Snap Inc S-3ASR, filed Feb 5, 2021
Snap Inc (SNAP)
Table of Contents
As filed with the Securities and Exchange Commission on February 5, 2021
Registration No. 333-
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
Snap Inc.
(Exact name of registrant as specified in its charter)
| Delaware | 45-5452795 | |
| (State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification Number) |
2772 Donald Douglas Loop North
Santa Monica, California
(310) 399-3339
(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)
Evan Spiegel
Chief Executive Officer
Snap Inc.
2772 Donald Douglas Loop North
Santa Monica, California 90405
(310) 399-3339
(Name, address, including zip code, and telephone number, including area code, of agent for service)
Copies to:
| Eric C. Jensen Seth J. Gottlieb Alex K. Kassai Cooley LLP 3175 Hanover Street Palo Alto, California 94304-1130 (650) 843-5000 |
Michael O’Sullivan Atul Porwal Snap Inc. 2772 Donald Douglas Loop North Santa Monica, California 90405 (310) 399-3339 |
Approximate date of commencement of proposed sale to the public: From time to time after the effective date of this registration statement.
If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please 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. ☒
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 additional 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, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer | ☒ | Accelerated filer | ☐ | |||
| Non-accelerated filer | ☐ | Smaller reporting company | ☐ | |||
| Emerging growth company |
☐ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐
CALCULATION OF REGISTRATION FEE
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| Title of Each Class of Securities to be Registered |
Amount to be Registered |
Proposed Maximum Offering Price Per Unit |
Proposed Maximum Aggregate Offering Price |
Amount of Registration Fee | ||||
| Class A Common Stock, par value $0.00001 per share |
(1) | (1) | (1) | (2) | ||||
| Preferred Stock, par value $0.00001 per share |
(1) | (1) | (1) | (2) | ||||
| Debt Securities |
(1) | (1) | (1) | (2) | ||||
| Warrants |
(1) | (1) | (1) | (2) | ||||
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| (1) | Omitted pursuant to General Instructions II.E of Form S-3. An indeterminate number or amount, as the case may be, of Class A common stock, preferred stock, debt securities, and warrants are being registered hereunder as may from time to time be issued at indeterminate prices. The securities being registered hereunder may be convertible into or exchangeable or exercisable for other securities of any identified class, and may be sold separately or in combination. In addition to the securities that may be issued directly under this registration statement, there is being registered hereunder such indeterminate aggregate number or amount, as the case may be, of the securities of each identified class as may from time to time be issued on the conversion, exchange, settlement, or exercise of other securities offered hereby. Separate consideration may or may not be received for securities that are issuable on the conversion or exercise of, or in exchange for, other securities offered hereby or that are offered in combination. Securities registered hereby may be offered for U.S. dollars or the equivalent thereof in foreign currencies. |
| (2) | Pursuant to Rules 456(b) and 457(r), the registrant is deferring payment of all applicable registration fees. Any registration fees will be paid subsequently on a pay-as-you-go basis in accordance with Rule 457(r). |
Table of Contents
PROSPECTUS
Class A Common Stock
Preferred Stock
Debt Securities
Warrants
We or a selling securityholder may, from time to time, offer and sell any combination of the securities described in this prospectus, either individually or in combination, at prices and on terms described in one or more supplements to this prospectus. We or a selling securityholder may also offer Class A common stock or preferred stock on conversion of debt securities, Class A common stock on conversion of preferred stock, or Class A common stock, preferred stock, or debt securities on exercise of warrants.
This prospectus describes some of the general terms that may apply to an offering of our securities. Each time we or a selling securityholder sells securities pursuant to this prospectus, we will provide the specific terms of these offerings and securities in one or more supplements to this prospectus. We may also authorize one or more free writing prospectuses to be provided to you in connection with these offerings. The prospectus supplement and any related free writing prospectus may also add, update, or change information contained in this prospectus. You should carefully read this prospectus, the applicable prospectus supplement, and any related free writing prospectus, and the documents incorporated by reference, before buying any of the securities being offered.
Securities may be sold by us or selling securityholders through underwriters or dealers, directly to purchasers, or through designated agents from time to time. For additional information on the methods of sale, you should refer to the section titled “Plan of Distribution” in this prospectus and in the applicable prospectus supplement. If any underwriters are involved in the sale of any securities with respect to which this prospectus is being delivered, the names of such underwriters and any applicable discounts or commissions and options to purchase additional securities will be listed in a prospectus supplement. The price to the public of such securities and the net proceeds we expect to receive from such sale will also be listed in a prospectus supplement. Unless the applicable prospectus supplement provides otherwise, we will not receive any proceeds from the sale of securities by selling securityholders.
Our Class A common stock is listed on the New York Stock Exchange under the symbol “SNAP.” On February 4, 2021, the last reported sale price of our Class A common stock on the New York Stock Exchange was $58.31 per share. The applicable prospectus supplement will contain information, where applicable, as to other listings, if any, on the New York Stock Exchange or other securities exchange of the securities covered by the applicable prospectus supplement.
Investing in our securities involves a high degree of risk. You should review carefully the risks and uncertainties described in the section titled “Risk Factors” included in, or incorporated by reference into, the applicable prospectus supplement and in any free writing prospectuses we have authorized for use in connection with a specific offering, and under similar headings in the other documents that are incorporated by reference into this prospectus.
This prospectus may not be used to consummate a sale of securities unless accompanied by a prospectus supplement.
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 February 5, 2021.
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We have not authorized anyone to provide any information other than that included or incorporated by reference in this prospectus or in any free writing prospectus prepared by or on behalf of us or to which we have referred you. We take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We are not making an offer of these securities in any state where the offer is not permitted. You should not assume that the information included or incorporated by reference in this prospectus or any prospectus supplement or in any such free writing prospectus is accurate as of any date other than their respective dates.
This prospectus is part of an automatic registration statement on Form S-3 that we filed with the Securities and Exchange Commission, or SEC, using a “shelf” registration process as a “well-known seasoned issuer” as defined in Rule 405 under the Securities Act of 1933, as amended, or the Securities Act. Under this shelf registration statement, from time to time, we or selling securityholders may sell, in one or more offerings, Class A common stock, preferred stock, various series of debt securities, or warrants to purchase any of such securities, either individually or in combination with other securities described in this prospectus. There is no limit on the aggregate amount of the securities that we or selling securityholders may offer pursuant to the registration statement of which this prospectus is a part. This prospectus provides you with a general description of the securities we or selling securityholders may offer.
Each time we or selling securityholders sell any type or series of securities under this prospectus, we will provide a prospectus supplement that will include more specific information about the terms of that offering. We may also authorize one or more free writing prospectuses to be provided to you that may contain material information relating to these offerings. In a prospectus supplement or free writing prospectus, we may also add, update, or change any of the information contained in this prospectus or in the documents we have incorporated by reference into this prospectus. This prospectus, together with the applicable prospectus supplement, any related free writing prospectus, and the documents incorporated by reference into this prospectus and the applicable prospectus supplement, will include all material information relating to the applicable offering. Before buying any of the securities being offered, you should carefully read both this prospectus and the applicable prospectus supplement and any related free writing prospectus, together with the additional information described in the section titled “Where You Can Find Additional Information.”
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This prospectus contains estimates and information concerning our industry, including market size and growth rates of the markets in which we participate, that are based on industry publications and reports. This information involves many assumptions and limitations, and you are cautioned not to give undue weight to these estimates. We have not independently verified the accuracy or completeness of the data contained in these industry publications and reports. The industry in which we operate is subject to a high degree of uncertainty and risk due to a variety of factors, including those described in the section titled “Risk Factors,” that could cause results to differ materially from those expressed in these publications and reports.
This prospectus includes summaries of certain provisions contained in some of the documents described in this prospectus, but reference is made to the actual documents for complete information. All of the summaries are qualified in their entirety by the actual documents. Copies of some of the documents referred to herein have been filed, will be filed, or will be incorporated by reference as exhibits to the registration statement of which this prospectus is a part, and you may obtain copies of those documents as described in the section titled “Where You Can Find Additional Information.”
Unless otherwise indicated, all references in this prospectus to “Snap,” the “company,” “we,” “our,” “us,” and similar terms refer to Snap Inc. and its subsidiaries.
This prospectus and the information incorporated herein by reference include trademarks, service marks, and trade names owned by us or other companies. All trademarks, service marks, and trade names included or incorporated by reference into this prospectus, any applicable prospectus supplement, or any related free writing prospectus are the property of their respective owners.
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This summary highlights information included elsewhere in this prospectus or incorporated by reference. This summary does not contain all of the information that you should consider before making your investment decision. You should carefully read the entire prospectus, the applicable prospectus supplement, and any related free writing prospectus, including the risks of investing in our securities discussed in the section titled “Risk Factors” in the applicable prospectus supplement and any related free writing prospectus, and under similar headings in the other documents that are incorporated by reference into this prospectus. Before making your investment decision, you should also carefully read the information incorporated by reference into this prospectus, including our financial statements and related notes, and the exhibits to the registration statement of which this prospectus is a part.
SNAP INC.
Overview
Snap Inc. is a camera company. We believe that reinventing the camera represents our greatest opportunity to improve the way that people live and communicate. We contribute to human progress by empowering people to express themselves, live in the moment, learn about the world, and have fun together.
Our flagship product, Snapchat, is a camera application that helps people communicate visually with friends and family through short videos and images called Snaps. By opening directly to the camera, we empower users to express themselves instantly. Snaps are deleted by default, so there is less pressure to look pretty or perfect when creating and sending images on Snapchat. By reducing the friction typically associated with creating and sharing content, Snapchat has become one of the most used cameras in the world.
In the way that the flashing cursor became the starting point for most products on desktop computers, we believe the camera screen will be the starting point for most products on smartphones. This is because images created by smartphone cameras contain more context and richer information than other forms of input like text entered on a keyboard. Given the magnitude of this opportunity, we invest heavily and take big risks in an attempt to create innovative and differentiated camera products that are better able to reflect and improve our life experiences.
Corporate Information
We were formed as Future Freshman, LLC, a California limited liability company, in 2010. We changed our name to Toyopa Group, LLC in 2011, incorporated as Snapchat, Inc., a Delaware corporation, in 2012, and changed our name to Snap Inc. in 2016. We completed our initial public offering in March 2017 and our Class A common stock is listed on the New York Stock Exchange under the symbol “SNAP.”
Our principal executive offices are located at 2772 Donald Douglas Loop North, Santa Monica, California 90405, and our telephone number is (310) 399-3339. Our website address is www.snap.com. Information contained on or accessible through our website is not a part of this prospectus or the registration statement of which it forms a part, and the inclusion of our website address in this prospectus is an inactive textual reference only. Snap Inc., “Snapchat,” and our other registered and common-law trade names, trademarks, and service marks appearing in this prospectus are property of Snap Inc. or our subsidiaries.
Risks Associated with Our Business
Our business is subject to numerous risks, as described in the section titled “Risk Factors” in the applicable prospectus supplement and in any free writing prospectuses we have authorized for use in connection with a specific offering, and under similar headings in the documents that are incorporated by reference into this prospectus, including the sections titled “Risk Factor Summary” and “Risk Factors” included in our most recent Annual Report on Form 10-K, as well as any amendments reflected in subsequent filings with the SEC.
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We or selling securityholders may offer shares of our Class A common stock or preferred stock, various series of debt securities, or warrants to purchase any of such securities, either individually or in combination, from time to time under this prospectus, together with the applicable prospectus supplement and any related free writing prospectus, at prices and on terms to be determined by market conditions at the time of any offering. We or selling securityholders may also offer Class A common stock or preferred stock on conversion of debt securities, Class A common stock on conversion of preferred stock, or Class A common stock, preferred stock, or debt securities on exercise of warrants. This prospectus provides you with a general description of the securities we or selling securityholders may offer. Each time we or selling securityholders offer a type or series of securities under this prospectus, we will provide a prospectus supplement that will describe the specific amounts, prices, and other important terms of the securities, including, to the extent applicable:
| • | designation or classification; |
| • | aggregate principal amount or aggregate offering price; |
| • | maturity date; |
| • | original issue discount; |
| • | rates and times of payment of interest or dividends; |
| • | redemption, conversion, exercise, exchange, or sinking fund terms; |
| • | ranking; |
| • | restrictive covenants; |
| • | voting or other rights; |
| • | conversion or exchange prices or rates and any provisions for changes to or adjustments in the conversion or exchange prices or rates and in the securities or other property receivable on conversion or exchange; and |
| • | a discussion of material U.S. federal income tax considerations. |
The applicable prospectus supplement and any related free writing prospectus that we may authorize to be provided to you may also add, update, or change any of the information contained in this prospectus or in the documents we have incorporated by reference.
We or selling securityholders may sell the securities directly to investors or to or through agents, underwriters, or dealers. We, selling securityholders, and our agents, underwriters, or dealers reserve the right to accept or reject all or part of any proposed purchase of securities. If we or selling securityholders do offer securities to or through agents, underwriters, or dealers, we will include in the applicable prospectus supplement:
| • | the names of those agents, underwriters, or dealers; |
| • | applicable fees, discounts, and commissions to be paid to them; |
| • | details regarding options to purchase additional securities, if any; and |
| • | the net proceeds to us, if any. |
This prospectus may not be used to consummate a sale of securities unless it is accompanied by a prospectus supplement.
Class A Common Stock
From time to time, we may issue shares of our Class A common stock. Our Class A common stock is non-voting and is not entitled to any votes on any matter that is submitted to a vote of our stockholders, except as required
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by Delaware law. Subject to preferences that may apply to any shares of preferred stock outstanding at the time, the holders of Class A common stock, Class B common stock, and Class C common stock will be entitled to share equally, identically, and ratably, on a per share basis, with respect to any dividend or distribution of cash or property paid or distributed by us, unless different treatment of the shares of the affected class is approved by the affirmative vote of the holders of a majority of the outstanding shares of the class treated adversely, voting separately as a class. On our liquidation, dissolution, or winding-up, the holders of Class A common stock, Class B common stock, and Class C common stock will be entitled to share equally, identically, and ratably in all assets remaining after the payment of any liabilities, liquidation preferences, and accrued or declared but unpaid dividends, if any, with respect to any outstanding preferred stock, unless a different treatment is approved by the affirmative vote of the holders of a majority of the outstanding shares of each class of common stock, including the Class A common stock, voting separately as a class. Holders of common stock have no preemptive, conversion, or subscription rights and there are no redemption or sinking fund provisions applicable to any class of common stock. The rights, preferences, and privileges of the holders of Class A common stock, Class B common stock, and Class C common stock are subject to, and may be adversely affected by, the rights of the holders of shares of any series of preferred stock that we may designate in the future. In this prospectus, we have summarized certain general features of the common stock in the section titled “Description of Capital Stock-Class A Common Stock, Class B Common Stock, and Class C Common Stock.” We urge you to read the applicable prospectus supplement and any related free writing prospectus that we may authorize to be provided to you related to any Class A common stock being offered.
Preferred Stock
From time to time, we may issue shares of our preferred stock, in one or more series. Under our certificate of incorporation, our board of directors has the authority to designate up to 500,000,000 shares of preferred stock in one or more series and to fix the rights, preferences, privileges, and restrictions of each series of preferred stock. Our board of directors also has the authority to the qualifications, limitations, or restrictions, including dividend rights, conversion rights, preemptive rights, terms of redemption or repurchase, liquidation preferences, sinking fund terms, and the number of shares constituting any series or the designation of any series. Convertible preferred stock will be convertible into our Class A common stock or exchangeable for other securities. Conversion may be mandatory or at your option and would be at prescribed conversion rates.
If we sell any series of preferred stock under this prospectus, we will fix the designations, voting powers, preferences, and rights of such series of preferred stock, as well as the qualifications, limitations, or restrictions, in the certificate of designation relating to that series. We will file as an exhibit to the registration statement of which this prospectus is a part, or will incorporate by reference from reports that we file with the SEC, the form of any certificate of designation that describes the terms of the series of preferred stock that we are offering before the issuance of the related series of preferred stock. In this prospectus, we have summarized certain general features of the preferred stock in the section titled “Description of Capital Stock-Preferred Stock.” We urge you to read the applicable prospectus supplement and any free writing prospectus that we may authorize to be provided to you related to any preferred stock being offered, as well as the complete certificate of designation that contains the terms of the applicable series of preferred stock.
Debt Securities
From time to time, we may issue debt securities, in one or more series, as either senior or subordinated debt or as senior or subordinated convertible debt. The senior debt securities will rank equally with any other unsecured and unsubordinated debt. The subordinated debt securities will be subordinate and junior in right of payment, to the extent and in the manner described in the instrument governing the debt, to all of our senior indebtedness. Convertible debt securities will be convertible into or exchangeable for our Class A common stock or other securities. Conversion may be mandatory or at your option, and would be at prescribed conversion rates.
Any debt securities issued under this prospectus will be issued under one or more documents called indentures, which are contracts between us and a national banking association or other eligible party, as trustee. In this
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prospectus, we have summarized certain general features of the debt securities in the section titled “Description of Debt Securities.” We urge you to read the applicable prospectus supplement and any free writing prospectus that we may authorize to be provided to you related to the series of debt securities being offered, as well as the complete indentures that contain the terms of the debt securities. A form of indenture has been filed as an exhibit to the registration statement of which this prospectus is a part, and supplemental indentures and forms of debt securities containing the terms of the debt securities being offered will be filed as exhibits to the registration statement of which this prospectus is a part or will be incorporated by reference from reports that we file with the SEC.
Warrants
From time to time, we may issue warrants for the purchase of Class A common stock, preferred stock, or debt securities in one or more series. We may issue warrants independently or in combination with Class A common stock, preferred stock, or debt securities. In this prospectus, we have summarized certain general features of the warrants in the section titled “Description of Warrants.” We urge you to read the applicable prospectus supplement and any free writing prospectus that we may authorize to be provided to you related to the particular series of warrants being offered, as well as the complete warrant agreements and warrant certificates that contain the terms of the warrants. We have filed forms of the warrant agreements and forms of warrant certificates containing the terms of the warrants that may be offered as exhibits to the registration statement of which this prospectus is a part. We will file as exhibits to the registration statement of which this prospectus is a part, or will incorporate by reference from reports that we file with the SEC, the form of warrant or the warrant agreement and warrant certificate, as applicable, that contain the terms of the particular series of warrants we are offering, and any supplemental agreements, before the issuance of such warrants.
Any warrants issued under this prospectus may be evidenced by warrant certificates. Warrants may be issued under an applicable warrant agreement that we enter into with a warrant agent. We will indicate the name and address of the warrant agent, if applicable, in the prospectus supplement relating to the particular series of warrants being offered.
Selling Securityholders
Selling securityholders are persons or entities that, directly or indirectly, have acquired or will from time to time acquire from us, our securities. Information about selling securityholders, if any, will be set forth in a prospectus supplement. See the section entitled “Selling Securityholders.”
Use of Proceeds
Except as described in any applicable prospectus supplement or in any free writing prospectus we have authorized for use in connection with a specific offering, we currently intend to use the net proceeds from the sale of securities offered by us, if any, for general corporate purposes, including working capital and capital expenditures. See the section titled “Use of Proceeds” in this prospectus. Unless the applicable prospectus supplement provides otherwise, we will not receive any of the proceeds from the sale of our securities by selling securityholders.
New York Stock Exchange Listing
Our Class A common stock is listed on the New York Stock Exchange under the symbol “SNAP.” The applicable prospectus supplement will contain information, where applicable, as to other listings on the New York Stock Exchange or other securities exchange of the shares of our Class A common stock covered by the applicable prospectus supplement.
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Investing in our securities involves a high degree of risk. Before deciding whether to invest in our securities, you should carefully consider the risks and uncertainties described in the section titled “Risk Factors” in the applicable prospectus supplement and any related free writing prospectus, and discussed in the sections titled “Risk Factor Summary” and “Risk Factors” in our most recent Annual Report on Form 10-K, as well as any amendments reflected in subsequent filings with the SEC, which are incorporated by reference into this prospectus in their entirety, together with other information in this prospectus, the documents incorporated by reference, and any free writing prospectus that we may authorize for use in connection with this offering. The risks described in these documents are not the only ones we face. Additional risks and uncertainties that we are unaware of, or that we currently believe are not material, may also become important factors that adversely affect our business. Past financial performance may not be a reliable indicator of future performance, and historical trends should not be used to anticipate results or trends in future periods. If any of these risks actually occurs, our business, reputation, financial condition, results of operations, revenue, and future prospects could be seriously harmed. This could cause the trading price of our Class A common stock to decline, resulting in a loss of all or part of your investment. Please also read carefully the section titled “Forward-Looking Statements.”
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This prospectus, including the documents that we incorporate by reference herein, contains, and any applicable prospectus supplement or free writing prospectus including the documents we incorporate by reference therein may contain, forward-looking statements within the meaning of Section 27A of the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act, including statements regarding our future financial condition, business strategy, and plans and objectives of management for future operations. All statements other than statements of historical facts, including statements regarding our future results of operations or financial condition, business strategy and plans, and objectives of management for future operations, are forward-looking statements. In some cases, you can identify forward-looking statements because they contain words such as “anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” or “would” or the negative of these words or other similar terms or expressions.
We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy, and financial needs. These forward-looking statements are subject to known and unknown risks, uncertainties, and assumptions, including risks described in the sections titled “Risk Factor Summary” and “Risk Factors” in our most recent Annual Report on Form 10-K, regarding, among other things:
| • | our financial performance, including our revenues, cost of revenues, operating expenses, and our ability to attain and sustain profitability; |
| • | our ability to generate and sustain positive cash flow; |
| • | our ability to attract and retain users and publishers; |
| • | our ability to attract and retain advertisers; |
| • | our ability to compete effectively with existing competitors and new market entrants; |
| • | our ability to effectively manage our growth and future expenses; |
| • | our ability to comply with modified or new laws, regulations, and executive actions applying to our business; |
| • | our ability to maintain, protect, and enhance our intellectual property; |
| • | our ability to successfully expand in our existing market segments and penetrate new market segments; |
| • | our ability to attract and retain qualified employees and key personnel; |
| • | our ability to repay outstanding debt; |
| • | future acquisitions of or investments in complementary companies, products, services, or technologies; and |
| • | the potential adverse impact of the COVID-19 pandemic on our business, operations, and the markets and communities in which we and our partners, advertisers, and users operate. |
Discussions containing these forward-looking statements may be found in the sections titled “Risk Factor Summary,” “Business,” “Risk Factors,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” incorporated by reference from our most recent Annual Report on Form 10-K, as well as any amendments filed with the SEC. These statements relate to future events or our future financial performance and involve known and unknown risks, uncertainties, and other factors that could cause our actual results, levels of activity, performance, or achievement to differ materially from those expressed or implied by these forward-looking statements. We discuss in greater detail, and incorporate by reference into this prospectus in their entirety, many of these risks and uncertainties in the sections titled “Risk Factors” in the applicable prospectus supplement, in any free writing prospectus we may authorize for use in connection with a specific offering, and
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in our most recent Annual Report on Form 10-K, as well as any amendments reflected in subsequent filings with the SEC. In addition, statements that we “believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based on information available to us as of the date of this prospectus, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely on these statements.
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Except as described in any applicable prospectus supplement or in any free writing prospectuses we have authorized for use in connection with a specific offering, we currently intend to use the net proceeds from this offering for general corporate purposes, including working capital and capital expenditures. Unless otherwise specified in the applicable prospectus supplement, we will not receive any proceeds from the sale of securities by selling securityholders.
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As of the date of this prospectus, our certificate of incorporation authorizes us to issue up to (i) 3,960,887,848 shares of common stock, $0.00001 par value per share, 3,000,000,000 of which are designated Class A common stock, 700,000,000 of which are designated Class B common stock, and 260,887,848 of which are designated Class C common stock; and (ii) 500,000,000 shares of preferred stock, $0.00001 par value per share. As of January 31, 2021:
| • | 1,252,952,827 shares of Class A common stock were outstanding; |
| • | 23,691,358 shares of Class B common stock were outstanding; |
| • | 231,626,943 shares of Class C common stock were outstanding; and |
| • | no shares of preferred stock were outstanding. |
The following summary describes the material terms of our capital stock. The description of capital stock is qualified by reference to our certificate of incorporation and our bylaws.
Class A Common Stock, Class B Common Stock, and Class C Common Stock
Voting Rights
Our Class A common stock is non-voting and is not entitled to any votes on any matter that is submitted to a vote of our stockholders, except as required by Delaware law. Delaware law would permit holders of Class A common stock to vote, with one vote per share, on a matter if we were to:
| • | change the par value of the common stock; or |
| • | amend our certificate of incorporation to alter the powers, preferences, or special rights of the common stock as a whole in a way that would adversely affect the holders of our Class A common stock. |
In addition, Delaware law would permit holders of Class A common stock to vote separately, as a single class, if an amendment to our certificate of incorporation would adversely affect them by altering the powers, preferences, or special rights of the Class A common stock, but not the Class B common stock or Class C common stock. As a result, in these limited instances, the holders of a majority of the Class A common stock could defeat any amendment to our certificate of incorporation. For example, if a proposed amendment of our certificate of incorporation provided for the Class A common stock to rank junior to the Class B common stock and Class C common stock with respect to (i) any dividend or distribution, (ii) the distribution of proceeds were we to be acquired, or (iii) any other right, Delaware law would require the vote of the Class A common stock, with each share of Class A common stock entitled to one vote per share. In this instance, the holders of a majority of Class A common stock could defeat that amendment to our certificate of incorporation. Moreover, if an amendment to our certificate of incorporation would alter the powers, preferences, or special rights of the Class A common stock and either the Class B common Stock or the Class C common stock in a way that would affect them adversely compared to the unaffected class, Delaware law would permit the holders of Class A common stock to vote with the other adversely affected class of common stock together as a single class. For example, if a proposed amendment to our certificate of incorporation provided for the Class A common stock and Class B common stock to rank junior to the Class C common stock with respect to (i) any dividend or distribution, (ii) the distribution of proceeds were we to be acquired, or (iii) any other right, Delaware law would require the vote of the Class A common stock and Class B common stock voting together as a single class, with each share of Class A common stock and Class B common stock entitled to one vote per share. In this instance, the holders of a majority of the Class A common stock and Class B common stock, voting together as a single class, could defeat that amendment to our certificate of incorporation.
Our certificate of incorporation provides that the number of authorized shares of common stock or any class of common stock, including our Class A common stock, may be increased or decreased (but not below the number
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of shares of common stock then outstanding) by the affirmative vote of the holders of a majority of the Class B common stock and Class C common stock, voting together as a single class. As a result, the holders of a majority of the outstanding Class B common stock and Class C common stock can approve an increase or decrease in the number of authorized shares of Class A common stock without a separate vote of the holders of Class A common stock. This could allow us to increase and issue additional shares of Class A common stock beyond what is currently authorized in our certificate of incorporation without the consent of the holders of our Class A common stock.
Holders of our Class B common stock are entitled to one vote per share and holders of Class C common stock are entitled to ten votes per share on any matter submitted to our stockholders. Except as set forth above, holders of shares of Class B common stock and Class C common stock will vote together as a single class on all matters (including the election of directors) submitted to a vote of stockholders. In addition, each class of our common stock may have the right to vote separately in certain instances as listed in the section titled “-Economic Rights.”
On the date that all outstanding shares of Class C common stock have converted to Class B common stock, all shares of Class B common stock will convert to Class A common stock and the holders of Class A common stock will be entitled to one vote per share.
Our certificate of incorporation does not provide for cumulative voting for the election of directors.
Founder Proxy Agreement
Evan Spiegel and Robert Murphy, our co-founders, have entered into a proxy agreement with each other. The agreement will apply to all shares of our Class B common stock and Class C common stock that each may beneficially own from time to time or have voting control over.
Under the proxy agreement, Mr. Spiegel has designated Mr. Murphy as his designated proxy holder, and Mr. Murphy has designated Mr. Spiegel as his designated proxy holder. Each co-founder has the right to select from time to time an alternate proxy holder who would exercise the proxy if the primary proxy holder were unable or unwilling to serve as a proxy. Mr. Spiegel and Mr. Murphy have each appointed Michael Lynton as his alternate proxy. Mr. Spiegel and Mr. Murphy may not change the primary proxy holder without the other’s consent. A proxy holder will have the right to exercise all of the voting and consent rights of our shares of Class B common stock and Class C common stock beneficially owned by the deceased or disabled co-founder or over which he has voting control on and for the nine months following the co-founder’s death or during his disability. Before any proxy holder may vote or act by written consent with respect to the shares of Class B common stock and Class C common stock over which they hold a proxy, that proxy holder will meet with the independent members of our board of directors within 90 days of the co-founder’s death or disability.
The proxy agreement will terminate as soon as any of the following occur: (i) nine months after the death of both Mr. Spiegel and Mr. Murphy, (ii) the liquidation, dissolution, or winding up of our business operations, (iii) the execution by us of a general assignment for the benefit of creditors or the appointment of a receiver or trustee to take possession of our property and assets, or (iv) the date as of which Mr. Spiegel and Mr. Murphy terminate the proxy agreement by written consent of Mr. Spiegel and Mr. Murphy, with notice to us.
Economic Rights
Except as otherwise expressly provided in our certificate of incorporation or required by Delaware law, all shares of Class A common stock, Class B common stock, and Class C common stock will have the same rights and privileges and rank equally, share ratably, and be identical in all respects for all matters, including those described below
Dividends and Distributions. Subject to preferences that may apply to any shares of preferred stock outstanding at the time, the holders of Class A common stock, Class B common stock, and Class C common stock will be
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entitled to share equally, identically, and ratably, on a per share basis, with respect to any dividend or distribution of cash or property paid or distributed by us, unless different treatment of the shares of the affected class is approved by the affirmative vote of the holders of a majority of the outstanding shares of the class treated adversely voting separately as a class. Even though holders of Class A common stock are not normally entitled to a vote on matters presented to our stockholders, they would be entitled to vote separately as a class, with one vote per share, on dividends and distributions if the holders of Class A common stock were treated adversely. As a result, if the holders of Class A common stock were treated adversely in any dividend or distribution, the holders of a majority of Class A common stock could defeat that dividend or distribution. In addition, if any two classes of common stock are treated adversely relative to another class of common stock with respect to any dividend or distribution, the vote of the holders of a majority of the adversely affected classes, voting together as a single class, would be required to approve that dividend or distribution. For example, if we were to make a distribution of cash to the holders of Class C common stock but not make a cash distribution or make a distribution of stock instead of cash to the holders of Class A common stock and Class B common stock, the holders of a majority of Class A common stock and Class B common stock, voting together as a single class, would be required to approve that dividend or distribution. In that scenario, each share of Class A common stock and Class B common stock would be entitled to one vote per share.
Liquidation Rights. On our liquidation, dissolution, or winding-up, the holders of Class A common stock, Class B common stock, and Class C common stock will be entitled to share equally, identically, and ratably in all assets remaining after the payment of any liabilities, liquidation preferences, and accrued or declared but unpaid dividends, if any, with respect to any outstanding preferred stock, unless a different treatment is approved by the affirmative vote of the holders of a majority of the outstanding shares of each class of common stock, including the Class A common stock, voting separately as a class. As a result, the holders of a majority of each class of common stock, including the Class A common stock, could defeat a proposed distribution of any assets on our liquidation, dissolution, or winding-up if that distribution were not to be shared equally, identically, and ratably.
Change of Control Transactions. The holders of Class A common stock, Class B common stock, and Class C common stock will be treated equally and identically with respect to shares of Class A common stock, Class B common stock, or Class C common stock owned by them, unless different treatment of the shares of each class is approved by the affirmative vote of the holders of a majority of the outstanding shares of each class of common stock, including the Class A common stock, voting separately as a class, on (i) the closing of the sale, transfer, or other disposition of all or substantially all of our assets, (ii) the consummation of a merger, reorganization, consolidation, or share transfer which results in our voting securities outstanding immediately before the transaction (or the voting securities issued with respect to our voting securities outstanding immediately before the transaction) representing less than a majority of the combined voting power of the voting securities of the company or the surviving or acquiring entity, or (iii) the closing of the transfer (whether by merger, consolidation, or otherwise), in one transaction or a series of related transactions, to a person or group of affiliated persons of securities of the company if, after closing, the transferee person or group would hold 50% or more of the outstanding voting power of the company (or the surviving or acquiring entity). However, consideration to be paid or received by a holder of common stock in connection with any such asset sale, merger, reorganization, consolidation, or share transfer under any employment, consulting, severance, or other arrangement will be disregarded for the purposes of determining whether holders of common stock are treated equally and identically. As a result, the holders of a majority of each class of common stock, including the holders Class A common stock, could defeat a change of control transaction if the holders of Class A common stock, Class B common stock, and Class C common stock were not to be treated equally and identically in such change of control transaction.
Subdivisions and Combinations. If we subdivide or combine in any manner outstanding shares of Class A common stock, Class B common stock, or Class C common stock, the outstanding shares of the other classes will be subdivided or combined in the same manner.
If holders of Class A common stock are treated the same as holders of Class B common stock and Class C common stock with respect to the dividends and distributions, liquidation rights, change of control transactions,
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and subdivisions and combinations, such holders of Class A common stock will not have the right to vote on such matters.
No Preemptive or Similar Rights
Our Class A common stock, Class B common stock, and Class C common stock are not entitled to preemptive rights, and are not subject to conversion, redemption, or sinking fund provisions, except for the conversion provisions with respect to the Class B common stock and Class C common stock described in this prospectus.
Conversion
Each share of Class B common stock is convertible at any time at the option of the holder into one share of Class A common stock. Each share of Class C common stock is convertible at any time at the option of the holder into one share of Class B common stock. On any transfer of shares of Class B common stock, whether or not for value, each such transferred share will automatically convert into one share of Class A common stock, except for certain transfers described in our certificate of incorporation, including transfers for tax and estate planning purposes, so long as the transferring holder continues to hold sole voting and dispositive power with respect to the shares transferred. Any holder’s shares of Class B common stock will automatically convert into Class A common stock, on a one-to-one basis, on the death of the holder.
On any transfer of shares of Class C common stock, whether or not for value, each transferred share will automatically convert into one share of Class B common stock, except for certain transfers described in our certificate of incorporation, including transfers for tax and estate planning purposes, so long as the transferring holder or a qualified trustee for that holder continues to hold sole voting and dispositive power with respect to the shares transferred, and transfers between founders.
Any holder’s shares of Class C common stock will automatically convert into Class B common stock, on a one-to-one basis, on the date on which the number of outstanding shares of Class C common stock held by that holder represents less than 30% of the Class C common stock held by that holder as of the date of the closing of our initial public offering in March 2017, or 32,383,178 shares of Class C common stock. Any holder’s shares of Class C common stock will automatically convert into Class B common stock, on a one-to-one basis, nine months after the death of that holder. Once there are no shares of Class C common stock outstanding, all shares of Class B common stock will convert to Class A common stock, on a one-to-one basis, and all shares of Class A common stock will have one vote per share, as described in our certificate of incorporation. Either of our founders may transfer shares of Class B common stock or Class C common stock to the other founder or a founder’s permitted transferee without such transferred shares converting into Class A common stock or Class B common stock, respectively. In addition, either founder may transfer shares of Class B common stock or Class C common stock to a qualified trustee without such transferred shares converting into Class A common stock or Class B common stock, respectively. A qualified trustee is a professional in the business of providing trustee services that is subject to appointment and removal solely by that founder or, following a founder’s death or during the founder’s disability event, by the founder’s designated proxy (who may be the other founder or another person selected by the founder and approved to act in that role by the independent members of our board of directors). A qualified trustee may not have any pecuniary interest in any Class B common stock or Class C common stock held by any entity of which that person is a trustee. Shares of Class C common stock held by a founder’s qualified trustee will convert to Class B common stock nine months after the death of that founder. Termination of a founder’s employment or services with us does not result in conversion of Class C common stock held by such founder.
Once transferred and converted into Class A common stock, the Class B common stock may not be reissued. Once transferred and converted into Class B common stock, the Class C common stock may not be reissued.
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Preferred Stock
Our board of directors may, without further action by our stockholders, fix the rights, preferences, privileges, and restrictions of up to an aggregate of 500,000,000 shares of preferred stock in one or more series and authorize their issuance. These rights, preferences, and privileges could include dividend rights, conversion rights, voting rights, terms of redemption, liquidation preferences, and the number of shares constituting any series or the designation of such series, any or all of which may be greater than the rights of our Class A common stock, Class B common stock, or Class C common stock. Any issuance of our preferred stock could adversely affect the voting power of holders of our Class B common stock or Class C common stock, and the likelihood that such holders would receive dividend payments and payments on liquidation. In addition, the issuance of preferred stock could have the effect of delaying, deferring, or preventing a change of control or other corporate action.
The following summary of terms of our preferred stock is not complete. You should refer to the provisions of our certificate of incorporation and bylaws and the resolutions containing the terms of each class or series of the preferred stock which have been or will be filed with the SEC at or prior to the time of issuance of such class or series of preferred stock and described in the applicable prospectus supplement. The applicable prospectus supplement may also state that any of the terms in this prospectus are inapplicable to such series of preferred stock, provided that the information in such prospectus supplement does not constitute material changes to the information in this prospectus such that it alters the nature of the offering or the securities offered.
We will fix the designations, voting powers, preferences, and rights of the preferred stock of each series we issue under this prospectus, as well as the qualifications, limitations, or restrictions, in the certificate of designation relating to that series. We will file as an exhibit to the registration statement of which this prospectus is a part, or will incorporate by reference from reports that we file with the SEC, the form of any certificate of designation that describes the terms of the series of preferred stock we are offering. We will describe in the applicable prospectus supplement the terms of the series of preferred stock being offered, including, to the extent applicable:
| • | the title and stated value; |
| • | the number of shares we are offering; |
| • | the liquidation preference per share; |
| • | the purchase price; |
| • | the dividend rate, period, and payment date and method of calculation for dividends; |
| • | whether dividends will be cumulative or non-cumulative and, if cumulative, the date from which dividends will accumulate; |
| • | the procedures for any auction and remarketing; |
| • | the provisions for a sinking fund; |
| • | the provisions for redemption or repurchase, if applicable, and any restrictions on our ability to exercise those redemption and repurchase rights; |
| • | any listing of the preferred stock on any securities exchange or market; |
| • | whether the preferred stock will be convertible into our Class A common stock, and, if applicable, the conversion price, or how it will be calculated, and the conversion period; |
| • | 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; |
| • | voting rights of the preferred stock; |
| • | preemptive rights; |
| • | restrictions on transfer, sale, or other assignment; |
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| • | whether interests in the preferred stock will be represented by depositary shares; |
| • | a discussion of material U.S. federal income tax considerations applicable to the preferred stock; |
| • | the relative ranking and preferences of the preferred stock as to dividend rights and rights if we liquidate, dissolve, or wind up our affairs; |
| • | any limitations on the 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 |
| • | any other specific terms, preferences, rights, or limitations of, or restrictions on, the preferred stock. |
If we issue shares of preferred stock under this prospectus, the shares will be fully paid and non-assessable.
Anti-Takeover Effects of Delaware Law and Our Certificate of Incorporation and Bylaws
Because our stockholders do not have cumulative voting rights, stockholders holding a majority of the voting power of our shares of common stock will be able to elect all of our directors. Our certificate of incorporation and bylaws provide for stockholder actions at a duly called meeting of stockholders or, before the date on which all shares of common stock convert into a single class, by written consent. A special meeting of stockholders may be called by a majority of total number of authorized directors of our board of directors, our chief executive officer, or, before the date on which all shares of common stock convert into a single class, the holders of at least 30% of the total voting power of our Class A common stock, Class B common stock, and Class C common stock, voting together as a single class. Our bylaws include an advance notice procedure for stockholder proposals to be brought before an annual meeting of our stockholders, including proposed nominations of persons for election to our board of directors.
Our certificate of incorporation further provides for a tri-class common stock structure, which provides Mr. Spiegel, our co-founder and Chief Executive Officer, and Mr. Murphy, our co-founder and Chief Technology Officer, or Mr. Spiegel alone, with control over all matters requiring stockholder approval, including the election of directors and significant corporate transactions, such as a merger or other sale of our company or its assets.
The foregoing provisions will make it more difficult for our existing stockholders, other than Mr. Spiegel and Mr. Murphy, or Mr. Spiegel alone, to replace our board of directors as well as for another party to obtain control of us by replacing our board of directors. Since our board of directors has the power to retain and discharge our officers, these provisions could also make it more difficult for existing stockholders or another party to effect a change in management. In addition, the authorization of undesignated preferred stock makes it possible for our board of directors to issue preferred stock with voting or other rights or preferences that could impede the success of any attempt to change our control.
These provisions, including the tri-class structure of our common stock, are intended to preserve our existing founder control structure, facilitate our continued product innovation and the risk-taking that it requires, permit us to continue to prioritize our long-term goals rather than short-term results, enhance the likelihood of continued stability in the composition of our board of directors and its policies, and discourage certain types of transactions that may involve an actual or threatened acquisition of us. These provisions are also designed to reduce our vulnerability to an unsolicited acquisition proposal and to discourage certain tactics that may be used in proxy fights. However, such provisions could have the effect of discouraging others from making tender offers for our shares and may have the effect of deterring hostile takeovers or delaying changes in our control or management. As a consequence, these provisions may also inhibit fluctuations in the market price of our stock that could result from actual or rumored takeover attempts
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When we have a class of voting stock that is either listed on a national securities exchange or held of record by more than 2,000 stockholders, we will be subject to Section 203 of the Delaware General Corporation Law, which prohibits a Delaware corporation from engaging in any business combination with any interested stockholder for a period of three years after the date that such stockholder became an interested stockholder, subject to certain exceptions.
Choice of Forum
Our certificate of incorporation provides that the Court of Chancery of the State of Delaware will be the exclusive forum for: (i) any derivative action or proceeding brought on our behalf; (ii) any action asserting a breach of fiduciary duty; (iii) any action asserting a claim against us arising under the DGCL, our certificate of incorporation, or our bylaws; or (iv) any action asserting a claim against us that is governed by the internal affairs doctrine.
This provision would not apply to actions brought to enforce a duty or liability created by the Exchange Act or any other claim for which the federal courts have exclusive jurisdiction. Furthermore, Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all Securities Act claims, which means both courts have jurisdiction to entertain such claims. To prevent having to litigate claims in multiple jurisdictions and the threat of inconsistent or contrary rulings by different courts, among other considerations, our certificate of incorporation provides that the federal district courts of the United States of America will be the exclusive forum for resolving any complaint asserting a cause of action arising under the Securities Act.
Transfer Agent and Registrar
The transfer agent and registrar for our Class A common stock, Class B common stock, and Class C common stock is American Stock Transfer & Trust Company, LLC. The transfer agent and registrar’s address is 6201 15th Avenue, Brooklyn, New York 11219. The transfer agent for any series of preferred stock that we may offer under this prospectus will be named and described in the prospectus supplement for that series.
Listing on the New York Stock Exchange
Our Class A common stock is listed on the New York Stock Exchange under the symbol “SNAP.” The applicable prospectus supplement will contain information, where applicable, as to other listings, if any, on the New York Stock Exchange or other securities exchange of the shares of our Class A common stock covered by the applicable prospectus supplement.
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DESCRIPTION OF DEBT SECURITIES
From time to time, we may issue debt securities in one or more series, as either senior or subordinated debt or as senior or subordinated convertible debt. While the terms we have summarized below will apply generally to any debt securities that 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. The terms of any debt securities offered under a prospectus supplement may differ from the terms described below. Unless the context requires otherwise, whenever we refer to the indenture, we also are referring to any supplemental indentures that specify the terms of a particular series of debt securities.
We will issue debt securities under the indenture that we will enter into with the trustee named in the indenture. The indenture will be qualified under the Trust Indenture Act of 1939, as amended, or the Trust Indenture Act. We have filed the form of indenture as an exhibit to the registration statement of which this prospectus is a part, and supplemental indentures and forms of debt securities listing the terms of the debt securities being offered will be filed as exhibits to the registration statement of which this prospectus is a part or will be incorporated by reference from reports that we file with the SEC.
The following summary of material provisions of the debt securities and the indenture is subject to, and qualified in its entirety by reference to, all of the provisions of the indenture applicable to a particular series of debt securities. We urge you to read the applicable prospectus supplements and any related free writing prospectuses related to the debt securities that we may offer under this prospectus, as well as the complete indenture that contains the terms of the debt securities.
General
The indenture does not limit the amount of debt securities that we may issue. It provides that we may issue debt securities up to the principal amount that we may authorize and may be in any currency or currency unit that we may designate. Except for the limitations on consolidation, merger, and sale of all or substantially all of our assets contained in the indenture, the terms of the indenture do not contain any covenants or other provisions designed to give holders of any debt securities protection against changes in our operations, financial condition, or transactions involving us.
We may issue the debt securities issued under the indenture as “discount securities,” which means they may be sold at a discount below their stated principal amount. These debt securities, as well as other debt securities that are not issued at a discount, may be issued with “original issue discount,” or OID, for U.S. federal income tax purposes because of interest payment and other characteristics or terms of the debt securities. Material U.S. federal income tax considerations applicable to debt securities issued with OID will be described in more detail in any applicable prospectus supplement.
We will describe in the applicable prospectus supplement the terms of the series of debt securities being offered, including:
| • | the title of the series of debt securities; |
| • | any limit on the aggregate principal amount that may be issued; |
| • | the maturity date or dates; |
| • | the form of the debt securities of the series; |
| • | the applicability of any guarantees; |
| • | whether or not the debt securities will be secured or unsecured, and the terms of any secured debt; |
| • | whether the debt securities rank as senior debt, senior subordinated debt, subordinated debt, or any combination of the foregoing, and the terms of any subordination; |
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| • | if the price (expressed as a percentage of the aggregate principal amount) at which such debt securities will be issued is a price other than the principal amount, the portion of the principal amount thereof payable on declaration of acceleration of the maturity, or if applicable, the portion of the principal amount of such debt securities that is convertible into another security or the method by which any such portion will be determined; |
| • | the interest rate or rates, which may be fixed or variable, or the method for determining the rate and the date interest will begin to accrue, the dates interest will be payable, and the regular record dates for interest payment dates, or the method for determining such dates; |
| • | our right, if any, to defer payment of interest and the maximum length of any such deferral period; |
| • | if applicable, the date or dates after which, or the period or periods during which, and the price or prices at which, we may, at our option, redeem the series of debt securities pursuant to any optional or provisional redemption provisions and the terms of those redemption provisions; |
| • | the date or dates, if any, on which, and the price or prices at which we are obligated, pursuant to any mandatory sinking fund or analogous fund provisions or otherwise, to redeem, or at the holder’s option to purchase, the series of debt securities and the currency or currency unit in which the debt securities are payable; |
| • | the denominations in which we will issue the series of debt securities, if other than denominations of $1,000 and any integral multiple; |
| • | any and all terms, if applicable, relating to any auction or remarketing of the debt securities of that series and any security for our obligations with respect to such debt securities and any other terms which may be advisable in connection with the marketing of debt securities of that series; |
| • | whether the debt securities of the series will be issued in whole or in part in the form of a global security or securities, the terms and conditions, if any, on which such global security or securities may be exchanged in whole or in part for other individual securities, and the depositary for such global security or securities; |
| • | if applicable, the provisions relating to conversion or exchange of any debt securities of the series and the terms and conditions on which such debt securities will be so convertible or exchangeable, including the conversion or exchange price, as applicable, or how it will be calculated and may be adjusted, any mandatory or optional (at our option or the holders’ option) conversion or exchange features, the applicable conversion or exchange period, and the manner of settlement for any conversion or exchange; |
| • | if other than the full principal amount, the portion of the principal amount of debt securities of the series which will be payable on declaration of acceleration of the maturity; |
| • | additions to or changes in the covenants applicable to the particular debt securities being issued, including the consolidation, merger, or sale covenant; |
| • | additions to or changes in the events of default with respect to the securities and any change in the right of the trustee or the holders to declare the principal, premium, and interest, with respect to such securities to be due and payable; |
| • | additions to or changes in or deletions of the provisions relating to covenant defeasance and legal defeasance; |
| • | additions to or changes in the provisions relating to satisfaction and discharge of the indenture; |
| • | additions to or changes in the provisions relating to the modification of the indenture both with and without the consent of holders of debt securities issued under the indenture; |
| • | the currency of payment of debt securities if other than U.S. dollars and the manner of determining the equivalent amount in U.S. dollars; |
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| • | whether interest will be payable in cash or additional debt securities at our or the holders’ option and the terms and conditions on which the election may be made; |
| • | the terms and conditions, if any, on which we will pay amounts in addition to the stated interest, premium, if any, and principal amounts of the debt securities of the series to any holder that is not a “United States person” for federal tax purposes; |
| • | any restrictions on transfer, sale, or assignment of the debt securities of the series; and |
| • | any other specific terms, preferences, rights, or limitations of, or restrictions on, the debt securities, any other additions or changes in the provisions of the indenture, and any terms that may be required by us or advisable under applicable laws or regulations. |
Conversion or Exchange Rights
In the applicable prospectus supplement, we will list the terms on which a series of debt securities may be convertible into or exchangeable for our Class A common stock or our other securities. We will include provisions as to settlement on conversion or exchange and whether conversion or exchange is mandatory, at the option of the holder or at our option. We may include provisions pursuant to which the number of shares of our Class A common stock or our other securities that the holders of the series of debt securities receive would be subject to adjustment.
Consolidation, Merger, or Sale
Unless we provide otherwise in the prospectus supplement applicable to a particular series of debt securities, the indenture will not contain any covenant that restricts our ability to merge or consolidate, or sell, convey, transfer, or otherwise dispose of our assets as an entirety or substantially as an entirety. However, any successor to or acquirer of such assets (other than a subsidiary of ours) must assume all of our obligations under the indenture or the debt securities, as appropriate.
Events of Default Under the Indenture
Unless we provide otherwise in the prospectus supplement applicable to a particular series of debt securities, the following are events of default under the indenture with respect to any series of debt securities that we may issue:
| • | if we fail to pay any installment of interest on any series of debt securities, as and when the same will become due and payable, and such default continues for a period of 90 days; provided, however, that a valid extension of an interest payment period by us in accordance with the terms of any indenture supplemental will not constitute a default in the payment of interest for this purpose; |
| • | if we fail to pay the principal of, or premium, if any, on any series of debt securities as and when the same will become due and payable whether at maturity, on redemption, by declaration, or otherwise, or in any payment required by any sinking or analogous fund established with respect to such series; provided, however, that a valid extension of the maturity of such debt securities in accordance with the terms of any indenture supplemental will not constitute a default in the payment of principal or premium, if any; |
| • | if we fail to observe or perform any other covenant or agreement contained in the debt securities or the indenture, other than a covenant specifically relating to another series of debt securities, and our failure continues for 90 days after we receive written notice of such failure, requiring the same to be remedied and stating that such is a notice of default, from the trustee or holders of at least 25% in aggregate principal amount of the outstanding debt securities of the applicable series; and |
| • | if specified events of bankruptcy, insolvency, or reorganization occur. |
If an event of default with respect to debt securities of any series occurs and is continuing, other than an event of default specified in the last bullet point above, the trustee or the holders of at least 25% in aggregate principal
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amount of the outstanding debt securities of that series may declare the unpaid principal, premium, if any, and accrued interest, if any, due and payable immediately. Such declaration may be made by notice to us in writing and to the trustee if notice is given by the holders. If an event of default specified in the last bullet point above occurs with respect to us, the principal amount of and accrued interest, if any, of each issue of debt securities then outstanding will be due and payable without any notice or other action on the part of the trustee or any holder.
The holders of a majority in principal amount of the outstanding debt securities of an affected series may waive any default or event of default with respect to the series and its consequences, except defaults or events of default regarding payment of principal, premium, if any, or interest, unless we have cured the default or event of default in accordance with the indenture. Any waiver will cure the default or event of default.
Subject to the terms of the indenture, if an event of default under an indenture occurs and is continuing, the trustee will be under no obligation to exercise any of its rights or powers under such indenture at the request or direction of any of the holders of the applicable series of debt securities, unless such holders have offered the trustee reasonable indemnity. 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, provided that:
| • | the direction so given by the holder is not in conflict with any law or the applicable indenture; and |
| • | subject to its duties under the Trust Indenture Act, the trustee need not take any action that might involve it in personal liability or might be unduly prejudicial to the holders not involved in the proceeding. |
A holder of the debt securities of any series will have the right to institute a proceeding under the indenture or to appoint a receiver or trustee, or to seek other remedies only if:
| • | the holder has given written notice to the trustee of a continuing event of default with respect to that series; |
| • | the holders of at least 25% in aggregate principal amount of the outstanding debt securities of that series have made written request; |
| • | such holders have offered to the trustee indemnity satisfactory to it against the costs, expenses, and liabilities to be incurred by the trustee in compliance with the request; and |
| • | the trustee does not institute the proceeding, and does not receive from the holders of a majority in aggregate principal amount of the outstanding debt securities of that series other conflicting directions within 90 days after the notice, request, and offer. |
These limitations do not apply to a suit instituted by a holder of debt securities if we default in the payment of the principal, premium, if any, or interest on the debt securities.
We will periodically file statements with the trustee regarding our compliance with specified covenants in the indenture.
Modification of Indenture; Waiver
We and the trustee may change an indenture without the consent of any holders with respect to specific matters:
| • | to cure any ambiguity, defect, or inconsistency in the indenture or in the debt securities of any series; |
| • | to comply with the provisions described in the section titled “-Consolidation, Merger, or Sale;” |
| • | to provide for uncertificated debt securities in addition to or in place of certificated debt securities; |
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| • | to add to our covenants, restrictions, conditions, or provisions such new covenants, restrictions, conditions, or provisions for the benefit of the holders of all or any series of debt securities, to make the occurrence, or the occurrence and the continuance, of a default in any such additional covenants, restrictions, conditions, or provisions an event of default, or to surrender any right or power conferred on us in the indenture; |
| • | to add to, delete from, or revise the conditions, limitations, and restrictions on the authorized amount, terms, or purposes of issue, authentication, and delivery of debt securities, as listed in the indenture; |
| • | to make any change that does not adversely affect the interests of any holder of debt securities of any series in any material respect; |
| • | to provide for the issuance of and establish the form and terms and conditions of the debt securities of any series as provided in the section titled “-General” to establish the form of any certifications required to be furnished pursuant to the terms of the indenture or any series of debt securities, or to add to the rights of the holders of any series of debt securities; |
| • | to evidence and provide for the acceptance of appointment under any indenture by a successor trustee; or |
| • | to comply with any requirements of the SEC in connection with the qualification of any indenture under the Trust Indenture Act. |
In addition, under the indenture, the rights of holders of a series of debt securities may be changed by us and the trustee with the written consent of the holders of at least a majority in aggregate principal amount of the outstanding debt securities of each series that is affected. However, unless we provide otherwise in the prospectus supplement applicable to a particular series of debt securities, we and the trustee may make the following changes only with the consent of each holder of any outstanding debt securities affected:
| • | extending the fixed maturity of any debt securities of any series; |
| • | reducing the principal amount, reducing the rate of, or extending the time of payment of interest, or reducing any premium payable on the redemption of any series of any debt securities; or |
| • | reducing the percentage of debt securities, the holders of which are required to consent to any amendment, supplement, modification, or waiver. |
Discharge
Each indenture provides that we can elect to be discharged from our obligations with respect to one or more series of debt securities, except for specified obligations, including obligations to:
| • | provide for payment; |
| • | register the transfer or exchange of debt securities of the series; |
| • | replace stolen, lost, or mutilated debt securities of the series; |
| • | pay principal of and premium and interest on any debt securities of the series; |
| • | maintain paying agencies; |
| • | hold monies for payment in trust; |
| • | recover excess money held by the trustee; |
| • | compensate and indemnify the trustee; and |
| • | appoint any successor trustee. |
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To exercise our rights to be discharged, we must deposit money or government obligations with the trustee sufficient to pay all the principal of, any premium, if any, and interest on the debt securities of the series on the dates payments are due.
Form, Exchange, and Transfer
We will issue the debt securities of each series only in fully registered form without coupons and, unless we provide otherwise in the applicable prospectus supplement, in denominations of $1,000 and any integral multiple. The indenture provides that we may issue debt securities of a series in temporary or permanent global form and as book-entry securities that will be deposited with, or on behalf of, The Depository Trust Company, or DTC, or another depositary named by us and identified in the applicable prospectus supplement with respect to that series. To the extent the debt securities of a series are issued in global form and as book-entry, a description of terms relating such securities will be listed in the applicable prospectus supplement.
At the option of the holder, subject to the terms of the indenture and the limitations applicable to global securities described in the applicable prospectus supplement, the holder of the debt securities of any series can exchange the debt securities for other debt securities of the same series, in any authorized denomination and of like tenor and aggregate principal amount.
Subject to the terms of the indenture and the limitations applicable to global securities listed in the applicable prospectus supplement, holders of the debt securities may present the debt securities for exchange or for registration of transfer, duly endorsed or with the form of transfer endorsed duly executed if so required by us or the security registrar, at the office of the security registrar, or at the office of any transfer agent designated by us for this purpose. Unless otherwise provided in the debt securities that the holder presents for transfer or exchange, we will impose no service charge for any registration of transfer or exchange, but we may require payment of any taxes or other governmental charges.
In the applicable prospectus supplement, we will name the security registrar, and any transfer agent in addition to the security registrar, that we initially designate for any debt securities. At any time, we may designate additional transfer agents or rescind the designation of any transfer agent or approve a change in the office through which any transfer agent acts, except that we will be required to maintain a transfer agent in each place of payment for the debt securities of each series.
If we elect to redeem the debt securities of any series, we will not be required to:
| • | issue, register the transfer of, or exchange any debt securities of that series during a period beginning at the opening of business 15 days before the day of mailing of a notice of redemption of any debt securities that may be selected for redemption and ending at the close of business on the day of the mailing; or |
| • | register the transfer of or exchange any debt securities so selected for redemption, in whole or in part, except the unredeemed portion of any debt securities we are redeeming in part. |
Information Concerning the Trustee
The trustee, other than during the occurrence and continuance of an event of default under an indenture, undertakes to perform only those duties as are specifically listed in the applicable indenture. On an event of default under an indenture, the trustee must use the same degree of care as a prudent person would exercise or use in the conduct of his or her own affairs. Subject to this provision, the trustee is under no obligation to exercise any of the powers given it by the indenture at the request of any holder of debt securities unless it is offered reasonable security and indemnity against the costs, expenses, and liabilities that it might incur.
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Payment and Paying Agents
Unless we otherwise indicate in the applicable prospectus supplement, we will make payment of the interest on any debt securities on any interest payment date to the person in whose name the debt securities, or one or more predecessor securities, are registered at the close of business on the regular record date for the interest.
We will pay principal of and any premium and interest on the debt securities of a particular series at the office of the paying agents designated by us, except that unless we otherwise indicate in the applicable prospectus supplement, we will make interest payments by check that we will mail to the holder or by wire transfer to certain holders. Unless we otherwise indicate in the applicable prospectus supplement, we will designate the corporate trust office of the trustee as our sole paying agent for payments with respect to debt securities of each series. We will name in the applicable prospectus supplement any other paying agents that we initially designate for the debt securities of a particular series. We will maintain a paying agent in each place of payment for the debt securities of a particular series.
All money we pay to a paying agent or the trustee for the payment of the principal of or any premium or interest on any debt securities that remains unclaimed at the end of two years after such principal, premium, or interest has become due and payable will be repaid to us, and the holder of the debt security thereafter may look only to us for payment.
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, except to the extent that the Trust Indenture Act is applicable.
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The following description, together with the additional information we may include in any applicable prospectus supplement and in any related free writing prospectus that we may authorize to be distributed to you, summarizes the material terms and provisions of the warrants that we may offer under this prospectus, which may consist of warrants to purchase Class A common stock, preferred stock, or debt securities and may be issued in one or more series. Warrants may be offered independently or in combination with Class A common stock, preferred stock, or debt securities offered by any prospectus supplement. While the terms we have 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 in more detail in the applicable prospectus supplement. The following description of warrants will apply to the warrants offered by this prospectus unless we provide otherwise in the applicable prospectus supplement. The applicable prospectus supplement for a particular series of warrants may specify different or additional terms.
We have filed forms of the warrant agreements and forms of warrant certificates listing the terms of the warrants that may be offered as exhibits to the registration statement of which this prospectus is a part. We will file as exhibits to the registration statement of which this prospectus is a part, or will incorporate by reference from reports that we file with the SEC, the form of warrant or the warrant agreement and warrant certificate, as applicable, that contain the terms of the particular series of warrants we are offering, and any supplemental agreements, before the issuance of such warrants. The following summaries of material terms and provisions of the warrants are subject to, and qualified in their entirety by reference to, all the provisions of the form of warrant or the warrant agreement and warrant certificate, as applicable, and any supplemental agreements applicable to a particular series of warrants that we may offer under this prospectus. We urge you to read the applicable prospectus supplement related to the particular series of warrants that we may offer under this prospectus, as well as any related free writing prospectus, and the complete form of warrant or the warrant agreement and warrant certificate, as applicable, and any supplemental agreements, that list the terms of the warrants.
General
In the applicable prospectus supplement, we will describe the terms of the series of warrants being offered, including, to the extent applicable:
| • | the offering price and aggregate number of warrants offered; |
| • | the currency for which the warrants may be purchased; |
| • | 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; |
| • | in the case of warrants to purchase debt securities, the principal amount of debt securities purchasable on exercise of one warrant and the price at, and currency in which, this principal amount of debt securities may be purchased on such exercise; |
| • | in the case of warrants to purchase Class A common stock or preferred stock, the number of shares of Class A common stock or preferred stock, as the case may be, purchasable on the exercise of one warrant and the price at which these shares may be purchased on such exercise; |
| • | the effect of any merger, consolidation, sale, or other disposition of our business on the warrant agreements and the warrants; |
| • | the terms of any rights to redeem or call the warrants; |
| • | any provisions for changes to or adjustments in the exercise price or number of securities issuable on exercise of the warrants; |
| • | 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; |
| • | a discussion of material or special U.S. federal income tax considerations of holding or exercising the warrants; |
| • | the terms of the securities issuable on exercise of the warrants; and |
| • | any other specific terms, preferences, rights, or limitations of or restrictions on the warrants. |
| • | Before exercising their warrants, holders of warrants will not have any of the rights of holders of the securities purchasable on such exercise, including: |
| • | in the case of warrants to purchase Class A common stock or preferred stock, the right to receive dividends, if any, or, payments on our liquidation, dissolution, or winding up or to exercise voting rights, if any; or |
| • | 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 on exercise or to enforce covenants in the applicable indenture. |
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. The warrants may be exercised as listed in the prospectus supplement relating to the warrants offered. Unless we otherwise specify in the applicable prospectus supplement, warrants may be exercised at any time up to the specified time on the expiration date that we list in the applicable prospectus supplement. After the close of business on the expiration date, unexercised warrants will become void.
On receipt of payment and the warrant or warrant certificate, as applicable, properly completed and duly executed at the corporate trust office of the warrant agent, if any, or any other office, including ours, indicated in the prospectus supplement, we will, as soon as practicable, issue and deliver the securities purchasable on such exercise. If less than all of the warrants (or the warrants represented by such warrant certificate) are exercised, a new warrant or a new warrant certificate, as applicable, will be issued for the remaining warrants.
Governing Law
Unless we provide otherwise in the applicable prospectus supplement, 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, if any, 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 on 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 on exercise of, its warrants.
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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, depositary, or warrant agent 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 discussed 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, 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 participants. 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.
As a result, investors in a global 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 legal 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 or any applicable trustee or depositary 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 or any applicable trustee or depositary 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.
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For example, once we make a payment or give a notice to the legal holder, we have no further responsibility for the payment or notice even if that legal holder is required, under agreements with its 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 legal 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 legal holders contact the indirect holders is up to the legal holders.
Special Considerations for Indirect Holders
If you hold securities through a bank, broker, or other financial institution, either in book-entry form because the securities are represented by one or more global securities or in street name, you should check with your own institution to find out:
| • | how it handles securities payments and notices; |
| • | whether it imposes fees or charges; |
| • | how it would handle a request for the holders’ consent, if ever required; |
| • | 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; |
| • | 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 |
| • | if the securities are in book-entry form, how the depositary’s rules and procedures will affect these matters. |
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 issue to, 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, DTC will be the depositary for all securities issued in book-entry form.
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. Those situations are described in the section titled “-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 legal 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 legal 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.
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Special Considerations for Global Securities
The rights of an indirect holder 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:
| • | 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 described below; |
| • | an investor will be an indirect holder and must look to his or her own bank, broker, or other financial institution for payments on the securities and protection of his or her legal rights relating to the securities, as described above; |
| • | 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; |
| • | 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 for the pledge to be effective; |
| • | 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, nor do we or any applicable trustee supervise the depositary in any way; |
| • | 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 bank, broker, or other financial institution may require you to do so as well; and |
| • | 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.
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, brokers, or other financial institutions to find out how to have their interests in securities transferred to their own name, so that they will be direct holders. The rights of holders and street name investors are described above.
Unless we provide otherwise in the applicable prospectus supplement, the global security will terminate when any of the following special situations occur:
| • | 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; |
| • | if we notify any applicable trustee that we wish to terminate that global security; or |
| • | 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 include additional situations for terminating a global security that would apply only to the particular series of securities covered by the applicable prospectus supplement. When a global security terminates, the depositary, and not us or any applicable trustee, is responsible for deciding the names of the institutions that will be the initial direct holders.
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We or selling securityholders may sell the securities from time to time pursuant to underwritten public offerings, “at-the-market” offerings, negotiated transactions, block trades, or a combination of these methods, or through any other methods described in a prospectus supplement. We or selling securityholders may sell the securities to or through one or more underwriters or dealers (acting as principal or agent), through agents, directly to one or more purchasers, or as otherwise described in a prospectus supplement. We or selling securityholders may distribute securities 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. |
A prospectus supplement or supplements (and any related free writing prospectus that we may authorize to be provided to you) will describe the terms of the offering of the securities, including, to the extent applicable:
| • | the name or names of the underwriters, dealers, or agents, if any; |
| • | the name or names of the selling securityholders, if any; |
| • | the purchase price of the securities or other consideration therefor, and the proceeds, if any, we will receive from the sale; |
| • | any options to purchase additional shares or other options under which underwriters may purchase additional securities from us or any selling securityholders; |
| • | any agency fees or underwriting discounts and other items constituting agents’ or underwriters’ compensation; |
| • | any public offering price; |
| • | any discounts or concessions allowed or reallowed or paid to dealers; and |
| • | any securities exchange or market on which the securities may be listed. |
Only underwriters named in the prospectus supplement will be underwriters of the securities offered by the prospectus supplement. Dealers and agents participating in the distribution of the securities may be deemed to be underwriters, and compensation received by them on resale of the securities may be deemed to be underwriting discounts. If such dealers or agents were deemed to be underwriters, they may be subject to statutory liabilities under the Securities Act.
If underwriters are used in the sale, they will acquire the securities for their own account and may resell the securities from time to time in one or more transactions at a fixed public offering price or at varying prices determined at the time of sale. The obligations of the underwriters to purchase the securities will be subject to the conditions set forth in the applicable underwriting agreement. We or selling securityholders may offer the securities to the public through underwriting syndicates represented by managing underwriters or by underwriters without a syndicate. Subject to certain conditions, the underwriters will be obligated to purchase all of the securities offered by the prospectus supplement, other than securities covered by any option to purchase additional shares or other option. If a dealer is used in the sale of securities, we, a selling stockholder, or an underwriter will sell the securities to the dealer, as principal. The dealer may then resell the securities to the public at varying prices to be determined by the dealer at the time of resale. To the extent required, we will set forth in the prospectus supplement the name of the dealer and the terms of the transaction. Any public offering price and any discounts or concessions allowed or reallowed or paid to dealers may change from time to time.
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We or selling securityholders may use underwriters, dealers, or agents with whom we have a material relationship. We will describe in the prospectus supplement, naming the underwriter, dealer, or agent, the nature of any such relationship.
We or selling securityholders may sell securities directly or through agents we designate from time to time. We will name any agent involved in the offering and sale of securities and we will describe any commissions payable to the agent in the prospectus supplement. Unless the prospectus supplement states otherwise, the agent will act on a best-efforts basis for the period of its appointment.
We may provide agents, underwriters and dealers with indemnification against civil liabilities, including liabilities under the Securities Act, or contribution with respect to payments that the agents, underwriters or dealers may make with respect to these liabilities. Agents, underwriters and dealers, or their affiliates, may engage in transactions with, or perform services for, us in the ordinary course of business.
Selling securityholders may be deemed to be underwriters under the Securities Act in connection with the securities they resell and any profits on the sales may be deemed to be underwriting discounts and commissions under the Securities Act.
All securities we may offer, other than Class A common stock, 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.
Any underwriter may be granted an option to purchase additional shares and engage in stabilizing transactions, short-covering transactions and penalty bids in accordance with Regulation M under the Exchange Act. An underwriter’s option to purchase additional shares involves sales in excess of the offering size, which create a short position. Stabilizing transactions permit bids to purchase the underlying security so long as the stabilizing bids do not exceed a specified maximum price. Syndicate-covering or other short-covering transactions involve purchases of the securities, either through exercise of the over-allotment option or in the open market after the distribution is completed, to cover short positions. Penalty bids permit the underwriters to reclaim a selling concession from a dealer when the securities originally sold by the dealer are purchased in a stabilizing or covering transaction to cover short positions. Those activities may cause the price of the securities to be higher than it would otherwise be. If commenced, the underwriters may discontinue any of the activities at any time.
Any underwriters that are qualified market makers on the New York Stock Exchange may engage in passive market making transactions in the Class A common stock on the New York Stock Exchange in accordance with Regulation M under the Exchange Act, during the business day prior to the pricing of the offering, before the commencement of offers or sales of the Class A common stock. Passive market makers must comply with applicable volume and price limitations and must be identified as passive market makers. In general, a passive market maker must display its bid at a price not in excess of the highest independent bid for such security; if all independent bids are lowered below the passive market maker’s bid, however, the passive market maker’s bid must then be lowered when certain purchase limits are exceeded. Passive market making may stabilize the market price of the securities at a level above that which might otherwise prevail in the open market and, if commenced, may be discontinued at any time.
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Unless otherwise indicated in the applicable prospectus supplement, the validity of the securities offered by this prospectus and any prospectus supplement, will be passed on for us by Cooley LLP. As of the date of this prospectus, (i) Cooley LLP beneficially owns an aggregate of 6,000 shares of our Class A common stock, and (ii) certain attorneys of Cooley LLP beneficially own an aggregate of 33,051 shares of our Class A common stock.
Ernst & Young LLP, independent registered public accounting firm, has audited our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2020, and the effectiveness of our internal control over financial reporting as of December 31, 2020, as set forth in their reports, which are 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 reports, given on their authority as experts in accounting and auditing.
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WHERE YOU CAN FIND ADDITIONAL INFORMATION
This prospectus is part of a registration statement we filed with the SEC. This prospectus does not contain all of the information set forth in the registration statement, some of which is contained in exhibits to the registration statement as permitted by the rules and regulations of the SEC. For further information with respect to us and the securities we are offering under this prospectus, we refer you to the registration statement, including the exhibits filed as a part of the registration statement. Statements contained in this prospectus concerning the contents of any contract or any other document are not necessarily complete. If a contract or other document has been filed as an exhibit to the registration statement, please see the copy of the contract or document that has been filed. Each statement in this prospectus relating to a contract or document filed as an exhibit is qualified in all respects by the filed exhibit.
We file annual, quarterly, and current reports, information statements, and other information with the SEC. The SEC maintains a website that contains reports, information statements, and other information regarding issuers that file electronically with the SEC, including Snap. The address of the SEC website is www.sec.gov.
We maintain a website at www.snap.com. Information contained in or accessible through our website does not constitute a part of this prospectus.
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INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The SEC allows us to “incorporate by reference” the information we file with it, which means that we can disclose important information to you by referring you to those documents instead of having to repeat the information in this prospectus. The information incorporated by reference is considered to be part of this prospectus, and later information that we file with the SEC will automatically update and supersede this information. We incorporate by reference the documents listed below and any future filings (including those made after the date of the initial filing of the registration statement of which this prospectus is a part) we will make with the SEC under Sections 13(a), 13(c), 14, or 15(d) of the Exchange Act until the termination of the offering of the shares covered by this prospectus:
| • | our Annual Report on Form 10-K for the year ended December 31, 2020, filed with the SEC on February 5, 2021; and |
| • | the description of our Class A common stock set forth in our registration statement on Form 8-A, filed with the SEC on February 23, 2017, including any amendments or reports filed for the purposes of updating this description, including any amendment or report filed for the purpose of updating such description, including Exhibit 4.4 of our Annual Report on Form 10-K for the year ended December 31, 2020. |
You can request a copy of these filings, at no cost, by writing or telephoning us at the following address or telephone number:
Snap Inc.
2772 Donald Douglas Loop North
Santa Monica, California 90405
(310) 399-3339
Attn: Secretary
This prospectus is part of a registration statement we filed with the SEC. That registration statement and the exhibits filed along with the registration statement contain more information about us and the securities in this offering. Because information about documents referred to in this prospectus is not always complete, you should read the full documents which are filed as exhibits to the registration statement. You may read and copy the full registration statement and its exhibits at the SEC’s website.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table lists an estimate of the expenses payable by us in connection with the issuance and distribution of the securities being registered.
| SEC registration fee |
$ | * | ||
| Financial Industry Regulatory Authority filing fee |
225,500 | |||
| Exchange listing fees |
** | |||
| Legal fees and expenses |
** | |||
| Transfer agent and registrar fees and expenses |
** | |||
| Trustee fees and expenses |
** | |||
| Accounting fees and expenses |
** | |||
| Blue sky fees and expenses (including legal fees) |
** | |||
| Printing and miscellaneous fees |
** | |||
|
|
|
|||
| Total |
$ | ** | ||
|
|
|
| * | In accordance with Rules 456(b) and 457(r), we are deferring payment of all applicable registration fees for the securities offered under this registration statement. |
| ** | These fees are calculated based on the securities offered and the number of issuances and, accordingly, cannot be estimated at this time. The applicable prospectus supplement will list the estimated amount of expenses of any offering of securities. |
Item 15. Indemnification of Directors and Officers.
Section 145 of the Delaware General Corporation Law authorizes a court to award, or a corporation’s board of directors to grant, indemnity to directors and officers in terms sufficiently broad to permit such indemnification under certain circumstances for liabilities, including reimbursement for expenses incurred, arising under the Securities Act. Our certificate of incorporation permits indemnification of our directors, officers, employees, and other agents to the maximum extent permitted by the Delaware General Corporation Law, and our bylaws provide that we will indemnify our directors and officers and permit us to indemnify our employees and other agents, in each case to the maximum extent permitted by the Delaware General Corporation Law.
We have entered into indemnification agreements with our directors and officers, whereby we have agreed to indemnify our directors and officers to the fullest extent permitted by law, including indemnification against expenses and liabilities incurred in legal proceedings to which the director or officer was, or is threatened to be made, a party by reason of the fact that such director or officer is or was a director, officer, employee, or agent of Snap Inc., provided that such director or officer acted in good faith and in a manner that the director or officer reasonably believed to be in, or not opposed to, the best interest of Snap Inc.
Beginning on May 16, 2017, we, certain of our officers and directors, and the underwriters of our initial public offering in March 2017 were named as defendants in securities class actions purportedly brought on behalf of purchasers of our Class A common stock. In January 2020, we entered into a preliminary agreement to settle the federal and state securities class actions. The settlement agreement was preliminarily approved by the federal court in April 2020 and by the state court in November 2020. The settlement amount was paid into escrow in December 2020 and will be released following final approval.
We maintain insurance policies that indemnify our directors and officers against various liabilities arising under the Securities Act of 1933, as amended, or the Securities Act, and the Securities Exchange Act of 1934, as amended, or the Exchange Act, that might be incurred by any director or officer in his capacity as such.
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The underwriting agreements that we may enter into may provide for indemnification by any underwriters of us, our directors, our officers who sign the registration statement and our controlling persons for some liabilities, including liabilities arising under the Securities Act.
Item 16. Exhibits.
| * | To be filed by amendment or as an exhibit to a Current Report on Form 8-K and incorporated herein by reference, if applicable. |
| ** | To be filed separately under electronic form type 305B2, if applicable. |
Item 17. Undertakings.
The undersigned registrant hereby undertakes:
| (1) | To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: |
| (i) | To include any prospectus required by section 10(a)(3) of the Securities Act; |
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| (ii) | To reflect in the prospectus any facts or events arising after the effective date of the 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 the registration statement. Notwithstanding the foregoing, any increase or decrease in 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 Securities and Exchange Commission, or SEC, pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% 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 the registration statement or any material change to such information in the registration statement. |
Provided, however, that paragraphs (1)(i), (1)(ii), and (1)(iii) above do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the SEC by the registrant pursuant to section 13 or section 15(d) of the Exchange Act that are incorporated by reference in this registration statement or are contained in a form of prospectus filed pursuant to Rule 424(b) that is part of this registration statement.
| (2) | 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. |
| (3) | 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. |
| (4) | That, for the purpose of determining liability under the Securities Act to any purchaser: |
| (i) | Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and |
| (ii) | Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing the information required by section 10(a) of the Securities Act shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date. |
| (5) | That, for the purpose of determining liability of the registrant under the Securities Act to any purchaser in the initial distribution of the securities, the undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by |
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| means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser: |
| (i) | Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424; |
| (ii) | Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant; |
| (iii) | The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and |
| (iv) | Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser. |
| (6) | 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 the registration statement 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. |
| (7) | 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 in accordance with the rules and regulations prescribed by the SEC under section 305(b)(2) of the Trust Indenture Act. |
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 SEC such indemnification is against public policy as expressed in the Securities 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 Securities Act and will be governed by the final adjudication of such issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, 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 Santa Monica, California, on February 5, 2021.
| SNAP INC. | ||
| By: | /s/ Evan Spiegel | |
| Name: | Evan Spiegel | |
| Title: | Chief Executive Officer | |
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KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Evan Spiegel, Michael O’Sullivan, and Atul Porwal, and each one of them, as his or her true and lawful attorneys-in-fact and agents, with full powers of substitution and resubstitution, for him or her and in their name, place and stead, in any and all capacities, to sign any and all amendments to this registration statement, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, and generally to do all such things in their names and behalf in their capacities as officers and directors to enable Snap Inc. to comply with the provisions of the Securities Act of 1933, as amended, and all requirements of the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully to all intents and purposes as he or she might or could do in person, ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitutes or substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities and on the dates indicated:
| Name |
Title |
Date | ||
| /s/ Evan Spiegel Evan Spiegel |
Chief Executive Officer and Director (Principal Executive Officer) | February 5, 2021 | ||
| /s/ Robert Murphy Robert Murphy |
Director and Chief Technology Officer | February 5, 2021 | ||
| /s/ Derek Andersen Derek Andersen |
Chief Financial Officer (Principal Financial Officer) |
February 5, 2021 | ||
| /s/ Rebecca Morrow Rebecca Morrow |
Chief Accounting Officer (Principal Accounting Officer) |
February 5, 2021 | ||
| /s/ Kelly Coffey Kelly Coffey |
Director | February 5, 2021 | ||
| /s/ Joanna Coles Joanna Coles |
Director | February 5, 2021 | ||
| /s/ Elizabeth Jenkins Elizabeth Jenkins |
Director | February 5, 2021 | ||
| /s/ A.G. Lafley A.G. Lafley |
Director | February 5, 2021 | ||
| /s/ Michael Lynton Michael Lynton |
Director | February 5, 2021 | ||
| /s/ Stanley Meresman Stanley Meresman |
Director | February 5, 2021 | ||
| /s/ Scott D. Miller Scott D. Miller |
Director | February 5, 2021 | ||
| /s/ Poppy Thorpe Poppy Thorpe |
Director | February 5, 2021 | ||
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Exhibit 4.6
SNAP INC.,
Issuer
AND
[TRUSTEE],
Trustee
INDENTURE
Dated as of [●], 20__
Debt Securities
TABLE OF CONTENTS
| PAGE | ||||||
| ARTICLE 1 |
DEFINITIONS |
1 | ||||
| Section 1.01 |
Definitions of Terms | 1 | ||||
| ARTICLE 2 |
ISSUE, DESCRIPTION, TERMS, EXECUTION, REGISTRATION, AND EXCHANGE OF SECURITIES |
5 | ||||
| Section 2.01 |
Designation and Terms of Securities | 5 | ||||
| Section 2.02 |
Form of Securities and Trustee’s Certificate | 7 | ||||
| Section 2.03 |
Denominations: Provisions for Payment | 8 | ||||
| Section 2.04 |
Execution and Authentications | 9 | ||||
| Section 2.05 |
Registration of Transfer and Exchange | 10 | ||||
| Section 2.06 |
Temporary Securities | 11 | ||||
| Section 2.07 |
Mutilated, Destroyed, Lost, or Stolen Securities | 11 | ||||
| Section 2.08 |
Cancellation | 12 | ||||
| Section 2.09 |
Benefits of Indenture | 12 | ||||
| Section 2.10 |
Authenticating Agent | 13 | ||||
| Section 2.11 |
Global Securities | 13 | ||||
| Section 2.12 |
CUSIP Numbers | 14 | ||||
| ARTICLE 3 |
REDEMPTION OF SECURITIES AND SINKING FUND PROVISIONS | 14 | ||||
| Section 3.01 |
Redemption | 14 | ||||
| Section 3.02 |
Notice of Redemption | 15 | ||||
| Section 3.03 |
Payment on Redemption | 16 | ||||
| Section 3.04 |
Sinking Fund | 16 | ||||
| Section 3.05 |
Satisfaction of Sinking Fund Payments with Securities | 16 | ||||
| Section 3.06 |
Redemption of Securities for Sinking Fund | 17 | ||||
| ARTICLE 4 |
COVENANTS | 17 | ||||
| Section 4.01 |
Payment of Principal, Premium, and Interest | 17 | ||||
| Section 4.02 |
Maintenance of Office | 18 | ||||
| Section 4.03 |
Paying Agents | 18 | ||||
| Section 4.04 |
Appointment to Fill Vacancy in Office of Trustee | 19 | ||||
| ARTICLE 5 |
SECURITYHOLDERS’ LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE | 19 | ||||
| Section 5.01 |
Company to Furnish Trustee Names and Addresses of Securityholders | 19 | ||||
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(CONTINUED)
| PAGE | ||||||
| Section 5.02 |
Preservation of Information; Communications With Securityholders | 19 | ||||
| Section 5.03 |
Reports by the Company | 20 | ||||
| Section 5.04 |
Reports by the Trustee | 20 | ||||
| ARTICLE 6 |
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS ON EVENT OF DEFAULT | 21 | ||||
| Section 6.01 |
Events of Default | 21 | ||||
| Section 6.02 |
Collection of Indebtedness and Suits for Enforcement by Trustee | 22 | ||||
| Section 6.03 |
Application of Funds Collected | 24 | ||||
| Section 6.04 |
Limitation on Suits | 24 | ||||
| Section 6.05 |
Rights and Remedies Cumulative; Delay or Omission Not Waiver | 25 | ||||
| Section 6.06 |
Control by Securityholders | 25 | ||||
| Section 6.07 |
Undertaking to Pay Costs | 26 | ||||
| ARTICLE 7 |
CONCERNING THE TRUSTEE | 26 | ||||
| Section 7.01 |
Certain Duties and Responsibilities of Trustee | 26 | ||||
| Section 7.02 |
Certain Rights of Trustee | 27 | ||||
| Section 7.03 |
Trustee Not Responsible for Recitals or Issuance or Securities | 29 | ||||
| Section 7.04 |
May Hold Securities | 30 | ||||
| Section 7.05 |
Funds Held in Trust | 30 | ||||
| Section 7.06 |
Compensation and Reimbursement | 30 | ||||
| Section 7.07 |
Reliance on Officer’s Certificate | 31 | ||||
| Section 7.08 |
Disqualification; Conflicting Interests | 31 | ||||
| Section 7.09 |
Corporate Trustee Required; Eligibility | 31 | ||||
| Section 7.10 |
Resignation and Removal; Appointment of Successor | 31 | ||||
| Section 7.11 |
Acceptance of Appointment by Successor | 33 | ||||
| Section 7.12 |
Merger, Conversion, Consolidation, or Succession to Business | 34 | ||||
| Section 7.13 |
Preferential Collection of Claims Against the Company | 34 | ||||
| Section 7.14 |
Notice of Default. | 34 | ||||
| ARTICLE 8 |
CONCERNING THE SECURITYHOLDERS | 35 | ||||
| Section 8.01 |
Evidence of Action by Securityholders | 35 | ||||
| Section 8.02 |
Proof of Execution by Securityholders | 35 | ||||
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(CONTINUED)
| PAGE | ||||||
| Section 8.03 |
Who May be Deemed Owners | 36 | ||||
| Section 8.04 |
Certain Securities Owned by Company Disregarded | 36 | ||||
| Section 8.05 |
Actions Binding on Future Securityholders | 36 | ||||
| ARTICLE 9 |
SUPPLEMENTAL INDENTURES | 37 | ||||
| Section 9.01 |
Supplemental Indentures Without the Consent of Securityholders | 37 | ||||
| Section 9.02 |
Supplemental Indentures With the Consent of Securityholders | 38 | ||||
| Section 9.03 |
Effect of Supplemental Indentures | 38 | ||||
| Section 9.04 |
Securities Affected by Supplemental Indentures | 38 | ||||
| Section 9.05 |
Execution of Supplemental Indentures | 39 | ||||
| ARTICLE 10 |
SUCCESSOR ENTITY | 39 | ||||
| Section 10.01 |
Company May Consolidate, Etc. | 39 | ||||
| Section 10.02 |
Successor Entity Substituted | 40 | ||||
| ARTICLE 11 |
SATISFACTION AND DISCHARGE | 40 | ||||
| Section 11.01 |
Satisfaction and Discharge of Indenture | 40 | ||||
| Section 11.02 |
Discharge of Obligations | 41 | ||||
| Section 11.03 |
Deposited Funds to be Held in Trust | 41 | ||||
| Section 11.04 |
Payment of Funds Held by Paying Agents | 41 | ||||
| Section 11.05 |
Repayment to Company | 42 | ||||
| ARTICLE 12 |
IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS, AND DIRECTORS | 42 | ||||
| Section 12.01 |
No Recourse | 42 | ||||
| ARTICLE 13 |
MISCELLANEOUS PROVISIONS | 43 | ||||
| Section 13.01 |
Effect on Successors and Assigns | 43 | ||||
| Section 13.02 |
Actions by Successor | 43 | ||||
| Section 13.03 |
Surrender of Company Powers | 43 | ||||
| Section 13.04 |
Notices | 43 | ||||
| Section 13.05 |
Governing Law; Jury Trial Waiver | 43 | ||||
| Section 13.06 |
Treatment of Securities as Debt | 44 | ||||
| Section 13.07 |
Certificates and Opinions as to Conditions Precedent | 44 | ||||
| Section 13.08 |
Payments on Business Days | 44 | ||||
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TABLE OF CONTENTS
(CONTINUED)
| PAGE | ||||||
| Section 13.09 |
Conflict with Trust Indenture Act | 44 | ||||
| Section 13.10 |
Counterparts | 44 | ||||
| Section 13.11 |
Separability | 45 | ||||
| Section 13.12 |
Compliance Certificates | 45 | ||||
| Section 13.13 |
U.S.A. Patriot Act | 45 | ||||
| Section 13.14 |
Force Majeure | 45 | ||||
| Section 13.12 |
Table of Contents; Headings | 46 | ||||
iv.
INDENTURE
INDENTURE, dated as of [●], 20__, between SNAP INC., a Delaware corporation (the “Company”), and [TRUSTEE], as trustee (the “Trustee”):
WHEREAS, the Company has duly authorized the execution and delivery of this Indenture to provide for the issuance of debt securities (the “Securities”), in an unlimited aggregate principal amount to be issued from time to time in one or more series as provided in this Indenture, as registered Securities without coupons, to be authenticated by a certificate of the Trustee; and
WHEREAS, to provide the terms and conditions on which the Securities are to be authenticated, issued, and delivered, the Company has duly authorized the execution of this Indenture.
NOW, THEREFORE, it is mutually agreed as follows for the equal and ratable benefit of the holders of Securities:
ARTICLE 1
DEFINITIONS
Section 1.01 Definitions of Terms.
As used in this Indenture and any indenture supplemental to this Indenture (a “supplemental indenture”), the terms below have the following meanings (except as expressly provided or unless the context otherwise requires). Any such term, unless the context otherwise requires, will include the plural as well as the singular. The term “includes” or “including” means “including without limitation.” All other terms used in this Indenture that are defined in the Trust Indenture Act, or that are by reference in the Trust Indenture Act defined in the Securities Act, have the meanings assigned to such terms in the Trust Indenture Act and the Securities Act as in force at the date of the execution of this Indenture (except as expressly provided or unless the context otherwise requires).
“Authenticating Agent” means the Trustee or an authenticating agent with respect to all or any of the series of Securities appointed pursuant to Section 2.10.
“Bankruptcy Law” means Title 11, U.S. Code, or any similar federal or state law for the relief of debtors.
“Board of Directors” means the Board of Directors of the Company or any duly authorized committee of the Board of Directors.
“Board Resolution” means a copy of a resolution certified by the Secretary or an Assistant Secretary of the Company to have been duly adopted by the Board of Directors (or duly authorized committee of the Board of Directors) and to be in full force and effect on the date of such certification.
1.
“Business Day” means any day other than a day on which federal or state banking institutions in the Borough of Manhattan, the City of New York, or in the city of the Corporate Trust Office of the Trustee, are authorized or obligated by law, executive order, or regulation to close.
“Commission” means the Securities and Exchange Commission, as from time to time constituted, created under the Exchange Act, or, if at any time after the execution of this Indenture such Commission is not existing and performing the duties now assigned to it under the Trust Indenture Act, then the body performing such duties at such time.
“Company” means Snap Inc., a Delaware corporation, and, subject to the provisions of Article Ten, its successors and assigns.
“Corporate Trust Office” means the office of the Trustee at which, at any particular time, its corporate trust business is principally administered, which office as of the date of this Indenture is located at .
“Custodian” means any receiver, trustee, assignee, liquidator, or similar official under any Bankruptcy Law.
“Depositary” means, with respect to Securities of any series that the Company determines will be issued as a Global Security, The Depository Trust Company, another clearing agency, or any successor registered as a clearing agency under the Exchange Act, or other applicable statute or regulation, which, in each case, is designated pursuant to either Section 2.01 or 2.11.
“Event of Default” means, with respect to Securities of a particular series, any event specified in Section 6.01, continued for the period of time, if any, designated in Section 6.01.
“Exchange Act” means the Securities and Exchange Act of 1934, as amended, and the rules and regulations promulgated by the Commission under such act.
The term “given,”, “mailed,” “notify,” or “sent” with respect to any notice to be given to a Securityholder pursuant to this Indenture, means notice (a) given to the Depositary (or its designee) pursuant to the standing instructions from the Depositary or its designee, including by electronic mail in accordance with accepted practices or procedures at the Depositary (in the case of a Global Security) or (b) mailed to such Securityholder by first class mail, postage prepaid, at its address as it appears on the Security Register (in the case of a definitive Security). Notice so “given” will include any notice to be “mailed” or “delivered,” as applicable, under this Indenture.
“Global Security” means a Security issued to evidence all or a part of any series of Securities which is executed by the Company and authenticated and delivered by the Trustee to the Depositary or pursuant to the Depositary’s instruction, all in accordance with the Indenture, which will be registered in the name of the Depositary or its nominee.
2.
“Governmental Obligations” means securities that are (a) direct obligations of the United States of America for the payment of which its full faith and credit is pledged or (b) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America, the payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America that, in either case, are not callable or redeemable at the option of the issuer at any time prior to the stated maturity of the Securities, and will also include a depositary receipt issued by a bank or trust company as custodian with respect to any such Governmental Obligation or a specific payment of principal of or interest on any such Governmental Obligation held by such custodian for the account of the holder of such depositary receipt; provided, however, that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depositary receipt from any funds received by the custodian in respect of the Governmental Obligation or the specific payment of principal of or interest on the Governmental Obligation evidenced by such depositary receipt.
“Indenture” means this instrument as originally executed or as it may from time to time be supplemented or amended by one or more supplemental indentures entered into in accordance with the terms of this Indenture and includes the terms of particular series of Securities established as contemplated by Section 2.01.
“Interest Payment Date,” when used with respect to any installment of interest on a Security of a particular series, means the date specified in such Security, a Board Resolution, or a supplemental indenture with respect to such series as the fixed date on which an installment of interest with respect to Securities of that series is due and payable.
“Officer” means, with respect to the Company, the chairman of the Board of Directors, a chief executive officer, a president, a chief financial officer, a chief strategy officer, any executive vice president, any senior vice president, any vice president, the treasurer or any assistant treasurer, the controller or any assistant controller, or the secretary or any assistant secretary.
“Officer’s Certificate” means a certificate signed by any Officer. Each such certificate will include the statements provided for in Section 13.07, if required.
“Opinion of Counsel” means an opinion in writing subject to customary exceptions of legal counsel, who may be an employee of or counsel for the Company, that is delivered to the Trustee in accordance with the terms of this Indenture. Each such opinion will include the statements provided for in Section 13.07, if required.
“Outstanding,” when used with respect to Securities of any series, means, subject to the provisions of Section 8.04, as of any particular time, all Securities of that series previously authenticated and delivered by the Trustee under this Indenture, except (a) Securities previously canceled by the Trustee or any paying agent, or delivered to the Trustee or any paying agent for cancellation; (b) Securities or portions of Securities for which funds or Governmental Obligations in the necessary amount for payment or redemption have been deposited in trust with the Trustee or with any paying agent (other than the Company) or have been set aside and segregated in trust by the Company (if the Company is acting as its own paying agent); provided, however, that if such Securities or portions of Securities are to be redeemed prior to maturity, notice of such redemption has been given as provided in Article Three, or provision satisfactory to the Trustee has been made for giving such notice; and (c) Securities in lieu of or in substitution for which other Securities have been authenticated and delivered pursuant to Section 2.07.
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“Person” means any individual, corporation, partnership, joint venture, joint-stock company, limited liability company, association, trust, unincorporated organization, or any other entity or organization, including a government or political subdivision, agency, or instrumentality.
“Predecessor Security” of any particular Security means every previous Security evidencing all or a portion of the same debt; and, for the purposes of this definition, any Security authenticated and delivered under Section 2.07 in lieu of a lost, destroyed, or stolen Security will be deemed to evidence the same debt as the lost, destroyed, or stolen Security.
“Responsible Officer,” when used with respect to the Trustee, means any officer within the Corporate Trust Office of the Trustee (or any successor group of the Trustee) or any other officer of the Trustee customarily performing functions similar to those performed by any of the above designated officers and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of his or her knowledge of and familiarity with the particular subject and in each case who has direct responsibility for the administration of this Indenture.
“Securities Act” means the Securities Act of 1933, as amended.
“Securityholder,” “holder of Securities,” “registered holder,” or other similar term, means the Person or Persons in whose name or names a particular Security is registered on the Security Register kept for that purpose in accordance with the terms of this Indenture.
“Subsidiary” means, with respect to any Person, any corporation, association, partnership, or other business entity in which such Person, directly or indirectly, owns a majority of the total voting power of shares of capital stock or other interests (including partnership interests) or which such Person otherwise, directly or indirectly, controls through an investment or participation in the equity of such entity.
“Trustee” means _________________________, and, subject to the provisions of Article Seven, its successors and assigns, and, if at any time there is more than one Person acting in such capacity, “Trustee” means each such Person. The term “Trustee” as used with respect to a particular series of the Securities means the trustee with respect to that series.
“Trust Indenture Act” means the Trust Indenture Act of 1939, as amended.
“U.S.A. Patriot Act” means the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Pub. L. 107-56, as amended and signed into law October 26, 2001.
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ARTICLE 2
ISSUE, DESCRIPTION, TERMS, EXECUTION, REGISTRATION, AND EXCHANGE OF SECURITIES
Section 2.01 Designation and Terms of Securities.
(a) The aggregate principal amount of Securities that may be authenticated and delivered under this Indenture is unlimited. The Securities may be issued in one or more series up to the aggregate principal amount of Securities of that series from time to time authorized by a Board Resolution or pursuant to one or more supplemental indentures. Prior to the initial issuance of Securities of any series, there will be established by a Board Resolution, and set forth in an Officer’s Certificate, or established in one or more supplemental indentures:
(i) the title of the Securities of the series (which will distinguish the Securities of that series from all other Securities);
(ii) any limit on the aggregate principal amount of the Securities of that series that may be authenticated and delivered under this Indenture (except for Securities authenticated and delivered on registration of transfer of, or in exchange for, or in lieu of, other Securities of that series);
(iii) the maturity date or dates on which the principal of the Securities of the series is payable;
(iv) the form of the Securities of the series, including the form of the certificate of authentication for such series;
(v) the applicability of any guarantees;
(vi) whether or not the Securities will be secured or unsecured, and the terms of any secured debt;
(vii) whether the Securities rank as senior debt, senior subordinated debt, subordinated debt, or any combination, and the terms of any subordination;
(viii) if the price (expressed as a percentage of the aggregate principal amount) at which the Securities will be issued is a price other than the principal amount, the portion of the principal amount payable on declaration of acceleration of maturity, or, if applicable, the portion of the principal amount of such Securities that is convertible into another security or the method by which any such portion will be determined;
(ix) the interest rate or rates, which may be fixed or variable, or the method for determining the rate, and the date interest will begin to accrue, the dates interest will be payable, and the regular record dates for interest payment dates, or the method for determining such dates;
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(x) the Company’s right, if any, to defer the payment of interest and the maximum length of any such deferral period;
(xi) if applicable, the date or dates after which, or the period or periods during which, and the price or prices at which, the Company may, at its option, redeem the series of Securities pursuant to any optional or provisional redemption provisions and the terms of those redemption provisions;
(xii) if applicable, the date or dates on which, and the price or prices at which, the Company is obligated, pursuant to any mandatory sinking fund or analogous fund provisions or otherwise, to redeem, or at the Securityholder’s option to purchase, the series of Securities and the currency or currency unit in which the Securities are payable;
(xiii) the denominations in which the Securities of the series are issuable, if other than denominations or integral multiples of U.S. $1,000;
(xiv) if applicable, any and all terms relating to any auction or remarketing of the Securities of that series and any security for the obligations of the Company with respect to such Securities and any other terms which may be advisable in connection with the marketing of Securities of that series;
(xv) whether the Securities of the series will be issued in whole or in part in the form of a Global Security or Securities, the terms and conditions, if any, on which such Global Security or Securities may be exchanged in whole or in part for other individual Securities, and the Depositary for such Global Security or Securities;
(xvi) if applicable, the provisions relating to conversion or exchange of any Securities of the series and the terms and conditions on which such Securities will be convertible or exchangeable, including the conversion or exchange price, or how it will be calculated and may be adjusted, any mandatory or optional (at the Company’s or the holders’ option) conversion or exchange features, the applicable conversion or exchange period, and the manner of settlement for any conversion or exchange, which may include the payment of cash as well as the delivery of securities;
(xvii) if other than the full principal amount, the portion of the principal amount of Securities of the series that is payable on declaration of acceleration of maturity pursuant to Section 6.01;
(xviii) additions to or changes in the covenants applicable to the series of Securities being issued;
(xix) additions to or changes in the Events of Default with respect to the Securities and any change in the right of the Trustee or the Securityholders to declare the principal, premium, if any, and interest, if any, with respect to such Securities to be due and payable;
(xx) additions to, changes in, or deletions of the provisions relating to covenant defeasance and legal defeasance;
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(xxi) additions to or changes in the provisions relating to satisfaction and discharge of this Indenture;
(xxii) additions to or changes in the provisions relating to the modification of this Indenture both with and without the consent of Securityholders;
(xxiii) the currency of payment of Securities if other than U.S. dollars and the manner of determining the equivalent amount in U.S. dollars;
(xxiv) whether interest will be payable in cash or additional Securities at the Company’s or the Securityholders’ option and the terms and conditions on which the election may be made;
(xxv) if applicable, the terms and conditions on which the Company will pay amounts in addition to the stated interest, premium, if any, and principal amounts of the Securities of the series to any Securityholder that is not a “U.S. person” for federal tax purposes;
(xxvi) any restrictions on transfer, sale, or assignment of the Securities of the series; and
(xxvii) any other specific terms, preferences, rights, or limitations of, or restrictions on, the Securities, other additions or changes in the provisions of this Indenture, and any terms that may be required by or advisable under applicable laws or regulations.
All Securities of any one series will be substantially identical except as may otherwise be provided by Board Resolution or in any supplemental indenture.
If any of the terms of the series are established by a Board Resolution, a copy of an appropriate record of such action will be certified by the secretary or an assistant secretary of the Company and delivered to the Trustee at or prior to the delivery of the Officer’s Certificate of the Company setting forth the terms of the series.
Securities of any particular series may be issued at various times, with different dates on which the principal or any installment of principal is payable, with different rates of interest, if any, or different methods by which rates of interest may be determined, with different dates on which such interest may be payable, and with different redemption dates.
Section 2.02 Form of Securities and Trustee’s Certificate.
The Securities of any series and the Trustee’s certificate of authentication to be borne by such Securities will be substantially of the tenor and purport as set forth in one or more supplemental indentures or as provided by a Board Resolution, and set forth in an Officer’s Certificate, and they may have such letters, numbers, or other marks of identification or designation and such legends or endorsements printed thereon as the Company may deem appropriate and as are not inconsistent with the provisions of this Indenture, or as may be required to comply with any law, rule, or regulation or with any rule or regulation of any securities exchange on which Securities of that series may be listed, or conform to usage.
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Section 2.03 Denominations: Provisions for Payment.
The Securities will be issuable as registered Securities and in the denominations or integral multiples of U.S. $1,000 , subject to Section 2.01(a)(xviii). The Securities of a particular series will bear interest payable on the dates and at the rate specified with respect to that series. Subject to Section 2.01(a)(xxiii), the principal of and the interest on the Securities of any series, as well as any premium in case of redemption or repurchase prior to maturity, and any cash amount due on conversion or exchange, will be payable in U.S. dollars, at the office or agency of the Company maintained for that purpose. Each Security will be dated the date of its authentication. Interest on the Securities will be computed on the basis of a 360-day year composed of twelve 30-day months.
The interest installment on any Security that is payable, and is punctually paid or duly provided for, on any Interest Payment Date for Securities of that series will be paid to the Person in whose name said Security (or one or more Predecessor Securities) is registered at the close of business on the regular record date for such interest installment. If any Security or portion of a Security of a particular series is called for redemption and the redemption date is subsequent to a regular record date with respect to any Interest Payment Date and prior to such Interest Payment Date, interest on such Security will be paid on presentation and surrender of such Security as provided in Section 3.03.
Any interest on any Security that is payable, but is not punctually paid or duly provided for, on any Interest Payment Date for Securities of the same series (“Defaulted Interest”) will cease to be payable to the registered holder on the relevant regular record date; and such Defaulted Interest will instead be paid by the Company, at its election, as provided in clause (a) or clause (b) below:
(a) The Company may make payment of any Defaulted Interest on Securities to the Persons in whose names such Securities (or their respective Predecessor Securities) are registered in the Security Register at the close of business on a special record date for the payment of such Defaulted Interest, which will be fixed in the following manner:
(i) the Company will notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on each Security and the date of the proposed payment;
(ii) the Company will deposit with the Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or will make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment (such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest);
(iii) the Trustee will fix a special record date for the payment of such Defaulted Interest, which will not be more than 15 nor less than 10 days prior to the date of the proposed payment and not less than 10 days after the receipt by the Trustee of the notice of the proposed payment;
(iv) the Trustee will promptly notify the Company of such special record date and, in the name and at the expense of the Company, will cause notice of the proposed payment of such Defaulted Interest and the special record date to be sent to each Securityholder not less than ten days prior to such special record date; and
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(v) such Defaulted Interest will be paid to the Persons in whose names such Securities (or their respective Predecessor Securities) are registered in the Security Register on such special record date.
(b) The Company may make payment of any Defaulted Interest on any Securities in any other lawful manner not inconsistent with the requirements of any securities exchange on which such Securities may be listed, and on such notice as may be required by such exchange; provided that such manner of payment must be deemed practicable by the Trustee.
Unless otherwise set forth in a Board Resolution or one or more supplemental indentures establishing the terms of any series of Securities pursuant to Section 2.01, the term “regular record date” as used in this Section with respect to a series of Securities and any Interest Payment Date for such series will mean either the fifteenth day of the month immediately before the month in which an Interest Payment Date for such series occurs, if such Interest Payment Date is the first day of a month, or the first day of the month in which an Interest Payment Date for such series occurs, if such Interest Payment Date is the fifteenth day of a month, whether or not such date is a Business Day.
Subject to the foregoing, each Security of a series delivered under this Indenture on transfer of or in exchange for or in lieu of any other Security of such series will carry the rights to interest accrued and unpaid, and to accrue, that were carried by such other Security.
Section 2.04 Execution and Authentications.
The Securities will be signed on behalf of the Company by one of its Officers. Signatures may be in the form of a manual or facsimile signature.
The Company may use the facsimile signature of any Person who was an Officer at the time of execution, notwithstanding the fact that at the time the Securities are authenticated and delivered or disposed of such Person has ceased to be an officer of the Company. The Securities may contain such notations, legends, or endorsements required by law, stock exchange rule, or usage. Each Security will be dated the date of its authentication by the Trustee.
A Security will not be valid until authenticated manually by an authorized signatory of the Trustee, or by an Authenticating Agent. Such signature will be conclusive evidence that the Security has been duly authenticated and delivered and that the holder is entitled to the benefits of this Indenture. At any time and from time to time after the execution and delivery of this Indenture, the Company may deliver Securities of any series executed by the Company to the Trustee for authentication, together with a written order of the Company for the authentication and delivery of such Securities, signed by an Officer, and the Trustee will authenticate and deliver such Securities in accordance with such written order.
On the Company’s delivery of an authentication order to the Trustee at any time after the initial issuance of Securities under this Indenture, the Trustee will be provided with, and (subject to Sections 315(a) through 315(d) of the Trust Indenture Act) will be fully protected in relying on, (a) an Opinion of Counsel or reliance letter and (b) an Officer’s Certificate stating that all conditions precedent to the execution, authentication, and delivery of such Securities are in conformity with the provisions of this Indenture.
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The Trustee will not be required to authenticate such Securities if the issue of such Securities pursuant to this Indenture will affect the Trustee’s own rights, duties, or immunities under the Securities and this Indenture or otherwise in a manner that is not reasonably acceptable to the Trustee.
Section 2.05 Registration of Transfer and Exchange.
(a) Securities of any series may be exchanged on presentation at the office or agency of the Company designated for such purpose, for other Securities of such series of authorized denominations, and for a like aggregate principal amount, on payment of funds sufficient to cover any associated tax or other governmental charge, all as provided in this Section. In respect of any Securities surrendered for exchange, the Company will execute, the Trustee will authenticate, and such office will deliver, in exchange for such surrendered Securities, the Security or Securities of the same series that the Securityholder making the exchange is entitled to receive, bearing numbers not contemporaneously outstanding.
(b) The Company will keep, or cause to be kept, at its office or agency designated for such purpose a register or registers (the “Security Register”) in which, subject to such reasonable regulations as it may prescribe, the Company will register the Securities and the transfers of Securities as provided in this Article and which at all reasonable times will be open for inspection by the Trustee. The registrar for the purpose of registering Securities and transfer of Securities (the “Security Registrar”) will be appointed as authorized by Board Resolution or supplemental indenture.
On surrender for transfer of any Security at the office or agency of the Company designated for such purpose, the Company will execute, the Trustee will authenticate, and such office will deliver in the name of the transferee or transferees a new Security or Securities of the same series as the Security presented for a like aggregate principal amount.
The Company appoints the Trustee as Security Registrar for each series of Securities.
All Securities presented or surrendered for exchange or registration of transfer, as provided in this Section, will be accompanied (if required by the Company or the Security Registrar) by a written instrument or instruments of transfer, in form satisfactory to the Company or the Security Registrar, duly executed by the registered holder or by such holder’s duly authorized attorney in writing.
(c) Except as provided pursuant to Section 2.01 by a Board Resolution, and set forth in an Officer’s Certificate, or established in one or more supplemental indentures, no service charge will be made for any exchange or registration of transfer of Securities, or issue of new Securities in case of partial redemption of any series or repurchase, conversion, or exchange of less than the entire principal amount of a Security, but the Company may require payment of funds sufficient to cover any associated tax or other governmental charge, other than exchanges pursuant to Section 2.06, Section 3.03(b), and Section 9.04 not involving any transfer.
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(d) The Company and the Security Registrar will not be required to (i) issue, exchange, or register the transfer of any Securities during a period beginning at the opening of business 15 days before the sending of a notice of redemption of less than all the Outstanding Securities of the same series and ending at the close of business on the day of such sending, or (ii) register the transfer of or exchange any Securities or portions of Securities of any series called for redemption or surrendered for repurchase, but not validly withdrawn, other than the unredeemed portion of any such Securities being redeemed in part or not surrendered for repurchase, as the case may be. The provisions of this Section 2.05 are, with respect to any Global Security, subject to Section 2.11.
The Trustee has no obligation or duty to monitor, determine, or inquire as to compliance with any restrictions on transfer imposed under this Indenture or under applicable law with respect to any transfer of any interest in any Security (including any transfers between or among Depositary participants or beneficial owners of interests in any Global Security) other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by the terms of, this Indenture, and to examine such certificates and other documentation or evidence to determine substantial compliance as to form with the express requirements of this Indenture.
Section 2.06 Temporary Securities.
Pending the preparation of definitive Securities of any series, the Company may execute, and the Trustee will authenticate and deliver, temporary Securities of any authorized denomination. Such temporary Securities will be substantially in the form of the definitive Securities in lieu of which they are issued, but with such omissions, insertions, and variations as may be appropriate for temporary Securities, all as may be determined by the Company. Every temporary Security of any series will be executed by the Company and authenticated by the Trustee on the same conditions and in substantially the same manner, and with like effect, as the definitive Securities of such series. Without unnecessary delay, the Company will execute and furnish definitive Securities of such series and any or all temporary Securities of such series may be surrendered in exchange for such definitive Securities (without charge to the Securityholders), at the office of the Company designated for the purpose, and the Trustee will authenticate and such office will deliver in exchange for such temporary Securities an equal aggregate principal amount of definitive Securities of such series, unless the Company advises the Trustee to the effect that definitive Securities need not be executed and furnished until further notice from the Company. Until so exchanged, the temporary Securities of such series will be entitled to the same benefits under this Indenture as definitive Securities of such series.
Section 2.07 Mutilated, Destroyed, Lost, or Stolen Securities.
If any temporary or definitive Security becomes mutilated or is destroyed, lost, or stolen, the Company (subject to the next sentence) will execute, and on the Company’s request the Trustee (subject to the next sentence) will authenticate and deliver, a new Security of the same series, bearing a number not contemporaneously outstanding, in exchange and substitution for the mutilated Security, or in lieu of and in substitution for the Security so destroyed, lost, or stolen. In every case the applicant for a substituted Security will furnish to the Company and the Trustee such security or indemnity as may be required by them to save each of them harmless, and, in
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every case of destruction, loss, or theft, the applicant will also furnish to the Company and the Trustee evidence to their satisfaction of the destruction, loss, or theft, and ownership, of the applicant’s Security. The Trustee may authenticate and deliver any such substituted Security on the written request or authorization of any officer of the Company. On the issuance of any substituted Security, the Company may require the payment of funds sufficient to cover any associated tax or other governmental charge that may be imposed and any other expenses (including the fees and expenses of the Trustee) connected therewith.
If any Security that has matured or is about to mature becomes mutilated or is destroyed, lost, or stolen, the Company may, instead of issuing a substitute Security, pay or authorize the payment of the same (without surrender except in the case of a mutilated Security) if the applicant for such payment furnishes to the Company and the Trustee such security or indemnity as they may require to save them harmless, and, in case of destruction, loss, or theft, evidence to the satisfaction of the Company and the Trustee of the destruction, loss, or theft, and ownership, of such Security.
Every replacement Security issued pursuant to the provisions of this Section will constitute an additional contractual obligation of the Company whether or not the mutilated, destroyed, lost, or stolen Security is found at any time, or is enforceable by anyone, and will be entitled to all the benefits of this Indenture equally and proportionately with any and all other duly issued Securities of the same series. All Securities will be held and owned on the express condition that the foregoing provisions are exclusive with respect to the replacement or payment of mutilated, destroyed, lost, or stolen Securities, and will preclude (to the extent lawful) any and all other rights or remedies, notwithstanding any law or statute existing or hereafter enacted to the contrary with respect to the replacement or payment of negotiable instruments or other securities without their surrender.
Section 2.08 Cancellation.
All Securities surrendered for the purpose of payment, redemption, repurchase, exchange, registration of transfer, or conversion will, if surrendered to the Company or any paying agent (or any other applicable agent), be delivered to the Trustee for cancellation, or, if surrendered to the Trustee, will be cancelled by it, and no Securities will be issued in lieu of such surrendered Securities except as expressly required or permitted by any of the provisions of this Indenture. On request of the Company at the time of such surrender, the Trustee will deliver to the Company canceled Securities held by the Trustee. In the absence of such request the Trustee may dispose of canceled Securities in accordance with its standard procedures and deliver a certificate of disposition to the Company. If the Company otherwise acquires any of the Securities, such acquisition will not operate as a redemption or satisfaction of the indebtedness represented by such Securities unless and until the same are delivered to the Trustee for cancellation.
Section 2.09 Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or implied, will give or be construed to give to any Person, other than the parties to this Indenture and the holders of the Securities, any legal or equitable right, remedy, or claim under or in respect of this Indenture, or under any covenant, condition, or provision contained in this Indenture; all such covenants, conditions, and provisions being for the sole benefit of the parties to this Indenture and of the holders of the Securities.
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Section 2.10 Authenticating Agent.
So long as any of the Securities of any series remain Outstanding there may be an Authenticating Agent for any or all such series of Securities, which the Trustee will have the right to appoint. The Authenticating Agent will be authorized to act on behalf of the Trustee to authenticate Securities of such series issued on exchange, transfer, or partial redemption, repurchase, or conversion, and Securities so authenticated will be entitled to the benefits of this Indenture and will be valid and obligatory for all purposes as if authenticated by the Trustee. All references in this Indenture to the authentication of Securities by the Trustee will be deemed to include authentication by an Authenticating Agent for such series. Each Authenticating Agent will be acceptable to the Company and will be a corporation that has a combined capital and surplus, as most recently reported or determined by it, sufficient under the laws of any jurisdiction under which it is organized or in which it is doing business to conduct a trust business, and that is otherwise authorized under such laws to conduct such business and is subject to supervision or examination by federal or state authorities. If at any time any Authenticating Agent ceases to be eligible in accordance with these provisions, it will resign immediately.
Any Authenticating Agent may at any time resign by giving written notice of resignation to the Trustee and the Company. The Trustee may at any time (and on request by the Company will) terminate the agency of any Authenticating Agent by giving written notice of termination to such Authenticating Agent and the Company. On resignation, termination, or cessation of eligibility of any Authenticating Agent, the Trustee may appoint an eligible successor Authenticating Agent acceptable to the Company. Any successor Authenticating Agent, on acceptance of its appointment, will become vested with all the rights, powers, and duties of its predecessor as if originally named as an Authenticating Agent.
Section 2.11 Global Securities.
(a) If the Company establishes pursuant to Section 2.01 that the Securities of a particular series are to be issued as a Global Security, then the Company will execute and the Trustee will, in accordance with Section 2.04, authenticate and deliver a Global Security that (i) represents, and is denominated in an amount equal to the aggregate principal amount of, all of the Outstanding Securities of such series, (ii) is registered in the name of the Depositary or its nominee, (iii) is delivered by the Trustee to the Depositary or pursuant to the Depositary’s instruction (or if the Depositary names the Trustee as its custodian, retained by the Trustee), and (iv) bears a legend substantially to the following effect: “Except as otherwise provided in Section 2.11 of the Indenture, this Security may be transferred, in whole but not in part, only to another nominee of the Depositary or to a successor Depositary or to a nominee of such successor Depositary.”
(b) Notwithstanding the provisions of Section 2.05, the Global Security of a series may be transferred, in whole but not in part and in the manner provided in Section 2.05, only to another nominee of the Depositary for such series, or to a successor Depositary for such series selected or approved by the Company or to a nominee of such successor Depositary.
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(c) If at any time the Depositary for a series of the Securities notifies the Company that it is unwilling or unable to continue as Depositary for such series or if at any time the Depositary for such series is no longer registered or in good standing under the Exchange Act, or other applicable statute or regulation, and a successor Depositary for such series is not appointed by the Company within 90 days after the Company receives such notice or becomes aware of such condition, as the case may be, or if an Event of Default has occurred and is continuing and the Company has received a request from the Depositary or from the Trustee, this Section 2.11 will no longer be applicable to the Securities of such series and the Company will execute, and subject to Section 2.04, the Trustee will authenticate and deliver the Securities of such series in definitive registered form without coupons, in authorized denominations, and in an aggregate principal amount equal to the principal amount of the Global Security of such series in exchange for such Global Security. In addition, the Company may at any time determine that the Securities of any series will no longer be represented by a Global Security and that the provisions of this Section 2.11 will no longer apply to the Securities of such series. In such event the Company will execute and, subject to Section 2.04, the Trustee, on receipt of an Officer’s Certificate evidencing such determination by the Company, will authenticate and deliver the Securities of such series in definitive registered form without coupons, in authorized denominations, and in an aggregate principal amount equal to the principal amount of the Global Security of such series in exchange for such Global Security. On the exchange of the Global Security for such Securities in definitive registered form without coupons, in authorized denominations, the Global Security will be canceled by the Trustee. Such Securities in definitive registered form issued in exchange for the Global Security pursuant to this Section 2.11(c) will be registered in such names and in such authorized denominations as the Depositary, pursuant to instructions from its direct or indirect participants or otherwise, instructs the Trustee. The Trustee will deliver such Securities to the Depositary for delivery to the Persons in whose names such Securities are so registered.
Section 2.12 CUSIP Numbers.
The Company in issuing the Securities may use “CUSIP” numbers (if then generally in use), and, if so, the Trustee will use “CUSIP” numbers in notices of redemption as a convenience to Securityholders; 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 will not be affected by any defect in or omission of such numbers. The Company will promptly notify the Trustee of any change in the “CUSIP” numbers.
ARTICLE 3
REDEMPTION OF SECURITIES AND SINKING FUND PROVISIONS
Section 3.01 Redemption.
The Company may redeem the Securities of any series issued under this Indenture on and after the dates and in accordance with the terms established for such series pursuant to Section 2.01.
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Section 3.02 Notice of Redemption.
(a) If the Company wishes to exercise its right to redeem all or, as the case may be, a portion of the Securities of any series in accordance with any right the Company reserved for itself to do so pursuant to Section 2.01, the Company will, or will cause the Trustee to, give notice of such redemption to holders of the Securities of such series to be redeemed by mailing (or, with regard to any Global Security held in book entry form, by electronic mail in accordance with the applicable procedures of the Depositary), a notice of such redemption not less than 30 days nor more than 90 days before the date fixed for redemption of that series to such Securityholders, unless a shorter period is specified in the Securities to be redeemed. Any notice that is mailed in the manner provided in this Indenture will be conclusively presumed to have been duly given, whether or not the registered holder receives the notice. In any case, failure to give such notice to any Securityholder of any series designated for redemption in whole or in part, or any defect in the notice, will not affect the validity of the proceedings for the redemption of any other Securities of such series or any other series. In the case of any redemption of Securities prior to the expiration of any restriction on such redemption provided in the terms of such Securities or elsewhere in this Indenture, the Company will furnish the Trustee with an Officer’s Certificate evidencing compliance with any such restriction.
Each such notice of redemption will identify the Securities to be redeemed (including CUSIP numbers, if any), specify the date fixed for redemption and the redemption price at which Securities of that series are to be redeemed, and state that payment of the redemption price of such Securities to be redeemed will be made at the office or agency of the Company, on presentation and surrender of such Securities, that interest accrued to the date fixed for redemption will be paid as specified in said notice, and that from and after said date interest will cease to accrue and that the redemption is from a sinking fund, if such is the case. If less than all the Securities of a series are to be redeemed, the notice to the holders of Securities of that series to be redeemed in part will specify the particular Securities to be redeemed.
If any Security is to be redeemed in part only, the notice that relates to such Security will state the portion of the principal amount to be redeemed, and will state that on and after the redemption date, on surrender of such Security, a new Security or Securities of such series in principal amount equal to the unredeemed portion will be issued.
(b) If less than all the Securities of a series are to be redeemed, the Company will give the Trustee at least 45 days’ notice (unless a shorter notice is satisfactory to the Trustee) in advance of the date fixed for redemption as to the aggregate principal amount of Securities of the series to be redeemed, and, upon such notice, the Trustee will select the Securities to be redeemed (by lot, on a pro rata basis, or in such other manner as the Company deems appropriate and fair in its discretion and that may provide for the selection of a portion or portions (equal to or in integral multiples of U.S. $1,000) of the principal amount of such Securities of a denomination larger than $1,000) and will promptly notify the Company in writing of the numbers of the Securities to be redeemed, in whole or in part. The Company may, if and whenever it elects, by delivery of instructions signed on its behalf by an Officer, instruct the Trustee or any paying agent to call all or any part of the Securities of a particular series for redemption and to give notice of redemption in the manner set forth in this Section, such notice to be in the name of the Company or its own name as the Trustee or such paying agent may deem advisable. If notice of redemption is to be given by the Trustee or any paying agent, the Company will deliver or cause to be delivered to, or permit to remain with, the Trustee or such paying agent, as the case may be, such Security Register, transfer books, or other records, or suitable copies or extracts therefrom, sufficient to enable the Trustee or such paying agent to give any notice by mail that may be required under the provisions of this Section.
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Section 3.03 Payment on Redemption.
(a) If the giving of notice of redemption has been completed, the Securities or portions of Securities of the series to be redeemed specified in such notice will become due and payable on the date and at the place stated in such notice at the applicable redemption price, together with interest accrued to, but excluding, the date fixed for redemption and interest on such Securities or portions of Securities will cease to accrue on and after the date fixed for redemption, unless the Company defaults in the payment of such redemption price and accrued interest with respect to any such Security or portion. On presentation and surrender of such Securities on or after the date fixed for redemption at the place of payment specified in the notice, such Securities will be paid and redeemed at the applicable redemption price for such series, together with interest accrued thereon to, but excluding, the date fixed for redemption (but if the date fixed for redemption is an Interest Payment Date, the interest installment payable on such date will be payable to the registered holder at the close of business on the applicable record date pursuant to Section 2.03).
(b) On presentation of any Security of such series that is to be redeemed in part only, the Company will execute, the Trustee will authenticate, and the office where the Security is presented will deliver to the Securityholder, at the expense of the Company, a new Security of the same series of authorized denominations in principal amount equal to the unredeemed portion of the Security so presented.
Section 3.04 Sinking Fund.
The provisions of Sections 3.04, 3.05, and 3.06 will be applicable to any sinking fund for the retirement of Securities of a series, except as otherwise specified as contemplated by Section 2.01 for Securities of such series.
The minimum amount of any sinking fund payment provided for by the terms of Securities of any series is referred to as a “mandatory sinking fund payment,” and any payment in excess of such minimum amount provided for by the terms of Securities of any series is referred to as an “optional sinking fund payment.” If provided for by the terms of Securities of any series, the cash amount of any sinking fund payment may be subject to reduction as provided in Section 3.05. Each sinking fund payment will be applied to the redemption of Securities of any series as provided for by the terms of Securities of such series.
Section 3.05 Satisfaction of Sinking Fund Payments with Securities.
The Company may (a) deliver Outstanding Securities of a series and (b) apply as a credit Securities of a series that have been redeemed either at the election of the Company pursuant to the terms of such Securities or through the application of permitted optional sinking fund payments pursuant to the terms of such Securities, in each case in satisfaction of all or any part of any sinking
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fund payment with respect to the Securities of such series required to be made pursuant to the terms of such Securities as provided for by the terms of such series, provided that such Securities have not been previously so credited. Such Securities will be received and credited for such purpose by the Trustee at the redemption price specified in such Securities for redemption through operation of the sinking fund and the amount of such sinking fund payment will be reduced accordingly.
Section 3.06 Redemption of Securities for Sinking Fund.
Not less than 45 days prior to each sinking fund payment date for any series of Securities (unless a shorter period is satisfactory to the Trustee), the Company will deliver to the Trustee an Officer’s Certificate specifying the amount of the next ensuing sinking fund payment for that series pursuant to the terms of the series, the portion, if any, that is to be satisfied by delivering and crediting Securities of that series pursuant to Section 3.05, and the basis for such credit and will, together with such Officer’s Certificate, deliver to the Trustee any Securities to be so delivered. Not less than 30 days before each such sinking fund payment date, the Securities to be redeemed on such sinking fund payment date will be selected in the manner specified in Section 3.02 and the Company will cause notice of the redemption to be given in the name of and at the expense of the Company in the manner provided in Section 3.02. Such notice having been duly given, the redemption of such Securities will be made on the terms and in the manner stated in Section 3.03.
ARTICLE 4
COVENANTS
Section 4.01 Payment of Principal, Premium, and Interest.
The Company will duly and punctually pay or cause to be paid the principal of (and premium, if any) and interest on the Securities of that series at the time and place and in the manner provided in this Indenture and established with respect to such Securities. Payments of principal on the Securities may be made at the time provided in this Indenture and established with respect to such Securities by U.S. dollar check drawn on and mailed to the address of the Securityholder entitled to such payment as such address appears in the Security Register, or by U.S. dollar wire transfer to a U.S. dollar account if such Securityholder has furnished wire instructions in writing to the Trustee no later than 15 days prior to the relevant payment date. Payments of interest on the Securities may be made at the time provided in this Indenture and established with respect to such Securities by U.S. dollar check mailed to the address of the Securityholder entitled to such payment as such address appears in the Security Register, or by U.S. dollar wire transfer to a U.S. dollar account if such Securityholder has furnished wire instructions in writing to the Trustee no later than 15 days prior to the relevant payment date.
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Section 4.02 Maintenance of Office.
So long as any series of the Securities remain Outstanding, the Company will maintain an office with respect to each such series and at such location or locations as may be designated as provided in this Section 4.02, where (a) Securities of that series may be presented for payment, (b) Securities of that series may be presented for registration of transfer and exchange, and (c) notices and demands to or on the Company in respect of the Securities of that series and this Indenture may be given or served, such designation to continue with respect to such office until the Company, by written notice signed by any officer authorized to sign an Officer’s Certificate and delivered to the Trustee, designates some other office for such purposes or any of them. If at any time the Company fails to maintain any such required office or fails to furnish the Trustee with the address of such office, such presentations, notices, and demands may be made or served at the Corporate Trust Office of the Trustee, and the Company appoints the Trustee as its agent to receive all such presentations, notices, and demands. The Company initially appoints the Corporate Trust Office of the Trustee as its paying agent with respect to the Securities.
Section 4.03 Paying Agents.
(a) If the Company appoints one or more paying agents for all or any series of the Securities, other than the Trustee, the Company will cause each such paying agent to execute and deliver to the Trustee an instrument in which such agent agrees with the Trustee, subject to the provisions of this Section, that it will:
(i) hold all funds held by it as such agent for the payment of the principal of (and premium, if any) or interest on the Securities of that series (whether such funds have been paid to it by the Company or by any other obligor of such Securities) in trust for the benefit of the Persons entitled to such funds;
(ii) give the Trustee notice of any failure by the Company (or by any other obligor of such Securities) to make any payment of the principal of (and premium, if any) or interest on the Securities of that series when the same is due and payable;
(iii) at any time during the continuance of any failure referred to in clause (a)(ii) above, on the written request of the Trustee, promptly pay to the Trustee all funds so held in trust by such paying agent; and
(iv) perform all other duties of paying agent as set forth in this Indenture.
(b) If the Company acts as its own paying agent with respect to any series of the Securities, it will on or before each due date of the principal of (and premium, if any) or interest on Securities of that series, set aside, segregate, and hold in trust for the benefit of the Persons entitled to such principal, premium, or interest, as applicable, funds sufficient to pay such principal (and premium, if any) or interest so becoming due on Securities of that series until such funds are paid to such Persons or otherwise disposed of as provided in this Indenture and will promptly notify the Trustee of such action, or any failure (by it or any other obligor on such Securities) to take such action. Whenever the Company has one or more paying agents for any series of Securities, it will, prior to each due date of the principal of (and premium, if any) or interest on any Securities of that series, deposit with the paying agent funds sufficient to pay the principal (and premium, if any) or interest so becoming due, such funds to be held in trust for the benefit of the Persons entitled to such principal, premium, or interest, and (unless such paying agent is the Trustee) the Company will promptly notify the Trustee of this action or failure to act.
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(c) Notwithstanding anything in this Section to the contrary, (i) the agreement to hold funds in trust as provided in this Section is subject to the provisions of Section 11.05, and (ii) the Company may at any time, for the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, pay, or direct any paying agent to pay, to the Trustee all funds held in trust by the Company or such paying agent, such funds to be held by the Trustee on the same terms and conditions as those on which such funds were held by the Company or such paying agent; and, on such payment by the Company or any paying agent to the Trustee, the Company or such paying agent will be released from all further liability with respect to such money.
Section 4.04 Appointment to Fill Vacancy in Office of Trustee.
The Company, whenever necessary to avoid or fill a vacancy in the office of Trustee, will appoint, in the manner provided in Section 7.10, a Trustee, so that there will at all times be a Trustee under this Indenture.
ARTICLE 5
SECURITYHOLDERS’ LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE
Section 5.01 Company to Furnish Trustee Names and Addresses of Securityholders.
The Company will furnish or cause to be furnished to the Trustee (a) within 15 days after each regular record date (as defined in Section 2.03), a list, in such form as the Trustee may reasonably require, of the names and addresses of the holders of each series of Securities as of such regular record date, provided that the Company will not be obligated to furnish or cause to be furnished such list at any time that the list does not differ in any respect from the most recent list furnished to the Trustee by the Company, and (b) at such other times as the Trustee may request in writing, within 30 days after the receipt by the Company of any such request, a list of similar form and content as of a date not more than 15 days prior to the time such list is furnished; provided, however, that, in either case, no such list need be furnished for any series for which the Trustee is the Security Registrar.
Section 5.02 Preservation Of Information; Communications With Securityholders.
(a) The Trustee will preserve, in as current a form as is reasonably practicable, all information as to the names and addresses of the holders of Securities contained in the most recent list furnished to it as provided in Section 5.01 and as to the names and addresses of holders of Securities received by the Trustee in its capacity as Security Registrar (if acting in such capacity).
(b) The Trustee may destroy any list furnished to it as provided in Section 5.01 on receipt of a new list so furnished.
(c) Securityholders may communicate as provided in Section 312(b) of the Trust Indenture Act with other Securityholders with respect to their rights under this Indenture or under the Securities, and, in connection with any such communications, the Trustee will satisfy its obligations under Section 312(b) of the Trust Indenture Act in accordance with the provisions of such section.
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Section 5.03 Reports by the Company.
(a) The Company will at all times comply with Section 314(a) of the Trust Indenture Act. The Company will provide (which delivery may be via electronic mail) to the Trustee, within 30 days after the Company files the same with the Commission, copies of the annual reports and of the information, documents, and other reports (or copies of such portions of any of the foregoing as the Commission may from time to time by rules and regulations prescribe) that the Company is required to file with the Commission pursuant to Section 13 or Section 15(d) of the Exchange Act; provided, however, that the Company will not be required to deliver to the Trustee any correspondence filed with the Commission or any materials for which the Company has sought and received confidential treatment by the Commission; and provided, further, that so long as such filings by the Company are available on the Commission’s Electronic Data Gathering, Analysis and Retrieval System (EDGAR), or any successor system, such filings will be deemed to have been filed with the Trustee for purposes of this Indenture without any further action by the Company. For the avoidance of doubt, a failure by the Company to file annual reports, information, and other reports with the Commission within the time period prescribed by the Commission will not be deemed a breach of this Section 5.03.
(b) Delivery of reports, information, and documents to the Trustee under Section 5.03 is for informational purposes only and the Trustee’s receipt of the foregoing will not constitute constructive notice of any information contained, or determinable from information contained, in such reports, information, or documents, including the Company’s compliance with any of its covenants under this Indenture (as to which the Trustee is entitled to rely exclusively on an Officer’s Certificate). The Trustee is under no duty to examine any such reports, information, or documents delivered to the Trustee or filed with the Commission via EDGAR to ensure compliance with the provisions of this Indenture or to ascertain the correctness or otherwise of the information or the statements contained in such reports, information, or documents. The Trustee has no responsibility or duty whatsoever to ascertain or determine whether the above referenced filings with the Commission on EDGAR (or any successor system) have occurred.
Section 5.04 Reports by the Trustee.
(a) If required by Section 313(a) of the Trust Indenture Act, the Trustee, within 60 days after each May 1, will send to the Securityholders a brief report dated as of such May 1, which complies with Section 313(a) of the Trust Indenture Act.
(b) The Trustee will comply with Section 313(b) and 313(c) of the Trust Indenture Act.
(c) A copy of each such report will, at the time of such transmission to Securityholders, be filed by the Trustee with the Company, with each securities exchange on which any Securities are listed (if so listed), and with the Commission. The Company will notify the Trustee when any Securities become listed on any securities exchange.
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ARTICLE 6
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS ON EVENT OF DEFAULT
Section 6.01 Events of Default.
(a) Whenever used in this Indenture with respect to Securities of a particular series, “Event of Default” means any one or more of the following events that has occurred and is continuing:
(i) the Company defaults in the payment of any installment of interest on any of the Securities of that series, as and when due and payable, and such default continues for a period of 90 days; provided, however, that a valid extension of an interest payment period by the Company in accordance with the terms of any supplemental indenture will not constitute a default in the payment of interest for this purpose;
(ii) the Company defaults in the payment of the principal of (or premium, if any, on) any of the Securities of that series as and when due and payable, whether at maturity, on redemption, by declaration, or otherwise, or in any payment required by any sinking or analogous fund established with respect to that series; provided, however, that a valid extension of the maturity of such Securities in accordance with the terms of any supplemental indenture will not constitute a default in the payment of principal or premium, if any;
(iii) the Company fails to observe or perform any other of its covenants or agreements with respect to that series contained in this Indenture or otherwise established with respect to that series of Securities pursuant to Section 2.01 (other than a covenant or agreement that has been expressly included in this Indenture solely for the benefit of one or more series of Securities other than such series) for a period of 90 days after the date on which written notice of such failure, requiring the failure to be remedied and stating that such notice is a “Notice of Default” under this Indenture, has been given to the Company by the Trustee, by registered or certified mail, or to the Company and the Trustee by the holders of at least 25% in principal amount of the Securities of that series at the time Outstanding;
(iv) the Company (1) commences a voluntary case, (2) consents to the entry of an order for relief against it in an involuntary case, (3) consents to the appointment of a Custodian of it or for all or substantially all of its property, or (4) makes a general assignment for the benefit of its creditors, in each case pursuant to or within the meaning of Bankruptcy Law; or
(v) a court of competent jurisdiction enters an order under any Bankruptcy Law that (1) is for relief against the Company in an involuntary case, (2) appoints a Custodian of the Company for all or substantially all of its property, or (3) orders the liquidation of the Company, and the order or decree remains unstayed and in effect for 90 days.
(b) In each such case (other than an Event of Default specified in clause (iv) or clause (v) above), unless the principal of all the Securities of that series has already become due and payable, either the Trustee or the holders of not less than 25% in aggregate principal amount of the Securities of that series then Outstanding, by notice in writing to the Company (and to the Trustee if given by such Securityholders), may declare the principal of (and premium, if any, on) and accrued and unpaid interest on all the Securities of that series to be due and payable immediately, and on any such declaration such amounts will be immediately due and payable. If an Event of Default specified in clause (iv) or clause (v) above occurs, the principal of and accrued and unpaid interest on all the Securities of that series will automatically be immediately due and payable without any declaration or other act on the part of the Trustee or the holders of the Securities.
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(c) At any time after the principal of (and premium, if any, on) and accrued and unpaid interest on the Securities of that series has been so declared due and payable, and before any judgment or decree for the payment of the amounts due has been obtained or entered, the holders of a majority in aggregate principal amount of the Securities of that series then Outstanding, by written notice to the Company and the Trustee, may rescind and annul such declaration and its consequences if: (i) the Company has paid or deposited with the Trustee funds sufficient to pay all matured installments of interest on all the Securities of that series and the principal of (and premium, if any, on) any and all Securities of that series that have become due otherwise than by acceleration (with interest on such principal and premium, if any, and, to the extent that such payment is enforceable under applicable law, on overdue installments of interest, at the rate per annum expressed in the Securities of that series to the date of such payment or deposit) and the amount payable to the Trustee under Section 7.06, and (ii) any and all Events of Default under the Indenture with respect to such series, other than the nonpayment of principal on (and premium, if any, on) and accrued and unpaid interest on Securities of that series that have not become due by their terms, have been remedied or waived as provided in Section 6.06.
No such rescission and annulment will extend to or affect any subsequent default or impair any right consequent thereon.
(d) If the Trustee has proceeded to enforce any right with respect to Securities of that series under this Indenture and such proceedings have been discontinued or abandoned because of such rescission or annulment or for any other reason or have been determined adversely to the Trustee, then, subject to any determination in such proceedings, the Company and the Trustee will be restored respectively to their former positions and rights, and all rights, remedies, and powers of the Company and the Trustee will continue as though no such proceedings had been taken.
Section 6.02 Collection of Indebtedness and Suits for Enforcement by Trustee.
(a) The Company covenants that if it defaults in the payment of (i) any installment of interest on any of the Securities of a series, or in any payment required by any sinking or analogous fund established with respect to that series when due and payable, and such default has continued for a period of 90 days, or (ii) the principal of (or premium, if any, on) any of the Securities of a series when due and payable, whether on maturity, redemption, declaration, or otherwise, then, on demand of the Trustee, the Company will pay to the Trustee, for the benefit of the holders of the Securities of that series, the whole amount that is then due and payable on all such Securities for principal (and premium, if any) or interest, or both, as the case may be, with interest on the overdue principal (and premium, if any) and (to the extent that payment of such interest is enforceable under applicable law) on overdue installments of interest at the rate per annum expressed in the Securities of that series; and, in addition, such further amount as is sufficient to cover the costs and expenses of collection, and the amount payable to the Trustee under Section 7.06.
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(b) If the Company fails to pay such amounts promptly on such demand, the Trustee, in its own name and as trustee of an express trust, will be entitled and empowered to institute any action or proceedings at law or in equity for the collection of the funds so due and unpaid, and may prosecute any such action or proceeding to judgment or final decree, and may enforce any such judgment or final decree against the Company or other obligor on the Securities of that series and collect the amounts adjudged or decreed to be payable in the manner provided by law or equity out of the property of the Company or other obligor on the Securities of that series, wherever situated.
(c) In case of any receivership, insolvency, liquidation, bankruptcy, reorganization, readjustment, arrangement, composition, or judicial proceedings affecting the Company, or its creditors or property, the Trustee will have power to intervene in such proceedings and take any action that may be permitted by the court and will (except as otherwise provided by law) be entitled to file such proofs of claim and other papers and documents as may be necessary or advisable in order to have the claims of the Trustee and of the holders of Securities of such series allowed for the entire amount due and payable by the Company under the Indenture at the date of institution of such proceedings and for any additional amount that may become due and payable by the Company after such date, and to collect and receive any funds or other property payable or deliverable on any such claim, and to distribute the same after the deduction of the amount payable to the Trustee under Section 7.06; and any receiver, assignee, or trustee in bankruptcy or reorganization is authorized by each of the holders of Securities of such series to make such payments to the Trustee, and, in the event that the Trustee consents to the making of such payments directly to such Securityholders, to pay to the Trustee any amount due it under Section 7.06.
(d) All rights of action and of asserting claims under this Indenture, or under any of the terms established with respect to Securities of that series, may be enforced by the Trustee without the possession of any of such Securities, or the production of any such Securities at any trial or other proceeding, and any such suit or proceeding instituted by the Trustee will be brought in its own name as trustee of an express trust, and any recovery of judgment will, after provision for payment to the Trustee of any amounts due under Section 7.06, be for the ratable benefit of the holders of the Securities of such series.
In case of an Event of Default, the Trustee may in its discretion proceed to protect and enforce the rights vested in it by this Indenture by such appropriate judicial proceedings as the Trustee deems most effectual, either at law or in equity or in bankruptcy or otherwise, whether for the specific enforcement of any covenant or agreement contained in the Indenture or in aid of the exercise of any power granted in this Indenture, or to enforce any other legal or equitable right vested in the Trustee by this Indenture or by law.
Nothing contained in this Indenture will be deemed to authorize the Trustee to authorize, consent to, accept, or adopt on behalf of any Securityholder any plan of reorganization, arrangement, adjustment, or composition affecting the Securities of that series or the rights of any Securityholder or to authorize the Trustee to vote in respect of the claim of any Securityholder in any such proceeding.
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Section 6.03 Application of Funds Collected.
Any funds collected by the Trustee pursuant to this Article with respect to a particular series of Securities will be applied in the following order, at the date or dates fixed by the Trustee and, in case of the distribution of such funds on account of principal (or premium, if any) or interest, on presentation of the Securities of that series, and notation on such Securities of the payment, if only partially paid, and on surrender of such Securities if fully paid:
FIRST: To the payment of costs and expenses of collection and of all amounts payable to the Trustee under Section 7.06;
SECOND: To the payment of the amounts then due and unpaid on Securities of such series for principal (and premium, if any) and interest, in respect of which or for the benefit of which such money has been collected, ratably, without preference or priority of any kind, according to the amounts due and payable on such Securities for principal (and premium, if any) and interest, respectively; and
THIRD: To the payment of the remainder, if any, to the Company or any other Person lawfully entitled to such funds.
Section 6.04 Limitation on Suits.
No holder of any Security of any series will have any right by virtue of any provision of this Indenture to institute any suit, action, or proceeding in equity or at law upon or under or with respect to this Indenture or for the appointment of a receiver or trustee, or for any other remedy under this Indenture, unless (a) such Securityholder has previously given to the Trustee written notice of the occurrence and continuance of an Event of Default with respect to the Securities of such series specifying such Event of Default, as provided in this Indenture; (b) the holders of not less than 25% in aggregate principal amount of the Securities of such series then Outstanding have made written request on the Trustee to institute such action, suit, or proceeding in its own name as Trustee; (c) such Securityholder or Securityholders have offered to the Trustee indemnity satisfactory to it against the costs, expenses, and liabilities to be incurred in compliance with such request; (d) the Trustee, for 90 days after its receipt of such notice, request, and offer of indemnity, has failed to institute any such action, suit, or proceeding; and (e) during such 90 day period, the holders of a majority in principal amount of the Securities of that series have not given the Trustee a direction inconsistent with the request.
Notwithstanding anything contained in this Indenture to the contrary or any other provisions of this Indenture, the right of any Securityholder to receive payment of the principal of (and premium, if any) and interest on such Security on or after the respective due dates expressed in such Security (or, in the case of redemption, on the redemption date), or to institute suit for the enforcement of any such payment on or after such respective dates or redemption date, will not be impaired or affected without the consent of such holder and by accepting a Security it is expressly understood, intended, and covenanted by every Securityholder of such series with every other Securityholder and the Trustee, that no one or more holders of Securities of such series have any
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right in any manner whatsoever by virtue of any provision of this Indenture to affect, disturb, or prejudice the rights of the holders of any other such Securities, or to obtain or seek to obtain priority over or preference to any other such holder, or to enforce any right under this Indenture, except in the manner provided in this Indenture and for the equal, ratable, and common benefit of all holders of Securities of such series. For the protection and enforcement of the provisions of this Section, each and every Securityholder and the Trustee will be entitled to such relief as can be given either at law or in equity.
Section 6.05 Rights and Remedies Cumulative; Delay or Omission Not Waiver.
(a) Except as otherwise provided in Section 2.07, all powers and remedies given by this Article to the Trustee or to the Securityholders will, to the extent permitted by law, be deemed cumulative and not exclusive of any other powers and remedies available to the Trustee or the holders of the Securities, by judicial proceedings or otherwise, to enforce the performance or observance of the covenants and agreements contained in this Indenture or otherwise established with respect to such Securities.
(b) No delay or omission of the Trustee or of any holder of any of the Securities to exercise any right or power accruing on any Event of Default occurring and continuing will impair any such right or power, or will be construed to be a waiver of or acquiescence to any such default; and, subject to the provisions of Section 6.04, every power and remedy given by this Article or by law to the Trustee or the Securityholders may be exercised from time to time, and as often as is deemed expedient, by the Trustee or by the Securityholders.
Section 6.06 Control by Securityholders.
The holders of a majority in aggregate principal amount of the Securities of any series at the time Outstanding, determined in accordance with Section 8.04, 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 such series; provided, however, that such direction will not be in conflict with any rule of law or with this Indenture or subject the Trustee in its sole discretion to personal liability. Subject to the provisions of Section 7.01, the Trustee will have the right to decline to follow any such direction if the Trustee in good faith, by a Responsible Officer or officers of the Trustee, determines that the proceeding so directed, subject to the Trustee’s duties under the Trust Indenture Act, would involve the Trustee in personal liability or might be unduly prejudicial to the Securityholders not involved in the proceeding. The holders of a majority in aggregate principal amount of the Securities of any series at the time Outstanding affected thereby, determined in accordance with Section 8.04, may on behalf of the holders of all of the Securities of such series waive any past default in the performance of any of the covenants contained in this Indenture or established pursuant to Section 2.01 with respect to such series and its consequences, except a default in the payment of the principal of, or premium, if any, or interest on, any of the Securities of that series as and when due by the terms of such Securities otherwise than by acceleration (unless such default has been cured and funds sufficient to pay all matured installments of interest and principal and any premium has been deposited with the Trustee (in accordance with Section 6.01(c)). On any such waiver, the default covered thereby will be deemed to be cured for all purposes of this Indenture and the Company, the Trustee, and the holders of the Securities of such series will be restored to their former positions and rights, respectively; but no such waiver will extend to any subsequent or other default or impair any right consequent thereon.
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Section 6.07 Undertaking to Pay Costs.
All parties to this Indenture agree, and each Securityholder by such holder’s acceptance of Securities will be deemed to have agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture, or in any suit against the Trustee for any action taken or omitted by it as Trustee, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorneys’ fees and expenses, 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 will not apply to any suit instituted by the Trustee, to any suit instituted by any Securityholder, or group of Securityholders, holding more than 10% in aggregate principal amount of the Outstanding Securities of any series, or to any suit instituted by any Securityholder for the enforcement of the payment of the principal of (or premium, if any), or interest on any Security of such series, on or after the respective due dates expressed in such Security or established pursuant to this Indenture.
ARTICLE 7
CONCERNING THE TRUSTEE
Section 7.01 Certain Duties and Responsibilities of Trustee.
(a) The Trustee, prior to the occurrence of an Event of Default with respect to the Securities of a series and after the curing of all Events of Default with respect to the Securities of that series that may have occurred, will undertake to perform with respect to the Securities of such series such duties and only such duties as are specifically set forth in this Indenture, and no implied covenants will be read into this Indenture against the Trustee. If an Event of Default with respect to the Securities of a series has occurred (that has not been cured or waived), the Trustee will exercise with respect to Securities of that series such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise, as a prudent man would exercise or use under the circumstances in the conduct of his or her own affairs.
(b) No provision of this Indenture will be construed to relieve the Trustee from liability for its own negligent action, negligent failure to act, or willful misconduct, except that:
(i) prior to the occurrence of an Event of Default with respect to the Securities of a series and after the curing or waiving of all such Events of Default with respect to that series that may have occurred:
(A) the duties and obligations of the Trustee will with respect to the Securities of such series be determined solely by the express provisions of this Indenture, and the Trustee will not be liable with respect to the Securities of such series except for the performance of such duties and obligations as are specifically set forth in this Indenture, and no implied covenants or obligations will be read into this Indenture against the Trustee; and
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(B) in the absence of bad faith on the part of the Trustee, the Trustee may with respect to the Securities of such series conclusively rely on any certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture, as to the truth of the statements and the correctness of the opinions expressed in such certificates or opinions; provided, however, that in the case of any certificates or opinions that are specifically required by this Indenture to be furnished to the Trustee, the Trustee will be under a duty to examine the same to determine whether or not they conform to the requirements of this Indenture;
(ii) the Trustee will not be liable to any Securityholder or any other Person for any error of judgment made in good faith by a Responsible Officer or Responsible Officers of the Trustee, unless it is proved that the Trustee was negligent in ascertaining the pertinent facts;
(iii) the Trustee will not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the holders of not less than a majority in principal amount of the Securities of any series at the time Outstanding relating to the time, method, and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on the Trustee under this Indenture with respect to the Securities of that series;
(iv) nothing in this Indenture will require the Trustee to expend or risk its own funds or otherwise incur personal financial liability in the performance of any of its duties or in the exercise of any of its rights or powers if there is reasonable ground for believing that the repayment of such funds or liability is not reasonably assured to it under the terms of this Indenture or adequate indemnity against such risk is not reasonably assured to it;
(v) the Trustee will not be required to give any bond or surety in respect of the performance of its powers or duties under this Indenture;
(vi) the permissive right of the Trustee to do things enumerated in this Indenture will not be construed as a duty of the Trustee; and
(vii) no Trustee will have any duty or responsibility for any act or omission of any other Trustee appointed with respect to a series of Securities under this Indenture.
Section 7.02 Certain Rights of Trustee.
Except as otherwise provided in Section 7.01:
(a) the Trustee may conclusively rely and will be protected in acting or refraining from acting on any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, approval, bond, security, or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties;
(b) any request, direction, order, or demand of the Company mentioned in this Indenture will be sufficiently evidenced by a Board Resolution or an instrument signed in the name of the Company by any authorized Officer of the Company (unless other evidence is specifically prescribed by this Indenture);
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(c) the Trustee may consult with counsel and the opinion or written advice of such counsel or, if requested, any Opinion of Counsel will be full and complete authorization and protection in respect of any action taken or suffered or omitted under this Indenture in good faith and in reliance on such opinion or advice;
(d) the Trustee will be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request, order, or direction of any of the Securityholders pursuant to the provisions of this Indenture, unless such Securityholders have offered to the Trustee security or indemnity reasonably acceptable to the Trustee against the costs, expenses, and liabilities that may be incurred by the Trustee; provided, however, that nothing contained in this Indenture will relieve the Trustee of the obligation, on the occurrence of an Event of Default with respect to a series of the Securities (that has not been cured or waived), to exercise with respect to Securities of that series such of the rights and powers vested in it by this Indenture, and to use the same degree of care and skill in their exercise, as a prudent man would exercise or use under the circumstances in the conduct of his or her own affairs;
(e) the Trustee will not be liable for any action taken or omitted to be taken by it in good faith and believed by it to be authorized or within the discretion or rights or powers conferred on it by this Indenture;
(f) the Trustee will not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, approval, bond, security, or other papers or documents or inquire as to the performance by the Company of one of its covenants under this Indenture, unless requested in writing so to do by the holders of not less than a majority in principal amount of the Outstanding Securities of the particular series affected thereby (determined as provided in Section 8.04); provided, however, that if the payment within a reasonable time to the Trustee of the costs, expenses, or liabilities likely to be incurred by it in the making of such investigation is, in the opinion of the Trustee, not reasonably assured to the Trustee by the security afforded to it by the terms of this Indenture, the Trustee may require security or indemnity reasonably acceptable to the Trustee against such costs, expenses, or liabilities as a condition to so proceeding. The reasonable expense of every such examination will be paid by the Company or, if paid by the Trustee, will be repaid by the Company on demand;
(g) the Trustee may execute any of the trusts or powers or perform any duties under this Indenture either directly or by or through agents or attorneys and the Trustee will not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it;
(h) in no event will the Trustee be responsible or liable for any failure or delay in the performance of its obligations under this Indenture arising out of or caused by, directly or indirectly, forces beyond its control, including strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes, or acts of God, and interruptions, loss, or malfunctions of utilities, communications, or computer (software and hardware) services; it being understood that the Trustee will use reasonable efforts consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances;
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(i) in no event will the Trustee be responsible or liable for special, indirect, punitive, or consequential loss or damage of any kind whatsoever (including loss of profit) irrespective of whether the Trustee has been advised of the likelihood of such loss or damage and regardless of the form of action;
(j) the Trustee agrees to accept and act on instructions or directions pursuant to this Indenture sent by e-mail, facsimile transmission, or other similar unsecured electronic methods; provided, however, that such instructions or directions will be signed by an authorized representative of the party providing such instructions or directions. If the party elects to give the Trustee e-mail or facsimile instructions (or instructions by a similar electronic method) and the Trustee in its discretion elects to act on such instructions, the Trustee’s understanding of such instructions will be deemed controlling. The Trustee will not be liable for any losses, costs, or expenses arising directly or indirectly from the Trustee’s reliance on and compliance with such instructions notwithstanding such instructions conflict or are inconsistent with a subsequent written instruction. The party providing electronic instructions agrees to assume all risks arising out of the use of such electronic methods to submit instructions and directions to the Trustee, including the risk of the Trustee acting on unauthorized instructions, and the risk or interception and misuse by third parties. The Trustee may request that the Company deliver an Officer’s Certificate setting forth the names of individuals or titles of officers authorized at such time to furnish the Trustee with Officer’s Certificates, Company Orders, and any other matters or directions pursuant to this Indenture;
(k) the rights, privileges, protections, immunities, and benefits given to the Trustee, including its right to be indemnified, are extended to, and will be enforceable by, the Trustee in each of its capacities under this Indenture and the Securities, and each agent, custodian, or other person employed to act under this Indenture; and
(l) the Trustee will not be deemed to have knowledge of any Default or Event of Default (other than an Event of Default constituting the failure to pay the interest on, or the principal of, the Securities if the Trustee also serves the paying agent for such Securities) until the Trustee has received written notification in the manner set forth in this Indenture or a Responsible Officer of the Trustee has obtained actual knowledge.
Section 7.03 Trustee Not Responsible for Recitals or Issuance or Securities.
(a) The recitals contained in this Indenture and in the Securities will be taken as the statements of the Company, and the Trustee assumes no responsibility for the correctness of the same. The Trustee will not be responsible for any statement in any registration statement, prospectus, or any other document in connection with the sale of Securities. The Trustee will not be responsible for any rating on the Securities or any action or omission of any rating agency.
(b) The Trustee makes no representations as to the validity or sufficiency of this Indenture or of the Securities.
(c) The Trustee will not be accountable for the use or application by the Company of any of the Securities or of the proceeds of such Securities, or for the use or application of any funds paid over by the Trustee in accordance with any provision of this Indenture or established pursuant to Section 2.01, or for the use or application of any funds received by any paying agent other than the Trustee.
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Section 7.04 May Hold Securities.
The Trustee or any paying agent or Security Registrar, in its individual or any other capacity, may become the owner or pledgee of Securities with the same rights it would have if it were not Trustee, paying agent, or Security Registrar.
Section 7.05 Funds Held in Trust.
Subject to the provisions of Section 11.05, all funds received by the Trustee will, until used or applied as provided in this Indenture, be held in trust for the purposes for which they were received but need not be segregated from other funds except to the extent required by law. The Trustee will be under no liability for interest on any funds received by it under this Indenture except such as it may agree with the Company.
Section 7.06 Compensation and Reimbursement.
(a) The Company will pay to the Trustee compensation for its services as the Company and the Trustee will from time to time agree in writing. The Trustee’s compensation will not be limited by any law on compensation of a trustee of an express trust. The Company will reimburse the Trustee on request for all reasonable out-of-pocket expenses incurred by it. Such expenses will include the reasonable compensation and expenses of the Trustee’s agents and counsel.
(b) The Company will indemnify the Trustee against any loss, liability, or expense (including the cost of defending itself and including the reasonable compensation and expenses of the Trustee’s agents and counsel) incurred by it except as set forth in Section 7.06(c) in the exercise or performance of its powers, rights, or duties under this Indenture as Trustee or Agent. The Trustee will notify the Company promptly of any claim for which it may seek indemnity. The Company will defend the claim and the Trustee will cooperate in the defense. The Trustee may have one separate counsel and the Company will pay the reasonable fees and expenses of such counsel. The Company need not pay for any settlement made without its consent, which consent will not be unreasonably withheld. This indemnification will apply to officers, directors, employees, shareholders, and agents of the Trustee.
(c) 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, willful misconduct, or bad faith.
(d) To ensure the Company’s payment obligations in this Section, the Trustee will have a lien prior to the Securities on all funds or property held or collected by the Trustee, except that held in trust to pay principal of or interest on particular Securities. When the Trustee incurs expenses or renders services in connection with an Event of Default specified in Section 6.01(iv) or (v), the expenses (including the reasonable fees and expenses of its counsel) and the compensation for services in connection therewith are to constitute expenses of administration under any bankruptcy law. The provisions of this Section 7.06 will survive the termination of this Indenture and the resignation or removal of the Trustee.
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Section 7.07 Reliance on Officer’s Certificate.
Except as otherwise provided in Section 7.01, whenever in the administration of the provisions of this Indenture the Trustee deems it reasonably necessary or desirable that a matter be proved or established prior to taking or omitting to take any action under this Indenture, such matter (unless other evidence is specifically prescribed by this Indenture) may, in the absence of negligence or bad faith on the part of the Trustee, be deemed to be conclusively proved and established by an Officer’s Certificate delivered to the Trustee and such certificate, in the absence of negligence or bad faith on the part of the Trustee, will be full warrant to the Trustee for any action taken or omitted to be taken by it under the provisions of this Indenture in reliance on such certificate.
Section 7.08 Disqualification; Conflicting Interests.
If the Trustee has or acquires any “conflicting interest” within the meaning of Section 310(b) of the Trust Indenture Act, the Trustee and the Company will in all respects comply with the provisions of Section 310(b) of the Trust Indenture Act.
Section 7.09 Corporate Trustee Required; Eligibility.
There will at all times be a Trustee with respect to the Securities issued under this Indenture, which will at all times be a corporation organized and doing business under the laws of the United States or any U.S. state or territory or of the District of Columbia, or a corporation or other Person permitted to act as trustee by the Commission, authorized under such laws to exercise corporate trust powers, having a combined capital and surplus of at least U.S. $50,000,000, and subject to supervision or examination by federal, state, territorial, or District of Columbia authority.
If such corporation or other Person publishes reports of condition at least annually, pursuant to law or to the requirements of the federal, state, territorial, or District of Columbia supervising or examining authority, then for the purposes of this Section, the combined capital and surplus of such corporation or other Person will be deemed to be its combined capital and surplus as set forth in its most recent report of condition. The Company may not, nor may any Person directly or indirectly controlling, controlled by, or under common control with the Company, serve as Trustee. If at any time the Trustee ceases to be eligible in accordance with the provisions of this Section, the Trustee will resign immediately in the manner and with the effect specified in Section 7.10.
Section 7.10 Resignation and Removal; Appointment of Successor.
(a) The Trustee or any successor may at any time resign with respect to the Securities of one or more series by giving written notice of such resignation to the Company and the Securityholders of such series. On receiving such notice of resignation, the Company will promptly appoint a successor trustee with respect to Securities of such series by written instrument, in duplicate, executed by order of the Board of Directors, one copy of which will be delivered to
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the resigning Trustee and one copy to the successor trustee. If no successor trustee has been appointed and accepted appointment within 30 days after the sending of such notice of resignation, the resigning Trustee may petition any court of competent jurisdiction for the appointment of a successor trustee with respect to Securities of such series, or any Securityholder of that series who has been a bona fide holder of a Security or Securities for at least six months may on behalf of himself and all others similarly situated, petition any such court for the appointment of a successor trustee. Such court may then appoint a successor trustee.
(b) If at any time any of the following occurs:
(i) the Trustee fails to comply with the provisions of Section 7.08 after written request by the Company or by any Securityholder who has been a bona fide holder of a Security or Securities for at least six months; or
(ii) the Trustee ceases to be eligible in accordance with the provisions of Section 7.09 and fails to resign after written request to resign by the Company or by any such Securityholder; or
(iii) the Trustee becomes incapable of acting, is adjudged bankrupt or insolvent, commences a voluntary bankruptcy proceeding, or a receiver of itself or of its property appointed or consented to, or any public officer takes charge or control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation, or liquidation;
then, in any such case, the Company may remove the Trustee with respect to all Securities and appoint a successor trustee by written instrument, in duplicate, executed by order of the Board of Directors, one copy of which will be delivered to the Trustee so removed and one copy to the successor trustee, or any Securityholder who has been a bona fide holder of a Security or Securities for at least six months may, on behalf of that holder and all others similarly situated, petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor trustee. Such court may then remove the Trustee and appoint a successor trustee.
(c) The holders of a majority in aggregate principal amount of the Securities of any series at the time Outstanding may at any time remove the Trustee with respect to such series by so notifying the Trustee and the Company and may appoint a successor Trustee for such series with the consent of the Company.
(d) Any resignation or removal of the Trustee and appointment of a successor trustee with respect to the Securities of a series pursuant to any of the provisions of this Section will become effective on acceptance of appointment by the successor trustee as provided in Section 7.11.
(e) Any successor trustee appointed pursuant to this Section may be appointed with respect to the Securities of one or more series or all of such series, and at any time there will be only one Trustee with respect to the Securities of any particular series.
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Section 7.11 Acceptance of Appointment by Successor.
(a) If a successor trustee is appointed under this Indenture with respect to all Securities, such successor trustee will execute, acknowledge, and deliver to the Company and to the retiring Trustee an instrument accepting such appointment, at which point the resignation or removal of the retiring Trustee will become effective and such successor trustee, without any further act, deed, or conveyance, will become vested with all the rights, powers, trusts, and duties of the retiring Trustee. On request of the Company or the successor trustee, such retiring Trustee will, on payment of any amounts due to it pursuant to the provisions of Section 7.06, execute and deliver an instrument transferring to such successor trustee all the rights, powers, and trusts of the retiring Trustee and will duly assign, transfer, and deliver to such successor trustee all property and funds held by such retiring Trustee pursuant to this Indenture.
(b) If a successor trustee is appointed under this Indenture with respect to the Securities of one or more (but not all) series, the Company, the retiring Trustee, and each successor trustee with respect to the Securities of one or more series will execute and deliver a supplemental indenture pursuant to which each successor trustee accepts such appointment and which (i) contains such provisions as are necessary or desirable to transfer and confirm to, and to vest in, each successor trustee all the rights, powers, trusts, and duties of the retiring Trustee with respect to the Securities of that or those series to which the appointment of such successor trustee relates, (ii) contains such provisions as are deemed necessary or desirable to confirm that all the rights, powers, trusts, and duties of the retiring Trustee with respect to the Securities of that or those series as to which the retiring Trustee is not retiring continue to be vested in the retiring Trustee, and (iii) adds to or changes any of the provisions of this Indenture as are necessary to provide for or facilitate the administration of the trusts under this Indenture by more than one Trustee, it being understood that nothing in this Indenture or in such supplemental indenture will constitute such Trustees co-trustees of the same trust, that each such Trustee will be trustee of a trust or trusts under this Indenture separate and apart from any trust or trusts under this Indenture administered by any other such Trustee, and that no Trustee will be responsible for any act or failure to act on the part of any other Trustee. On the execution and delivery of such supplemental indenture the resignation or removal of the retiring Trustee will become effective to the extent provided in such supplemental indenture, such retiring Trustee will with respect to the Securities of that or those series to which the appointment of such successor trustee relates have no further responsibility for the exercise of rights and powers or for the performance of the duties and obligations vested in the Trustee under this Indenture, and each such successor trustee, without any further act, deed, or conveyance, will become vested with all the rights, powers, trusts, and duties of the retiring Trustee with respect to the Securities of that or those series to which the appointment of such successor trustee relates. On request of the Company or any successor trustee, such retiring Trustee will duly assign, transfer, and deliver to such successor trustee, to the extent contemplated by such supplemental indenture, the property and funds held by such retiring Trustee under this Indenture with respect to the Securities of that or those series to which the appointment of such successor trustee relates.
(c) On request of any such successor trustee, the Company will execute any and all instruments for more fully and certainly vesting in and confirming to such successor trustee all such rights, powers, and trusts referred to in clause (a) or (b) of this Section, as the case may be.
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(d) No successor trustee will accept its appointment unless at the time of such acceptance such successor trustee is qualified and eligible under this Article.
(e) On acceptance of appointment by a successor trustee as provided in this Section, the Company will send notice of the succession of such trustee to the Securityholders. If the Company fails to transmit such notice within ten days after acceptance of appointment by the successor trustee, the successor trustee will cause such notice to be transmitted at the expense of the Company.
Section 7.12 Merger, Conversion, Consolidation, or Succession to Business.
Any corporation into which the Trustee may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion, or consolidation to which the Trustee is a party, or any corporation succeeding to all or substantially all the corporate trust business of the Trustee, including the administration of the trust created by this Indenture, will be the successor of the Trustee under this Indenture, provided that such corporation will be qualified under the provisions of Section 7.08 and eligible under the provisions of Section 7.09, without the execution or filing of any paper or any further act on the part of any of the parties to this Indenture, anything in this Indenture to the contrary notwithstanding. If any Securities have been authenticated, but not delivered, by the Trustee then in office, any successor by merger, conversion, or consolidation to such authenticating Trustee may adopt such authentication and deliver the Securities so authenticated with the same effect as if such successor Trustee had itself authenticated such Securities.
Section 7.13 Preferential Collection of Claims Against the Company.
The Trustee will comply with Section 311(a) of the Trust Indenture Act, excluding any creditor relationship described in Section 311(b) of the Trust Indenture Act. A Trustee who has resigned or been removed will be subject to Section 311(a) of the Trust Indenture Act to the extent included in such section.
Section 7.14 Notice of Default.
If any Event of Default occurs and is continuing and if such Event of Default is known to a Responsible Officer of the Trustee, the Trustee will send to each Securityholder in the manner and to the extent provided in Section 313(c) of the Trust Indenture Act notice of the Event of Default within the earlier of 90 days after it occurs and 30 days after it is known to a Responsible Officer of the Trustee or written notice of it is received by the Trustee, unless such Event of Default has been cured; provided, however, that, except in the case of a default in the payment of the principal of (or premium, if any) or interest on any Security, the Trustee will be protected in withholding such notice if and so long as the Responsible Officers of the Trustee in good faith determine that the withholding of such notice is in the interest of the Securityholders.
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ARTICLE 8
CONCERNING THE SECURITYHOLDERS
Section 8.01 Evidence of Action by Securityholders.
Whenever in this Indenture it is provided that the holders of a majority or specified percentage in aggregate principal amount of the Securities of a particular series may take any action (including the making of any demand or request, the giving of any notice, consent, or waiver, or the taking of any other action), the fact that at the time of taking any such action the holders of such majority or specified percentage of that series have joined in such action may be evidenced by any instrument or any number of instruments of similar tenor executed by such holders of Securities of that series in person or by agent or proxy appointed in writing.
If the Company solicits from the Securityholders of any series any request, demand, authorization, direction, notice, consent, waiver, or other action, the Company may, at its option, as evidenced by an Officer’s Certificate, fix in advance a record date for such series for the determination of Securityholders entitled to give such request, demand, authorization, direction, notice, consent, waiver, or other action, but the Company will have no obligation to do so. If such a record date is fixed, such request, demand, authorization, direction, notice, consent, waiver, or other action may be given before or after the record date, but only the Securityholders of record at the close of business on the record date will be deemed to be Securityholders for the purposes of determining whether the requisite proportion of Outstanding Securities of that series have authorized or agreed or consented to such request, demand, authorization, direction, notice, consent, waiver, or other action, and for that purpose the Outstanding Securities of that series will be computed as of the record date; provided, however, that no such authorization, agreement, or consent by such Securityholders on the record date will be deemed effective unless it becomes effective pursuant to the provisions of this Indenture not later than six months after the record date.
Section 8.02 Proof of Execution by Securityholders.
Subject to the provisions of Section 7.01, proof of the execution of any instrument by a Securityholder (which will not require notarization) or his or her agent or proxy and proof of the holding by any Person of any of the Securities will be sufficient if made in the following manner:
(a) The fact and date of the execution by any such Person of any instrument may be proved in any reasonable manner acceptable to the Trustee.
(b) The ownership of Securities will be proved by the Security Register or by a certificate of the Security Registrar, in each case of such Securities.
The Trustee may require such additional proof of any matter referred to in this Section as it deems necessary.
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Section 8.03 Who May be Deemed Owners.
Prior to the due presentment for registration of transfer of any Security, the Company, the Trustee, any paying agent, and any Security Registrar may deem and treat the Person in whose name such Security is registered on the books of the Security Registrar as the absolute owner of such Security (whether or not such Security is overdue and notwithstanding any notice of ownership or writing thereon made by anyone other than the Security Registrar) for the purpose of receiving payment of or on account of the principal of, premium, if any, and (subject to Section 2.03) interest on such Security and for all other purposes; and neither the Company nor the Trustee nor any paying agent nor any Security Registrar will be affected by any notice to the contrary.
Section 8.04 Certain Securities Owned by Company Disregarded.
In determining whether the holders of the requisite aggregate principal amount of Securities of a particular series have concurred in any direction, consent, or waiver under this Indenture, the Securities of that series that are owned by the Company or any other obligor on the Securities of that series or by any Person directly or indirectly controlling or controlled by or under common control with the Company or any other obligor on the Securities of that series will be disregarded and deemed not to be Outstanding for the purpose of any such determination, except that for the purpose of determining whether the Trustee is protected in relying on any such direction, consent, or waiver, only Securities of such series that the Trustee actually knows are so owned will be so disregarded. The Securities so owned that have been pledged in good faith may be regarded as Outstanding for the purposes of this Section, if the pledgee establishes to the satisfaction of the Trustee the pledgee’s right to act with respect to such Securities and that the pledgee is not a Person directly or indirectly controlling or controlled by or under direct or indirect common control with the Company or any such other obligor. If there is a dispute as to such right, any decision by the Trustee taken on the advice of counsel will be full protection to the Trustee.
Section 8.05 Actions Binding on Future Securityholders.
At any time prior to (but not after) the evidencing to the Trustee, as provided in Section 8.01, of the taking of any action by the holders of the majority or percentage in aggregate principal amount of the Securities of a particular series specified in this Indenture in connection with such action, any holder of a Security of that series that is shown by the evidence to be included in the Securities the holders of which have consented to such action may, by filing written notice with the Trustee, and on proof of holding as provided in Section 8.02, revoke such action so far as concerns such Security. Except as expressly provided in the prior sentence, any such action taken by the holder of any Security will be conclusive and binding on such holder and on all future holders and owners of such Security, and of any Security issued in exchange, on registration of transfer, or in place of such Security, irrespective of whether or not any notation in regard to such action is made on such Security. Any action taken by the holders of the majority or percentage in aggregate principal amount of the Securities of a particular series specified in this Indenture in connection with such action will be conclusively binding on the Company, the Trustee, and the holders of all the Securities of that series.
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ARTICLE 9
SUPPLEMENTAL INDENTURES
Section 9.01 Supplemental Indentures Without the Consent of Securityholders.
In addition to any supplemental indenture otherwise authorized by this Indenture, the Company and the Trustee may from time to time enter into a supplemental indenture or indentures (which will conform to the provisions of the Trust Indenture Act as then in effect), without the consent of the Securityholders, for one or more of the following purposes:
(a) to cure any ambiguity, defect, or inconsistency in this Indenture or in the Securities of any series;
(b) to comply with Article Ten;
(c) to provide for uncertificated Securities in addition to or in place of certificated Securities;
(d) to add to the covenants, restrictions, conditions, or provisions relating to the Company for the benefit of the holders of all or any series of Securities (and if such covenants, restrictions, conditions, or provisions are to be for the benefit of less than all series of Securities, stating that such covenants, restrictions, conditions, or provisions are expressly being included solely for the benefit of such series), to make the occurrence, or the occurrence and the continuance, of a default in any such additional covenants, restrictions, conditions, or provisions an Event of Default, or to surrender any right or power conferred on the Company;
(e) to add to, delete from, or revise the conditions, limitations, and restrictions on the authorized amount, terms, or purposes of issue, authentication, and delivery of Securities;
(f) to make any change that does not adversely affect the rights of any Securityholder in any material respect;
(g) to provide for the issuance of and establish the form and terms and conditions of the Securities of any series as provided in Section 2.01, to establish the form of any certifications required to be furnished pursuant to the terms of this Indenture or any series of Securities, or to add to the rights of the holders of any series of Securities;
(h) to evidence and provide for the acceptance of appointment by a successor trustee; or
(i) to comply with any requirements of the Commission or any successor in connection with the qualification of this Indenture under the Trust Indenture Act.
The Trustee is authorized to join with the Company in the execution of any such supplemental indenture, and to make any further appropriate agreements and stipulations that may be contained in such supplemental indenture, but the Trustee will not be obligated to enter into any supplemental indenture that affects the Trustee’s own rights, duties, or immunities under this Indenture or otherwise.
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Any supplemental indenture authorized by the provisions of this Section may be executed by the Company and the Trustee without the consent of the holders of any of the Securities at the time Outstanding, notwithstanding any of the provisions of Section 9.02.
Section 9.02 Supplemental Indentures With the Consent of Securityholders.
With the consent (evidenced as provided in Section 8.01) of the holders of not less than a majority in aggregate principal amount of the Securities of each series affected by such supplemental indenture or indentures at the time Outstanding, the Company, when authorized by a Board Resolution, and the Trustee may from time to time enter into a supplemental indenture or indentures (which will conform to the provisions of the Trust Indenture Act as then in effect) for the purpose of adding any provisions to, changing in any manner, or eliminating any of the provisions of this Indenture or of any supplemental indenture or of modifying in any manner not covered by Section 9.01 the rights of the holders of the Securities of such series under this Indenture; provided, however, that no supplemental indenture will, without the consent of the holders of each Security then Outstanding and affected thereby, (a) extend the fixed maturity of any Securities of any series, or reduce the principal amount of such Securities, or reduce the rate or extend the time of payment of interest on such Securities, or reduce any premium payable on the redemption of such Securities or (b) reduce the percentage of Securities, the holders of which are required to consent to any such supplemental indenture.
It will not be necessary for the consent of the Securityholders of any series affected by such supplemental indenture under this Section to approve the particular form of proposed supplemental indenture, but will be sufficient if such consent approves the substance of such supplemental indenture.
Section 9.03 Effect of Supplemental Indentures.
On the execution of any supplemental indenture pursuant to the provisions of this Article or Section 10.01, this Indenture will, with respect to such series, be modified and amended in accordance with such supplemental indenture and the respective rights, limitations of rights, obligations, duties, and immunities under this Indenture of the Trustee, the Company, and the holders of Securities of the series affected thereby will thereafter be determined, exercised, and enforced subject in all respects to such modifications and amendments, and all the terms and conditions of such supplemental indenture will be part of the terms and conditions of this Indenture for all purposes.
Section 9.04 Securities Affected by Supplemental Indentures.
Securities of any series affected by a supplemental indenture, authenticated, and delivered after the execution of such supplemental indenture pursuant to the provisions of this Article or Section 10.01, may bear a notation in form approved by the Company, provided such form meets the requirements of any securities exchange on which such series may be listed, as to any matter provided for in such supplemental indenture. If the Company determines, new Securities of that series so modified as to conform, in the opinion of the Board of Directors, to any modification of this Indenture contained in any such supplemental indenture may be prepared by the Company, authenticated by the Trustee, and delivered in exchange for the Securities of that series then Outstanding.
38.
Section 9.05 Execution of Supplemental Indentures.
On the request of the Company, accompanied by Board Resolutions authorizing the execution of such supplemental indenture, and on the filing with the Trustee of evidence of the consent of Securityholders required to consent to such supplemental indenture, the Trustee will join with the Company in the execution of such supplemental indenture unless such supplemental indenture affects the Trustee’s own rights, duties, or immunities under this Indenture or otherwise, in which case the Trustee may in its discretion but will not be obligated to enter into such supplemental indenture. The Trustee, subject to the provisions of Section 7.01, will receive an Officer’s Certificate or an Opinion of Counsel as conclusive evidence that any supplemental indenture executed pursuant to this Article is authorized or permitted by the terms of this Article and that all conditions precedent to the execution of the supplemental indenture have been complied with; provided, however, that such Officer’s Certificate or Opinion of Counsel need not be provided in connection with the execution of a supplemental indenture that establishes the terms of a series of Securities pursuant to Section 2.01 .
Promptly after the execution by the Company and the Trustee of any supplemental indenture pursuant to the provisions of this Section, the Company will (or will direct the Trustee to) send a notice, setting forth in general terms the substance of such supplemental indenture, to the Securityholders of all series affected thereby as their names and addresses appear on the Security Register. Any failure of the Company to send, or cause the sending of, such notice, or any defect in such notice, will not in any way impair or affect the validity of any such supplemental indenture.
ARTICLE 10
SUCCESSOR ENTITY
Section 10.01 Company May Consolidate, Etc.
Nothing contained in this Indenture will prevent any consolidation or merger of the Company with or into any other Person (whether or not affiliated with the Company) or successive consolidations or mergers in which the Company or its successor or successors are a party or parties, or will prevent any sale, conveyance, transfer, or other disposition of the property of the Company or its successor or successors as an entirety, or substantially as an entirety, to any other Person (whether or not affiliated with the Company or its successor or successors); provided, however, the Company agrees that, on any such consolidation or merger (in each case, if the Company is not the survivor of such transaction) or any such sale, conveyance, transfer, or other disposition (other than a sale, conveyance, transfer, or other disposition to a Subsidiary of the Company), the due and punctual payment of the principal of (and premium, if any) and interest on all of the Securities of all series in accordance with the terms of each series, according to their tenor, and the due and punctual performance and observance of all the covenants and conditions of this Indenture with respect to each series or established with respect to such series pursuant to Section 2.01 to be kept or performed by the Company will be expressly assumed, by supplemental indenture (which will conform to the provisions of the Trust Indenture Act, as then in effect) reasonably satisfactory in form to the Trustee executed and delivered to the Trustee by the entity formed by such consolidation, or into which the Company has been merged, or by the entity which has acquired such property.
39.
Section 10.02 Successor Entity Substituted.
(a) If any such consolidation, merger, sale, conveyance, transfer, or other disposition occurs, and on the assumption by the successor entity by supplemental indenture, executed and delivered to the Trustee and satisfactory in form to the Trustee, of the obligations set forth under Section 10.01 on all of the Securities of all series Outstanding, such successor entity will succeed to and be substituted for the Company with the same effect as if it had been named as the Company in this Indenture, and the predecessor corporation will be relieved of all obligations and covenants under this Indenture and the Securities.
(b) If any such consolidation, merger, sale, conveyance, transfer, or other disposition occurs, such changes in phraseology and form (but not in substance) may be made in the Securities subsequently to be issued as may be appropriate.
(c) Nothing contained in this Article will require any action by the Company if a consolidation or merger of any Person into the Company occurs, where the Company is the survivor of such transaction, or the Company acquires, by purchase or otherwise, all or any part of the property of any other Person (whether or not affiliated with the Company).
ARTICLE 11
SATISFACTION AND DISCHARGE
Section 11.01 Satisfaction and Discharge of Indenture.
If at any time:
(a) (i) the Company has delivered to the Trustee for cancellation all Securities of a series previously authenticated and not delivered to the Trustee for cancellation (other than any Securities that have been destroyed, lost, or stolen and that have been replaced or paid as provided in Section 2.07 and Securities for whose payment money or Governmental Obligations have been deposited in trust or segregated and held in trust by the Company and repaid to the Company or discharged from such trust, as provided in Section 11.05); or (ii) all such Securities of a particular series not previously delivered to the Trustee for cancellation have become due and payable, or by their terms will become due and payable within one year or will be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption,
(b) the Company deposits or causes to be deposited with the Trustee as trust funds the entire amount in money or Governmental Obligations or a combination, sufficient (in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification delivered to the Trustee) to pay at maturity or on redemption all Securities of that series not previously delivered to the Trustee for cancellation, including principal (and premium, if any) and interest due or to become due to such date of maturity or date fixed for redemption, as the case may be, and
40.
(c) the Company pays or causes to be paid all other funds payable under this Indenture with respect to such series by the Company
(i) then this Indenture will cease to be of further effect with respect to such series except for the provisions of Sections 2.03, 2.05, 2.07, 4.01, 4.02, 4.03, 7.10, 11.05, and 13.04, which will survive until the date of maturity or redemption date, as the case may be, and Sections 7.06 and 11.05, which will survive indefinitely, and the Trustee, on demand of the Company and at the cost and expense of the Company, will execute proper instruments acknowledging satisfaction of and discharging this Indenture with respect to such series.
Section 11.02 Discharge of Obligations.
If at any time all Securities of a particular series not previously delivered to the Trustee for cancellation or that have not become due and payable as described in Section 11.01 have been paid by the Company by depositing irrevocably with the Trustee as trust funds money or Governmental Obligations sufficient to pay, at maturity or on redemption, all such Securities of that series not previously delivered to the Trustee for cancellation, including principal (and premium, if any) and interest due or to become due to such date of maturity or date fixed for redemption, as the case may be, and if the Company also pays or causes to be paid all other funds payable under this Indenture by the Company with respect to such series, then, after the date such money or Governmental Obligations, as the case may be, are deposited with the Trustee, the obligations of the Company under this Indenture with respect to such series will cease to be of further effect except for the provisions of Sections 2.03, 2.05, 2.07, 4,01, 4.02, 4,03, 7.06, 7.10, 11.05, and 13.04, which will survive until such Securities mature and are paid, and Sections 7.06 and 11.05, which will survive indefinitely.
Section 11.03 Deposited Funds to be Held in Trust.
All money or Governmental Obligations deposited with the Trustee pursuant to Sections 11.01 or 11.02 will be held in trust and will be available for payment as due, either directly or through any paying agent (including the Company acting as its own paying agent), to the holders of the particular series of Securities for the payment or redemption of which such money or Governmental Obligations were deposited with the Trustee.
Section 11.04 Payment of Funds Held by Paying Agents.
In connection with the satisfaction and discharge of this Indenture, all money or Governmental Obligations then held by any paying agent under the provisions of this Indenture will, on demand of the Company, be paid to the Trustee and such paying agent will then be released from all further liability with respect to such money or Governmental Obligations.
41.
Section 11.05 Repayment to Company.
Any money or Governmental Obligations deposited with any paying agent or the Trustee, or held by the Company, in trust for payment of principal of or premium, if any, or interest on the Securities of a particular series that are not applied but remain unclaimed by the holders of such Securities for at least two years after the date on which the principal of (and premium, if any) or interest on such Securities have respectively become due and payable, or such other shorter period set forth in applicable escheat or abandoned or unclaimed property law, will be repaid to the Company on May 31 of each year or on the Company’s request or (if held by the Company) will be discharged from such trust; and the paying agent and the Trustee will then be released from all further liability with respect to such money or Governmental Obligations, and the holder of any of the Securities entitled to receive such payment will then, as a general creditor, look only to the Company for payment.
ARTICLE 12
IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS, AND DIRECTORS
Section 12.01 No Recourse.
No recourse under or on any obligation, covenant, or agreement of this Indenture, or of any Security, or for any claim based on or otherwise in respect of this Indenture, will be had against any incorporator, stockholder, officer, or director (in each case, past, present, or future) of the Company or any predecessor or successor corporation, either directly or through the Company or any such predecessor or successor corporation, whether by virtue of any constitution, statute, or rule of law, or by the enforcement of any assessment or penalty or otherwise; it being expressly understood that this Indenture and the obligations issued under this Indenture are solely corporate obligations, and that no personal liability will attach to, or is or will be incurred by, the incorporators, stockholders, officers, or directors of the Company or of any predecessor or successor corporation, or any of them, because of the creation of the indebtedness authorized by this Indenture, or under or by reason of the obligations, covenants, or agreements contained in or implied by this Indenture or in any of the Securities; and that any and all such personal liability of every name and nature, either at common law or in equity or by constitution or statute, of, and any and all such rights and claims against, every such incorporator, stockholder, officer, or director, because of the creation of the indebtedness authorized by this Indenture, or under or by reason of the obligations, covenants, or agreements contained in or implied by this Indenture or in any of the Securities, are expressly waived and released as a condition of, and as a consideration for, the execution of this Indenture and the issuance of such Securities.
42.
ARTICLE 13
MISCELLANEOUS PROVISIONS
Section 13.01 Effect on Successors and Assigns.
All the covenants, stipulations, promises, and agreements in this Indenture made by or on behalf of the Company will bind its successors and assigns.
Section 13.02 Actions by Successor.
Any act or proceeding by any provision of this Indenture authorized or required to be done or performed by any board, committee, or officer of the Company will and may be done and performed with like force and effect by the corresponding board, committee, or officer of any corporation that at the time is the lawful successor of the Company.
Section 13.03 Surrender of Company Powers.
The Company may surrender any of the powers reserved to the Company by instrument in writing executed by authority of its Board of Directors and delivered to the Trustee, and such surrendered power surrendered will then terminate as to both the Company and any successor corporation.
Section 13.04 Notices.
Except as otherwise expressly provided in this Indenture, any notice, request, or demand that is required or permitted to be given, made, or served by the Trustee, the Security Registrar, any paying or other agent under this Indenture, the holders of Securities, or any other Person pursuant to this Indenture to or on the Company may be given or served by being deposited in first class mail, postage prepaid, addressed (until another address is filed in writing by the Company with the Trustee), as follows: Snap Inc., 2772 Donald Douglas Loop North, Santa Monica, CA 90405, Attn: Secretary. Any notice, election, request, or demand by the Company, any Securityholder, or any other Person pursuant to this Indenture to or on the Trustee will be deemed to have been sufficiently given or made, for all purposes, if given or made in writing at the Corporate Trust Office of the Trustee.
Section 13.05 Governing Law; Jury Trial Waiver.
This Indenture and each Security will be governed by, and construed in accordance with, the internal laws of the State of New York, except to the extent that the Trust Indenture Act is applicable.
EACH PARTY TO THIS INDENTURE, AND EACH HOLDER OF A SECURITY BY ACCEPTANCE OF SUCH SECURITY, WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER, OR IN CONNECTION WITH THIS INDENTURE.
43.
Section 13.06 Treatment of Securities as Debt.
It is intended that the Securities will be treated as indebtedness and not as equity for federal income tax purposes. The provisions of this Indenture will be interpreted to further this intention.
Section 13.07 Certificates and Opinions as to Conditions Precedent.
(a) On any application or demand by the Company to the Trustee to take any action under any provision of this Indenture, the Company will furnish to the Trustee an Officer’s Certificate stating that all conditions precedent provided for in this Indenture (other than the certificate to be delivered pursuant to Section 13.12) relating to the proposed action have been complied with and, if requested, an Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent have been complied with, except that in the case of any such application or demand as to which the furnishing of such documents is specifically required by any provision of this Indenture relating to such particular application or demand, no additional certificate or opinion need be furnished.
(b) Each certificate or opinion provided for in this Indenture and delivered to the Trustee with respect to compliance with a condition or covenant in this Indenture (other than the certificate to be delivered pursuant to Section 13.12 (or Section 314(a)(1) of the Trust Indenture Act)) will include (i) a statement that the Person making such certificate or opinion has read such covenant or condition; (ii) a brief statement as to the nature and scope of the examination or investigation on which the statements or opinions contained in such certificate or opinion are based; (iii) a statement that, in the opinion of such Person, he or she has made such examination or investigation as is reasonably necessary to enable him or her to express an informed opinion as to whether or not such covenant or condition has been complied with; and (iv) a statement as to whether or not, in the opinion of such Person, such condition or covenant has been complied with.
Section 13.08 Payments on Business Days.
Except as provided pursuant to Section 2.01 pursuant to a Board Resolution, and set forth in an Officer’s Certificate, or established in one or more supplemental indentures, if the date of maturity of interest or principal of any Security or the date of redemption of any Security is not a Business Day, then payment of interest or principal (and premium, if any) may be made on the next succeeding Business Day with the same force and effect as if made on the nominal date of maturity or redemption, and no interest will accrue for the period after such nominal date.
Section 13.09 Conflict with Trust Indenture Act.
If and to the extent that any provision of this Indenture limits, qualifies, or conflicts with the duties imposed by Section 318(c) of the Trust Indenture Act, such imposed duties will control.
Section 13.10 Counterparts.
This Indenture may be executed in any number of counterparts, each of which will be an original, and such counterparts together will constitute one instrument. The exchange of copies of this Indenture and signature pages by facsimile or PDF transmission will constitute effective execution and delivery of this Indenture as to the parties to this Indenture and may be used in lieu of the original Indenture for all purposes. Signatures of the parties to this Indenture transmitted by facsimile or PDF will be deemed to be original signatures for all purposes.
44.
Section 13.11 Separability.
If any one or more of the provisions contained in this Indenture or the Securities of any series are for any reason held to be invalid, illegal, or unenforceable in any respect, such invalidity, illegality, or unenforceability will not affect any other provisions of this Indenture or such Securities, but this Indenture and such Securities will be construed as if such invalid or illegal or unenforceable provision had never been contained in this Indenture or such Securities, as applicable.
Section 13.12 Compliance Certificates.
The Company will deliver to the Trustee, within 120 days after the end of each fiscal year during which any Securities of any series were outstanding, an officer’s certificate stating whether or not the signers know of any Event of Default that occurred during such fiscal year. Such certificate will contain a certification from the principal executive officer, principal financial officer, or principal accounting officer of the Company that a review has been conducted of the activities of the Company and the Company’s performance under this Indenture and that the Company has complied with all conditions and covenants under this Indenture. For purposes of this Section 13.12, such compliance will be determined without regard to any period of grace or requirement of notice provided under this Indenture. If the officer of the Company signing such certificate has knowledge of such an Event of Default, the certificate will describe such Event of Default and its status.
Section 13.13 U.S.A Patriot Act.
The parties to this Indenture acknowledge that in accordance with Section 326 of the U.S.A. Patriot Act, the Trustee, like all financial institutions and in order to help fight the funding of terrorism and money laundering, is required to obtain, verify, and record information that identifies each person or legal entity that establishes a relationship or opens an account with the Trustee. The parties to this Indenture agree that they will provide the Trustee with such information as it may request in order for the Trustee to satisfy the requirements of the U.S.A. Patriot Act.
Section 13.14 Force Majeure.
In no event will the Trustee, the Security Registrar, any paying agent, or any other agent under this Indenture be responsible or liable for any failure or delay in the performance of its obligations under this Indenture arising out of or caused by, directly or indirectly, forces beyond its control, including strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes, or acts of God, and interruptions, loss, or malfunctions of utilities, communications, or computer (software and hardware) services; it being understood that the Trustee, the Security Registrar, any paying agent, or any other agent under this Indenture will use reasonable efforts consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.
45.
Section 13.15 Table of Contents; Headings.
The table of contents and headings of the articles and sections of this Indenture have been inserted for convenience of reference only, are not intended to be considered a part of this Indenture and will not modify or restrict any of the terms or provisions of this Indenture.
46.
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly executed as of the day and year first written above.
| SNAP INC. | ||
| By: |
| |
| Name: |
| |
| Title: |
| |
| [TRUSTEE], as Trustee | ||
| By: |
| |
| Name: |
| |
| Title: |
| |
47.
CROSS-REFERENCE TABLE (1)
| Section of Trust Indenture Act of 1939, as Amended |
Section of Indenture | |
| 310(a) |
7.09 | |
| 310(b) |
7.08 | |
| 7.10 | ||
| 310(c) |
Inapplicable | |
| 311(a) |
7.13 | |
| 311(b) |
7.13 | |
| 311(c) |
Inapplicable | |
| 312(a) |
5.01 | |
| 5.02(a) | ||
| 312(b) |
5.02(c) | |
| 312(c) |
5.02(c) | |
| 313(a) |
5.04(a) | |
| 313(b) |
5.04(b) | |
| 313(c) |
5.04(a) | |
| 5.04(b) | ||
| 313(d) |
5.04(c) | |
| 314(a) |
5.03 | |
| 13.12 | ||
| 314(b) |
Inapplicable | |
| 314(c) |
13.07(a) | |
| 314(d) |
Inapplicable | |
| 314(e) |
13.07(b) | |
| 314(f) |
Inapplicable | |
| 315(a) |
7.01(a) | |
| 7.01(b) | ||
| 315(b) |
7.14 | |
| 315(c) |
7.01 | |
| 315(d) |
7.01(b) | |
| 315(e) |
6.07 | |
| 316(a) |
6.06 | |
| 8.04 | ||
| 316(b) |
6.04 | |
| 316(c) |
8.01 | |
| 317(a) |
6.02 | |
| 317(b) |
4.03 | |
| 318(a) |
13.09 |
| (1) | This Cross-Reference Table does not constitute part of the Indenture and will not have any bearing on the interpretation of any of its terms or provisions. |
48.
Exhibit 4.8
SNAP INC.
AND
, AS WARRANT AGENT
FORM OF CLASS A COMMON STOCK
WARRANT AGREEMENT
DATED AS OF [•], 20
SNAP INC.
FORM OF CLASS A COMMON STOCK WARRANT AGREEMENT
THIS CLASS A COMMON STOCK WARRANT AGREEMENT (this “Agreement”), dated as of [•], between SNAP INC., a Delaware corporation (the “Company”) and [•], a [corporation] [national banking association] organized and existing under the laws of [•] and having a corporate trust office in [•], as warrant agent (the “Warrant Agent”).
WHEREAS, the Company proposes to sell [If Warrants are sold with other securities —[title of other securities being offered] (the “Other Securities”) with] warrant certificates evidencing one or more warrants (the “Warrants” or, individually, a “Warrant”) representing the right to purchase Class A Common Stock of the Company, par value $0.00001 per share (the “Warrant Securities”), the warrant certificates and other warrant certificates issued pursuant to this Agreement are herein called the “Warrant Certificates”; and
WHEREAS, the Company desires the Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing to act, in connection with the issuance, registration, transfer, exchange, exercise and replacement of the Warrant Certificates, and the Company wishes to set forth in this Agreement, among other things, the form and provisions of the Warrant Certificates and the terms and conditions on which they may be issued, registered, transferred, exchanged, exercised and replaced.
NOW THEREFORE, in consideration of the premises and of the mutual agreements contained in this Agreement, the parties agree as follows:
ARTICLE 1
ISSUANCE OF WARRANTS AND EXECUTION AND
DELIVERY OF WARRANT CERTIFICATES
1.1 Issuance of Warrants. [If Warrants alone — Upon issuance, each Warrant Certificate will evidence one or more Warrants.] [If Other Securities and Warrants — Warrant Certificates will be issued in connection with the issuance of the Other Securities but will be separately transferable and each Warrant Certificate will evidence one or more Warrants.] Each Warrant evidenced by a Warrant Certificate will represent the right, subject to the provisions contained in this Agreement and in such Warrant Certificate, to purchase one Warrant Security. [If Other Securities and Warrants — Warrant Certificates will be issued with the Other Securities and each Warrant Certificate will evidence [•] Warrants for each [$[•] principal amount] [[•] shares] of Other Securities issued.]
1.2 Execution and Delivery of Warrant Certificates. Each Warrant Certificate, whenever issued, will be in registered form substantially in the form set forth in Exhibit A hereto, will be dated the date of its countersignature by the Warrant Agent and may have letters, numbers, or other marks of identification or designation and legends or endorsements printed, lithographed or engraved on it, as the officers of the Company executing the Warrant Certificate
1.
may approve (execution of the Warrant Certificate to be conclusive evidence of such approval) and as are not inconsistent with the provisions of this Agreement, or as may be required to comply with any law or with any rule or regulation made pursuant to it or with any rule or regulation of any securities exchange on which the Warrants may be listed, or to conform to usage. The Warrant Certificates will be signed on behalf of the Company by any of its present or future chief executive officers, presidents, senior vice presidents, vice presidents, chief financial officers, chief legal officers, treasurers, assistant treasurers, controllers, assistant controllers, secretaries or assistant secretaries under its corporate seal reproduced on it. The signatures may be manual or facsimile signatures of such authorized officers and may be imprinted or otherwise reproduced on the Warrant Certificates. The seal of the Company may be in the form of a facsimile and may be impressed, affixed, imprinted or otherwise reproduced on the Warrant Certificates.
No Warrant Certificate will be valid for any purpose, and no Warrant evidenced by it will be exercisable, until such Warrant Certificate has been countersigned by the manual signature of the Warrant Agent. The signature of the Warrant Agent on any Warrant Certificate executed by the Company will be conclusive evidence that the countersigned Warrant Certificate has been duly issued under this Agreement.
In case any officer of the Company who signed any of the Warrant Certificates either manually or by facsimile signature ceases to be an officer before the Warrant Certificates have been countersigned and delivered by the Warrant Agent, the Warrant Certificates may be countersigned and delivered notwithstanding that the person who signed such Warrant Certificates ceased to be an officer of the Company; and any Warrant Certificate may be signed on behalf of the Company by such persons, at the actual date of the execution of such Warrant Certificate, who are the proper officers of the Company, although at the date of the execution of this Agreement any such person was not such officer.
The term “holder” or “holder of a Warrant Certificate” as used in this Agreement will mean any person in whose name at the time any Warrant Certificate is registered on the books maintained by the Warrant Agent for that purpose.
1.3 Issuance of Warrant Certificates. Warrant Certificates evidencing the right to purchase Warrant Securities may be executed by the Company and delivered to the Warrant Agent on the execution of this Agreement or from time to time thereafter. The Warrant Agent will, upon receipt of Warrant Certificates duly executed on behalf of the Company, countersign the Warrant Certificates and deliver the Warrant Certificates to, or upon the order of, the Company.
ARTICLE 2
WARRANT PRICE, DURATION AND EXERCISE OF WARRANTS
2.1 Warrant Price. During the period specified in Section 2.2, each Warrant will, subject to the terms of this Agreement and the applicable Warrant Certificate, entitle the holder of the Warrant Certificate to purchase the number of Warrant Securities specified in the applicable Warrant Certificate at an exercise price of $[•] per Warrant Security, subject to adjustment upon the occurrence of certain events, as provided in this Agreement. Such purchase price per Warrant Security is referred to in this Agreement as the “Warrant Price.”
2.
2.2 Duration of Warrants. Each Warrant may be exercised in whole or in part at any time, as specified herein, on or after [the date thereof] [•] and at or before [•] p.m., [City] time, on [•] or such later date as the Company may designate by notice to the Warrant Agent and the holders of Warrant Certificates mailed to their addresses as set forth in the record books of the Warrant Agent (the “Expiration Date”). Each Warrant not exercised at or before [•] p.m., [City] time, on the Expiration Date will become void, and all rights of the holder of the Warrant Certificate evidencing such Warrant under this Agreement will cease.
2.3 Exercise of Warrants.
(a) During the period specified in Section 2.2, the Warrants may be exercised to purchase a whole number of Warrant Securities in registered form by providing certain information as set forth on the reverse side of the Warrant Certificate and by paying in full, in lawful funds of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds] the Warrant Price for each Warrant Security with respect to which a Warrant is being exercised to the Warrant Agent at its corporate trust office, provided that such exercise is subject to receipt within five business days of such payment by the Warrant Agent of the Warrant Certificate with the form of election to purchase Warrant Securities set forth on the reverse side of the Warrant Certificate properly completed and duly executed. The date on which payment in full of the Warrant Price is received by the Warrant Agent will, subject to receipt of the Warrant Certificate, be deemed to be the date on which the Warrant is exercised; except that if, at the date of receipt of such Warrant Certificates and payment in full of the Warrant Price, the transfer books for the Warrant Securities purchasable on the exercise of such Warrants will be closed, no receipt of such Warrant Certificates and no payment of such Warrant Price will be effective to name the designated person as the holder of record of such Warrant Securities on such date, but will be effective to constitute such person as the holder of record of such Warrant Securities for all purposes at the opening of business on the next succeeding day on which the transfer books for the Warrant Securities purchasable upon the exercise of such Warrants will be opened, and the certificates for the Warrant Securities in respect of which such Warrants are then exercised will be issuable as of the next succeeding day on which the transfer books will be opened, and until such date the Company will be under no duty to deliver any certificate for such Warrant Securities. The Warrant Agent will deposit all funds received by it in payment of the Warrant Price in an account of the Company maintained with it and will advise the Company by telephone at the end of each day on which a payment for the exercise of Warrants is received of the amount so deposited to its account. The Warrant Agent will promptly confirm such telephone advice to the Company in writing.
(b) The Warrant Agent will, from time to time, as promptly as practicable, advise the Company of (i) the number of Warrant Securities with respect to which Warrants were exercised, (ii) the instructions of each holder of the Warrant Certificates evidencing Warrants with respect to delivery of the Warrant Securities to which each holder is entitled upon exercise, (iii) delivery of Warrant Certificates evidencing the balance, if any, of the Warrants for the remaining Warrant Securities after exercise, and (iv) any other information as the Company will reasonably require.
3.
(c) As soon as practicable after the exercise of any Warrant, the Company will issue, to or on the order of the holder of the Warrant Certificate evidencing such Warrant, the Warrant Securities to which the holder is entitled, in fully registered form, registered in the name or names as directed by the holder. If fewer than all of the Warrants evidenced by the Warrant Certificate are exercised, the Company will execute, and an authorized officer of the Warrant Agent will manually countersign and deliver, a new Warrant Certificate evidencing Warrants for the number of Warrant Securities remaining unexercised.
(d) The Company will not be required to pay any stamp or other tax or other governmental charge required to be paid in connection with any transfer involved in the issue of the Warrant Securities, and in the event that any such transfer is involved, the Company will not be required to issue or deliver any Warrant Security until the tax or other charge has been paid or it has been established to the Company’s satisfaction that no such tax or other charge is due.
(e) Prior to the issuance of any Warrants there must be a reserve, and the Company will at all times through the Expiration Date keep reserved, out of its authorized but unissued Warrant Securities, a number of shares sufficient to provide for the exercise of the Warrants.
ARTICLE 3
OTHER PROVISIONS RELATING TO RIGHTS OF HOLDERS OF
WARRANT CERTIFICATES
3.1 No Rights as Warrant Securityholder Conferred by Warrants or Warrant Certificates. No Warrant Certificate or Warrant evidenced by a Warrant Certificate will entitle the holder to any of the rights of a holder of Warrant Securities, including, without limitation, the right to receive the payment of dividends or distributions, if any, on the Warrant Securities or to exercise any voting rights, except to the extent expressly set forth in this Agreement or the applicable Warrant Certificate.
3.2 Lost, Stolen, Mutilated or Destroyed Warrant Certificates. Upon receipt by the Warrant Agent of evidence reasonably satisfactory to it and the Company of the ownership of and the loss, theft, destruction or mutilation of any Warrant Certificate or indemnity reasonably satisfactory to the Warrant Agent and the Company and, in the case of mutilation, upon surrender of the mutilated Warrant Certificate to the Warrant Agent for cancellation, then, in the absence of notice to the Company or the Warrant Agent that such Warrant Certificate has been acquired by a bona fide purchaser, the Company will execute, and an authorized officer of the Warrant Agent will manually countersign and deliver, in exchange for or in lieu of the lost, stolen, destroyed or mutilated Warrant Certificate, a new Warrant Certificate of the same tenor and evidencing Warrants for a like number of Warrant Securities. Upon the issuance of any new Warrant Certificate under this Section 3.2, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation to the new issuance and any other expenses (including the fees and expenses of the Warrant Agent) in connection therewith. Every substitute Warrant Certificate executed and delivered pursuant to
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this Section 3.2 in lieu of any lost, stolen or destroyed Warrant Certificate will represent an additional contractual obligation of the Company, whether or not the lost, stolen or destroyed Warrant Certificate will be at any time enforceable by anyone, and will be entitled to the benefits of this Agreement equally and proportionately with any and all other Warrant Certificates duly executed and delivered hereunder. The provisions of this Section 3.2 are exclusive and will preclude (to the extent lawful) all other rights and remedies with respect to the replacement of mutilated, lost, stolen or destroyed Warrant Certificates.
3.3 Holder of Warrant Certificate May Enforce Rights. Notwithstanding any of the provisions of this Agreement, any holder of a Warrant Certificate, without the consent of the Warrant Agent, the holder of any Warrant Securities or the holder of any other Warrant Certificate, may, in such holder’s own behalf and for such holder’s own benefit, enforce, and may institute and maintain any suit, action or proceeding against the Company suitable to enforce, or otherwise in respect of, each holder’s right to exercise the Warrants evidenced by the holder’s Warrant Certificate in the manner provided in the holder’s Warrant Certificate and in this Agreement.
3.4 Adjustments.
(a) In case the Company will at any time subdivide its outstanding shares of Class A Common Stock into a greater number of shares, the Warrant Price in effect immediately prior to such subdivision will be proportionately reduced and the number of Warrant Securities purchasable under the Warrants will be proportionately increased. Conversely, in case the outstanding shares of Class A Common Stock of the Company will be combined into a smaller number of shares, the Warrant Price in effect immediately prior to such combination will be proportionately increased and the number of Warrant Securities purchasable under the Warrants will be proportionately decreased.
(b) If at any time or from time to time the holders of Class A Common Stock (or any shares of stock or other securities at the time receivable upon the exercise of the Warrants) will have received or become entitled to receive, without payment,
(i) Class A Common Stock or any shares of stock or other securities which are at any time directly or indirectly convertible into or exchangeable for Class A Common Stock, or any rights or options to subscribe for, purchase or otherwise acquire any of the foregoing by way of dividend or other distribution;
(ii) any cash paid or payable otherwise than as a cash dividend paid or payable out of the Company’s current or retained earnings;
(iii) any evidence of the Company’s indebtedness or rights to subscribe for or purchase the Company’s indebtedness; or
(iv) Class A Common Stock or additional stock or other securities or property (including cash) by way of spinoff, split-up, reclassification, combination of shares or similar corporate rearrangement (other than shares of Class A Common Stock issued as a stock split or adjustments in respect of which will be covered by the terms of Section 3.4(a) above), then and
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in each such case, the holder of each Warrant will, on the exercise of the Warrant, be entitled to receive, in addition to the number of Warrant Securities receivable, and without payment of any additional consideration, the amount of stock and other securities and property (including cash and indebtedness or rights to subscribe for or purchase indebtedness) which a holder would hold on the date of exercise had he been the holder of record of Warrant Securities as of the date on which holders of Class A Common Stock received or became entitled to receive shares or all other additional stock and other securities and property.
(c) In case of (i) any reclassification, capital reorganization, or change in the Class A Common Stock of the Company (other than as a result of a subdivision, combination, or stock dividend provided for in Section 3.4(a) or Section 3.4(b) above), (ii) share exchange, merger or similar transaction of the Company with or into another person or entity (other than a share exchange, merger or similar transaction in which the Company is the acquiring or surviving corporation and which does not result in any change in the Class A Common Stock other than the issuance of additional shares of Class A Common Stock) or (iii) the sale, exchange, lease, transfer or other disposition of all or substantially all of the properties and assets of the Company as an entirety (in any such case, a “Reorganization Event”), then, as a condition of such Reorganization Event, lawful provisions will be made, and duly executed documents evidencing the same from the Company or its successor will be delivered to the holders of the Warrants, so that the holders of the Warrants will have the right at any time prior to the expiration of the Warrants to purchase, at a total price equal to that payable on the exercise of the Warrants, the kind and amount of shares of stock and other securities and property receivable in connection with a Reorganization Event by a holder of the same number of Warrant Securities as were purchasable by the holders of the Warrants immediately prior to such Reorganization Event. In this case, appropriate provisions will be made with respect to the rights and interests of the holders of the Warrants so that the provisions of this Agreement will be applicable with respect to any shares of stock or other securities and property deliverable upon exercise the Warrants, and appropriate adjustments will be made to the Warrant Price payable under this Agreement if the aggregate purchase price will remain the same. In the case of any transaction described in clauses (ii) and (iii) above, the Company will be relieved of any further obligation under this Agreement or under the Warrants, and the Company as the predecessor corporation may or at any time after be dissolved, wound up or liquidated. Such successor or assuming entity may cause to be signed, and may issue either in its own name or in the name of the Company, any or all of the Warrants issuable under this Agreement which previously will not have been signed by the Company, and may execute and deliver securities in its own name, in fulfillment of its obligations to deliver Warrant Securities upon exercise of the Warrants. All issued Warrants so will have, in all respects, the same legal rank and benefit under this Agreement as the Warrants issued before or after in accordance with the terms of this Agreement as though all of such Warrants had been issued at the date of the execution of this Agreement. In the case of any such Reorganization Event, changes in phraseology and form (but not in substance) may be made in the Warrants to be issued as may be appropriate. The Warrant Agent may receive a written opinion of legal counsel as conclusive evidence that the Reorganization Event complies with the provisions of this Section 3.4.
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(d) The Company may, at its option, at any time until the Expiration Date, reduce the then current Warrant Price to any amount deemed appropriate by the Board of Directors of the Company for any period not exceeding twenty consecutive days (as evidenced in a resolution adopted by such Board of Directors), but only after giving the notices required by Section 3.5 at least ten days prior to taking such action.
(e) Except as otherwise expressly provided in this Agreement, no adjustment in the Warrant Price will be made by reason of the issuance of shares of Class A Common Stock, or securities convertible into or exchangeable for shares of Class A Common Stock, or securities carrying the right to purchase any of the foregoing or for any other reason whatsoever.
(f) No fractional Warrant Securities will be issued upon the exercise of Warrants. If more than one Warrant is exercised at one time by the same holder, the number of full Warrant Securities that will be issuable upon exercise will be computed on the basis of the aggregate number of Warrant Securities purchased pursuant to the exercised Warrants. Instead of any fractional Warrant Security that would otherwise be issuable upon exercise of any Warrant, the Company will pay a cash adjustment in respect of such fraction in an amount equal to the same fraction of the last reported sale price (or bid price if there were no sales) per Warrant Security, in either case as reported on the principal registered national securities exchange on which the Warrant Securities are listed or admitted to trading on the business day before the day of exercise or, if the Warrant Securities are not then listed or admitted to trading on any registered national securities exchange, the average of the closing high bid and low asked prices as reported on the OTC Bulletin Board Service (the “OTC Bulletin Board”) operated by the Financial Industry Regulatory Authority, Inc. (“FINRA”) or, if not available on the OTC Bulletin Board, then the average of the closing high bid and low asked prices as reported on any other U.S. quotation medium or inter-dealer quotation system on such date, or if on any such date the Warrant Securities are not listed or admitted to trading on a registered national securities exchange, are not included in the OTC Bulletin Board, and are not quoted on any other U.S. quotation medium or inter-dealer quotation system, an amount equal to the same fraction of the average of the closing bid and asked prices as furnished by any FINRA member firm selected from time to time by the Company for that purpose at the close of business on the business day before the day of exercise.
(g) Whenever the Warrant Price then in effect is adjusted as herein provided, the Company will mail to each holder of the Warrants at such holder’s address as it will appear on the books of the Company a statement setting forth the adjusted Warrant Price then and thereafter effective under the provisions hereof, together with the facts, in reasonable detail, upon which such adjustment is based.
(h) Notwithstanding anything to the contrary herein, in no event will the Warrant Price, as adjusted in accordance with the terms hereof, be less than the par value per share of Common Stock.
3.5 Notice to Warrantholders. In case the Company (a) effects any dividend or distribution described in Section 3.4(b), (b) effects any Reorganization Event, (c) makes any distribution on or in respect of the Class A Common Stock in connection with the dissolution, liquidation or winding up of the Company, or (d) reduces the then current Warrant Price pursuant to Section 3.4(d), then the Company will mail to each holder of Warrants at each holder’s address as it appears on the books of the Warrant Agent, at least ten days prior to the applicable
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date specified below, a notice stating (x) the record date for such dividend or distribution, or, if a record is not to be taken, the date as of which the holders of record of Class A Common Stock that will be entitled to such dividend or distribution are to be determined, (y) the date on which such Reorganization Event, dissolution, liquidation or winding up is expected to become effective, and the date as of which it is expected that holders of Class A Common Stock of record will be entitled to exchange their shares of Class A Common Stock for securities or other property deliverable upon such Reorganization Event, dissolution, liquidation or winding up, or (z) the first date on which the then current Warrant Price will be reduced pursuant to Section 3.4(d). No failure to mail such notice nor any defect in the notice or in the mailing will affect any transaction or any adjustment in the Warrant Price required by Section 3.4.
3.6 [If the Warrants are Subject to Acceleration by the Company, Insert — Acceleration of Warrants by the Company.
(a) At any time on or after [•], the Company will have the right to accelerate any or all Warrants at any time by causing them to expire at the close of business on the day immediately before a specified date (the “Acceleration Date”), if the Market Price (as hereinafter defined) of the Class A Common Stock equals or exceeds [•] percent ([•]%) of the then effective Warrant Price on any twenty Trading Days (as defined below) within a period of thirty consecutive Trading Days ending no more than five Trading Days prior to the date on which the Company gives notice to the Warrant Agent of its election to accelerate the Warrants.
(b) “Market Price” for each Trading Day will be, if the Class A Common Stock is listed or admitted to trading on any registered national securities exchange, the last reported sale price, regular way (or, if no such price is reported, the average of the reported closing bid and asked prices, regular way) of Class A Common Stock, in either case as reported on the principal registered national securities exchange on which the Class A Common Stock is listed or admitted to trading or, if not listed or admitted to trading on any registered national securities exchange, the average of the closing high bid and low asked prices as reported on the OTC Bulletin Board operated by FINRA, or if not available on the OTC Bulletin Board, then the average of the closing high bid and low asked prices as reported on any other U.S. quotation medium or inter-dealer quotation system, or if on any such date the shares of Class A Common Stock are not listed or admitted to trading on a registered national securities exchange, are not included in the OTC Bulletin Board, and are not quoted on any other U.S. quotation medium or inter-dealer quotation system, the average of the closing bid and asked prices as furnished by any FINRA member firm selected from time to time by the Company for that purpose. “Trading Day” will be each Monday through Friday, other than any day on which securities are not traded in the system or on the exchange that is the principal market for the Class A Common Stock, as determined by the Board of Directors of the Company.
(c) In the event of an acceleration of less than all of the Warrants, the Warrant Agent will select the Warrants to be accelerated by lot, pro rata or in such other manner as it deems, in its discretion, to be fair and appropriate.
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(d) Notice of an acceleration specifying the Acceleration Date will be sent by mail first class, postage prepaid, to each registered holder of a Warrant Certificate representing an accelerated Warrant at each holder’s address on the books of the Warrant Agent not more than sixty days nor less than thirty days before the Acceleration Date. Such notice of an acceleration also must be given no more than twenty days, and no less than ten days, prior to the mailing of notice to registered holders of Warrants pursuant to this Section 3.6, by publication at least once in a newspaper of general circulation in the City of New York.
(e) Any accelerated Warrant may be exercised until [•] p.m., [City] time, on the business day immediately before the Acceleration Date. The Warrant Price will be payable as provided in Section 2.]
ARTICLE 4
EXCHANGE AND TRANSFER OF WARRANT CERTIFICATES
4.1 Exchange and Transfer of Warrant Certificates. Upon surrender at the corporate trust office of the Warrant Agent, Warrant Certificates evidencing Warrants may be exchanged for Warrant Certificates in other denominations evidencing the Warrants or the transfer of the Warrants may be registered in whole or in part; as long as the other Warrant Certificates evidence Warrants for the same aggregate number of Warrant Securities as the Warrant Certificates surrendered. The Warrant Agent will keep, at its corporate trust office, books in which, subject to such reasonable regulations as it may prescribe, it will register Warrant Certificates and exchanges and transfers of outstanding Warrant Certificates, on surrender of the Warrant Certificates to the Warrant Agent at its corporate trust office for exchange or registration of transfer, properly endorsed or accompanied by appropriate instruments of registration of transfer and written instructions for transfer, all in form satisfactory to the Company and the Warrant Agent. There will be no service charge for any exchange or registration of transfer of Warrant Certificates, but the Company may require payment of a sum sufficient to cover any stamp or other tax or other governmental charge that may be imposed in connection with the exchange or registration of transfer. Whenever Warrant Certificates are surrendered for exchange or registration of transfer, an authorized officer of the Warrant Agent will manually countersign and deliver to the person or persons entitled to it, a Warrant Certificate or Warrant Certificates duly authorized and executed by the Company, as so requested. The Warrant Agent will not be required to effect any exchange or registration of transfer which will result in the issuance of a Warrant Certificate evidencing a Warrant for a fraction of a Warrant Security or a number of Warrants for a whole number of Warrant Securities and a fraction of a Warrant Security. All Warrant Certificates issued upon any exchange or registration of transfer of Warrant Certificates will be the valid obligations of the Company, evidencing the same obligations and entitled to the same benefits under this Agreement as the Warrant Certificate surrendered for such exchange or registration of transfer.
4.2 Treatment of Holders of Warrant Certificates. The Company, the Warrant Agent and all other persons may treat the registered holder of a Warrant Certificate as the absolute owner of the Warrant Certificate for any purpose and as the person entitled to exercise the rights represented by the Warrants evidenced thereby, any notice to the contrary notwithstanding.
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4.3 Cancellation of Warrant Certificates. Any Warrant Certificate surrendered for exchange, registration of transfer or exercise of the Warrants evidenced by the Warrant Certificate will, if surrendered to the Company, be delivered to the Warrant Agent and all Warrant Certificates surrendered or so delivered to the Warrant Agent will be promptly canceled by the Warrant Agent and will not be reissued and, except as expressly permitted by this Agreement, no Warrant Certificate will be issued under this Agreement in exchange for a Warrant Certificate or in lieu of it. The Warrant Agent will deliver to the Company from time to time or otherwise dispose of canceled Warrant Certificates in a manner satisfactory to the Company.
ARTICLE 5
CONCERNING THE WARRANT AGENT
5.1 Warrant Agent. The Company hereby appoints [•] as Warrant Agent of the Company in respect of the Warrants and the Warrant Certificates upon the terms and subject to the conditions herein set forth, and [•] hereby accepts such appointment. The Warrant Agent has the powers and authority granted to and conferred upon it in the Warrant Certificates and by this Agreement and further powers and authority to act on behalf of the Company as the Company may later grant or confer upon it. All of the terms and provisions with respect to the powers and authority contained in the Warrant Certificates are subject to and governed by the terms and provisions of this Agreement.
5.2 Conditions of Warrant Agent’s Obligations. The Warrant Agent accepts its obligations set forth upon the terms and conditions of this Agreement, including the following, all of which the Company agrees to and which the rights of the holders from time to time of the Warrant Certificates under this Agreement will be subject:
(a) Compensation and Indemnification. The Company agrees to promptly pay the Warrant Agent the compensation to be agreed upon with the Company for all services rendered by the Warrant Agent and to reimburse the Warrant Agent for reasonable out-of-pocket expenses (including reasonable counsel fees) incurred without negligence, bad faith or willful misconduct by the Warrant Agent in connection with the services rendered by the Warrant Agent under this Agreement. The Company also agrees to indemnify the Warrant Agent for, and to hold it harmless against, any loss, liability or expense incurred without negligence, bad faith or willful misconduct on the part of the Warrant Agent, arising out of or in connection with its acting as Warrant Agent, including the reasonable costs and expenses of defending against any claim of such liability.
(b) Agent for The Company. In acting under this Agreement and in connection with the Warrant Certificates, the Warrant Agent is acting solely as agent of the Company and does not assume any obligations or relationship of agency or trust for or with any of the holders of Warrant Certificates or beneficial owners of Warrants.
(c) Counsel. The Warrant Agent may consult with counsel satisfactory to it, which may include counsel for the Company, and the written advice of such counsel will be full and complete authorization and protection in respect of any action taken, suffered or omitted by it under this Agreement in good faith and in accordance with the advice of such counsel.
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(d) Documents. The Warrant Agent will be protected and will not incur liability for or in respect of any action taken or omitted by it in reliance upon any Warrant Certificate, notice, direction, consent, certificate, affidavit, statement or other paper or document reasonably believed by it to be genuine and to have been presented or signed by the proper parties.
(e) Certain Transactions. The Warrant Agent, and its officers, directors and employees, may become the owner of, or acquire any interest in, Warrants, with the same rights that it or they would have if it were not the Warrant Agent, and, to the extent permitted by applicable law, it or they may engage or be interested in any financial or other transaction with the Company and may act on, or as depositary, trustee or agent for, any committee or body of holders of Warrant Securities or other obligations of the Company as freely as if it were not the Warrant Agent. Nothing in this Agreement will be deemed to prevent the Warrant Agent from acting as trustee under any indenture to which the Company is a party.
(f) No Liability for Interest. Unless otherwise agreed with the Company, the Warrant Agent will not be liable for interest on any funds at any time received by it pursuant to any of the provisions of this Agreement or of the Warrant Certificates.
(g) No Liability for Invalidity. The Warrant Agent is not liable with respect to any invalidity of this Agreement or any of the Warrant Certificates (except as to the Warrant Agent’s countersignature thereon).
(h) No Responsibility for Representations. The Warrant Agent is not responsible for any of the recitals or representations in this Agreement or in the Warrant Certificates (except as to the Warrant Agent’s countersignature), all of which are made solely by the Company.
(i) No Implied Obligations. The Warrant Agent is obligated to perform only the duties specifically set forth under this Agreement and in the Warrant Certificates. There are no implied duties or obligations of the Warrant Agent under this Agreement or the Warrant Certificates. The Warrant Agent is not under any obligation to take any action which may tend to involve it in any expense or liability, the payment of which within a reasonable time is not, in its reasonable opinion, assured to it. The Warrant Agent is not accountable or under any duty or responsibility for the use by the Company of any of the Warrant Certificates authenticated by the Warrant Agent and delivered by it to the Company pursuant to this Agreement or for the application by the Company of the proceeds of the Warrant Certificates. The Warrant Agent has no duty or responsibility in case of any default by the Company in the performance of its covenants or agreements contained under this Agreement or in the Warrant Certificates or in the case of the receipt of any written demand from a holder of a Warrant Certificate with respect to such default, including, without limiting the generality of the foregoing, any duty or responsibility to initiate or attempt to initiate any proceedings at law or otherwise or, except as provided in Section 6.2 hereof, to make any demand upon the Company.
5.3 Resignation, Removal and Appointment of Successors.
(a) The Company agrees, for the benefit of the holders from time to time of the Warrant Certificates, that there will be at all times a Warrant Agent until all the Warrants have been exercised or are no longer exercisable.
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(b) The Warrant Agent may at any time resign as agent by giving written notice to the Company of its intention, specifying the date on which its desired resignation will become effective; as long as the date of resignation is not less than three months after the date on which such notice is given unless the Company otherwise agrees. The Company may remove the Warrant Agent at any time by filing with the Warrant Agent an instrument in writing signed by or on behalf of the Company and specifying its intent to remove the Warrant Agent and the intended date when the removal will become effective. Any resignation or removal will take effect upon the appointment by the Company, as provided in this Agreement, of a successor Warrant Agent (which will be a bank or trust company authorized under the laws of the jurisdiction of its organization to exercise corporate trust powers) and the acceptance of the appointment by the successor Warrant Agent. The obligation of the Company under Section 5.2(a) will continue to the extent set forth therein notwithstanding the resignation or removal of the Warrant Agent.
(c) If, at any time, the Warrant Agent resigns, or is removed, or becomes incapable of acting, or is adjudged a bankrupt or insolvent, or commences a voluntary case under the Federal bankruptcy laws, as now or hereafter constituted, or under any other applicable Federal or state bankruptcy, insolvency or similar law or consents to the appointment of or taking possession by a receiver, custodian, liquidator, assignee, trustee, sequestrator (or other similar official) of the Warrant Agent or its property or affairs, or makes an assignment for the benefit of creditors, or admits in writing its inability to pay its debts generally as they become due, or takes corporate action in furtherance of any action, or a decree or order for relief by a court having jurisdiction in the premises will have been entered in respect of the Warrant Agent in an involuntary case under the Federal bankruptcy laws, as now or hereafter constituted, or any other applicable Federal or state bankruptcy, insolvency or similar law, or a decree or order by a court having jurisdiction in the premises will have been entered for the appointment of a receiver, custodian, liquidator, assignee, trustee, sequestrator (or similar official) of the Warrant Agent or of its property or affairs, or any public officer takes charge or control of the Warrant Agent or of its property or affairs for the purpose of rehabilitation, conservation, winding up or liquidation, a successor Warrant Agent, qualified as described above, will be appointed by the Company by an instrument in writing, filed with the successor Warrant Agent. Upon the appointment as aforesaid of a successor Warrant Agent and acceptance by the successor Warrant Agent of such appointment, the Warrant Agent will cease to be Warrant Agent.
(d) Any successor Warrant Agent appointed under this Agreement will execute, acknowledge and deliver to its predecessor and to the Company an instrument accepting the appointment, and immediately after, successor Warrant Agent, without any further act, deed or conveyance, will become vested with all the authority, rights, powers, trusts, immunities, duties and obligations of the predecessor as if originally named as Warrant Agent under this Agreement, and the predecessor, on payment of its unpaid charges and disbursements, will then become obligated to transfer, deliver and pay over, and the successor Warrant Agent will be entitled to receive, all funds, securities and other property on deposit with or held by the predecessor, as Warrant Agent hereunder.
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(e) Any corporation into which the Warrant Agent may be merged or converted or any corporation with which the Warrant Agent may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Warrant Agent will be a party, or any corporation to which the Warrant Agent sells or otherwise transfers all or substantially all the assets and business of the Warrant Agent, provided that it is qualified as described above, will be the successor Warrant Agent under this Agreement without the execution or filing of any paper or any further act on the part of any of the parties to this Agreement.
ARTICLE 6
MISCELLANEOUS
6.1 Amendment. This Agreement may be amended by the parties to this Agreement, without the consent of the holder of any Warrant Certificate, for the purpose of curing any ambiguity, or of curing, correcting or supplementing any defective provision contained in this Agreement, or making any other provisions with respect to matters or questions arising under this Agreement as the Company and the Warrant Agent may deem necessary or desirable; provided that such action will not materially adversely affect the interests of the holders of the Warrant Certificates.
6.2 Notices and Demands to the Company and Warrant Agent. If the Warrant Agent receives any notice or demand addressed to the Company by the holder of a Warrant Certificate pursuant to the provisions of the Warrant Certificates, the Warrant Agent will promptly forward the notice or demand to the Company.
6.3 Addresses. Any communication from the Company to the Warrant Agent with respect to this Agreement must be addressed to [•], Attention: [•] and any communication from the Warrant Agent to the Company with respect to this Agreement must be addressed to Snap Inc., 2772 Donald Douglas Loop North, Santa Monica, California 90405, Attention: [•] (or such other address as will be specified in writing by the Warrant Agent or by the Company).
6.4 Governing Law. This Agreement and each Warrant Certificate issued under this Agreement, and any claim, controversy or dispute arising under or related to this Agreement or any Warrant Certificate, will be governed by and construed in accordance with the laws of the State of New York.
6.5 Delivery of Prospectus. The Company will furnish to the Warrant Agent sufficient copies of a prospectus meeting the requirements of the Securities Act of 1933, as amended, relating to the Warrant Securities deliverable on exercise of the Warrants (the “Prospectus”), and the Warrant Agent agrees that on the exercise of any Warrant, the Warrant Agent will deliver to the holder of the Warrant Certificate evidencing such Warrant, prior to or concurrently with the delivery of the Warrant Securities issued on such exercise, a Prospectus. The Warrant Agent will not, by reason of any delivery, assume any responsibility for the accuracy or adequacy of such Prospectus.
6.6 Obtaining of Governmental Approvals. The Company will, from time to time, take all action which may be necessary to obtain and keep effective any and all permits, consents and approvals of governmental agencies and authorities and securities act filings under United States Federal and state laws (including without limitation a registration statement in respect of the
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Warrants and Warrant Securities under the Securities Act of 1933, as amended), which may be or become requisite in connection with the issuance, sale, transfer, and delivery of the Warrant Securities issued upon exercise of the Warrants, the issuance, sale, transfer and delivery of the Warrants or upon the expiration of the period during which the Warrants are exercisable.
6.7 Persons Having Rights Under the Agreement. Nothing in this Agreement gives to any person other than the Company, the Warrant Agent or the holders of the Warrant Certificates any right, remedy or claim under or by reason of this Agreement.
6.8 Headings. The descriptive headings of the several Articles and Sections of this Agreement are inserted for convenience only and does not control or affect the meaning or construction of any of the provisions hereof.
6.9 Counterparts. This Agreement may be executed in any number of counterparts, each of which as executed will be deemed to be an original and such counterparts together will constitute one instrument.
6.10 Inspection of Agreement. A copy of this Agreement will be available at all reasonable times at the principal corporate trust office of the Warrant Agent for inspection by the holder of any Warrant Certificate. The Warrant Agent may require such holder to submit such holder’s Warrant Certificate for inspection by it.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed as of the day and year first written above.
| SNAP INC., as Company | ||
| By: |
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| Name: |
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| Title: |
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| Attest: |
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| COUNTERSIGNED | ||
| [•], as Warrant Agent | ||
| By: |
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| Name: |
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| Title: |
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| Attest: |
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[SIGNATURE PAGE TO FORM OF CLASS A COMMON STOCK WARRANT AGREEMENT]
EXHIBIT A
FORM OF WARRANT CERTIFICATE
[FACE OF WARRANT CERTIFICATE]
| [Form of Legend if Warrants are not immediately exercisable.] | [Prior to [•] Warrants evidenced by this Warrant Certificate cannot be exercised.] |
EXERCISABLE ONLY IF COUNTERSIGNED BY THE WARRANT AGENT
VOID AFTER [•] P.M., [City] time, ON [•].
SNAP INC.
WARRANT CERTIFICATE REPRESENTING
WARRANTS TO PURCHASE
CLASS A COMMON STOCK, PAR VALUE $0.00001 PER SHARE
| No. [•] |
[•] Warrants |
This certificate (“Warrant Certificate”) certifies that [•] or registered assigns is the registered owner of the above indicated number of Warrants, each Warrant entitling such owner to purchase, at any time [after [•] p.m., [City] time, [on [•] and] on or before [•] p.m., [City] time, on [•] shares of Class A Common Stock, par value $0.00001 per share (the “Warrant Securities”), of Snap Inc. (the “Company”) on the following basis: during the period from [•], through and including [•], the exercise price per Warrant Security will be $[•], subject to adjustment as provided in the Warrant Agreement (as hereinafter defined) (the “Warrant Price”). The Holder may exercise the Warrants evidenced by this Warrant Certificate by providing certain information set forth on the back of this Warrant Certificate and by paying in full, in lawful funds of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds], the Warrant Price for each Warrant Security with respect to which this Warrant is exercised to the Warrant Agent (as defined below) and by surrendering this Warrant Certificate, with the purchase form on the back of this Warrant Certificate duly executed, at the corporate trust office of [name of Warrant Agent], or its successor as warrant agent (the “Warrant Agent”), which is, on the date of this Warrant Certificate, at the address specified on the reverse of this Warrant Certificate, and upon compliance with and subject to the conditions set forth in this Warrant Certificate and in the Warrant Agreement (as defined below).
The term “Holder” as used in this Warrant Certificate will mean the person in whose name at the time this Warrant Certificate will be registered on the books maintained by the Warrant Agent pursuant to Section 4 of the Warrant Agreement.
The Warrants evidenced by this Warrant Certificate may be exercised to purchase a whole number of Warrant Securities in registered form. Upon any exercise of fewer than all of the Warrants evidenced by this Warrant Certificate, the Holder will be issued a new Warrant Certificate evidencing Warrants for the number of remaining Warrant Securities unexercised.
This Warrant Certificate is issued under and in accordance with the Warrant Agreement dated as of [•] (the “Warrant Agreement”), between the Company and the Warrant Agent and is subject to the terms and provisions contained in the Warrant Agreement, the terms and provisions of which the Holder of this Warrant Certificate consents by acceptance of this Warrant Certificate. Copies of the Warrant Agreement are on file at the above-mentioned office of the Warrant Agent.
Transfer of this Warrant Certificate may be registered when this Warrant Certificate is surrendered at the corporate trust office of the Warrant Agent by the registered owner or such owner’s assigns, in the manner and subject to the limitations provided in the Warrant Agreement.
After countersignature by the Warrant Agent and prior to the expiration of this Warrant Certificate, this Warrant Certificate may be exchanged at the corporate trust office of the Warrant Agent for Warrant Certificates representing Warrants for the same aggregate number of Warrant Securities.
This Warrant Certificate will not entitle the Holder of this Warrant Certificate to any of the rights of a holder of the Warrant Securities, including, without limitation, the right to receive payments of dividends or distributions, if any, on the Warrant Securities (except to the extent set forth in the Warrant Agreement) or to exercise any voting rights.
Reference is hereby made to the further provisions of this Warrant Certificate set forth on the reverse of this Warrant Certificate, which will, for all purposes, have the same effect as if set forth at this place.
This Warrant Certificate will not be valid or obligatory for any purpose until countersigned by the Warrant Agent.
IN WITNESS WHEREOF, the Company has caused this Warrant to be executed in its name and on its behalf by the facsimile signatures of its duly authorized officers.
Dated:
| SNAP INC., as Company | ||
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| Attest: |
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| COUNTERSIGNED | ||
| [•], as Warrant Agent | ||
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[REVERSE OF WARRANT CERTIFICATE]
(Instructions for Exercise of Warrant)
To exercise any Warrants evidenced by this Warrant Certificate for Warrant Securities (as defined below), the Holder must pay, in lawful funds of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds], the Warrant Price in full for Warrants exercised, to [•] [address of Warrant Agent], Attention: [•], which payment must specify the name of the Holder and the number of Warrants exercised by such Holder. In addition, the Holder must complete the information required below and present this Warrant Certificate in person or by mail (certified or registered mail is recommended) to the Warrant Agent at the appropriate address set forth above. This Warrant Certificate, completed and duly executed, must be received by the Warrant Agent within five business days of the payment.
(To be executed upon exercise of Warrants)
The undersigned hereby irrevocably elects to exercise [•] Warrants, evidenced by this Warrant Certificate, to purchase [•] shares of the Class A Common Stock, par value $0.00001 per share (the “Warrant Securities”), of Snap Inc. and represents that he or she has tendered payment for such Warrant Securities, in lawful funds of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds], to the order of Snap Inc., c/o [insert name and address of Warrant Agent], in the amount of $[•] in accordance with the terms hereof. The undersigned requests that said Warrant Securities be in fully registered form in the authorized denominations, registered in such names and delivered all as specified in accordance with the instructions set forth below.
If the number of Warrants exercised is less than all of the Warrants evidenced by this Warrant Certificate, the undersigned requests that a new Warrant Certificate evidencing the Warrants for the number of Warrant Securities remaining unexercised be issued and delivered to the undersigned unless otherwise specified in the instructions below.
| Dated: | Name: |
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| Please Print |
| Address: |
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| (Insert Social Security or Other Identifying Number of Holder) |
Signature
Guaranteed:
Signature
(Signature must conform in all respects to name of holder as specified on the face of this Warrant Certificate and must bear a signature guarantee by a FINRA member firm).
This Warrant may be exercised at the following addresses:
By hand at:
By mail at:
[Instructions as to form and delivery of Warrant Securities and, if applicable, Warrant Certificates evidencing Warrants for the number of Warrant Securities remaining unexercised — complete as appropriate.]
ASSIGNMENT
[Form of assignment to be executed if Warrant Holder desires to transfer Warrant]
FOR VALUE RECEIVED, [•] hereby sells, assigns and transfers unto:
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| (Please print name and address including zip code) | Please print Social Security or other identifying number |
the right represented by the within Warrant to purchase shares of [Title of Warrant Securities] of Snap Inc. to which the within Warrant relates and appoints attorney [•] to transfer such right on the books of the Warrant Agent with full power of substitution in the premises.
| Dated: | Name: |
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| Signature |
(Signature must conform in all respects to name of holder as specified on the face of the Warrant)
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Signature Guaranteed |
Exhibit 4.9
SNAP INC.
AND
, AS WARRANT AGENT
FORM OF PREFERRED STOCK
WARRANT AGREEMENT
DATED AS OF [•], 20
SNAP INC.
FORM OF PREFERRED STOCK WARRANT AGREEMENT
THIS PREFERRED STOCK WARRANT AGREEMENT (this “Agreement”), dated as of [•], between SNAP INC., a Delaware corporation (the “Company”) and [•], a [corporation] [national banking association] organized and existing under the laws of [•] and having a corporate trust office in [•], as warrant agent (the “Warrant Agent”).
WHEREAS, the Company proposes to sell [If Warrants are sold with other securities —[title of other securities being offered] (the “Other Securities”) with] warrant certificates evidencing one or more warrants (the “Warrants” or, individually, a “Warrant”) representing the right to purchase [title of Preferred Stock purchasable through exercise of Warrants] (the “Warrant Securities”),the warrant certificates and other warrant certificates issued pursuant to this Agreement are herein called the “Warrant Certificates”; and
WHEREAS, the Company desires the Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing to act, in connection with the issuance, registration, transfer, exchange, exercise and replacement of the Warrant Certificates, and the Company wishes to set forth in this Agreement, among other things, the form and provisions of the Warrant Certificates and the terms and conditions on which they may be issued, registered, transferred, exchanged, exercised and replaced.
NOW THEREFORE, in consideration of the premises and of the mutual agreements contained in this Agreement, the parties agree as follows:
ARTICLE 1
ISSUANCE OF WARRANTS AND EXECUTION AND
DELIVERY OF WARRANT CERTIFICATES
1.1 Issuance of Warrants. [If Warrants alone — Upon issuance, each Warrant Certificate will evidence one or more Warrants.] [If Other Securities and Warrants — Warrant Certificates will be issued in connection with the issuance of the Other Securities but will be separately transferable and each Warrant Certificate will evidence one or more Warrants.] Each Warrant evidenced by a Warrant Certificate will represent the right, subject to the provisions contained in this Agreement and in such Warrant Certificate, to purchase one Warrant Security. [If Other Securities and Warrants — Warrant Certificates will be issued with the Other Securities and each Warrant Certificate will evidence [•] Warrants for each [$[•] principal amount] [[•] shares] of Other Securities issued.]
1.2 Execution and Delivery of Warrant Certificates. Each Warrant Certificate, whenever issued, will be in registered form substantially in the form set forth in Exhibit A hereto, will be dated the date of its countersignature by the Warrant Agent and may have letters, numbers, or other marks of identification or designation and legends or endorsements printed, lithographed or engraved on it, as the officers of the Company executing the Warrant Certificate may approve (execution of the Warrant Certificate to be conclusive evidence of such approval) and as are not inconsistent with the provisions of this Agreement, or as may be required to
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comply with any law or with any rule or regulation made pursuant to it or with any rule or regulation of any securities exchange on which the Warrants may be listed, or to conform to usage. The Warrant Certificates will be signed on behalf of the Company by any of its present or future chief executive officers, presidents, senior vice presidents, vice presidents, chief financial officers, chief legal officers, treasurers, assistant treasurers, controllers, assistant controllers, secretaries or assistant secretaries under its corporate seal reproduced on it. The signatures may be manual or facsimile signatures of such authorized officers and may be imprinted or otherwise reproduced on the Warrant Certificates. The seal of the Company may be in the form of a facsimile and may be impressed, affixed, imprinted or otherwise reproduced on the Warrant Certificates.
No Warrant Certificate will be valid for any purpose, and no Warrant evidenced by it will be exercisable, until such Warrant Certificate has been countersigned by the manual signature of the Warrant Agent. The signature of the Warrant Agent on any Warrant Certificate executed by the Company will be conclusive evidence that the countersigned Warrant Certificate has been duly issued under this Agreement.
In case any officer of the Company who signed any of the Warrant Certificates either manually or by facsimile signature ceases to be an officer before the Warrant Certificates have been countersigned and delivered by the Warrant Agent, the Warrant Certificates may be countersigned and delivered notwithstanding that the person who signed such Warrant Certificates ceased to be an officer of the Company; and any Warrant Certificate may be signed on behalf of the Company by such persons, at the actual date of the execution of such Warrant Certificate, who are the proper officers of the Company, although at the date of the execution of this Agreement any such person was not such officer.
The term “holder” or “holder of a Warrant Certificate” as used in this Agreement will mean any person in whose name at the time any Warrant Certificate is registered on the books maintained by the Warrant Agent for that purpose.
1.3 Issuance of Warrant Certificates. Warrant Certificates evidencing the right to purchase Warrant Securities may be executed by the Company and delivered to the Warrant Agent on the execution of this Warrant Agreement or from time to time thereafter. The Warrant Agent will, upon receipt of Warrant Certificates duly executed on behalf of the Company, countersign the Warrant Certificates and deliver the Warrant Certificates to, or upon the order of, the Company.
ARTICLE 2
WARRANT PRICE, DURATION AND EXERCISE OF WARRANTS
2.1 Warrant Price. During the period specified in Section 2.2, each Warrant will, subject to the terms of this Warrant Agreement and the applicable Warrant Certificate, entitle the holder of the Warrant Certificate to purchase the number of Warrant Securities specified in the applicable Warrant Certificate at an exercise price of $[•] per Warrant Security, subject to adjustment upon the occurrence of certain events, as provided in this Agreement. Such purchase price per Warrant Security is referred to in this Agreement as the “Warrant Price.”
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2.2 Duration of Warrants. Each Warrant may be exercised in whole or in part at any time, as specified herein, on or after [the date thereof] [•] and at or before [•] p.m., [City] time, on [•] or such later date as the Company may designate by notice to the Warrant Agent and the holders of Warrant Certificates mailed to their addresses as set forth in the record books of the Warrant Agent (the “Expiration Date”). Each Warrant not exercised at or before [•] p.m., [City] time, on the Expiration Date will become void, and all rights of the holder of the Warrant Certificate evidencing such Warrant under this Agreement will cease.
2.3 Exercise of Warrants.
(a) During the period specified in Section 2.2, the Warrants may be exercised to purchase a whole number of Warrant Securities in registered form by providing certain information as set forth on the reverse side of the Warrant Certificate and by paying in full, in lawful funds of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds] the Warrant Price for each Warrant Security with respect to which a Warrant is being exercised to the Warrant Agent at its corporate trust office, provided that such exercise is subject to receipt within five business days of such payment by the Warrant Agent of the Warrant Certificate with the form of election to purchase Warrant Securities set forth on the reverse side of the Warrant Certificate properly completed and duly executed. The date on which payment in full of the Warrant Price is received by the Warrant Agent will, subject to receipt of the Warrant Certificate, be deemed to be the date on which the Warrant is exercised; except that if, at the date of receipt of such Warrant Certificates and payment in full of the Warrant Price, the transfer books for the Warrant Securities purchasable on the exercise of such Warrants will be closed, no receipt of such Warrant Certificates and no payment of such Warrant Price will be effective to name the designated person as the holder of record of such Warrant Securities on such date, but will be effective to constitute such person as the holder of record of such Warrant Securities for all purposes at the opening of business on the next succeeding day on which the transfer books for the Warrant Securities purchasable upon the exercise of such Warrants will be opened, and the certificates for the Warrant Securities in respect of which such Warrants are then exercised will be issuable as of the next succeeding day on which the transfer books will be opened, and until such date the Company will be under no duty to deliver any certificate for such Warrant Securities. The Warrant Agent will deposit all funds received by it in payment of the Warrant Price in an account of the Company maintained with it and will advise the Company by telephone at the end of each day on which a payment for the exercise of Warrants is received of the amount so deposited to its account. The Warrant Agent will promptly confirm such telephone advice to the Company in writing.
(b) The Warrant Agent will, from time to time, as promptly as practicable, advise the Company of (i) the number of Warrant Securities with respect to which Warrants were exercised, (ii) the instructions of each holder of the Warrant Certificates evidencing Warrants with respect to delivery of the Warrant Securities to which each holder is entitled upon exercise, (iii) delivery of Warrant Certificates evidencing the balance, if any, of the Warrants for the remaining Warrant Securities after exercise, and (iv) any other information as the Company will reasonably require.
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(c) As soon as practicable after the exercise of any Warrant, the Company will issue, to or on the order of the holder of the Warrant Certificate evidencing such Warrant, the Warrant Securities to which the holder is entitled, in fully registered form, registered in the name or names as directed by such holder. If fewer than all of the Warrants evidenced by the Warrant Certificate are exercised, the Company will execute, and an authorized officer of the Warrant Agent will manually countersign and deliver, a new Warrant Certificate evidencing Warrants for the number of Warrant Securities remaining unexercised.
(d) The Company will not be required to pay any stamp or other tax or other governmental charge required to be paid in connection with any transfer involved in the issue of the Warrant Securities, and in the event that any such transfer is involved, the Company will not be required to issue or deliver any Warrant Security until the tax or other charge has been paid or it has been established to the Company’s satisfaction that no such tax or other charge is due.
(e) Prior to the issuance of any Warrants there must be a reserve, and the Company will at all times through the Expiration Date keep reserved, out of its authorized but unissued Warrant Securities, a number of shares sufficient to provide for the exercise of the Warrants.
ARTICLE 3
OTHER PROVISIONS RELATING TO RIGHTS OF HOLDERS OF
WARRANT CERTIFICATES
3.1 No Rights as Warrant Securityholder Conferred by Warrants or Warrant Certificates. No Warrant Certificate or Warrant evidenced by a Warrant Certificate will entitle the holder to any of the rights of a holder of Warrant Securities, including, without limitation, the right to receive the payment of dividends or distributions, if any, on the Warrant Securities or to exercise any voting rights, except to the extent expressly set forth in this Agreement or the applicable Warrant Certificate.
3.2 Lost, Stolen, Mutilated or Destroyed Warrant Certificates. Upon receipt by the Warrant Agent of evidence reasonably satisfactory to it and the Company of the ownership of and the loss, theft, destruction or mutilation of any Warrant Certificate or indemnity reasonably satisfactory to the Warrant Agent and the Company and, in the case of mutilation, upon surrender of the mutilated Warrant Certificate to the Warrant Agent for cancellation, then, in the absence of notice to the Company or the Warrant Agent that such Warrant Certificate has been acquired by a bona fide purchaser, the Company will execute, and an authorized officer of the Warrant Agent will manually countersign and deliver, in exchange for or in lieu of the lost, stolen, destroyed or mutilated Warrant Certificate, a new Warrant Certificate of the same tenor and evidencing Warrants for a like number of Warrant Securities. Upon the issuance of any new Warrant Certificate under this Section 3.2, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation to the new issuance and any other expenses (including the fees and expenses of the Warrant Agent) in connection therewith. Every substitute Warrant Certificate executed and delivered pursuant to this Section 3.2 in lieu of any lost, stolen or destroyed Warrant Certificate will represent an additional contractual obligation of the Company, whether or not the lost, stolen or destroyed Warrant Certificate will be at any time enforceable by anyone, and will be entitled to the benefits of this Agreement equally and proportionately with any and all other Warrant Certificates duly executed and delivered hereunder. The provisions of this Section 3.2 are exclusive and will preclude (to the extent lawful) all other rights and remedies with respect to the replacement of mutilated, lost, stolen or destroyed Warrant Certificates.
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3.3 Holder of Warrant Certificate May Enforce Rights. Notwithstanding any of the provisions of this Agreement, any holder of a Warrant Certificate, without the consent of the Warrant Agent, the holder of any Warrant Securities or the holder of any other Warrant Certificate, may, in such holder’s own behalf and for such holder’s own benefit, enforce, and may institute and maintain any suit, action or proceeding against the Company suitable to enforce, or otherwise in respect of, each holder’s right to exercise the Warrants evidenced by the holder’s Warrant Certificate in the manner provided in the holder’s Warrant Certificate and in this Agreement.
3.4 Adjustments.
(a) In case the Company will at any time subdivide its outstanding shares of [title of Preferred Stock purchasable through exercise of Warrants] into a greater number of shares, the Warrant Price in effect immediately prior to such subdivision will be proportionately reduced and the number of Warrant Securities purchasable under the Warrants will be proportionately increased. Conversely, in case the outstanding shares of [title of Preferred Stock purchasable through exercise of Warrants] of the Company will be combined into a smaller number of shares, the Warrant Price in effect immediately prior to such combination will be proportionately increased and the number of Warrant Securities purchasable under the Warrants will be proportionately decreased.
(b) If at any time or from time to time the holders of [title of Preferred Stock purchasable through exercise of Warrants] (or any shares of stock or other securities at the time receivable upon the exercise of the Warrants) will have received or become entitled to receive, without payment,
(i) [title of Preferred Stock purchasable through exercise of Warrants] or any shares of stock or other securities which are at any time directly or indirectly convertible into or exchangeable for [title of Preferred Stock purchasable through exercise of Warrants], or any rights or options to subscribe for, purchase or otherwise acquire any of the foregoing by way of dividend or other distribution;
(ii) any cash paid or payable otherwise than in accordance with the terms of [title of Preferred Stock purchasable through exercise of Warrants] or as a cash dividend paid or payable out of the Company’s current or retained earnings;
(iii) any evidence of the Company’s indebtedness or rights to subscribe for or purchase the Company’s indebtedness; or
(iv) [title of Preferred Stock purchasable through exercise of Warrants] or additional stock or other securities or property (including cash) by way of spinoff, split-up, reclassification, combination of shares or similar corporate rearrangement (other than shares of [title of Preferred Stock purchasable through exercise of Warrants] issued as a stock split or adjustments in respect of which will be covered by the terms of Section 3.4(a) above), then and in each such case, the holder of each Warrant will, on the exercise of the Warrant, be entitled to
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receive, in addition to the number of Warrant Securities receivable, and without payment of any additional consideration therefore, the amount of stock and other securities and property (including cash and indebtedness or rights to subscribe for or purchase indebtedness) which a holder would hold on the date of exercise had he been the holder of record of Warrant Securities as of the date on which holders of [title of Preferred Stock purchasable through exercise of Warrants] received or became entitled to receive shares or all other additional stock and other securities and property.
(c) In case of (i) any reclassification, capital reorganization, or change in the [title of Preferred Stock purchasable through exercise of Warrants] of the Company (other than as a result of a subdivision, combination or stock dividend provided for in Section 3.4(a) or Section 3.4(b) above), (ii) share exchange, merger or similar transaction of the Company with or into another person or entity (other than a share exchange, merger or similar transaction in which the Company is the acquiring or surviving corporation and which does not result in any change in the [title of Preferred Stock purchasable through exercise of Warrants] other than the issuance of additional shares of [title of Preferred Stock purchasable through exercise of Warrants]) or (iii) the sale, exchange, lease, transfer or other disposition of all or substantially all of the properties and assets of the Company as an entirety (in any such case, a “Reorganization Event”), then, as a condition of such Reorganization Event, lawful provisions will be made, and duly executed documents evidencing the same from the Company or its successor will be delivered to the holders of the Warrants, so that the holders of the Warrants will have the right at any time prior to the expiration of the Warrants to purchase, at a total price equal to that payable upon the exercise of the Warrants, the kind and amount of shares of stock and other securities and property receivable in connection with a Reorganization Event by a holder of the same number of shares of [title of Preferred Stock purchasable through exercise of Warrants] as were purchasable by the holders of the Warrants immediately prior to such Reorganization Event. In this case, appropriate provisions will be made with respect to the rights and interests of the holders of the Warrants so that the provisions of this Agreement will be applicable with respect to any shares of stock or other securities and property deliverable upon exercise the Warrants, and appropriate adjustments will be made to the Warrant Price payable under this Agreement if the aggregate purchase price will remain the same. In the case of any transaction described in clauses (ii) and (iii) above, the Company will be relieved of any further obligation under this Agreement r or under the Warrants, and the Company as the predecessor corporation may or at any time after be dissolved, wound up or liquidated. Such successor or assuming entity may cause to be signed, and may issue either in its own name or in the name of the Company, any or all of the Warrants issuable under this Agreement which previously will not have been signed by the Company, and may execute and deliver securities in its own name, in fulfillment of its obligations to deliver Warrant Securities upon exercise of the Warrants. All issued Warrants will have, in all respects, the same legal rank and benefit under this Agreement as the Warrants before or after issued before or after in accordance with the terms of this Agreement as though all of such Warrants had been issued at the date of the execution of this Agreement. In the case of any such Reorganization Event, changes in phraseology and form (but not in substance) may be made in the Warrants to be issued as may be appropriate. The Warrant Agent may receive a written opinion of legal counsel as conclusive evidence that the Reorganization Event complies with the provisions of this Section 3.4.
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(d) The Company may, at its option, at any time until the Expiration Date, reduce the then current Warrant Price to any amount deemed appropriate by the Board of Directors of the Company for any period not exceeding twenty consecutive days (as evidenced in a resolution adopted by such Board of Directors), but only after giving the notices required by Section 3.5 at least ten days prior to taking such action.
(e) Except as otherwise expressly provided in this Agreement, no adjustment in the Warrant Price will be made by reason of the issuance of any securities of the Company or for any other reason whatsoever.
(f) No fractional Warrant Securities will be issued upon the exercise of Warrants. If more than one Warrant is exercised at one time by the same holder, the number of full Warrant Securities that will be issuable upon exercise will be computed on the basis of the aggregate number of Warrant Securities purchased pursuant to the exercised Warrants. Instead of any fractional Warrant Security that would otherwise be issuable upon exercise of any Warrant, the Company will pay a cash adjustment in respect of such fraction in an amount equal to the same fraction of the last reported sale price (or bid price if there were no sales) per Warrant Security, in either case as reported on the principal registered national securities exchange on which the Warrant Securities are listed or admitted to trading on the business day before the day of exercise or, if the Warrant Securities are not then listed or admitted to trading on any registered national securities exchange, the average of the closing high bid and low asked prices as reported on the OTC Bulletin Board Service (the “OTC Bulletin Board”) operated by the Financial Industry Regulatory Authority, Inc. (“FINRA”) or, if not available on the OTC Bulletin Board, then the average of the closing high bid and low asked prices as reported on any other U.S. quotation medium or inter-dealer quotation system on such date, or if on any such date the Warrant Securities are not listed or admitted to trading on a registered national securities exchange, are not included in the OTC Bulletin Board, and are not quoted on any other U.S. quotation medium or inter-dealer quotation system, an amount equal to the same fraction of the average of the closing bid and asked prices as furnished by any FINRA member firm selected from time to time by the Company for that purpose at the close of business on the business day before the day of exercise.
(g) Whenever the Warrant Price then in effect is adjusted as herein provided, the Company will mail to each holder of the Warrants at such holder’s address as it will appear on the books of the Company a statement setting forth the adjusted Warrant Price then and thereafter effective under the provisions hereof, together with the facts, in reasonable detail, upon which such adjustment is based.
(h) Notwithstanding anything to the contrary herein, in no event will the Warrant Price, as adjusted in accordance with the terms hereof, be less than the par value per share of [title of Preferred Stock purchasable through exercise of Warrants].
3.5 Notice to Warrantholders. In case the Company (a) effects any dividend or distribution described in Section 3.4(b), (b) effects any Reorganization Event, (c) makes any distribution on or in respect of the [title of Preferred Stock purchasable through exercise of Warrants] in connection with the dissolution, liquidation or winding up of the Company, or (d) reduces the then current Warrant Price pursuant to Section 3.4(d), then the Company will mail to each holder of Warrants at each holder’s address as it appears on the books of the Warrant
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Agent, at least ten days prior to the applicable date specified below, a notice stating (x) the record date for such dividend or distribution, or, if a record is not to be taken, the date as of which the holders of record of [title of Preferred Stock purchasable through exercise of Warrants] that will be entitled to such dividend or distribution are to be determined, (y) the date on which such Reorganization Event, dissolution, liquidation or winding up is expected to become effective, and the date as of which it is expected that holders of [title of Preferred Stock purchasable through exercise of Warrants] of record will be entitled to exchange their shares of [title of Preferred Stock purchasable through exercise of Warrants] for securities or other property deliverable upon such Reorganization Event, dissolution, liquidation or winding up, or (z) the first date on which the then current Warrant Price will be reduced pursuant to Section 3.4(d). No failure to mail such notice nor any defect in the notice or in the mailing will affect any transaction or any adjustment in the Warrant Price required by Section 3.4.
3.6 [If the Warrants are Subject to Acceleration by the Company, Insert — Acceleration of Warrants by the Company.]
(a) At any time on or after [•], the Company will have the right to accelerate any or all Warrants at any time by causing them to expire at the close of business on the day immediately before a specified date (the “Acceleration Date”), if the Market Price (as defined below) of the [title of Preferred Stock purchasable through exercise of Warrants] equals or exceeds [•] percent ([•]%) of the then effective Warrant Price on any twenty Trading Days (as hereinafter defined) within a period of thirty consecutive Trading Days ending no more than five Trading Days prior to the date on which the Company gives notice to the Warrant Agent of its election to accelerate the Warrants.
(b) “Market Price” for each Trading Day will be, if the [title of Preferred Stock purchasable through exercise of Warrants] is listed or admitted to trading on any registered national securities exchange, the last reported sale price, regular way (or, if no such price is reported, the average of the reported closing bid and asked prices, regular way) of [title of Preferred Stock purchasable through exercise of Warrants], in either case as reported on the principal registered national securities exchange on which the [title of Preferred Stock purchasable through exercise of Warrants] is listed or admitted to trading or, if not listed or admitted to trading on any registered national securities exchange, the average of the closing high bid and low asked prices as reported on the OTC Bulletin Board operated by FINRA, or if not available on the OTC Bulletin Board, then the average of the closing high bid and low asked prices as reported on any other U.S. quotation medium or inter-dealer quotation system, or if on any such date the shares of [title of Preferred Stock purchasable through exercise of Warrants] are not listed or admitted to trading on a registered national securities exchange, are not included in the OTC Bulletin Board, and are not quoted on any other U.S. quotation medium or inter-dealer quotation system, the average of the closing bid and asked prices as furnished by any FINRA member firm selected from time to time by the Company for that purpose. “Trading Day” will be each Monday through Friday, other than any day on which securities are not traded in the system or on the exchange that is the principal market for the [title of Preferred Stock purchasable through exercise of Warrants], as determined by the Board of Directors of the Company.
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(c) In the event of an acceleration of less than all of the Warrants, the Warrant Agent will select the Warrants to be accelerated by lot, pro rata or in such other manner as it deems, in its discretion, to be fair and appropriate.
(d) Notice of an acceleration specifying the Acceleration Date will be sent by mail first class, postage prepaid, to each registered holder of a Warrant Certificate representing an accelerated Warrant at each holder’s address on the books of the Warrant Agent not more than sixty days nor less than thirty days before the Acceleration Date. Such notice of an acceleration also must be given no more than twenty days, and no less than ten days, prior to the mailing of notice to registered holders of Warrants pursuant to this Section 3.6, by publication at least once in a newspaper of general circulation in the City of New York.
(e) Any accelerated Warrant may be exercised until [•] p.m., [City] time, on the business day immediately before the Acceleration Date. The Warrant Price will be payable as provided in Section 2.]
ARTICLE 4
EXCHANGE AND TRANSFER OF WARRANT CERTIFICATES
4.1 Exchange and Transfer of Warrant Certificates. Upon surrender at the corporate trust office of the Warrant Agent, Warrant Certificates evidencing Warrants may be exchanged for Warrant Certificates in other denominations evidencing the Warrants or the transfer of the Warrants may be registered in whole or in part; as long as the other Warrant Certificates evidence Warrants for the same aggregate number of Warrant Securities as the Warrant Certificates surrendered. The Warrant Agent will keep, at its corporate trust office, books in which, subject to such reasonable regulations as it may prescribe, it will register Warrant Certificates and exchanges and transfers of outstanding Warrant Certificates, on surrender of the Warrant Certificates to the Warrant Agent at its corporate trust office for exchange or registration of transfer, properly endorsed or accompanied by appropriate instruments of registration of transfer and written instructions for transfer, all in form satisfactory to the Company and the Warrant Agent. There will be no service charge for any exchange or registration of transfer of Warrant Certificates, but the Company may require payment of a sum sufficient to cover any stamp or other tax or other governmental charge that may be imposed in connection with the exchange or registration of transfer. Whenever Warrant Certificates are surrendered for exchange or registration of transfer, an authorized officer of the Warrant Agent will manually countersign and deliver to the person or persons entitled to it, a Warrant Certificate or Warrant Certificates duly authorized and executed by the Company, as so requested. The Warrant Agent will not be required to effect any exchange or registration of transfer which will result in the issuance of a Warrant Certificate evidencing a Warrant for a fraction of a Warrant Security or a number of Warrants for a whole number of Warrant Securities and a fraction of a Warrant Security. All Warrant Certificates issued upon any exchange or registration of transfer of Warrant Certificates will be the valid obligations of the Company, evidencing the same obligations and entitled to the same benefits under this Agreement as the Warrant Certificate surrendered for such exchange or registration of transfer.
4.2 Treatment of Holders of Warrant Certificates. The Company, the Warrant Agent and all other persons may treat the registered holder of a Warrant Certificate as the absolute owner of the Warrant Certificate for any purpose and as the person entitled to exercise the rights represented by the Warrants evidenced thereby, any notice to the contrary notwithstanding.
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4.3 Cancellation of Warrant Certificates. Any Warrant Certificate surrendered for exchange, registration of transfer or exercise of the Warrants evidenced by the Warrant Certificate, if surrendered to the Company, be delivered to the Warrant Agent and all Warrant Certificates surrendered or so delivered to the Warrant Agent will be promptly canceled by the Warrant Agent and will not be reissued and, except as expressly permitted by this Agreement, no Warrant Certificate will be issued under this Agreement in exchange for a Warrant Certificate or in lieu of it. The Warrant Agent will deliver to the Company from time to time or otherwise dispose of canceled Warrant Certificates in a manner satisfactory to the Company.
ARTICLE 5
CONCERNING THE WARRANT AGENT
5.1 Warrant Agent. The Company hereby appoints [•] as Warrant Agent of the Company in respect of the Warrants and the Warrant Certificates upon the terms and subject to the conditions herein set forth, and [•] hereby accepts such appointment. The Warrant Agent has the powers and authority granted to and conferred upon it in the Warrant Certificates and by this Agreement and further powers and authority to act on behalf of the Company as the Company may hereafter grant to or confer upon it. All of the terms and provisions with respect to such powers and authority contained in the Warrant Certificates are subject to and governed by the terms and provisions hereof.
5.2 Conditions of Warrant Agent’s Obligations. The Warrant Agent accepts its obligations set forth upon the terms and conditions of this Agreement, including the following, all of which the Company agrees to and which the rights of the holders from time to time of the Warrant Certificates under this Agreement will be subject:
(a) Compensation and Indemnification. The Company agrees to promptly pay the Warrant Agent the compensation to be agreed upon with the Company for all services rendered by the Warrant Agent and to reimburse the Warrant Agent for reasonable out-of-pocket expenses (including reasonable counsel fees) incurred without negligence, bad faith or willful misconduct by the Warrant Agent in connection with the services rendered by the Warrant Agent under this Agreement. The Company also agrees to indemnify the Warrant Agent for, and to hold it harmless against, any loss, liability or expense incurred without negligence, bad faith or willful misconduct on the part of the Warrant Agent, arising out of or in connection with its acting as Warrant Agent, including the reasonable costs and expenses of defending against any claim of such liability.
(b) Agent for The Company. In acting under this Agreement and in connection with the Warrant Certificates, the Warrant Agent is acting solely as agent of the Company and does not assume any obligations or relationship of agency or trust for or with any of the holders of Warrant Certificates or beneficial owners of Warrants.
(c) Counsel. The Warrant Agent may consult with counsel satisfactory to it, which may include counsel for the Company, and the written advice of such counsel will be full and complete authorization and protection in respect of any action taken, suffered or omitted by it under this Agreement in good faith and in accordance with the advice of such counsel.
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(d) Documents. The Warrant Agent will be protected and will not incur liability for or in respect of any action taken or omitted by it in reliance upon any Warrant Certificate, notice, direction, consent, certificate, affidavit, statement or other paper or document reasonably believed by it to be genuine and to have been presented or signed by the proper parties.
(e) Certain Transactions. The Warrant Agent, and its officers, directors and employees, may become the owner of, or acquire any interest in, Warrants, with the same rights that it or they would have if it were not the Warrant Agent , and, to the extent permitted by applicable law, it or they may engage or be interested in any financial or other transaction with the Company and may act on, or as depositary, trustee or agent for, any committee or body of holders of Warrant Securities or other obligations of the Company as freely as if it were not the Warrant Agent. Nothing in this Agreement will be deemed to prevent the Warrant Agent from acting as trustee under any indenture to which the Company is a party.
(f) No Liability for Interest. Unless otherwise agreed with the Company, the Warrant Agent will not be liable for interest on any funds at any time received by it pursuant to any of the provisions of this Agreement or of the Warrant Certificates.
(g) No Liability for Invalidity. The Warrant Agent is not liable with respect to any invalidity of this Agreement or any of the Warrant Certificates (except as to the Warrant Agent’s countersignature thereon).
(h) No Responsibility for Representations. The Warrant Agent is not responsible for any of the recitals or representations in this Agreement or in the Warrant Certificates (except as to the Warrant Agent’s countersignature thereon), all of which are made solely by the Company.
(i) No Implied Obligations. The Warrant Agent is obligated to perform only duties specifically set forth under this Agreement and in the Warrant Certificates. There are no implied duties or obligations of the Agreement under this Agreement or the Warrant Certificates. The Warrant Agent is not under any obligation to take any action which may tend to involve it in any expense or liability, the payment of which within a reasonable time is not, in its reasonable opinion, assured to it. The Warrant Agent is not accountable or under any duty or responsibility for the use by the Company of any of the Warrant Certificates authenticated by the Warrant Agent and delivered by it to the Company pursuant to this Agreement or for the application by the Company of the proceeds of the Warrant Certificates. The Warrant Agent has no duty or responsibility in case of any default by the Company in the performance of its covenants or agreements contained under this Agreement or in the Warrant Certificates or in the case of the receipt of any written demand from a holder of a Warrant Certificate with respect to such default, including, without limiting the generality of the foregoing, any duty or responsibility to initiate or attempt to initiate any proceedings at law or otherwise or, except as provided in Section 6.2 hereof, to make any demand upon the Company.
5.3 Resignation, Removal and Appointment of Successors.
(a) The Company agrees, for the benefit of the holders from time to time of the Warrant Certificates, that there will be at all times a Warrant Agent until all the Warrants have been exercised or are no longer exercisable.
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(b) The Warrant Agent may at any time resign as agent by giving written notice to the Company of its intention, specifying the date on which its desired resignation will become effective; as long as the date of resignation is not less than three months after the date on which such notice is given unless the Company otherwise agrees. The Company may remove the Warrant Agent at any time by filing with the Warrant Agent an instrument in writing signed by or on behalf of the Company and specifying its intent to remove the Warrant Agent and the intended date when the removal will become effective. Any resignation or removal will take effect upon the appointment by the Company, as provided in this Agreement, of a successor Warrant Agent (which will be a bank or trust company authorized under the laws of the jurisdiction of its organization to exercise corporate trust powers) and the acceptance of the appointment by the successor Warrant Agent. The obligation of the Company under Section 5.2(a) will continue to the extent set forth therein notwithstanding the resignation or removal of the Warrant Agent.
(c) If, at any time the Warrant Agent resigns, or is removed, or become incapable of acting, or will be adjudged a bankrupt or insolvent, or commences a voluntary case under the Federal bankruptcy laws, as now or hereafter constituted, or under any other applicable Federal or state bankruptcy, insolvency or similar law or consents to the appointment of or taking possession by a receiver, custodian, liquidator, assignee, trustee, sequestrator (or other similar official) of the Warrant Agent or its property or affairs, or makes an assignment for the benefit of creditors, or admits in writing its inability to pay its debts generally as they become due, or takes corporate action in furtherance of any action, or a decree or order for relief by a court having jurisdiction in the premises will have been entered in respect of the Warrant Agent in an involuntary case under the Federal bankruptcy laws, as now or hereafter constituted, or any other applicable Federal or state bankruptcy, insolvency or similar law, or a decree or order by a court having jurisdiction in the premises will have been entered for the appointment of a receiver, custodian, liquidator, assignee, trustee, sequestrator (or similar official) of the Warrant Agent or of its property or affairs, or any public officer takes charge or control of the Warrant Agent or of its property or affairs for the purpose of rehabilitation, conservation, winding up or liquidation, a successor Warrant Agent, qualified as described above, will be appointed by the Company by an instrument in writing, filed with the successor Warrant Agent. Upon the appointment as aforesaid of a successor Warrant Agent and acceptance by the successor Warrant Agent of such appointment, the Warrant Agent will cease to be Warrant Agent.
(d) Any successor Warrant Agent appointed under this Agreement will execute, acknowledge and deliver to its predecessor and to the Company an instrument accepting the appointment, and immediately after, successor Warrant Agent, without any further act, deed or conveyance, will become vested with all the authority, rights, powers, trusts, immunities, duties and obligations of the predecessor as if originally named as Warrant Agent under this Agreement, and the predecessor, on payment of its unpaid charges and disbursements, will then become obligated to transfer, deliver and pay over, and successor Warrant Agent will be entitled to receive, all funds, securities and other property on deposit with or held by the predecessor, as Warrant Agent hereunder.
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(e) Any corporation into which the Warrant Agent may be merged or converted or any corporation with which the Warrant Agent may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Warrant Agent will be a party, or any corporation to which the Warrant Agent sells or otherwise transfers all or substantially all the assets and business of the Warrant Agent, provided that it is qualified as described above, will be the successor Warrant Agent under this Agreement without the execution or filing of any paper or any further act on the part of any of the parties to this Agreement.
ARTICLE 6
MISCELLANEOUS
6.1 Amendment. This Agreement may be amended by the parties to this Agreement, without the consent of the holder of any Warrant Certificate, for the purpose of curing any ambiguity, or of curing, correcting or supplementing any defective provision contained in this Agreement, or making any other provisions with respect to matters or questions arising under this Agreement as the Company and the Warrant Agent may deem necessary or desirable; provided that such action will not materially adversely affect the interests of the holders of the Warrant Certificates.
6.2 Notices and Demands to the Company and Warrant Agent. If the Warrant Agent receives any notice or demand addressed to the Company by the holder of a Warrant Certificate pursuant to the provisions of the Warrant Certificates, the Warrant Agent will promptly forward the notice or demand to the Company.
6.3 Addresses. Any communication from the Company to the Warrant Agent with respect to this Agreement must be addressed to [•], Attention: [•] and any communication from the Warrant Agent to the Company with respect to this Agreement must be addressed to Snap Inc., 2772 Donald Douglas Loop North, Santa Monica, California 90405, Attention: [•] (or such other address as will be specified in writing by the Warrant Agent or by the Company).
6.4 Governing Law. This Agreement and each Warrant Certificate issued under this agreement, and any claim, controversy or dispute arising under or related to this Agreement or any Warrant Certificate, will be governed by and construed in accordance with the laws of the State of New York.
6.5 Delivery of Prospectus. The Company will furnish to the Warrant Agent sufficient copies of a prospectus meeting the requirements of the Securities Act of 1933, as amended, relating to the Warrant Securities deliverable on exercise of the Warrants (the “Prospectus”), and the Warrant Agent agrees that on the exercise of any Warrant, the Warrant Agent will deliver to the holder of the Warrant Certificate evidencing such Warrant, prior to or concurrently with the delivery of the Warrant Securities issued on such exercise, a Prospectus. The Warrant Agent will not, by reason of any delivery, assume any responsibility for the accuracy or adequacy of such Prospectus.
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6.6 Obtaining of Governmental Approvals. The Company will, from time to time, take all action which may be necessary to obtain and keep effective any and all permits, consents and approvals of governmental agencies and authorities and securities act filings under United States Federal and state laws (including without limitation a registration statement in respect of the Warrants and Warrant Securities under the Securities Act of 1933, as amended), which may be or become requisite in connection with the issuance, sale, transfer, and delivery of the Warrant Securities issued upon exercise of the Warrants, the issuance, sale, transfer and delivery of the Warrants or upon the expiration of the period during which the Warrants are exercisable.
6.7 Persons Having Rights Under the Agreement. Nothing in this Agreement gives to any person other than the Company, the Warrant Agent or the holders of the Warrant Certificates any right, remedy or claim under or by reason of this Agreement.
6.8 Headings. The descriptive headings of the several Articles and Sections of this Agreement are inserted for convenience only and does not control or affect the meaning or construction of any of the provisions hereof.
6.9 Counterparts. This Agreement may be executed in any number of counterparts, each of which as executed will be deemed to be an original, and such counterparts together will constitute one instrument.
6.10 Inspection of Agreement. A copy of this Agreement will be available at all reasonable times at the principal corporate trust office of the Warrant Agent for inspection by the holder of any Warrant Certificate. The Warrant Agent may require such holder to submit such holder’s Warrant Certificate for inspection by it.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed, as of the day and year first written above.
| SNAP INC., as Company | ||
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| Name: |
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| Title: |
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| Attest: |
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| COUNTERSIGNED | ||
| [•], as Warrant Agent | ||
| By: |
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[SIGNATURE PAGE TO PREFERRED STOCK WARRANT AGREEMENT]
EXHIBIT A
FORM OF WARRANT CERTIFICATE
[FACE OF WARRANT CERTIFICATE]
| [Form of Legend if Warrants are not immediately exercisable.] | [Prior to [•] Warrants evidenced by this Warrant Certificate cannot be exercised.] |
EXERCISABLE ONLY IF COUNTERSIGNED BY THE WARRANT AGENT
VOID AFTER [•] P.M., [City] time, ON [•].
SNAP INC.
WARRANT CERTIFICATE REPRESENTING
WARRANTS TO PURCHASE
[TITLE OF WARRANT SECURITIES]
| No. [•] |
[•] Warrants |
This certificate (“Warrant Certificate”) certifies that [•] or registered assigns is the registered owner of the above indicated number of Warrants, each Warrant entitling such owner to purchase, at any time [after [•] p.m., [City] time, on [•] and] on or before [•] p.m., [City] time, on [•] shares of [Title of Warrant Securities] (the “Warrant Securities”), of Snap Inc. (the “Company”) on the following basis: during the period from [•], through and including [•], the exercise price per Warrant Security will be $[•], subject to adjustment as provided in the Warrant Agreement (as hereinafter defined) (the “Warrant Price”). The Holder may exercise the Warrants evidenced by this Warrant Certificate by providing certain information set forth on the back of this Warrant Certificate and by paying in full, in lawful funds of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds], the Warrant Price for each Warrant Security with respect to which this Warrant is exercised to the Warrant Agent (as defined below) and by surrendering this Warrant Certificate, with the purchase form on the back of this Warrant Certificate duly executed, at the corporate trust office of [name of Warrant Agent], or its successor as warrant agent (the “Warrant Agent”), which is, on the date of this Warrant Certificate, at the address specified on the reverse of this Warrant Certificate, and upon compliance with and subject to the conditions set forth in this Warrant Certificate and in the Warrant Agreement (as defined below).
The term “Holder” as used in this Warrant Certificate will mean the person in whose name at the time this Warrant Certificate will be registered on the books maintained by the Warrant Agent for pursuant to Section 4 of the Warrant Agreement.
The Warrants evidenced by this Warrant Certificate may be exercised to purchase a whole number of Warrant Securities in registered form. Upon any exercise of fewer than all of the Warrants evidenced by this Warrant Certificate, the Holder will be issued a new Warrant Certificate evidencing Warrants for the number of remaining Warrant Securities unexercised.
This Warrant Certificate is issued under and in accordance with the Warrant Agreement dated as of [•] (the “Warrant Agreement”), between the Company and the Warrant Agent and is subject to the terms and provisions contained in the Warrant Agreement, the terms and provisions of which the Holder of this Warrant Certificate consents by acceptance of this Warrant Agreement. Copies of the Warrant Agreement are on file at the above-mentioned office of the Warrant Agent.
Transfer of this Warrant Certificate may be registered when this Warrant Certificate is surrendered at the corporate trust office of the Warrant Agent by the registered owner or such owner’s assigns, in the manner and subject to the limitations provided in the Warrant Agreement.
After countersignature by the Warrant Agent and prior to the expiration of this Warrant Certificate, this Warrant Certificate may be exchanged at the corporate trust office of the Warrant Agent for Warrant Certificates representing Warrants for the same aggregate number of Warrant Securities.
This Warrant Certificate will not entitle the Holder of this Warrant Certificate to any of the rights of a holder of the Warrant Securities, including, without limitation, the right to receive payments of dividends or distributions, if any, on the Warrant Securities (except to the extent set forth in the Warrant Agreement) or to exercise any voting rights.
Reference is hereby made to the further provisions of this Warrant Certificate set forth on the reverse of this Warrant Certificate, which will, for all purposes have the same effect as if set forth at this place.
This Warrant Certificate will not be valid or obligatory for any purpose until countersigned by the Warrant Agent.
IN WITNESS WHEREOF, the Company has caused this Warrant to be executed in its name and on its behalf by the facsimile signatures of its duly authorized officers.
Dated:
| SNAP INC., as Company | ||
| By: |
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| Name: |
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| Title: |
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| Attest: |
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| COUNTERSIGNED | ||
| [•], as Warrant Agent | ||
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[REVERSE OF WARRANT CERTIFICATE]
(Instructions for Exercise of Warrant)
To exercise any Warrants evidenced by this Warrant Certificate for Warrant Securities (as defined below), the Holder must pay, in lawful funds of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds], the Warrant Price in full for Warrants exercised, to [•] [address of Warrant Agent], Attention: [•], which payment must specify the name of the Holder and the number of Warrants exercised by such Holder. In addition, the Holder must complete the information required below and present this Warrant Certificate in person or by mail (certified or registered mail is recommended) to the Warrant Agent at the appropriate address set forth above. This Warrant Certificate, completed and duly executed, must be received by the Warrant Agent within five business days of the payment.
(To be executed upon exercise of Warrants)
The undersigned hereby irrevocably elects to exercise [•] Warrants, evidenced by this Warrant Certificate, to purchase [•] shares of the [Title of Warrant Securities] (the “Warrant Securities”), of Snap Inc. and represents that the undersigned has tendered payment for such Warrant Securities, in lawful funds of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds], to the order of Snap Inc., c/o [insert name and address of Warrant Agent], in the amount of $[•] in accordance with the terms hereof. The undersigned requests that said Warrant Securities be in fully registered form in the authorized denominations, registered in such names and delivered all as specified in accordance with the instructions set forth below.
If the number of Warrants exercised is less than all of the Warrants evidenced by this Warrant Certificate, the undersigned requests that a new Warrant Certificate evidencing the Warrants for the number of Warrant Securities remaining unexercised be issued and delivered to the undersigned unless otherwise specified in the instructions below.
| Dated: | Name: | |||
| Please Print | ||||
| Address: |
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| (Insert Social Security or Other Identifying Number of Holder) |
Signature
Guaranteed:
Signature
(Signature must conform in all respects to name of holder as specified on the face of this Warrant Certificate and must bear a signature guarantee by a FINRA member firm).
This Warrant may be exercised at the following addresses:
By hand at:
By mail at:
[Instructions as to form and delivery of Warrant Securities and, if applicable, Warrant Certificates evidencing Warrants for the number of Warrant Securities remaining unexercised — complete as appropriate.]
ASSIGNMENT
[Form of assignment to be executed if Warrant Holder desires to transfer Warrant]
FOR VALUE RECEIVED, [•] hereby sells, assigns and transfers unto:
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| (Please print name and address including zip code) | Please print Social Security or other identifying number |
the right represented by the within Warrant to purchase shares of [Title of Warrant Securities] of Snap Inc. to which the within Warrant relates and appoints attorney [•] to transfer such right on the books of the Warrant Agent with full power of substitution in the premises.
| Dated: | Name: | |||
| Signature | ||||
(Signature must conform in all respects to name of holder as specified on the face of the Warrant)
| Signature Guaranteed |
Exhibit 4.10
SNAP INC.
and
, AS WARRANT AGENT
FORM OF DEBT SECURITIES
WARRANT AGREEMENT
DATED AS OF [•], 20
SNAP INC.
FORM OF DEBT SECURITIES WARRANT AGREEMENT
This DEBT SECURITIES WARRANT AGREEMENT (this “Agreement”), dated as of [•], between SNAP INC., a Delaware corporation (the “Company”), and [•], a [corporation] [national banking association] organized and existing under the laws of [•] and having a corporate trust office in [•], as warrant agent (the “Warrant Agent”).
WHEREAS, the Company has entered into an indenture dated as of [•] [(the “Indenture”), with [•], as trustee (together with any successors to such trustee, the “Trustee”), providing for the issuance from time to time of its [unsubordinated][subordinated] debt securities, to be issued in one or more series as provided in the Indenture (the “Debt Securities”);]
WHEREAS, the Company proposes to sell [If Warrants are sold with other securities — title of such other securities being offered (the “Other Securities”) with] warrant certificates evidencing one or more warrants (the “Warrants” or, individually, a “Warrant”) representing the right to purchase [title of Debt Securities purchasable through exercise of Warrants] (the “Warrant Debt Securities”), such warrant certificates and other warrant certificates issued pursuant to this Agreement (the “Warrant Certificates”); and
WHEREAS, the Company desires the Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing to act, in connection with the issuance, registration, transfer, exchange, exercise and replacement of the Warrant Certificates, and the Company wishes to set forth in this Agreement, among other things, the form and provisions of the Warrant Certificates and the terms and conditions on which they may be issued, registered, transferred, exchanged, exercised and replaced.
NOW, THEREFORE, in consideration of the premises and of the mutual agreements contained in this Agreement, the parties agree as follows:
ARTICLE 1
ISSUANCE OF WARRANTS AND EXECUTION AND
DELIVERY OF WARRANT CERTIFICATES
1.1 Issuance of Warrants. [If Warrants alone — Upon issuance, each Warrant Certificate will evidence one or more Warrants.] [If Other Securities and Warrants — Warrant Certificates will be [initially] issued in connection with the issuance of the Other Securities but will be separately transferable and each Warrant Certificate will evidence one or more Warrants.] Each Warrant evidenced thereby will represent the right, subject to the provisions contained in this Agreement and in such Warrant Certificate, to purchase one Warrant Debt Security. [If Other Securities and Warrants — Warrant Certificates will be issued with the Other Securities and each Warrant Certificate will evidence [•] Warrants for each [$[•] principal amount] [[•] shares] of Other Securities issued].
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1.2 Execution and Delivery of Warrant Certificates. Each Warrant Certificate, whenever issued, will be in registered form substantially in the form set forth in Exhibit A hereto, will be dated the date of its countersignature by the Warrant Agent and may have letters, numbers, or other marks of identification or designation and legends or endorsements printed, lithographed or engraved on it, as the officers of the Company executing the Warrant Certificate may approve (execution of the Warrant Certificate to be conclusive evidence of such approval) and as are not inconsistent with the provisions of this Agreement, or as may be required to comply with any law or with any rule or regulation made pursuant to it or with any rule or regulation of any securities exchange on which the Warrants may be listed, or to conform to usage. The Warrant Certificates will be signed on behalf of the Company by any of its present or future chief executive officers, presidents, senior vice presidents, vice presidents, chief financial officers, chief legal officers, treasurers, assistant treasurers, controllers, assistant controllers, secretaries or assistant secretaries under its corporate seal reproduced on it. The signatures may be manual or facsimile signatures of such authorized officers and may be imprinted or otherwise reproduced on the Warrant Certificates. The seal of the Company may be in the form of a facsimile thereof and may be impressed, affixed, imprinted or otherwise reproduced on the Warrant Certificates.
No Warrant Certificate will be valid for any purpose, and no Warrant evidenced by it will l be exercisable, until such Warrant Certificate has been countersigned by the manual signature of the Warrant Agent. The signature of the Warrant Agent on any Warrant Certificate executed by the Company will be conclusive evidence that the countersigned Warrant Certificate has been duly issued under this Agreement.
In case any officer of the Company who signed any of the Warrant Certificates either manually or by facsimile signature ceases to be an officer before the Warrant Certificates have been countersigned and delivered by the Warrant Agent, the Warrant Certificates may be countersigned and delivered notwithstanding that the person who signed such Warrant Certificates ceased to be an officer of the Company; and any Warrant Certificate may be signed on behalf of the Company by such persons, at the actual date of the execution of such Warrant Certificate, who are the proper officers of the Company, although at the date of the execution of this Agreement any such person was not such officer.
The term “holder” or “holder of a Warrant Certificate” as used in this Agreement will mean any person in whose name at the time any Warrant Certificate is registered on the books maintained by the Warrant Agent for that purpose.
1.3 Issuance of Warrant Certificates. Warrant Certificates evidencing the right to purchase Warrant Debt Securities may be executed by the Company and delivered to the Warrant Agent on the execution of this Agreement or from time to time thereafter. The Warrant Agent will, upon receipt of Warrant Certificates duly executed on behalf of the Company, countersign the Warrant Certificates and deliver the Warrant Certificates to, or upon the order of, the Company.
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ARTICLE 2
WARRANT PRICE, DURATION AND EXERCISE OF WARRANTS
2.1 Warrant Price. During the period specified in Section 2.2, each Warrant will, subject to the terms of this Agreement and the applicable Warrant Certificate, entitle the holder of the Warrant Certificate to purchase the principal amount of Warrant Debt Securities specified in the applicable Warrant Certificate at an exercise price of [•]% of the principal amount thereof [plus accrued amortization, if any, of the original issue discount of the Warrant Debt Securities] [plus accrued interest, if any, from the most recent date from which interest will have been paid on the Warrant Debt Securities or, if no interest will have been paid on the Warrant Debt Securities, from the date of their initial issuance.] [The original issue discount ($[•] for each $1,000 principal amount of Warrant Debt Securities) will be amortized at a [•]% annual rate, computed on a[n] [semi-] annual basis [using a 360-day year consisting of twelve 30-day months].] Such purchase price for the Warrant Debt Securities is referred to in this Agreement as the “Warrant Price.”
2.2 Duration of Warrants. Each Warrant may be exercised in whole or in part at any time, as specified herein, on or after [the date thereof] [[•]] and at or before [•]p.m., [City] time, on [•] or such later date as the Company may designate by notice to the Warrant Agent and the holders of Warrant Certificates mailed to their addresses as set forth in the record books of the Warrant Agent (the “Expiration Date”). Each Warrant not exercised at or before [[•]] p.m., [City] time, on the Expiration Date will become void, and all rights of the holder of the Warrant Certificate evidencing such Warrant under this Agreement will cease.
2.3 Exercise of Warrants.
(a) During the period specified in Section 2.2, the Warrants may be exercised to purchase a whole number of Warrant Debt Securities in registered form by providing certain information as set forth on the reverse side of the Warrant Certificate and by paying in full, in lawful funds of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds] the Warrant Price for each Warrant Debt Security with respect to which a Warrant is being exercised to the Warrant Agent at its corporate trust office, provided that such exercise is subject to receipt within five business days of such payment by the Warrant Agent of the Warrant Certificate with the form of election to purchase Warrant Debt Securities set forth on the reverse side of the Warrant Certificate properly completed and duly executed. The date on which payment in full of the Warrant Price is received by the Warrant Agent will, subject to receipt of the Warrant Certificate, be deemed to be the date on which the Warrant is exercised; except that if, at the date of receipt of such Warrant Certificates and payment in full of the Warrant Price, the transfer books for the Warrant Debt Securities purchasable on the exercise of such Warrants will be closed, no receipt of such Warrant Certificates and no payment of such Warrant Price will be effective to name the designated person as the holder of record of such Warrant Debt Securities on such date, but will be effective to constitute such person as the holder of record of such Warrant Debt Securities for all purposes at the opening of business on the next succeeding day on which the transfer books for the Warrant Debt Securities purchasable upon the exercise of such Warrants will be opened, and the certificates for the Warrant Debt Securities in respect of which such Warrants are then exercised will be issuable as of the next succeeding day on which the transfer books will be opened, and until such date the Company will be under no duty to deliver any certificate for such Warrant Debt Securities. The Warrant Agent will deposit all funds received by it in payment of the Warrant Price in an account of the Company maintained with it and will advise the Company by telephone at the end of each day on which a payment for the exercise of Warrants is received of the amount so deposited to its account. The Warrant Agent will promptly confirm such telephone advice to the Company in writing.
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(b) The Warrant Agent will, from time to time, as promptly as practicable, advise the Company of (i) the number of Warrant Debt Securities with respect to which Warrants were exercised, (ii) the instructions of each holder of the Warrant Certificates evidencing Warrants with respect to delivery of the Warrant Debt Securities to which each holder is entitled upon exercise, (iii) delivery of Warrant Certificates evidencing the balance, if any, of the Warrants for the remaining Warrant Debt Securities after exercise, and (iv) any other information as the Company or the Trustee will reasonably require.
(c) As soon as practicable after the exercise of any Warrant, the Company will issue, pursuant to the Indenture, in authorized denominations, to or on the order of the holder of the Warrant Certificate evidencing such Warrant, the Warrant Debt Securities to which the holder is entitled, in fully registered form, registered in the name or names directed by the holder. If fewer than all of the Warrants evidenced by the Warrant Certificate are exercised, the Company will execute, and an authorized officer of the Warrant Agent will manually countersign and deliver, a new Warrant Certificate evidencing Warrants for the number of Warrant Debt Securities remaining unexercised.
(d) The Company will not be required to pay any stamp or other tax or other governmental charge required to be paid in connection with any transfer involved in the issue of the Warrant Debt Securities, and in the event that any such transfer is involved, the Company will not be required to issue or deliver any Warrant Debt Securities until the tax or other charge has been paid or it has been established to the Company’s satisfaction that no such tax or other charge is due.
(e) Prior to the issuance of any Warrants there must be a reserve, and the Company will at all times through the Expiration Date keep reserved, out of its authorized but unissued Warrant Debt Securities, a number of shares sufficient to provide for the exercise of the Warrants.
ARTICLE 3
OTHER PROVISIONS RELATING TO
RIGHTS OF HOLDERS OF WARRANT CERTIFICATES
3.1 No Rights as Holders of Warrant Debt Securities Conferred by Warrants or Warrant Certificates. No Warrant Certificate or Warrant evidenced by a Warrant Certificate will entitle the holder to any of the rights of a holder of Warrant Debt Securities, including, without limitation, the right to receive the payment of principal of (or premium, if any) or interest, if any, on the Warrant Debt Securities or to enforce any of the covenants in the Indenture.
3.2 Lost, Stolen, Mutilated or Destroyed Warrant Certificates. Upon receipt by the Warrant Agent of evidence reasonably satisfactory to it and the Company of the ownership of and the loss, theft, destruction or mutilation of any Warrant Certificate or indemnity reasonably satisfactory to the Warrant Agent and the Company and, in the case of mutilation, upon
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surrender of the mutilated Warrant Certificate to the Warrant Agent for cancellation, then, in the absence of notice to the Company or the Warrant Agent that such Warrant Certificate has been acquired by a bona fide purchaser, the Company will execute, and an authorized officer of the Warrant Agent will manually countersign and deliver, in exchange for or in lieu of the lost, stolen, destroyed or mutilated Warrant Certificate, a new Warrant Certificate of the same tenor and evidencing Warrants for a like principal amount of Warrant Debt Securities. Upon the issuance of any new Warrant Certificate under this Section 3.2, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation to the new issuance and any other expenses (including the fees and expenses of the Warrant Agent) in connection therewith. Every substitute Warrant Certificate executed and delivered pursuant to this Section 3.2 in lieu of any lost, stolen or destroyed Warrant Certificate will represent an additional contractual obligation of the Company, whether or not the lost, stolen or destroyed Warrant Certificate will be at any time enforceable by anyone, and will be entitled to the benefits of this Agreement equally and proportionately with any and all other Warrant Certificates duly executed and delivered hereunder. The provisions of this Section 3.2 are exclusive and will preclude (to the extent lawful) all other rights and remedies with respect to the replacement of mutilated, lost, stolen or destroyed Warrant Certificates.
3.3 Holder of Warrant Certificate May Enforce Rights. Notwithstanding any of the provisions of this Agreement, any holder of a Warrant Certificate, without the consent of the Warrant Agent, the Trustee, the holder of any Warrant Debt Securities or the holder of any other Warrant Certificate, may, in such holder’s own behalf and for such holder’s own benefit, enforce, and may institute and maintain any suit, action or proceeding against the Company suitable to enforce, or otherwise in respect of, each holder’s right to exercise the Warrants evidenced by the holder’s Warrant Certificate in the manner provided in the holder’s Warrant Certificates and in this Agreement.
3.4 Merger, Sale, Conveyance or Lease. In case of (a) any share exchange, merger or similar transaction of the Company with or into another person or entity (other than a share exchange, merger or similar transaction in which the Company is the acquiring or surviving corporation) or (b) the sale, exchange, lease, transfer or other disposition of all or substantially all of the properties and assets of the Company as an entirety (in any such case, a “Reorganization Event”), then, as a condition of such Reorganization Event, lawful provisions will be made, and duly executed documents evidencing the same from the Company’s successor will be delivered to the holders of the Warrants, so that such successor will succeed to and be substituted for the Company, and assume all the Company’s obligations under, this Agreement and the Warrants. The Company will then be relieved of any further obligation under this Agreement or under the Warrants, and the Company as the predecessor corporation may or at any time after be dissolved, wound up or liquidated. Such successor or assuming entity may then cause to be signed, and may issue either in its own name or in the name of the Company, any or all of the Warrants issuable under this Agreement which previously will not have been signed by the Company, and may execute and deliver securities in its own name, in fulfillment of its obligations to deliver Warrant Debt Securities upon exercise of the Warrants. All issued Warrants will have, in all respects, the same legal rank and benefit under this Agreement as the Warrants issued before or after in accordance with the terms of this Agreement as though all of such Warrants had been issued at the date of the execution of this Agreement. In the case of any such Reorganization Event, changes in phraseology and form (but not in substance) may be made in the Warrants to be issued as may be appropriate. The Warrant Agent may receive a written opinion of legal counsel as conclusive evidence that the Reorganization Event complies with the provisions of this Section 3.4.
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3.5 Notice to Warrantholders. In case the Company (a) effects any Reorganization Event or (b) makes any distribution on or in respect of the [title of Warrant Debt Securities] in connection with the dissolution, liquidation or winding up of the Company, then the Company will mail to each holder of Warrants at each holder’s address as it appears on the books of the Warrant Agent, at least ten days prior to the applicable date specified below, a notice stating the date on which such Reorganization Event, dissolution, liquidation or winding up is expected to become effective, and the date as of which it is expected that holders of [title of Warrant Debt Securities] of record are entitled to exchange their shares of [title of Warrant Debt Securities] for securities or other property deliverable upon such Reorganization Event, dissolution, liquidation or winding up. No failure to mail such notice nor any defect in the notice or in the mailing will affect any such transaction.
ARTICLE 4
EXCHANGE AND TRANSFER OF WARRANT CERTIFICATES
4.1 Exchange and Transfer of Warrant Certificates. Upon surrender at the corporate trust office of the Warrant Agent, Warrant Certificates evidencing Warrants may be exchanged for Warrant Certificates in other denominations evidencing the Warrants or the transfer of the Warrants may be registered in whole or in part; as long as the other Warrant Certificates evidence Warrants for the same aggregate principal amount of Warrant Debt Securities as the Warrant Certificates surrendered. The Warrant Agent will keep, at its corporate trust office, books in which, subject to such reasonable regulations as it may prescribe, it will register Warrant Certificates and exchanges and transfers of outstanding Warrant Certificates, upon surrender of the Warrant Certificates to the Warrant Agent at its corporate trust office for exchange or registration of transfer, properly endorsed or accompanied by appropriate instruments of registration of transfer and written instructions for transfer, all in form satisfactory to the Company and the Warrant Agent. There will be no service charge for any exchange or registration of transfer of Warrant Certificates, but the Company may require payment of a sum sufficient to cover any stamp or other tax or other governmental charge that may be imposed in connection with the exchange or registration of transfer. Whenever Warrant Certificates are surrendered for exchange or registration of transfer, an authorized officer of the Warrant Agent will manually countersign and deliver to the person or persons entitled to it, a Warrant Certificate or Warrant Certificates duly authorized and executed by the Company, as so requested. The Warrant Agent will not be required to effect any exchange or registration of transfer which will result in the issuance of a Warrant Certificate evidencing a Warrant for a fraction of a Warrant Debt Security or a number of Warrants for a whole number of Warrant Debt Securities and a fraction of a Warrant Debt Security. All Warrant Certificates issued upon any exchange or registration of transfer of Warrant Certificates will be the valid obligations of the Company, evidencing the same obligations and entitled to the same benefits under this Agreement as the Warrant Certificate surrendered for such exchange or registration of transfer.
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4.2 Treatment of Holders of Warrant Certificates. The Company, the Warrant Agent and all other persons may treat the registered holder of a Warrant Certificate as the absolute owner of the Warrant Certificate for any purpose and as the person entitled to exercise the rights represented by the Warrants evidenced thereby, any notice to the contrary notwithstanding.
4.3 Cancellation of Warrant Certificates. Any Warrant Certificate surrendered for exchange, registration of transfer or exercise of the Warrants evidenced by the Warrant Certificate, if surrendered to the Company, be delivered to the Warrant Agent and all Warrant Certificates surrendered or so delivered to the Warrant Agent be promptly canceled by the Warrant Agent and will not be reissued and, except as expressly permitted by this Agreement, no Warrant Certificate will be issued under this Agreement in exchange for a Warrant Certificate or in lieu of it. The Warrant Agent will deliver to the Company from time to time or otherwise dispose of canceled Warrant Certificates in a manner satisfactory to the Company.
ARTICLE 5
CONCERNING THE WARRANT AGENT
5.1 Warrant Agent. The Company hereby appoints [•] as Warrant Agent of the Company in respect of the Warrants and the Warrant Certificates upon the terms and subject to the conditions herein set forth, and [•] hereby accepts such appointment. The Warrant Agent has the powers and authority granted to and conferred upon it in the Warrant Certificates and by this Agreement and further powers and authority to act on behalf of the Company as the Company may later grant or confer upon it. All of the terms and provisions with respect to the powers and authority contained in the Warrant Certificates are subject to and governed by the terms and provisions of this Agreement.
5.2 Conditions of Warrant Agent’s Obligations. The Warrant Agent accepts its obligations set forth upon the terms and conditions of this Agreement, including the following, all of which the Company agrees to and which the rights of the holders from time to time of the Warrant Certificates under this Agreement will be subject:
(a) Compensation and Indemnification. The Company agrees to promptly pay the Warrant Agent the compensation to be agreed upon with the Company for all services rendered by the Warrant Agent and to reimburse the Warrant Agent for reasonable out-of-pocket expenses (including reasonable counsel fees) incurred without negligence, bad faith or willful misconduct by the Warrant Agent in connection with the services rendered by the Warrant Agent under this Agreement. The Company also agrees to indemnify the Warrant Agent for, and to hold it harmless against, any loss, liability or expense incurred without negligence, bad faith or willful misconduct on the part of the Warrant Agent, arising out of or in connection with its acting as Warrant Agent, including the reasonable costs and expenses of defending against any claim of such liability.
(b) Agent for the Company. In acting under this Warrant Agreement and in connection with the Warrant Certificates, the Warrant Agent is acting solely as agent of the Company and does not assume any obligations or relationship of agency or trust for or with any of the holders of Warrant Certificates or beneficial owners of Warrants.
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(c) Counsel. The Warrant Agent may consult with counsel satisfactory to it, which may include counsel for the Company, and the written advice of such counsel will be full and complete authorization and protection in respect of any action taken, suffered or omitted by it under this Agreement in good faith and in accordance with the advice of such counsel.
(d) Documents. The Warrant Agent will be protected and will not incur liability for or in respect of any action taken or omitted by it in reliance upon any Warrant Certificate, notice, direction, consent, certificate, affidavit, statement or other paper or document reasonably believed by it to be genuine and to have been presented or signed by the proper parties.
(e) Certain Transactions. The Warrant Agent, and its officers, directors and employees, may become the owner of, or acquire any interest in, Warrants, with the same rights that it or they would have if it were not the Warrant Agent, and, to the extent permitted by applicable law, it or they may engage or be interested in any financial or other transaction with the Company and may act on, or as depositary, trustee or agent for, any committee or body of holders of Warrant Debt Securities or other obligations of the Company as freely as if it were not the Warrant Agent hereunder. Nothing in this Agreement will be deemed to prevent the Warrant Agent from acting as trustee under any indenture to which the Company is a party, including, without limitation, as Trustee under the Indenture.
(f) No Liability for Interest. Unless otherwise agreed with the Company, the Warrant Agent will not be liable for interest on any funds at any time received by it pursuant to any of the provisions of this Agreement or of the Warrant Certificates.
(g) No Liability for Invalidity. The Warrant Agent will not be liable with respect to any invalidity of this Agreement or any of the Warrant Certificates (except as to the Warrant Agent’s countersignature thereon).
(h) No Responsibility for Representations. The Warrant Agent is not responsible for any of the recitals or representations in this Agreement or in the Warrant Certificates (except as to the Warrant Agent’s countersignature thereon), all of which are made solely by the Company.
(i) No Implied Obligations. The Warrant Agent is obligated to perform only the duties specifically set forth under this Agreement and in the Warrant Certificates. There are no implied duties or obligations of the Warrant Agent under this Agreement or the Warrant Certificates. The Warrant Agent is not under any obligation to take any action which may tend to involve it in any expense or liability, the payment of which within a reasonable time is not, in its reasonable opinion, assured to it. The Warrant Agent is not be accountable or under any duty or responsibility for the use by the Company of any of the Warrant Certificates authenticated by the Warrant Agent and delivered by it to the Company pursuant to this Agreement or for the application by the Company of the proceeds of the Warrant Certificates. The Warrant Agent has no duty or responsibility in case of any default by the Company in the performance of its covenants or agreements contained under this Agreement or in the Warrant Certificates or in the case of the receipt of any written demand from a holder of a Warrant Certificate with respect to such default, including, without limiting the generality of the foregoing, any duty or responsibility to initiate or attempt to initiate any proceedings at law or otherwise or, except as provided in Section 6.2 hereof, to make any demand upon the Company.
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5.3 Resignation, Removal and Appointment of Successors.
(a) The Company agrees, for the benefit of the holders from time to time of the Warrant Certificates, that there will be at all times a Warrant Agent until all the Warrants have been exercised or are no longer exercisable.
(b) The Warrant Agent may at any time resign as agent by giving written notice to the Company of its intention, specifying the date on which its desired resignation will become effective; as long as the date of resignation is not less than three months after the date on which such notice is given unless the Company otherwise agrees. The Company may remove the Warrant Agent at any time by filing with the Warrant Agent an instrument in writing signed by or on behalf of the Company and specifying its intent to remove the Warrant Agent and the intended date when the removal will become effective. Any resignation or removal will take effect upon the appointment by the Company, as provided in this Agreement, of a successor Warrant Agent (which will be a bank or trust company authorized under the laws of the jurisdiction of its organization to exercise corporate trust powers) and the acceptance of the appointment by the successor Warrant Agent. The obligation of the Company under Section 5.2(a) will continue to the extent set forth therein notwithstanding the resignation or removal of the Warrant Agent.
(c) If, at any time, the Warrant Agent resigns, or is removed, or becomes incapable of acting, or is adjudged a bankrupt or insolvent, or commences a voluntary case under the Federal bankruptcy laws, as now or hereafter constituted, or under any other applicable Federal or state bankruptcy, insolvency or similar law or consents to the appointment of or taking possession by a receiver, custodian, liquidator, assignee, trustee, sequestrator (or other similar official) of the Warrant Agent or its property or affairs, or makes an assignment for the benefit of creditors, or admits in writing its inability to pay its debts generally as they become due, or takes corporate action in furtherance of any action, or a decree or order for relief by a court having jurisdiction in the premises will have been entered in respect of the Warrant Agent in an involuntary case under the Federal bankruptcy laws, as now or hereafter constituted, or any other applicable Federal or state bankruptcy, insolvency or similar law, or a decree or order by a court having jurisdiction in the premises will have been entered for the appointment of a receiver, custodian, liquidator, assignee, trustee, sequestrator (or similar official) of the Warrant Agent or of its property or affairs, or any public officer takes charge or control of the Warrant Agent or of its property or affairs for the purpose of rehabilitation, conservation, winding up or liquidation, a successor Warrant Agent, qualified as described above, will be appointed by the Company by an instrument in writing, filed with the successor Warrant Agent. Upon the appointment as aforesaid of a successor Warrant Agent and acceptance by the successor Warrant Agent of such appointment, the Warrant Agent will cease to be Warrant Agent.
(d) Any successor Warrant Agent appointed under this Agreement will execute, acknowledge and deliver to its predecessor and to the Company an instrument accepting the appointment, and immediately after, successor Warrant Agent, without any further act, deed or conveyance, will become vested with all the authority, rights, powers, trusts, immunities, duties and obligations of the predecessor as if originally named as Warrant Agent under this Agreement, and the predecessor, on payment of its unpaid charges and disbursements, will then become obligated to transfer, deliver and pay over, and the successor Warrant Agent will be entitled to receive, all funds, securities and other property on deposit with or held by the predecessor, as Warrant Agent hereunder.
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(e) Any corporation into which the Warrant Agent may be merged or converted or any corporation with which the Warrant Agent may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Warrant Agent will be a party, or any corporation to which the Warrant Agent sells or otherwise transfers all or substantially all the assets and business of the Warrant Agent, provided that it is qualified as described above, will be the successor Warrant Agent under this Agreement without the execution or filing of any paper or any further act on the part of any of the parties to this Agreement.
ARTICLE 6
MISCELLANEOUS
6.1 Amendment. This Agreement may be amended by the parties to this Agreement, without the consent of the holder of any Warrant Certificate, for the purpose of curing any ambiguity, or of curing, correcting or supplementing any defective provision contained in this Agreement, or making any other provisions with respect to matters or questions arising under this Agreement as the Company and the Warrant Agent may deem necessary or desirable; provided that such action will not materially adversely affect the interests of the holders of the Warrant Certificates.
6.2 Notices and Demands to the Company and Warrant Agent. If the Warrant Agent receives any notice or demand addressed to the Company by the holder of a Warrant Certificate pursuant to the provisions of the Warrant Certificates, the Warrant Agent will promptly forward the notice or demand to the Company.
6.3 Addresses. Any communication from the Company to the Warrant Agent with respect to this Agreement must be addressed to [•], Attention: [•], and any communication from the Warrant Agent to the Company with respect to this Agreement must be addressed to Snap Inc., 2772 Donald Douglas Loop North, Santa Monica, California 90405, Attention: [•] (or such other address as will be specified in writing by the Warrant Agent or by the Company).
6.4 Governing Law. This Agreement and each Warrant Certificate issued under this Agreement will be governed by and construed in accordance with the laws of the State of New York.
6.5 Delivery of Prospectus. The Company will furnish to the Warrant Agent sufficient copies of a prospectus meeting the requirements of the Securities Act of 1933, as amended, relating to the Warrant Debt Securities deliverable on exercise of the Warrants (the “Prospectus”), and the Warrant Agent agrees that on the exercise of any Warrant, the Warrant Agent will deliver to the holder of the Warrant Certificate evidencing such Warrant, prior to or concurrently with the delivery of the Warrant Debt Securities issued on such exercise, a Prospectus. The Warrant Agent will not, by reason of any delivery, assume any responsibility for the accuracy or adequacy of such Prospectus.
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6.6 Obtaining of Governmental Approvals. The Company will, from time to time, take all action which may be necessary to obtain and keep effective any and all permits, consents and approvals of governmental agencies and authorities and securities act filings under United States Federal and state laws (including without limitation a registration statement in respect of the Warrants and Warrant Debt Securities under the Securities Act of 1933, as amended), which may be or become requisite in connection with the issuance, sale, transfer, and delivery of the Warrant Debt Securities issued upon exercise of the Warrants, the issuance, sale, transfer and delivery of the Warrants or upon the expiration of the period during which the Warrants are exercisable.
6.7 Persons Having Rights Under the Agreement. Nothing in this Agreement gives to any person other than the Company, the Warrant Agent or the holders of the Warrant Certificates any right, remedy or claim under or by reason of this Agreement.
6.8 Headings. The descriptive headings of the several Articles and Sections of this Agreement are inserted for convenience only and does not control or affect the meaning or construction of any of the provisions hereof.
6.9 Counterparts. This Agreement may be executed in any number of counterparts, each of which as executed will be deemed to be an original and such counterparts together will constitute one instrument.
6.10 Inspection of Agreement. A copy of this Agreement will be available at all reasonable times at the principal corporate trust office of the Warrant Agent for inspection by the holder of any Warrant Certificate. The Warrant Agent may require such holder to submit such holder’s Warrant Certificate for inspection by it.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed as of the day and year first written above.
| SNAP INC. |
| By: |
| Name: |
| Title: |
| [WARRANT AGENT], as Warrant Agent |
| By: |
| Name: |
| Title: |
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EXHIBIT A
FORM OF WARRANT CERTIFICATE
[FACE OF WARRANT CERTIFICATE]
| [Form of Legend if Warrants are not immediately exercisable.] |
[Prior to [•] , Warrants evidenced by this Warrant Certificate cannot be exercised.] |
EXERCISABLE ONLY IF COUNTERSIGNED BY THE WARRANT AGENT
VOID AFTER [•]P.M., [City] TIME, ON [•].
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SNAP INC.
WARRANT CERTIFICATE REPRESENTING
WARRANTS TO PURCHASE
[TITLE OF WARRANT DEBT SECURITIES]
No. [•] [•]Warrants
This certificate (“Warrant Certificate”) certifies that [•] or registered assigns is the registered owner of the above indicated number of Warrants, each Warrant entitling such owner to purchase, at any time [after [[•]] p.m., [City] time, on [•] and] on or before [[•]] p.m., [City] time, on [•], $ principal amount of [Title of Warrant Debt Securities] (the “Warrant Debt Securities”), of Snap Inc. (the “Company”), issued or to be issued under the Indenture (as defined below), on the following basis: during the period from [•], through and including [•], each Warrant will entitle the Holder of the Warrant Certificate, subject to the provisions of this Agreement, to purchase the principal amount of Warrant Debt Securities stated in the Warrant Certificate at the warrant price (the “Warrant Price”) of [•]% of the principal amount thereof [plus accrued amortization, if any, of the original issue discount of the Warrant Debt Securities] [plus accrued interest, if any, from the most recent date from which interest will have been paid on the Warrant Debt Securities or, if no interest will have been paid on the Warrant Debt Securities, from the date of their original issuance]. [The original issue discount ($[•] for each $1,000 principal amount of Warrant Debt Securities) will be amortized at a[•] % annual rate, computed on a[n] [semi-]annual basis [using a 360-day year consisting of twelve 30-day months]. The Holder may exercise the Warrants evidenced hereby by providing certain information set forth on the back hereof and by paying in full, in lawful funds of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds], the Warrant Price for each Warrant Debt Security with respect to which this Warrant is exercised to the Warrant Agent (as defined below) and by surrendering this Warrant Certificate, with the purchase form on the back of this Warrant Certificate duly executed, at the corporate trust office of [name of Warrant Agent], or its successor as warrant agent (the “Warrant Agent”), which is, on the date of this Warrant Certificate, at the address specified on the reverse of this Warrant Certificate, and upon compliance with and subject to the conditions set forth in this Warrant Certificate and in the Warrant Agreement (as defined below).
The term “Holder” as used in this Warrant Certificate will mean the person in whose name at the time this Warrant Certificate will be registered on the books maintained by the Warrant Agent pursuant to Section 4 of the Warrant Agreement.
The Warrants evidenced by this Warrant Certificate may be exercised to purchase Warrant Debt Securities in the principal amount of $1,000 or any integral multiple thereof in registered form. Upon any exercise of fewer than all of the Warrants evidenced by this Warrant Certificate, the Holder will be issued a new Warrant Certificate evidencing Warrants for the aggregate principal amount of remaining Warrant Debt Securities unexercised.
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This Warrant Certificate is issued under and in accordance with the Warrant Agreement dated as of [•], (the “Warrant Agreement”), between the Company and the Warrant Agent and is subject to the terms and provisions contained in the Warrant Agreement, the terms and provisions of which the Holder of this Warrant Certificate consents by acceptance of this Warrant Certificate. Copies of the Warrant Agreement are on file at the above-mentioned office of the Warrant Agent.
The Warrant Debt Securities to be issued and delivered upon the exercise of Warrants evidenced by this Warrant Certificate will be issued under and in accordance with an Indenture, dated as of , (the “Indenture”), between the Company and , as trustee (such trustee, and any successors to such trustee, the “Trustee”)] and will be subject to the terms and provisions contained in the Warrant Debt Securities and in the Indenture. Copies of the Indenture, including the form of the Warrant Debt Securities, are on file at the corporate trust office of the Trustee.
Transfer of this Warrant Certificate may be registered when this Warrant Certificate is surrendered at the corporate trust office of the Warrant Agent by the registered owner or such owner’s assigns, in the manner and subject to the limitations provided in the Warrant Agreement.
After countersignature by the Warrant Agent and prior to the expiration of this Warrant Certificate, this Warrant Certificate may be exchanged at the corporate trust office of the Warrant Agent for Warrant Certificates representing Warrants for the same aggregate principal amount of Warrant Debt Securities.
This Warrant Certificate will not entitle the Holder of this Warrant Certificate to any of the rights of a holder of the Warrant Debt Securities, including, without limitation, the right to receive payments of principal of (and premium, if any) or interest, if any, on the Warrant Debt Securities or to enforce any of the covenants of the Indenture.
Reference is hereby made to the further provisions of this Warrant Certificate set forth on the reverse of this Warrant Certificate, which will for all purposes have the same effect as if set forth at this place.
This Warrant Certificate will not be valid or obligatory for any purpose until countersigned by the Warrant Agent.
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IN WITNESS WHEREOF, the Company has caused this Warrant to be executed in its name and on its behalf by the facsimile signatures of its duly authorized officers.
Dated:
| SNAP INC. |
| By: |
| Name: |
| Title: |
| [WARRANT AGENT], as Warrant Agent |
| By: |
| Name: |
| Title: |
16
[REVERSE OF WARRANT CERTIFICATE]
(Instructions for Exercise of Warrant)
To exercise any Warrants evidenced by this Warrant Certificate for Warrant Debt Securities (as defined below), the Holder must pay, in lawful funds of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds], the Warrant Price in full for Warrants exercised, to [Warrant Agent] [address of Warrant Agent], Attention: [•], which payment must specify the name of the Holder and the number of Warrants exercised by such Holder. In addition, the Holder must complete the information required below and present this Warrant Certificate in person or by mail (certified or registered mail is recommended) to the Warrant Agent at the appropriate address set forth above. This Warrant Certificate, completed and duly executed, must be received by the Warrant Agent within five business days of the payment.
(To be executed upon exercise of Warrants)
The undersigned hereby irrevocably elects to exercise [•] Warrants, evidenced by this Warrant Certificate, to purchase $[•] principal amount of the [Title of Warrant Debt Securities] (the “Warrant Debt Securities”) of Snap Inc. and represents that the undersigned has tendered payment for such Warrant Debt Securities, in lawful funds of the United States of America, [in cash or by certified check or official bank check in New York Clearing House funds] [by bank wire transfer in immediately available funds], to the order of Snap Inc. c/o [insert name and address of Warrant Agent], in the amount of $[•] in accordance with the terms hereof. The undersigned requests that said principal amount of Warrant Debt Securities be in fully registered form in the authorized denominations, registered in such names and delivered all as specified in accordance with the instructions set forth below.
If the number of Warrants exercised is less than all of the Warrants evidenced by this Warrant Certificate, the undersigned requests that a new Warrant Certificate evidencing the Warrants for the aggregate principal amount of Warrant Debt Securities remaining unexercised be issued and delivered to the undersigned unless otherwise specified in the instructions below.
| Dated: | Name: |
| ||||
| Please Print |
| Address: |
|
|
| (Insert Social Security or Other Identifying Number of Holder) |
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Signature
| Guaranteed: |
| |
| Signature |
(Signature must conform in all respects to name of holder as specified on the face of this Warrant Certificate and must bear a signature guarantee by a FINRA member firm).
This Warrant may be exercised at the following addresses:
By hand at:
By mail at:
[Instructions as to form and delivery of Warrant Debt Securities and, if applicable, Warrant Certificates evidencing Warrants for the number of Warrant Debt Securities remaining unexercised — complete as appropriate.]
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ASSIGNMENT
[Form of assignment to be executed if Warrant Holder desires to transfer Warrant]
| FOR VALUE RECEIVED, [•] hereby sells, assigns and transfers unto: |
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the right represented by the within Warrant to purchase $[•] aggregate principal amount of [Title of Warrant Debt Securities] of Snap Inc. to which the within Warrant relates and appoints [•]to transfer such right on the books of the Warrant Agent with full power of substitution in the premises.
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(Signature must conform in all respects to name of holder as specified on the face of the Warrant)
Signature Guaranteed
19
Exhibit 5.1
Seth J. Gottlieb
+1 650 843 5864
sgottlieb@cooley.com
February 5, 2021
Snap Inc.
2772 Donald Douglas Loop North
Santa Monica, California 90405
Ladies and Gentlemen:
We have acted as counsel to Snap Inc., a Delaware corporation (the “Company”), in connection with the filing of a Registration Statement on Form S-3 (the “Registration Statement”) by the Company under the Securities Act of 1933, as amended (the “Securities Act”). The Registration Statement includes a prospectus (the “Base Prospectus”) that provides it will be supplemented in the future by one or more prospectus supplements (each, a “Prospectus Supplement”). The Registration Statement, including the Base Prospectus (as supplemented from time to time by one or more Prospectus Supplements), will provide for the registration by the Company of an indefinite amount of:
| • | shares of Class A common stock, par value $0.00001 per share, of the Company (the “Common Stock”); |
| • | shares of preferred stock, par value $0.00001 per share, of the Company (the “Preferred Stock”); |
| • | debt securities, in one or more series (the “Debt Securities”), which may be issued pursuant to an indenture to be dated on or about the date of the first issuance of Debt Securities thereunder, by and between a trustee to be selected by the Company (the “Trustee”) and the Company, in the form filed as Exhibit 4.7 to the Registration Statement and one or more indentures supplemental thereto with respect to any particular series of Debt Securities (the “Indenture”); and |
| • | warrants to purchase Common Stock, Preferred Stock, or Debt Securities (the “Warrants”), which may be issued under one or more warrant agreements, to be dated on or about the date of the first issuance of the Warrants thereunder, by and between a warrant agent to be selected by the Company (the “Warrant Agent”) and the Company, in the forms filed as Exhibits 4.8, 4.9 and 4.10 to the Registration Statement, respectively (each, a “Warrant Agreement”). |
The Common Stock, the Preferred Stock, the Debt Securities and the Warrants are collectively referred to herein as the “Securities.” The Securities are being registered for offer and sale from time to time pursuant to Rule 415 under the Securities Act.
In connection with this opinion, we have examined and relied upon originals, or copies certified to our satisfaction, of such records, documents, certificates, opinions, memoranda and other instruments as in our judgment are necessary or appropriate to enable us to render the opinion expressed below. As to certain factual matters, we have relied upon a certificate of an officer of the Company and have not independently verified such matters.
In rendering this opinion, we have assumed the genuineness and authenticity of all signatures on original documents; the authenticity of all documents submitted to us as originals; the conformity to originals of all documents submitted to us as copies; the accuracy, completeness and authenticity of certificates of public officials; and the due authorization, execution and delivery of all documents where authorization, execution and delivery are prerequisites to the effectiveness of such documents.
3175 HANOVER STREET, PALO ALTO, CA 94304-1130 T: (650) 843-5000 F: (650) 849-7400 WWW.COOLEY.COM
Snap Inc.
February 5, 2021
Page Two
With respect to our opinion as to the Common Stock, we have assumed that, at the time of issuance and sale, a sufficient number of shares of Common Stock are authorized and available for issuance and that the consideration for the issuance and sale of the Common Stock (or Preferred Stock or Debt Securities convertible into, or Warrants exercisable for, Common Stock) is in an amount that is not less than the par value of the Common Stock. With respect to our opinion as to the Preferred Stock, we have assumed that, at the time of issuance and sale, a sufficient number of shares of Preferred Stock are authorized, designated and available for issuance and that the consideration for the issuance and sale of the Preferred Stock (or Debt Securities convertible into, or Warrants exercisable for, Preferred Stock) is in an amount that is not less than the par value of the Preferred Stock. We have also assumed that any Debt Securities or Warrants offered under the Registration Statement, and the related Indenture and Warrant Agreement are executed in the forms filed as exhibits to the Registration Statement or incorporated by reference therein. We have also assumed that (i) with respect to Securities issuable upon conversion of any convertible Preferred Stock, such convertible Preferred Stock is duly authorized, validly issued, fully paid and nonassessable; and (ii) with respect to any Securities issuable upon conversion of any convertible Debt Securities or upon exercise of any Warrants, such convertible Debt Securities or Warrants constitute valid and legally binding obligations of the Company, enforceable against the Company in accordance with their terms, except as enforcement may be limited by applicable bankruptcy, insolvency, reorganization, arrangement, moratorium or other similar laws affecting creditors’ rights, and subject to general equity principles and to limitations on availability of equitable relief, including specific performance.
Our opinion herein is expressed solely with respect to the General Corporation Law of the State of Delaware (the “DGCL”) and, as to the Debt Securities and the Warrants constituting valid and legally binding obligations of the Company, the laws of the State of New York. Our opinion is based on these laws as in effect on the date hereof. We express no opinion to the extent that any other laws are applicable to the subject matter hereof and express no opinion and provide no assurance as to compliance with any federal or state securities law, rule or regulation.
On the basis of the foregoing and in reliance thereon, and subject to the qualifications herein stated, we are of the opinion that:
1. With respect to the Common Stock offered under the Registration Statement, provided that (i) the Registration Statement and any required post-effective amendment thereto have become effective under the Securities Act and the Base Prospectus and any and all Prospectus Supplement(s) required by applicable laws have been delivered and filed as required by such laws; (ii) the issuance of the Common Stock has been duly authorized by all necessary corporate action on the part of the Company; (iii) the issuance and sale of the Common Stock do not violate any applicable law, are in conformity with the Company’s then operative certificate of incorporation (the “Certificate of Incorporation”) and bylaws (the “Bylaws”), do not result in a default under or breach of any agreement or instrument binding upon the Company and comply with any applicable requirement or restriction imposed by any court or governmental body having jurisdiction over the Company; and (iv) the certificates, if any, for the Common Stock have been duly executed by the Company, countersigned by the transfer agent therefor and duly delivered to the purchasers thereof against payment therefor, then the Common Stock, when issued and sold as contemplated in the Registration Statement, the Base Prospectus and the related Prospectus Supplement(s) and in accordance with a duly authorized, executed and delivered purchase, underwriting or similar agreement, or upon conversion of any convertible Preferred Stock, or convertible Debt Securities in accordance with their terms, or upon exercise of any Warrants in accordance with their terms, will be validly issued, fully paid and nonassessable.
3175 HANOVER STREET, PALO ALTO, CA 94304-1130 T: (650) 843-5000 F: (650) 849-7400 WWW.COOLEY.COM
Snap Inc.
February 5, 2021
Page Three
2. With respect to the Preferred Stock offered under the Registration Statement, provided that (i) the Registration Statement and any required post-effective amendment thereto have become effective under the Securities Act and the Base Prospectus and any and all Prospectus Supplement(s) required by applicable laws have been delivered and filed as required by such laws; (ii) the terms and issuance of the Preferred Stock have been duly authorized by all necessary corporate action on the part of the Company; (iii) the terms of the shares of Preferred Stock and their issuance and sale do not violate any applicable law, are in conformity with the Certificate of Incorporation and the Bylaws, do not result in a default under or breach of any agreement or instrument binding upon the Company and comply with any applicable requirement or restriction imposed by any court or governmental body having jurisdiction over the Company; and (iv) the certificates, if any, for the Preferred Stock have been duly executed by the Company, countersigned by the transfer agent therefor and duly delivered to the purchasers thereof against payment therefor, then the Preferred Stock, when issued and sold as contemplated in the Registration Statement, the Base Prospectus and the related Prospectus Supplement(s) and in accordance with a duly authorized, executed and delivered purchase, underwriting or similar agreement, or upon conversion of any convertible Debt Securities in accordance with their terms, or upon exercise of any Warrants in accordance with their terms, will be validly issued, fully paid and nonassessable.
3. With respect to any series of the Debt Securities issued under the Indenture and offered under the Registration Statement, provided that (i) the Registration Statement and any required post-effective amendment thereto have become effective under the Securities Act and the Base Prospectus and any and all Prospectus Supplement(s) required by applicable laws have been delivered and filed as required by such laws; (ii) the Indenture has been duly authorized by the Company and the Trustee by all necessary corporate action; (iii) the Indenture in substantially the form filed as an exhibit to the Registration Statement, has been duly executed and delivered by the Company and the Trustee and has been qualified under the Trust Indenture Act of 1939, as amended; (iv) the issuance and terms of the Debt Securities have been duly authorized by the Company by all necessary corporate action; (v) the terms of the Debt Securities and of their issuance and sale have been duly established in conformity with the 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, so as to be in conformity with the Certificate of Incorporation and the Bylaws, and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over the Company; and (vi) the notes representing the Debt Securities have been duly executed and delivered by the Company and authenticated by the Trustee pursuant to the Indenture and delivered against payment therefor, then the Debt Securities, when issued and sold in accordance with the Indenture and a duly authorized, executed and delivered purchase, underwriting or similar agreement, or upon exercise of any Warrants in accordance with their terms, will be valid and legally binding obligations of the Company, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting creditors’ rights generally, and by general equitable principles (regardless of whether considered in a proceeding at law or in equity).
4. With respect to the Warrants issued under the Warrant Agreements and offered under the Registration Statement, provided that (i) the Registration Statement and any required post-effective amendment thereto have become effective under the Securities Act and the Base Prospectus and any and all Prospectus Supplement(s) required by applicable laws have been delivered and filed as required by such laws; (ii) the applicable Warrant Agreement has been duly authorized by the Company and the Warrant Agent by all necessary corporate action; (iii) the applicable Warrant Agreement has been duly executed and delivered by the Company and the Warrant Agent; (iv) the issuance and terms of the Warrants have been duly authorized by the Company by all necessary corporate action; (v) the terms of the Warrants and of their issuance and sale have been duly established in conformity with the applicable Warrant Agreement and as described in the Registration Statement, the Base Prospectus and the related Prospectus Supplement(s), so as not to violate any applicable law or result in a default under or breach of
3175 HANOVER STREET, PALO ALTO, CA 94304-1130 T: (650) 843-5000 F: (650) 849-7400 WWW.COOLEY.COM
Snap Inc.
February 5, 2021
Page Four
any agreement or instrument binding upon the Company, so as to be in conformity with the Certificate of Incorporation and the Bylaws, and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over the Company; and (vi) the Warrants have been duly executed and delivered by the Company and authenticated by the Warrant Agent pursuant to the applicable Warrant Agreement and delivered against payment therefor, then the Warrants, when issued and sold as contemplated in the Registration Statement, the Base Prospectus and the Prospectus Supplement(s) and in accordance with the applicable Warrant Agreement and a duly authorized, executed and delivered purchase, underwriting or similar agreement, will be valid and legally binding obligations of the Company, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting creditors’ rights generally, and by general equitable principles (regardless of whether considered in a proceeding at law or in equity).
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We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the reference to our firm under the caption “Legal Matters” in the Base Prospectus. Our opinion set forth above is limited to the matters expressly set forth in this letter, and no opinion is implied or may be inferred beyond the matters expressly stated. This opinion speaks only as to law and facts in effect or existing as of the date hereof, and we undertake no obligation or responsibility to update or supplement this opinion to reflect any facts or circumstances that may hereafter come to our attention or any changes in law that may hereafter occur.
Very truly yours,
COOLEY LLP
| By: | /s/ Seth J. Gottlieb | |
| Seth J. Gottlieb |
3175 HANOVER STREET, PALO ALTO, CA 94304-1130 T: (650) 843-5000 F: (650) 849-7400 WWW.COOLEY.COM
Exhibit 23.1
Consent of Independent Registered Public Accounting Firm
We consent to the reference to our firm under the caption “Experts” in this Registration Statement (Form S-3) and related Prospectus of Snap Inc. for the registration of Class A common stock, preferred stock, debt securities, and warrants and to the incorporated by reference therein of our reports dated February 4, 2021, with respect to the consolidated financial statements of Snap Inc., and the effectiveness of internal control over financial reporting of Snap Inc., included in its Annual Report (Form 10-K) for the year ended December 31, 2020, filed with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
Los Angeles, California
February 5, 2021