution or an Officers’
Certificate delivered pursuant to Section 2.2.18 and designated as an Event of
Default shall not constitute a Default or Event of Default hereunder, with
respect to the Securities of such Series, provided that the following conditions
shall have been satisfied:
(a) With
reference to this Section 8.4, the Company has deposited or caused to be
irrevocably deposited (except as provided in Section 8.2(c)) with the Trustee as
trust funds in trust for the purpose of making the following payments
specifically pledged as security for, and dedicated solely to, the benefit of
the Holders of such Securities (i) in the case of Securities of such Series
denominated in Dollars, cash in Dollars and/or U.S. Government Obligations, or
(ii) in the case of Securities of such Series denominated in a Foreign
Currency (other than a composite currency), money and/or Foreign Government
Obligations, which through the payment of interest and principal in respect
thereof in accordance with their terms, will provide (and without reinvestment
and assuming no tax liability will be imposed on such Trustee), not later than
one day before the due date of any payment of money, an amount in cash,
sufficient, in the opinion of a nationally recognized firm of independent
certified public accountants expressed in a written certification thereof
delivered to the Trustee, to pay and discharge each installment of principal of
and interest, if any, on and any mandatory sinking fund payments in respect of
the Securities of such Series on the dates such installments of interest or
principal and such sinking fund payments are due;
(b) Such
deposit will not result in a breach or violation of, or constitute a default
under, this Indenture or any other agreement or instrument to which the Company
is a party or by which it is bound;
(c) No
Default or Event of Default with respect to the Securities of such Series shall
have occurred and be continuing on the date of such deposit or during the period
ending on the 91st day after such date;
(d) The
Company shall have delivered to the Trustee an Opinion of Counsel to the effect
that Holders of the Securities of such Series will not recognize income, gain or
loss for federal income tax purposes as a result of such deposit and covenant
defeasance and will be subject to federal income tax on the same amounts, in the
same manner and at the same times as would have been the case if such deposit
and covenant defeasance had not occurred; and
(e) The
Company shall have delivered to the Trustee an Officers’ Certificate and an
Opinion of Counsel, each stating that all conditions precedent herein provided
for relating to the covenant defeasance contemplated by this Section have been
complied with.
Section
8.5 Repayment
to Company.
The
Trustee and the Paying Agent shall pay to the Company upon request any money
held by them for the payment of principal and interest that remains unclaimed
for two years. After that, Securityholders entitled to the money must look to
the Company for payment as general creditors unless an applicable abandoned
property law designates another person.
AMENDMENTS
AND WAIVERS
Section
9.1 Without
Consent of Holders.
The
Company and the Trustee may amend or supplement this Indenture or the Securities
of one or more Series without the consent of any Securityholder:
(a) to
cure any ambiguity, defect or inconsistency;
(b) to
comply with Article V;
(c) to
provide for uncertificated Securities in addition to or in place of certificated
Securities;
(d) to
make any change that does not adversely affect the rights of any
Securityholder;
(e) to
provide for the issuance of and establish the form and terms and conditions of
Securities of any Series as permitted by this Indenture;
(f) to
evidence and provide for the acceptance of appointment hereunder by a successor
Trustee with respect to the Securities of one or more Series and to 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; or
(g) to
comply with requirements of the SEC in order to effect or maintain the
qualification of this Indenture under the TIA.
Section
9.2 With
Consent of Holders.
The
Company and the Trustee may enter into a supplemental indenture with the written
consent of the Holders of at least a majority in principal amount of the
outstanding Securities of each Series affected by such supplemental indenture
(including consents obtained in connection with a tender offer or exchange offer
for the Securities of such Series), 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 the rights of the
Securityholders of each such Series. Except as provided in Section 6.13, the
Holders of at least a majority in principal amount of the outstanding Securities
of any Series by notice to the Trustee (including consents obtained in
connection with a tender offer or exchange offer for the Securities of such
Series) may waive compliance by the Company with any provision of this Indenture
or the Securities with respect to such Series.
It shall
not be necessary for the consent of the Holders of Securities under this Section
9.2 to approve the particular form of any proposed supplemental indenture or
waiver, but it shall be sufficient if such consent approves the substance
thereof. After a supplemental indenture or waiver under this section becomes
effective, the Company shall mail to the Holders of Securities affected thereby
and, if any Bearer Securities affected thereby are outstanding, publish on one
occasion in an Authorized Newspaper, a notice briefly describing the
supplemental indenture or waiver. Any failure by the Company to mail or publish
such notice, or any defect therein, shall not, however, in any way impair or
affect the validity of any such supplemental indenture or waiver.
Section
9.3 Limitations.
Without
the consent of each Securityholder affected, an amendment or waiver may
not:
(a) reduce
the amount of Securities whose Holders must consent to an amendment, supplement
or waiver;
(b) reduce
the rate of or extend the time for payment of interest (including default
interest) on any Security;
(c) reduce
the principal or change the Stated Maturity of any Security or reduce the amount
of, or postpone the date fixed for, the payment of any sinking fund or analogous
obligation;
(d) reduce
the principal amount of Discount Securities payable upon acceleration of the
maturity thereof;
(e) waive
a Default or Event of Default in the payment of the principal of or interest, if
any, on any Security (except a rescission of acceleration of the Securities of
any Series by the Holders of at least a majority in principal amount of the
outstanding Securities of such Series and a waiver of the payment default that
resulted from such acceleration);
(f) make
the principal of or interest, if any, on any Security payable in any currency
other than that stated in the Security;
(g) make
any change in Sections 6.8, 6.13, or 9.3 (this sentence); or
(h) waive
a redemption payment with respect to any Security.
Section
9.4 Compliance
with Trust Indenture Act.
Every
amendment to this Indenture or the Securities of one or more Series shall be set
forth in a supplemental indenture hereto that complies with the TIA as then in
effect.
Section
9.5 Revocation
and Effect of Consents.
Until an
amendment is set forth in a supplemental indenture or a waiver becomes
effective, a consent to it by a Holder of a Security is a continuing consent by
the Holder and every subsequent Holder of a Security or portion of a Security
that evidences the same debt as the consenting Holder’s Security, even if
notation of the consent is not made on any Security. However, any such Holder or
subsequent Holder may revoke the consent as to his Security or portion of a
Security if the Trustee receives the notice of revocation before the date of the
supplemental indenture or the date the waiver becomes effective.
Any
amendment or waiver once effective shall bind every Securityholder of each
Series affected by such amendment or waiver unless it is of the type described
in any of clauses (a) through (h) of Section 9.3. In that case, the amendment or
waiver shall bind each Holder of a Security who has consented to it and every
subsequent Holder of a Security or portion of a Security that evidences the same
debt as the consenting Holder’s Security.
Section
9.6 Notation
on or Exchange of Securities.
The
Trustee may place an appropriate notation about an amendment or waiver on any
Security of any Series thereafter authenticated. The Company in exchange for
Securities of that Series may issue and the Trustee shall authenticate upon
request new Securities of that Series that reflect the amendment or
waiver.
Section
9.7 Trustee
Protected.
In
executing, or accepting the additional trusts created by, any supplemental
indenture permitted by this Article or the modifications thereby of the trusts
created by this Indenture, the Trustee shall be entitled to receive, and
(subject to Section 7.1) shall be fully protected in relying upon, an Opinion of
Counsel stating that the execution of such supplemental indenture is authorized
or permitted by this Indenture. The Trustee shall sign all supplemental
indentures, except that the Trustee need not sign any supplemental indenture
that adversely affects its rights.
MISCELLANEOUS
Section
10.1 Trust
Indenture Act Controls.
If any
provision of this Indenture limits, qualifies or conflicts with another
provision which is required or deemed to be included in this Indenture by the
TIA, such required or deemed provision shall control.
Section
10.2 Notices.
Any
notice or communication by the Company or the Trustee to the other, or by a
Holder to the Company or the Trustee, is duly given if in writing and delivered
in person or mailed by first-class mail:
| if to the Company: | ||
|
Lexicon
Pharmaceuticals, Inc.
8800
Technology Forest Place
The
Woodlands, Texas 77381
Attention:
President and Chief Executive Officer
Telephone:
(281) 863-3000
Facsimile:
(281)
863-8095
|
||
| if to the Trustee: | ||||
|
Attention:
|
||||
|
Telephone:
|
||||
|
Facsimile:
|
||||
The
Company or the Trustee by notice to the other may designate additional or
different addresses for subsequent notices or communications.
Any
notice or communication to a Securityholder shall be mailed by first-class mail
to his address shown on the register kept by the Registrar and, if any Bearer
Securities are outstanding, published in an Authorized Newspaper. Failure to
mail a notice or communication to a Securityholder of any Series or any defect
in it shall not affect its sufficiency with respect to other Securityholders of
that or any other Series.
If a
notice or communication is mailed or published in the manner provided above,
within the time prescribed, it is duly given, whether or not the Securityholder
receives it.
If the
Company mails a notice or communication to Securityholders, it shall mail a copy
to the Trustee and each Agent at the same time.
Section
10.3 Communication
by Holders with Other Holders.
Securityholders
of any Series may communicate pursuant to TIA Section 312(b) with other
Securityholders of that Series or any other Series with respect to their rights
under this Indenture or the Securities of that Series or all Series. The
Company, the Trustee, the Registrar and anyone else shall have the protection of
TIA Section 312(c).
Section
10.4 Certificate
and Opinion as to Conditions Precedent.
Upon any
request or application by the Company to the Trustee to take any action under
this Indenture, the Company shall furnish to the Trustee:
(a) an
Officers’ Certificate stating that, in the opinion of the signers, all
conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with; and
(b) an
Opinion of Counsel stating that, in the opinion of such counsel, all such
conditions precedent have been complied with.
Section
10.5 Statements
Required in Certificate or Opinion.
Each
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture (other than a certificate provided pursuant to
TIA Section 314(a)(4)) shall comply with the provisions of TIA Section 314(e)
and shall include:
(a) a
statement that the person making such certificate or opinion has read such
covenant or condition;
(b) a
brief statement as to the nature and scope of the examination or investigation
upon which the statements or opinions contained in such certificate or opinion
are based;
(c) a
statement that, in the opinion of such person, he has made such examination or
investigation as is necessary to enable him to express an informed opinion as to
whether or not such covenant or condition has been complied with;
and
(d) a
statement as to whether or not, in the opinion of such person, such condition or
covenant has been complied with.
Section
10.6 Rules
by Trustee and Agents.
The
Trustee may make reasonable rules for action by or a meeting of Securityholders
of one or more Series. Any Agent may make reasonable rules and set reasonable
requirements for its functions.
Section
10.7 Legal
Holidays.
Unless
otherwise provided by Board Resolution, Officers’ Certificate or supplemental
indenture hereto for a particular Series, a “Legal Holiday” is any day that is
not a Business Day. If a payment date is a Legal Holiday at a place of payment,
payment may be made at that place on the next succeeding day that is not a Legal
Holiday, and no interest shall accrue for the intervening period.
Section
10.8 No
Recourse Against Others.
A
director, officer, employee or stockholder, as such, of the Company shall not
have any liability for any obligations of the Company under the Securities or
the Indenture or for any claim based on, in respect of or by reason of such
obligations or their creation. Each Securityholder by accepting a Security
waives and releases all such liability. The waiver and release are part of the
consideration for the issue of the Securities.
Section
10.9 Counterparts.
This
Indenture may be executed in any number of counterparts and by the parties
hereto in separate counterparts, each of which when so executed shall be deemed
to be an original and all of which taken together shall constitute one and the
same agreement.
Section
10.10 Governing
Laws.
THIS
INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW
YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE, WITHOUT
REGARD TO THE CONFLICT OF LAWS PROVISIONS THEREOF.
Section
10.11 No
Adverse Interpretation Of Other Agreements.
This
Indenture may not be used to interpret another indenture, loan or debt agreement
of the Company or a Subsidiary of the Company. Any such indenture, loan or debt
agreement may not be used to interpret this Indenture.
Section
10.12 Successors.
All
agreements of the Company in this Indenture and the Securities shall bind its
successor. All agreements of the Trustee in this Indenture shall bind its
successor.
Section
10.13 Severability.
In case
any provision in this Indenture or in the Securities shall be invalid, illegal
or unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
Section
10.14 Table
of Contents, Headings, Etc.
The Table
of Contents, Cross-Reference Table, and headings of the Articles and Sections of
this Indenture have been inserted for convenience of reference only, are not to
be considered a part hereof, and shall in no way modify or restrict any of the
terms or provisions hereof.
Section
10.15 Securities
in a Foreign Currency or in ECU.
Unless
otherwise specified in a Board Resolution, a supplemental indenture hereto or an
Officers’ Certificate delivered pursuant to Section 2.2 of this Indenture with
respect to a particular Series of Securities, whenever for purposes of this
Indenture any action may be taken by the Holders of a specified percentage in
aggregate principal amount of Securities of all Series or all Series affected by
a particular action at the time outstanding and, at such time, there are
outstanding Securities of any Series which are denominated in a coin or currency
other than Dollars (including ECUs), then the principal amount of Securities of
such Series which shall be deemed to be outstanding for the purpose of taking
such action shall be that amount of Dollars that could be obtained for such
amount at the Market Exchange Rate at such time. For purposes of this Section
10.15, “Market Exchange Rate” shall mean the noon Dollar buying rate in New York
City for cable transfers of that currency as published by the Federal Reserve
Bank of New York; provided, however, in the case of ECUs, Market Exchange Rate
shall mean the rate of exchange determined by the Commission of the European
Union (or any successor thereto) as published in the Official Journal of the
European Union (such publication or any successor publication, the “Journal”).
If such Market Exchange Rate is not available for any reason with respect to
such currency, the Trustee shall use, in its sole discretion and without
liability on its part, such quotation of the Federal Reserve Bank of New York
or, in the case of ECUs, the rate of exchange as published in the Journal, as of
the most recent available date, or quotations or, in the case of ECUs, rates of
exchange from one or more major banks in The City of New York or in the country
of issue of the currency in question or, in the case of ECUs, in Luxembourg or
such other quotations or, in the case of ECUs, rates of exchange as the Trustee,
upon consultation with the Company, shall deem appropriate. The provisions of
this paragraph shall apply in determining the equivalent principal amount in
respect of Securities of a Series denominated in currency other than Dollars in
connection with any action taken by Holders of Securities pursuant to the terms
of this Indenture.
All
decisions and determinations of the Trustee regarding the Market Exchange Rate
or any alternative determination provided for in the preceding paragraph shall
be in its sole discretion and shall, in the absence of manifest error, to the
extent permitted by law, be conclusive for all purposes and irrevocably binding
upon the Company and all Holders.
Section
10.16 Judgment
Currency.
The
Company agrees, to the fullest extent that it may effectively do so under
applicable law, that (a) if for the purpose of obtaining judgment in any court
it is necessary to convert the sum due in respect of the principal of or
interest or other amount on the Securities of any Series (the “Required
Currency”) into a currency in which a judgment will be rendered (the “Judgment
Currency”), the rate of exchange used shall be the rate at which in accordance
with normal banking procedures the Trustee could purchase in The City of New
York the Required Currency with the Judgment Currency on the day on which final
unappealable judgment is entered, unless such day is not a New York Banking Day,
then the rate of exchange used shall be the rate at which in accordance with
normal banking procedures the Trustee could purchase in The City of New York the
Required Currency with the Judgment Currency on the New York Banking Day
preceding the day on which final unappealable judgment is entered and (b) its
obligations under this Indenture to make payments in the Required Currency (i)
shall not be discharged or satisfied by any tender, any recovery pursuant to any
judgment (whether or not entered in accordance with subsection (a)), in any
currency other than the Required Currency, except to the extent that such tender
or recovery shall result in the actual receipt, by the payee, of the full amount
of the Required Currency expressed to be payable in respect of such payments,
(ii) shall be enforceable as an alternative or additional cause of action for
the purpose of recovering in the Required Currency the amount, if any, by which
such actual receipt shall fall short of the full amount of the Required Currency
so expressed to be payable, and (iii) shall not be affected by judgment being
obtained for any other sum due under this Indenture. For purposes of the
foregoing, “New York Banking Day” means any day except a Saturday, Sunday or a
legal holiday in The City of New York on which banking institutions are
authorized or required by law, regulation or executive order to
close.
SINKING
FUNDS
Section
11.1 Applicability
Of Article.
The
provisions of this Article shall be applicable to any sinking fund for the
retirement of the Securities of a Series, except as otherwise permitted or
required by any form of Security of such Series issued pursuant to this
Indenture.
The
minimum amount of any sinking fund payment provided for by the terms of the
Securities of any Series is herein referred to as a “mandatory sinking fund
payment” and any other amount provided for by the terms of Securities of such
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 11.2. Each
sinking fund payment shall be applied to the redemption of Securities of any
Series as provided for by the terms of the Securities of such
Series.
Section
11.2 Satisfaction
of Sinking Fund Payments with Securities.
The
Company may, in satisfaction of all or any part of any sinking fund payment with
respect to the Securities of any Series to be made pursuant to the terms of such
Securities (1) deliver outstanding Securities of such Series to which such
sinking fund payment is applicable (other than any of such Securities previously
called for mandatory sinking fund redemption) and (2) apply as credit Securities
of such Series to which such sinking fund payment is applicable and which have
been repurchased by the Company or redeemed either at the election of the
Company pursuant to the terms of such Series of Securities (except pursuant to
any mandatory sinking fund) or through the application of permitted optional
sinking fund payments or other optional redemptions pursuant to the terms of
such Securities, provided that such Securities have not been previously so
credited. Such Securities shall be received by the Trustee, together with an
Officers’ Certificate with respect thereto, not later than 15 days prior to the
date on which the Trustee begins the process of selecting Securities for
redemption, and shall be credited for such purpose by the Trustee at the 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.
If as a result of the delivery or credit of Securities in lieu of cash payments
pursuant to this Section 11.2, the principal amount of Securities of such Series
to be redeemed in order to exhaust the aforesaid cash payment shall be less than
$100,000, the Trustee need not call Securities of such Series for redemption,
except upon receipt of a Company Order that such action be taken, and such cash
payment shall be held by the Trustee or a Paying Agent and applied to the next
succeeding sinking fund payment, provided, however, that the Trustee or such
Paying Agent shall from time to time upon receipt of a Company Order pay over
and deliver to the Company any cash payment so being held by the Trustee or such
Paying Agent upon delivery by the Company to the Trustee of Securities of that
Series purchased by the Company having an unpaid principal amount equal to the
cash payment required to be released to the Company.
Section
11.3 Redemption
of Securities for Sinking Fund.
Not less
than 45 days (unless otherwise indicated in the Board Resolution, supplemental
indenture or Officers’ Certificate in respect of a particular Series of
Securities) prior to each sinking fund payment date for any Series of
Securities, the Company will deliver to the Trustee an Officers’ Certificate
specifying the amount of the next ensuing mandatory sinking fund payment for
that Series pursuant to the terms of that Series, the portion thereof, if any,
which is to be satisfied by payment of cash and the portion thereof, if any,
which is to be satisfied by delivering and crediting of Securities of that
Series pursuant to Section 11.2, and the optional amount, if any, to be added in
cash to the next ensuing mandatory sinking fund payment, and the Company shall
thereupon be obligated to pay the amount therein specified. Not less than 30
days (unless otherwise indicated in the Board Resolution, Officers’ Certificate
or supplemental indenture in respect of a particular Series of Securities)
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 3.2 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 3.3. Such notice having been duly given, the redemption of such
Securities shall be made upon the terms and in the manner stated in Sections
3.4, 3.5 and 3.6.
(Remainder
of page intentionally left blank)
IN
WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly
executed and attested, all as of the day and year first above
written.
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Attest:
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LEXICON
PHARMACEUTICALS, INC.
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By:
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||
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Name:
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Its:
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||
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Attest:
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[TRUSTEE]
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By:
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Name:
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Its:
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39
Exhibit
5.1
[Letterhead
of Vinson & Elkins L.L.P.]
September
2, 2009
8800
Technology Forest Place
The
Woodlands, Texas 77381
Re: Registration
Statement on Form S-3 of Lexicon Pharmaceuticals, Inc.
Ladies
and Gentlemen:
We have
acted as counsel to Lexicon Pharmaceuticals, Inc. (the “Company”), a Delaware
corporation, with respect to certain legal matters in connection with the
Company’s Registration Statement on Form S-3 (the “Registration Statement”)
relating to the registration by the Company under the Securities Act of 1933, as
amended (the “Securities Act”), of (i) unsecured debt securities of the Company,
which may be either senior or subordinated and may be issued in one or more
series, consisting of notes, debentures or other evidences of indebtedness (the
“Debt Securities”), (ii) shares of preferred stock, par value $0.01 per share,
of the Company, in one or more series (the “Preferred Stock”), (iii) shares of
common stock, par value $0.001 per share, of the Company (the “Common Stock”),
(iv) warrants for the purchase of Common Stock or Preferred Stock (the
“Warrants”), (v) rights to purchase Common Stock, Preferred Stock, Debt
Securities or other Securities (the “Rights”) and (vi) units comprised of one or
more shares of Common Stock, shares of Preferred Stock, Debt Securities and
Warrants in any combination (the “Units” and, together with the Warrants, the
Debt Securities, the Preferred Stock, the Common Stock and the Rights, the
“Securities”). The aggregate initial offering prices of the Securities to be
offered and sold by the Company pursuant to the Registration Statement, to which
this opinion is an exhibit, will not exceed $150,000,000 or, if applicable, the
equivalent thereof in any other currency or currency unit. The Securities will
be offered in amounts, at prices and on terms to be determined in light of
market conditions at the time of sale and to be set forth in supplements (each a
“Prospectus Supplement”) to the Prospectus contained in the Registration
Statement
We have
examined originals or copies, certified or otherwise identified to our
satisfaction, of (i) the Restated Certificate of Incorporation, as amended to
the date hereof, and the Amended and Restated Bylaws of the Company, (ii) the
Registration Statement, (iii) the form of Indenture (the “Indenture”), (iv)
resolutions of the board of directors of the Company and (v) such other
certificates, statutes and other instruments and documents as we considered
appropriate for purposes of the opinions hereafter expressed. In addition, we
reviewed such questions of law, as we considered appropriate.
In
connection with rendering the opinions set forth below, we have assumed that (i)
all information contained in all documents reviewed by us is true and correct,
(ii) all signatures on all documents examined by us are genuine and provided by
natural persons with legal capacity and authority execute such documents, (iii)
all documents submitted to us as originals are authentic and all documents
submitted to us as copies conform to the originals of those documents, (iv) the
Registration Statement, and any amendments thereto (including post-effective
amendments), will have become effective, (v) a Prospectus Supplement will have
been prepared and filed with the Commission describing the Securities offered
thereby, (vi) all Securities will be issued and sold in compliance with
applicable federal and state securities laws and in the manner specified in the
Registration Statement and the applicable Prospectus Supplement, (vii) the
Indenture relating to the Debt Securities, a warrant agreement (“Warrant
Agreement”) relating to the Warrants, a rights agreement (“Rights Agreement”)
relating to the Rights and a unit agreement (“Unit Agreement”) relating to the
Units will each be duly authorized, executed and delivered by the parties
thereto, (viii) each person signing the Indenture, Warrant Agreement, Rights
Agreement and Unit Agreement, as applicable, will have the legal capacity and
authority to do so, (ix) at the time of any offering or sale of any shares of
Common Stock and/or Preferred Stock, that the Company shall have such number of
shares of Common Stock and/or Preferred Stock, as set forth in such offering or
sale, authorized or created and available for issuance, (x) a definitive
purchase, underwriting or similar agreement with respect to any Securities
offered will have been duly authorized and validly executed and delivered by the
Company and the other parties thereto, and (xi) any Securities issuable upon
conversion, exchange or exercise of any Debt Securities, Preferred Stock, Rights
or Units being offered will have been duly authorized, created and, if
appropriate, reserved for issuance upon such conversion, exchange or
exercise.
Based on
the foregoing, and subject to the assumptions, qualifications, limitations, and
exceptions set forth herein, we are of the opinion that:
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1.
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When
(a) the applicable Indenture relating either to senior Debt Securities or
subordinated Debt Securities has been duly qualified under the Trust
Indenture Act of 1939, as amended, (b) the board of directors of the
Company (or a committee thereof) has taken all necessary corporate action
to approve the issuance and terms of any such Debt Securities, (c) the
terms of such Debt Securities and of their issuance and sale have been
duly established in conformity with the applicable Indenture so as not to
violate any applicable law or result in a default under or breach of any
agreement or instrument binding upon the Company and so as to comply with
any requirements or restrictions imposed by any court or governmental body
having jurisdiction over the Company, (d) any shares of Common Stock
issuable upon the conversion of such Debt Securities, if applicable, have
been duly and validly authorized for issuance and (e) such Debt Securities
have been duly executed and authenticated in accordance with the
applicable Indenture and issued and sold as contemplated in the
Registration Statement and upon payment of the consideration for such Debt
Securities as provided for in the applicable definitive purchase,
underwriting or similar agreement, such Debt Securities will be legally
issued and such Debt Securities will constitute valid and legally binding
obligations of the Company, enforceable against the Company in accordance
with their terms, except as such enforcement is subject to any applicable
bankruptcy, insolvency (including, without limitation, all laws relating
to fraudulent transfers), reorganization, moratorium and similar laws
relating to or affecting creditors’ rights generally and to general
equitable principles (regardless of whether enforcement is sought in a
proceeding in equity or at law);
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2.
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With
respect to shares of Common Stock, when (i) the board of directors of the
Company has taken all necessary corporate action to approve the issuance
and terms of the offering thereof and related matters; and (ii)
certificates representing the shares of Common Stock have been duly
executed, countersigned, registered and delivered either (A) in accordance
with the applicable definitive purchase, underwriting or similar agreement
approved by the board of directors of the Company, then upon payment of
the consideration therefor (not less than the par value of the Common
Stock) provided for therein; or (B) upon conversion, exchange or exercise
of any other Security in accordance with the terms of the Security or the
instrument governing the Security providing for the conversion, exchange
or exercise as approved by the board of directors of the Company, for the
consideration approved by the board of directors of the Company (not less
than the par value of the Common Stock), such shares of Common Stock will
be validly issued, fully paid and
non-assessable.
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3.
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With
respect to shares of Preferred Stock, when (i) the board of directors of
the Company has taken all necessary corporate action to approve the
issuance and terms of the shares of the series, the terms of the offering
thereof and related matters, including the adoption of a resolution
establishing and designating the series and fixing and determining the
preferences, limitations and relative rights thereof and the filing of a
statement with respect to the series with the Secretary of State of the
State of Delaware (the “Certificate of Designation”); and (ii)
certificates representing the shares of the series of Preferred Stock have
been duly executed, countersigned, registered and delivered either (A) in
accordance with the applicable definitive purchase, underwriting or
similar agreement approved by the Board, then upon payment of the
consideration therefor (not less than the par value of the Preferred
Stock) provided for therein; or (B) upon conversion, exchange or exercise
of any other Security in accordance with the terms of the Security or the
instrument governing the Security providing for the conversion, exchange
or exercise as approved by the Board, for the consideration approved by
the Board (not less than the par value of the Preferred Stock), the shares
of the series of Preferred Stock will be validly issued, fully paid and
non-assessable.
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4.
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When
(a) the terms of any Warrants and of their issuance and sale have been
duly established in conformity with the applicable Warrant Agreement so as
not to violate any applicable law or result in a default under or breach
of any agreement or instrument binding upon the Company and so as to
comply with any requirements or restrictions imposed by any court or
governmental body having jurisdiction over the Company, and (b) the
Warrants have been duly executed and authenticated in accordance with the
applicable Warrant Agreement and issued and sold as contemplated in the
Registration Statement, the Warrants will constitute valid and legally
binding obligations of the Company, subject to bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium and similar laws relating to or
affecting creditors’ rights generally and to general equitable principles
(regardless of whether enforcement is sought in a proceeding in equity or
at law).
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5.
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When
(a) the terms of any Rights and of their issuance and sale have been duly
established in conformity with the applicable Rights Agreement so as not
to violate any applicable law or result in a default under or breach of
any agreement or instrument binding upon the Company and so as to comply
with any requirements or restrictions imposed by any court or governmental
body having jurisdiction over the Company, and (b) the Rights have been
duly executed and authenticated in accordance with the applicable Rights
Agreement and issued and sold as contemplated in the Registration
Statement, the Rights will constitute valid and legally binding
obligations of the Company, subject to bankruptcy, insolvency (including,
without limitation, all laws relating to fraudulent transfers),
reorganization, moratorium and similar laws relating to or affecting
creditors’ rights generally and to general equitable principles
(regardless of whether enforcement is sought in a proceeding in equity or
at law).
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6.
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When
(a) the terms of any Units and of their issuance and sale have been duly
established in conformity with the applicable Unit Agreement and the
applicable agreements under which the Securities comprising the Units are
to be delivered so as not to violate any applicable law or result in a
default under or breach of any agreement or instrument binding upon the
Company and so as to comply with any requirements or restrictions imposed
by any court or governmental body having jurisdiction over the Company,
and (b) the Units have been duly executed and authenticated in accordance
with the applicable Unit Agreement and the applicable agreements under
which the Securities comprising the Units are to be delivered and issued
and sold as contemplated in the Registration Statement, the Units will
constitute valid and legally binding obligations of the Company, subject
to bankruptcy, insolvency (including, without limitation, all laws
relating to fraudulent transfers), reorganization, moratorium and similar
laws relating to or affecting creditors’ rights generally and to general
equitable principles (regardless of whether enforcement is sought in a
proceeding in equity or at law).
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With
respect to our opinions expressed above, as they relate to Debt Securities
denominated in a currency other than U.S. dollars, we note that effective
enforcement of a foreign currency claim in the New York State courts or the
federal courts sitting in the State of New York may be limited by requirements
that the claim (or a foreign currency judgment in respect of such claim) be
converted to U.S. dollars at the rate of exchange prevailing on a specified
date. We express no opinion as to whether a federal court sitting in the State
of New York would award a judgment in a currency other than U.S.
dollars.
We
express no opinions concerning (a) the validity or enforceability of any
provisions contained in the Indenture that purport to waive or not give effect
to rights to notices, defenses, subrogation or other rights or benefits that
cannot be effectively waived under applicable law; or (b) the enforceability of
indemnification provisions to the extent they purport to relate to liabilities
resulting from or based upon negligence or any violation of federal or state
securities or blue sky laws.
The
foregoing opinions are limited to the laws of the State of New York, the State
of Texas, the General Corporation Laws of the State of Delaware (including the
applicable provisions of the Delaware Constitution and the reported judicial
decisions interpreting these laws) and the federal laws of the United States of
America and we are expressing no opinion as to the effect of the laws of any
other jurisdiction, domestic or foreign.
We hereby
consent to the filing of this opinion as an exhibit to the Registration
Statement and to the use of our name in the Prospectus forming a part of the
Registration Statement under the caption “Legal Matters.” In giving this
consent, we do not admit that we are within the category of persons whose
consent is required under Section 7 of the Securities Act and the rules and
regulations thereunder.
Very truly yours,
/s/
Vinson & Elkins L.L.P.
Exhibit
12.1
|
Statement
of Computation of Ratio of Earnings to Fixed Charges
(in
thousands)
|
||||||||||||||||||||||||
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Six
months ended
|
||||||||||||||||||||||||
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June 30,
|
For
the year ended December 31,
|
|||||||||||||||||||||||
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2009
|
2008
|
2007
|
2006
|
2005
|
2004
|
|||||||||||||||||||
|
Earnings
(loss):
|
||||||||||||||||||||||||
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Loss before income
taxes
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$ | (41,633 | ) | $ | (76,860 | ) | $ | (58,794 | ) | $ | (54,430 | ) | $ | (36,196 | ) | $ | (47,172 | ) | ||||||
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Add:
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||||||||||||||||||||||||
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Interest expense
|
1,395 | 2,691 | 2,771 | 3,253 | 3,280 | 2,660 | ||||||||||||||||||
|
Estimated interest factor in
rental expense
|
862 | 1,849 | 1,871 | 1,834 | 1,859 | 1,836 | ||||||||||||||||||
|
Total loss
|
$ | (39,376 | ) | $ | (72,320 | ) | $ | (54,152 | ) | $ | (49,343 | ) | $ | (31,057 | ) | $ | (42,676 | ) | ||||||
|
Fixed
Charges:
|
||||||||||||||||||||||||
|
Interest expense
|
$ | 1,395 | $ | 2,691 | $ | 2,771 | $ | 3,253 | $ | 3,280 | $ | 2,660 | ||||||||||||
|
Estimated interest factor in
rental expense
|
862 | 1,849 | 1,871 | 1,834 | 1,859 | 1,836 | ||||||||||||||||||
|
Total fixed
charges
|
$ | 2,257 | $ | 4,540 | $ | 4,642 | $ | 5,087 | $ | 5,139 | $ | 4,496 | ||||||||||||
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Ratio
of Earnings to Fixed Charges (1)
|
— | — | — | — | — | — | ||||||||||||||||||
(1) For
the six months ended June 30, 2009, and the fiscal years ended December 31,
2008, 2007, 2006, 2005 and 2004, our earnings were insufficient to cover fixed
charges by $41.6 million, $76.9 million, $58.8 million,
$54.4 million, $36.2 million, and $47.2 million,
respectively.
Exhibit
23.1
CONSENT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We
consent to the reference to our firm under the caption “Experts”
in the Registration Statement (Form S-3) and related Prospectus of
Lexicon Pharmaceuticals, Inc. for the registration of common stock, preferred
stock, debt securities, warrants and/or rights and to the incorporation by
reference therein of our reports (a) dated March 3, 2009 (except for the effects
of the adoption of SFAS No. 160 discussed in Note 3, as to which the date is
September 1, 2009) with respect to the consolidated financial statements of
Lexicon Pharmaceuticals, Inc. for the year ended December 31, 2008 included in
the Current Report (Form 8-K) of Lexicon Pharmaceuticals, Inc. dated September
2, 2009, and (b) dated March 3, 2009 with respect to the effectiveness of
internal control over financial reporting of Lexicon Pharmaceuticals, Inc. as of
December 31, 2008 included in the Annual Report (Form 10-K) of Lexicon
Pharmaceuticals, Inc. for the year ended December 31, 2008, both filed with the
Securities and Exchange Commission.
/s/ ERNST
& YOUNG LLP
Houston,
Texas
September
1, 2009