Exhibit 4
FORM OF BOND
[FACE OF BOND]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
No. CUSIP: 718154 CK 1
$
PHILIP MORRIS COMPANIES INC.
Puttable Reset Securities PURS(SM) due March 15, 2010
PHILIP MORRIS COMPANIES INC., a corporation organized and existing
under the laws of the Commonwealth of Virginia (hereinafter called the
"Company", which term shall include any successor entity), for value received,
hereby promises to pay to CEDE & CO. or registered assigns, the principal sum of
DOLLARS on March 15, 2010 (the "Final Maturity") at any office or agency
maintained for the purpose in the Borough of Manhattan, The City of New York,
New York, which shall initially be the corporate trust office of The Chase
Manhattan Bank, the Trustee under the Indenture referred to on the reverse
hereof, located on the date hereof at 450 W. 33rd Street, New York, New York
10001, in such coin or currency of the United States of America as at the time
of payment is legal tender for the payment of public and private debts, and to
pay to the registered holder hereof, as hereinafter provided, interest (computed
on the basis of a 360-day year of twelve 30-day months) on said principal sum at
the rate described below, in like coin or currency, from and including March 16,
1998, or from the most recent Interest Payment Date to which interest has been
paid or duly provided for, on March 15 and September 15 of each year, commencing
September 15, 1998, to but excluding the date on which the principal amount is
paid or made available for payment in full. The interest so payable on any March
15 or September 15 shall, subject to certain exceptions provided in the
Indenture, be paid to the person in whose name this Bond is registered at the
close of business on the next preceding February 28 or August 30, as the case
may be (each, an "Interest Payment Record Date"). Payments of interest shall be
made at any office or agency referred to above, provided that, at the option of
the Company, payments of interest may be made by check mailed to the registered
address of the persons entitled thereto.
From and including March 16, 1998 to but excluding March 15, 2000,
interest shall accrue on the principal sum of this Bond at an annual rate equal
to 6.15%. On March 15, 2000 (the "Reset Date"), the interest rate on this Bond
shall be reset so as to equal a fixed rate determined as described on the
reverse hereof, unless the Company is obligated to repurchase this Bond on such
date pursuant to the Put Option referred to on the reverse hereof.
Notwithstanding the foregoing, reset shall be subject to the occurrence of a
Market Disruption Event or a Failed Remarketing as described on the reverse
hereof.
This Bond has initially been issued in the form of a Global Security
(as defined on the reverse hereof), and the Company has initially designated The
Depository Trust Company ("DTC", which term shall include any successor) as the
Depositary (the "Depositary") for this Bond. For as long as this Bond or any
portion hereof is issued in such form, and notwithstanding the foregoing, all
payments of interest, principal and other amounts in respect of this Bond or
such portion (including payments pursuant to the Call Option and Put Option
referred to on the reverse hereof) shall be made to the Depositary or its
nominee in accordance with its Applicable Procedures (as defined on the reverse
hereof), in the coin or currency specified above and as further provided on the
reverse hereof.
Notwithstanding the foregoing, if any payment of interest, principal
or other amount to be made in respect of this Bond (including any payment
pursuant to an exercise of the Call Option or Put Option) would otherwise be due
on a day that is not a Business Day, such payment may be made on the next
succeeding day that is a Business Day, with the same effect as if such payment
were made on the due date.
This Bond is continued on the reverse hereof and the additional
provisions there set forth shall for all purposes have the same effect as if set
forth at this place. Such provisions include, inter alia, the Call Option and
Put Option, interest rate reset mechanism and the definitions of certain terms
used on the face hereof.
This Bond shall not be valid or become obligatory for any purpose
until the certificate of authentication hereon shall have been signed by the
Trustee under the Indenture.
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IN WITNESS WHEREOF, PHILIP MORRIS COMPANIES INC. has caused this
instrument to be duly executed under its corporate seal.
Dated: March 16, 1998
[CORPORATE SEAL] PHILIP MORRIS COMPANIES INC.
By:__________________________
Name:
Title:
ATTEST:
By:________________________
Name:
Title:
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated herein referred
to in the within-mentioned Indenture.
THE CHASE MANHATTAN BANK,
as Trustee
By:__________________________
Authorized Signatory
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[REVERSE OF BOND]
PHILIP MORRIS COMPANIES INC.
Puttable Reset Securities PURS(SM) due March 15, 2010
1. Indenture.
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(a) This bond is one of a duly authorized issue of debentures, notes
or other evidence of indebtedness of the Company (hereinafter called the
"Securities") of the series hereinafter specified, all issued or to be issued
under and pursuant to an indenture dated as of December 2, 1996 (the
"Indenture", which term has the meaning set forth in such instrument), duly
executed and delivered by the Company to The Chase Manhattan Bank, as Trustee
(the "Trustee", which term includes any successor trustee under the Indenture),
to which Indenture reference is hereby made for a description of the rights,
obligations, duties and immunities thereunder of the Trustee, the Company and
the holders of the Securities.
(b) The Securities may be issued in one or more series, which
different series may be issued in various aggregate principal amounts, may
mature at different times, may bear interest (if any) at different rates, may be
subject to different redemption provisions (if any), may be subject to different
sinking, purchase or analogous funds (if any) and may otherwise vary as provided
in the Indenture. This bond is one of a series of the Securities designated as
the Puttable Reset Securities PURS(SM) due March 15, 2010 of the Company,
limited in aggregate principal amount to $800,000,000 (the "Bonds"). The Bonds
constitute a separate series of Securities under the Indenture.
(c) The provisions of this Bond (including those relating to the Call
Option and Put Option), together with the provisions of the Indenture, shall
govern the rights, obligations, duties and immunities of the holders hereof, the
Company and the Trustee with respect to this Bond, provided that, if any
provision of this Bond necessarily conflicts with any provision of the
Indenture, the provision of this Bond shall be controlling to the fullest extent
permitted under the Indenture.
(d) Terms used and not defined herein that are defined in the
Indenture shall have the respective meanings assigned thereto in the Indenture.
Unless the context requires otherwise, terms defined herein include the plural
as well as the singular and vice-versa, and the words "herein" and "hereof", and
words of similar import, refer to this Bond as a whole and not to any particular
paragraph or other subdivision.
2. Call Option.
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(a) Goldman, Sachs & Co., a New York limited partnership ("Goldman,
Sachs & Co.", which term shall include any successor), shall have the right to
purchase, on the Reset Date, all of the Bonds outstanding on the Reset Date (in
whole and not in part), including this Bond, from the registered holders thereof
on the Reset Date (such right, the "Call Option"), at a price equal to 100% of
the principal amount of the Bonds purchased (the "Face Value") and
subject to Goldman, Sachs & Co. giving notice of its intention to purchase the
outstanding Bonds as described below (a "Call Notice"). Whether or not the Call
Option is exercised with respect to the Reset Date, the Company shall remain
obligated to pay all accrued and unpaid interest on this Bond, and interest that
becomes payable on this Bond on the Reset Date shall be payable to the
registered holder of this Bond on the corresponding Interest Payment Record
Date, as provided herein and in the Indenture.
(b) To exercise the Call Option, Goldman, Sachs & Co. must give a
Call Notice to the registered holder of this Bond no later than the tenth Market
Day prior to the Reset Date, in the manner described in paragraph 9 below.
Subject to paragraph 5(a) below, in the event a Call Notice is duly given, the
registered holder of this Bond on the Reset Date shall be obligated to sell this
Bond to Goldman, Sachs & Co., and Goldman, Sachs & Co. shall be obligated to
purchase this Bond from such holder, at the Face Value on the Reset Date. Each
such sale and purchase shall be effected through the facilities of the
Depositary, with the registered holder being deemed to have automatically
tendered this Bond for sale to Goldman, Sachs & Co. on the Reset Date in
accordance with the Depositary's Applicable Procedures as provided in paragraph
5 below. The registered holder's automatic tender of this Bond on the Reset Date
shall be subject to receipt of payment of the Face Value of this Bond as
provided in paragraph 5(a) below. Notwithstanding any exercise of the Call
Option with respect to this Bond, this Bond will remain outstanding until it
otherwise ceases to be outstanding pursuant to the Indenture. As used herein,
"Market Day" means a Business Day other than a day on which dealings in the U.S.
Treasury bond market are generally not being conducted.
(c) If the Call Option is exercised, this Bond shall be subject to
purchase by Goldman, Sachs & Co. on the Reset Date as provided herein and
subject to paragraph 5(a) below. This will be the case for every holder (and
every beneficial holder) of the Bonds outstanding on the Reset Date, including
any holder that acquires an interest in this Bond after the Call Notice is given
or who is otherwise unaware that the Call Notice has been given.
3. Put Option.
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(a) If Goldman, Sachs & Co. does not exercise the Call Option, the
registered holder of this Bond on the Reset Date shall have the right to require
the Company to repurchase this Bond (in whole and not in part) from such holder
on the Reset Date (such right, the holder's "Put Option") at a price equal to
100% of the principal amount of this Bond repurchased (the "Put Price"), in the
circumstances described in the next paragraph. In the event the Put Option is
exercised, the Put Price shall be payable by the Company to the registered
holder of this Bond on the Reset Date, whereas the accrued and unpaid interest
on this Bond that becomes payable on the Reset Date shall be payable by the
Company to the registered holder of this Bond on the corresponding Interest
Payment Record Date, as provided herein and in the Indenture. If for any reason
payment of the Put Price is not made when due on this Bond, the accrued interest
from the Reset Date to the date such payment is made would be payable by the
Company as part of the Put Price for this Bond, to the person entitled to
receive the Put Price.
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(b) On the Reset Date, the registered holder of this Bond on the
Reset Date shall be deemed to have exercised its Put Option automatically,
without any action on its part, for the full principal amount of this Bond held
of record by such holder on the Reset Date unless either (x) Goldman, Sachs &
Co. has duly given a Call Notice or (y) if Goldman, Sachs & Co. does not
exercise the Call Option, (i) no later than 10:00 A.M. (New York City time) on
the seventh Market Day prior to the Reset Date, the registered holder of this
Bond at the time gives notice to the Trustee that such holder elects not to sell
this Bond to the Company on the Reset Date (a "Hold Notice") and (ii) such
notice is effective (an "Effective Hold Notice") under the 10% Requirement (as
defined below). A Hold Notice must be given in the manner described in paragraph
9 below. Consequently, with respect to this Bond on the Reset Date, if a Call
Notice is not duly given by Goldman, Sachs & Co. and an Effective Hold Notice is
not duly given by the applicable holder as provided above, the Company shall be
obligated to repurchase this Bond from the registered holder on the Reset Date,
and the registered holder of this Bond on the Reset Date shall be obligated to
sell this Bond to the Company, at the Put Price on the Reset Date. Any such sale
and purchase shall be effected through the facilities of the Depositary, with
the registered holder of this Bond on the Reset Date being deemed (in the
absence of an Effective Hold Notice) to have automatically tendered this Bond in
whole for sale to the Company on the Reset Date, all in accordance with the
Depositary's Applicable Procedures as provided in paragraph 5 below.
Notwithstanding any exercise of the Put Option with respect to this Bond, this
Bond shall remain outstanding until it otherwise ceases to be outstanding
pursuant to the Indenture.
(c) Notwithstanding the foregoing, no Hold Notice for this Bond shall
be effective unless Hold Notices are duly given by the holders of record of at
least 10% in aggregate principal amount of all Bonds outstanding. The provision
described in this paragraph is called the "10% Requirement". If a Hold Notice is
duly given for this Bond but the 10% Requirement is not satisfied, the Trustee
shall give written notice of that fact (a "10% Requirement Notice") to the
registered holder of this Bond and the Company not later than the close of
business on the seventh Market Day before the Reset Date, in the manner
described in paragraph 9 below.
(d) Notwithstanding the foregoing, the Put Option shall be deemed to
be automatically exercised if Goldman, Sachs & Co. exercises the Call Option but
either (i) a Market Disruption Event or Failed Remarketing occurs, as provided
in paragraph 4 below, or (ii) Goldman, Sachs & Co. fails to pay the Face Value
on the Reset Date, as provided in paragraph 5(a) below.
4. Reset of Interest Rate. The interest rate on this Bond shall be
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reset on the Reset Date, unless the Company is obligated to purchase this Bond
on such date pursuant to the Put Option. Notwithstanding the foregoing, reset of
the interest rate shall be subject to the occurrence of a Market Disruption
Event or a Failed Remarketing as described below.
Subject to its right to terminate the appointment of any such agent,
the Company shall take such action as is necessary to ensure that there shall at
all relevant times be a qualified financial institution appointed and acting as
its agent for the purpose of performing the actions contemplated hereby to be
performed by the Calculation Agent (such agent, including any
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successor agent, the "Calculation Agent"). The Company has initially appointed
Goldman, Sachs & Co. as Calculation Agent. If the interest rate is to be reset
on the Reset Date, the Calculation Agent shall effect the reset as set forth
below.
Between the tenth Market Day prior to the Reset Date and 11:00 A.M.,
New York City time, on the Calculation Date (as defined below), the Calculation
Agent shall select three financial institutions (one of which shall be Goldman,
Sachs & Co. if it so requests) that deal in the Company's debt securities and
have agreed to participate as reference dealers in accordance with the terms
described below (the "Reference Dealers"). If Goldman, Sachs & Co. has exercised
the Call Option and so requests, each Reference Dealer must include in its
participation agreement a written commitment (satisfactory to Goldman, Sachs &
Co.) that, if it is selected as the Final Dealer (as defined below), it shall
purchase from Goldman, Sachs & Co. on the Calculation Date for settlement on the
Reset Date and at the Final Offer Price (as defined below), all the Bonds that
Goldman, Sachs & Co. purchases pursuant to the Call Option and tenders for
resale to the Final Dealer on the Reset Date. For each Reference Dealer, the
Calculation Agent shall request the name of and telephone and facsimile numbers
for one individual to represent such Reference Dealer.
On the sixth Market Day prior to the Reset Date (the "Calculation
Date"), the Calculation Agent shall undertake the following actions to calculate
a fixed rate at which interest will accrue on the Bonds from and including the
Reset Date to but excluding the Final Maturity (the "Reset Period"). In
paragraphs (a) and (b) below, all references to specific hours are references to
prevailing New York City time, and each notice shall be given telephonically and
shall be confirmed as soon as possible by facsimile to each of the Calculation
Agent and the Company. The times set forth below are guidelines for action, and
the Calculation Agent shall use reasonable efforts to adhere to these times.
(a) At 12:00 P.M., the Calculation Agent shall:
(i) determine (or obtain from Goldman, Sachs & Co., if Goldman,
Sachs & Co. has exercised the Call Option) the approximate ten-year
U.S. Treasury bond yield at or about such time, which shall be
expressed as a percentage (the "Designated Treasury Yield") and shall
be based on the then-current, ten-year U.S. Treasury bond (the
"Designated Treasury Bond");
(ii) calculate and provide to the Reference Dealers, on a
preliminary basis, a hypothetical price at which the Bonds might be
offered for sale to a Reference Dealer on the Reset Date (the "Offer
Price"). The Offer Price shall be expressed as a percentage of the
principal amount of the Bonds and will equal 100% plus the Margin (as
defined below), if the Treasury Rate Difference (as defined below) is
positive, or 100% minus the Margin, if the Treasury Rate Difference is
negative. The "Margin" means the present value, expressed as a
percentage of the principal amount of the Bonds, of the absolute value
of the Treasury Rate Difference applied to twenty semi-annual periods
(i.e., ten years), discounted at the Designated Treasury Yield divided
by two. The "Treasury Rate
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Difference" means the percentage (which may be positive or negative)
equal to (x) 5.634% (the "Initial Treasury Yield") minus (y) the
Designated Treasury Yield; and
(iii) request each Reference Dealer to provide to the Calculation
Agent, when notified of the Final Offer Price as described in
paragraph (b) below, a firm bid, expressed as a percentage
representing an interest rate spread over the Designated Treasury
Yield (the "Spread"), at which such Reference Dealer would be willing
to purchase on the Calculation Date for settlement on the Reset Date,
at the Final Offer Price, all of the Bonds. Each such firm bid must be
given on an "all-in" basis and must remain open for at least 30
minutes after it is given.
(b) At 12:30 P.M., the Calculation Agent shall determine (or obtain
from Goldman, Sachs & Co., if Goldman, Sachs & Co. has exercised the Call
Option) the Designated Treasury Yield on a final basis, and calculate and
provide to the Reference Dealers the Offer Price on a final basis (the "Final
Offer Price") and request each Reference Dealer to submit its bid immediately as
described in clause (a)(iii) above. If the Calculation Agent receives at least
two bids, the following shall occur:
(i) the Reference Dealer providing the bid presenting the
lowest all-in Spread (the "Final Spread") shall be the "Final Dealer";
(ii) if Goldman, Sachs & Co. has exercised the Call Option, the
Final Dealer shall purchase from Goldman, Sachs & Co. at the Final
Offer Price, for settlement on the Reset Date, all the Bonds that
Goldman, Sachs & Co. purchases pursuant to the Call Option and tenders
for resale to the Final Dealer on the Reset Date (assuming that the
interest rate on the Bonds will be reset so as to equal the Adjusted
Rate (as defined below) during the Reset Period); the Final Dealer
shall not be obligated to purchase any Bonds if Goldman, Sachs & Co.
has not exercised the Call Option;
(iii) the Calculation Agent shall calculate and provide to the
Company the "Adjusted Rate", which shall be the semi-annual, bond-
equivalent, fixed interest rate on the Bonds required to produce,
during the Reset Period, a semi-annual, bond-equivalent yield on the
Bonds that equals the sum of the Final Spread plus the final
Designated Treasury Yield, assuming that the Bonds are purchased on
the Reset Date at the Final Offer Price; and
(iv) the interest rate on the Bonds shall be adjusted so as to
equal the Adjusted Rate, effective from and including the Reset Date
to but excluding the Final Maturity. If Goldman, Sachs & Co. has not
exercised the Call Option and an Effective Hold Notice is given for
this Bond, the Company shall promptly give written notice of the
Adjusted Rate to the registered holder.
All determinations regarding the Designated Treasury Yield and the Designated
Treasury Bond as described in clause (a)(i) and the first sentence of paragraph
(b) above shall be made by
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Goldman, Sachs & Co. if another party is acting as the Calculation Agent, unless
Goldman, Sachs & Co. has elected not to exercise the Call Option, in which case
such determinations will be made as necessary by the Calculation Agent.
If the Calculation Agent determines that, on the Calculation Date, (x)
a Market Disruption Event (as defined below) has occurred or is continuing or
(y) fewer than two Reference Dealers have provided firm bids in a timely manner
pursuant to participation agreements satisfactory to Goldman, Sachs & Co.
substantially as described above (a "Failed Remarketing"), the steps
contemplated above shall be taken on the next Market Day on which the
Calculation Agent determines that no Market Disruption Event has occurred or is
continuing and at least two Reference Dealers have provided bids pursuant to
participation agreements satisfactory to Goldman, Sachs & Co. substantially as
described above. If the Calculation Agent determines that a Market Disruption
Event and/or a Failed Remarketing has occurred or is continuing for at least
four consecutive Market Days starting on the Calculation Date, then Goldman,
Sachs & Co. shall be deemed not to have exercised the Call Option and the
Company shall repurchase this Bond on the Reset Date at the Put Price from the
registered holder hereof on the Reset Date, all as if the Put Option on this
Bond had been exercised. In these circumstances, the registered holder may not
continue to hold this Bond by giving an Effective Hold Notice. The Calculation
Agent shall notify the Company of such determination promptly after the close of
business on such fourth Market Day. The Company shall give notice to the
registered holder that this Bond will be repurchased by the Company at the Put
Price, from the registered holder on the Reset Date, such notice to be given no
later than such second Market Day prior to the Reset Date in the manner
described below.
Notwithstanding the foregoing, if at any time Goldman, Sachs & Co. is
not acting as Calculation Agent, then the determinations and notice to the
Company described in the preceding paragraph shall be made and given by Goldman,
Sachs & Co., unless Goldman, Sachs & Co. does not exercise the Call Option, in
which case such determinations and notice will be made and given by the
Calculation Agent.
"Market Disruption Event" means any of the following: (i) a suspension
or material limitation in trading in securities generally on the New York Stock
Exchange or the establishment of minimum prices on such exchange; (ii) a general
moratorium on commercial banking activities declared by either federal or New
York State authorities; (iii) any material adverse change in the existing
financial, political or economic conditions in the United States of America;
(iv) an outbreak or escalation of hostilities involving the United States of
America or the declaration of a national emergency or war by the United States
of America; or (v) any material disruption of the U.S. government securities
market, U.S. corporate bond market and/or U.S. federal wire system.
All determinations regarding Market Disruption Events and Failed
Remarketings, including whether or not any such event has occurred or is
continuing, shall be made by the Calculation Agent (or Goldman, Sachs & Co., if
applicable as provided above) in its sole discretion.
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All percentages resulting from any calculation with respect to the
Bonds will be rounded upwards, if necessary, to the nearest one one-thousandth
of a percentage point (e.g., 5.6331% (or 0.056331) being rounded to 5.634% (or
0.05634)), and all U.S. dollar amounts will be rounded to the nearest cent (with
one-half cent being rounded upwards).
All determinations made by the Calculation Agent (or Goldman, Sachs &
Co.) regarding the matters described herein shall be final, conclusive and
binding on all concerned absent manifest error. To the extent permitted by law,
no determination made by the Calculation Agent (or Goldman, Sachs & Co.)
regarding the matters described herein shall give rise to any liability on the
part of the Calculation Agent, Goldman, Sachs & Co., the Trustee or the Company.
5. Settlement on Exercises of Call Option or Put Option. For as long
----------------------------------------------------
(but only for as long) as this Bond or any portion hereof is issued in the form
of a Global Security, the provisions of paragraphs 5(a) through 5(d) below,
inclusive, shall apply with respect to this Bond or such portion, as the case
may be.
(a) If the Call Option is exercised, then, on the Reset Date, all
beneficial interests in this Bond held by or through Agent Members (as defined
below) shall be transferred to a Depositary account designated by Goldman, Sachs
& Co. The transfers shall be made automatically, without any action on the part
of any holder or beneficial owner, by book entry through the facilities of the
Depositary. Goldman, Sachs & Co. shall be obligated to make payment of the Face
Value of this Bond to the Depositary or its nominee, for credit to the accounts
of the Agent Members by or through which beneficial interests in this Bond are
held, by the close of business on the Reset Date. Each such transfer shall be
made against the corresponding payment, and each such payment shall be made
against the corresponding transfer, in accordance with the Depositary's
Applicable Procedures. In all cases, the Company shall remain obligated to make
payment of accrued and unpaid interest on this Bond, with interest payable on
the Reset Date being payable to the registered holder on the corresponding
Interest Payment Record Date.
If Goldman, Sachs & Co. fails to pay the Face Value of this Bond on
the Reset Date, the Call Option shall be deemed not to have been exercised and
the Put Option shall be deemed to have been exercised on this Bond. In these
circumstances, the registered holder on the Reset Date may not continue to hold
this Bond by giving an Effective Hold Notice, and the Company will be obligated
to pay, not later than two Business Days following the Reset Date, the Put Price
for this Bond (including accrued interest from the Reset Date to but excluding
the date payment is made), with settlement otherwise occurring as described in
paragraph 5(b).
As used herein, (i) "Agent Member" means, at any time, any person who
is a member of, or participant in, the Depositary at such time and (ii)
"Applicable Procedures" means, with respect to any payment, transfer or other
transaction to be effected with respect to a Global Security, through the
facilities of the Depositary at any time, the policies and procedures of the
Depositary applicable to such transaction, as in effect at such time.
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(b) If the Put Option is exercised as to this Bond, then, on the
Reset Date, all beneficial interests in this Bond held by or through Agent
Members shall be transferred to a Depositary account designated by the Company.
The transfers shall be made automatically, without any action on the part of any
holder or beneficial owner, by book entry through the facilities of the
Depositary. The Company shall be obligated to make payment of the Put Price of
this Bond to the Depositary or its nominee, for credit to the accounts of the
Agent Members by or through which beneficial interests in this Bond are held, by
the close of business on the Reset Date. Each such transfer shall be made
against the corresponding payment, and each such payment shall be made against
the corresponding transfer, in accordance with the Depositary's Applicable
Procedures. If the Company fails to pay the Put Price for this Bond on the Reset
Date, accrued interest at the then applicable rate from the Reset Date to the
date the payment is made shall be payable as part of such Put Price, in the same
manner and for credit to the same accounts as such Put Price. Whether or not
purchased pursuant to the Put Option, the Company shall remain obligated to make
payment of accrued and unpaid interest on this Bond, with interest payable on
the Reset Date being payable to the registered holder on the corresponding
Interest Payment Record Date as provided herein and in the Indenture.
(c) The transactions described in paragraphs 5(a) and 5(b) above
shall be executed on the Reset Date through the facilities of the Depositary in
accordance with its Applicable Procedures, and the accounts of the respective
Agent Members shall be debited and credited and beneficial interests in this
Bond shall be delivered by book entry as necessary to effect the purchases and
sales provided for above. Unless the Depositary's Applicable Procedures require
otherwise, such transactions shall settle, and all other payments in respect of
the Bonds shall be made, in immediately available funds through DTC's Same-Day
Funds Settlement System. Notwithstanding any provision hereof or of the
Indenture, neither the Company, the Trustee, Goldman, Sachs & Co., nor any agent
of any such person, shall have any responsibility with respect to the Applicable
Procedures or for any payments, transfers or other transactions, or any notices
or other communications, among the Depositary, its Agent Members, any other
direct or indirect participants therein and any beneficial owners of a Global
Security. For all purposes of this Bond and the Indenture, any payment or notice
to be made or given with respect to this Bond by the Company or Goldman, Sachs &
Co. shall be deemed made or given when made or given to the Depositary or its
nominee, in accordance with its Applicable Procedures.
(d) The settlement procedures described in paragraphs 5(a), 5(b) and
5(c) above may be modified, notwithstanding any contrary terms of the Bonds or
the Indenture, to the extent required by the Depositary. In addition,
notwithstanding any contrary terms of the Bonds or the Indenture, the Company
may modify the settlement procedures described in paragraphs 5(a), 5(b) and 5(c)
above in order to facilitate the settlement process.
(e) If any Bonds are issued in non-book-entry form, the Company shall
modify the provisions of paragraphs 5(a) through 5(d) above, inclusive, so as to
ensure that the Reset Date settlements of transactions in such Bonds are
effected in as comparable a manner as practical, provided that such modified
procedures shall not adversely affect the interests of the holders of the
outstanding Bonds in any material respect.
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6. Default, Waiver, Amendment and Enforcement.
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(a) In case an Event of Default, as defined in the Indenture, with
respect to the Bonds shall have occurred and be continuing, the principal of all
outstanding Bonds may be declared, and upon such declaration shall become, due
and payable, in the manner, with the effect and subject to the conditions
provided in the Indenture. The Indenture provides that in the event of such a
declaration, its consequences may be rescinded and annulled (and the related
default and its consequences may be waived) with respect to all the Bonds by the
holders of not less than a majority in aggregate principal amount of all the
Bonds then outstanding, voting as a separate class, in accordance with the
provisions of, and in the circumstances provided by and the conditions set forth
in the Indenture. It is also provided in the Indenture that the holders of a
majority in aggregate principal amount of the Bonds at the time outstanding may,
on behalf of the holders of all of the Bonds, waive, prior to such a
declaration, any past default under the Indenture with respect to the Bonds and
its consequences, except a default in the payment of interest on or principal of
any Bond.
For all purposes of this Bond and the Indenture, any amount payable by
the Company in respect of the Put Price of this or any other Bond (including any
such amount payable by the Company because Goldman, Sachs & Co. fails to pay the
Face Value of any Bond after its exercise of the Call Option as to this Bond)
shall be deemed to be an amount payable by the Company in respect of the
principal of such Bond at its maturity, and any default by the Company in paying
such amount shall be deemed to be a default in the payment of such principal at
maturity. No failure by Goldman, Sachs & Co. to purchase any Bond pursuant to
the Call Option shall be deemed to be a default under this Bond or the Indenture
for any purpose.
(b) The Indenture contains provisions permitting the Company and the
Trustee, with the consent of the holders of not less than 50% in aggregate
principal amount of the Securities of all series to be affected (voting as one
class) at the time outstanding, evidenced as provided in the Indenture, to
execute supplemental indentures for the purpose of adding any provisions to, or
changing in any manner or eliminating any of the provisions of, the Indenture
with respect to each such series of Securities or modifying in any manner the
rights of the holders of each such series of Securities; provided, however, that
no such supplemental indenture, without the consent of the holder of each
outstanding security affected thereby, shall (i) change the stated maturity of
the principal or reduce the principal amount hereof, or reduce the rate of
interest thereon or any premium payable upon redemption, or change any
obligation of the Company to pay certain additional amounts required by the
Indenture (subject to stated exceptions) or reduce the amount of the principal
of a Discounted Security (as defined) due and payable upon an acceleration
thereof, or change the place of payment of amounts due, or change the currency
in which this Bond or interest hereon is payable, or impair or affect the right
of any registered holder hereof to institute suit for the payment hereof, (ii)
reduce the percentage in principal amount of securities of any series or of all
series, the consent of the holders of which is required for any such
supplemental indenture affecting this Bond or the consent of which holders is
required for waivers of certain conditions of or a default under the Indenture;
or (iii) modify any of the provisions of the section discussed in this
subsection (b) or certain other sections, except to increase the percentages
discussed therein or to provide that other provisions of the
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Indenture cannot be modified or waived without the consent of the holders of
each security affected thereby, subject to certain exceptions enumerated in the
Indenture.
(c) As provided in and subject to the provisions of the Indenture, no
holder of this Bond shall have the right to institute any suit, action or
proceeding with respect to the Indenture, or for appointment of any receiver or
trustee or for any other remedy thereunder, unless an Event of Default with
respect to the Bonds shall have occurred and be continuing and such holder
previously shall have given the Trustee written notice of default and the
continuance thereof, the holders of not less than 25% in aggregate principal
amount of the Bonds then outstanding shall have made written request to the
Trustee to institute such suit, action or proceeding and shall have offered to
the Trustee reasonable indemnity and the Trustee, for 60 days after the receipt
of such notice, request and offer of indemnity, shall have neglected or refused
to institute the same and shall not have received any direction inconsistent
therewith from the holders of a majority in aggregate principal amount of all
affected Securities then outstanding.
(d) No reference herein to the Indenture and no provision of this
Bond or of the Indenture shall alter or impair the obligation of the Company,
which is absolute and unconditional, to pay the principal or Put Price of and
interest on this Bond at the place, at the respective times, at the rate and in
the coin or currency herein prescribed.
(e) Any consent, waiver or other action by the registered holder of
this Bond provided pursuant to this Bond or the Indenture (unless effectively
revoked as provided in the Indenture) shall be conclusive and binding upon such
holder and upon all future holders of this Bond and of any Bond issued in
exchange or substitution herefor, irrespective of whether or not any notation of
such consent or waiver is made upon this Bond or such other Bond.
7. Form and Denomination; Global Securities.
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(a) The Bonds are issuable as fully registered Bonds without coupons
in the denominations of $1,000 and any whole multiple of $1,000. At the
corporate trust office of the Trustee referred to on the face hereof, and in the
manner and subject to the limitations provided herein and in the Indenture,
Bonds may be exchanged for a like aggregate principal amount of Bonds of other
authorized denominations, without payment of any charge other than a sum
sufficient to reimburse the Company for any tax or other governmental charge
incident thereto.
(b) The transfer of this Bond is registrable by the registered holder
hereof in person or by his attorney, duly authorized in writing, on the books of
the Company at the office or agency of the Company referred to on the face
hereof, subject to the terms of this Bond and the Indenture but without payment
of any charge other than a sum sufficient to reimburse the Company for any tax
or other governmental charge incident thereto, and upon surrender and
cancellation of this Bond upon any such transfer, a new Bond or Bonds of
authorized denomination or denominations, for the same aggregate principal
amount, shall be issued to the transferee in exchange herefor.
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(c) The Bond evidenced by this certificate has been issued in the
form of a Global Security and, for as long as this Bond shall be issued in such
form, the provisions of paragraphs (c)(i) through (c)(iv), inclusive, below
shall apply to this Bond.
(i) Notwithstanding any other provision of this Bond or the
Indenture, this Global Security may not be exchanged in whole or in
part for Bonds registered, and no transfer of this Global Security in
whole or in part may be registered, in the name of any person other
than the Depositary or a nominee thereof unless (A) the Depositary has
notified the Company that (1) it is unwilling or unable to continue as
Depositary or (2) has ceased to be a clearing agency registered under
the Exchange Act or (B) there shall have occurred and be continuing an
Event of Default with respect to the Bonds, or except as the Company
may request in order to facilitate the purchase of this Bond or any
portion hereof by Goldman, Sachs & Co. pursuant to the Call Option or
by the Company pursuant to the Put Option (provided that, after
consummation of any such purchase pursuant to the Call Option, the
Bond or portion so purchased may be reissued in the form of a Global
Security in accordance with the Applicable Procedures).
(ii) Subject to paragraph (c)(i) above, any exchange of this
Global Security for other Bonds may be made in whole or in part, and
all Bonds issued in exchange for this Global Security or any portion
hereof shall be registered in such names and delivered to such persons
as the Depositary shall direct.
(iii) Every Bond authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, this Global Security or
any portion hereof shall be issued and authenticated in the form of,
and shall be, a Global Security, shall bear such legend as the
Depositary may require and shall be delivered to the Depositary or a
nominee thereof or custodian therefor, unless such Bond is registered
in the name of a person other than the Depositary or a nominee
thereof.
(iv) As used herein, (A) "Global Security" means a Bond that
evidences all or any portion of the Bonds and is registered in the
name of the Depositary (or its nominee), (B) "Depositary" means a
clearing agency registered under the Exchange Act and designated by
the Company to act as Depositary for the Bonds issued in book-entry
form, and (C) "Exchange Act" means the Securities Exchange Act of 1934
(or any successor provision) as amended from time to time.
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8. Holder. The Company, the Trustee and Goldman, Sachs & Co. (and
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any agent of any such person) may treat the person in whose name this Bond shall
be registered as of the date of determination upon the books of the Company kept
for such purpose pursuant to the Indenture as the sole and absolute owner and
holder of this Bond (whether or not this Bond shall be overdue and
notwithstanding any notation of ownership or other writing hereon) for all
purposes, including the making of any payment in respect hereof, any exercise of
the Call Option or the Put Option and consummation of any sale and purchase
hereof pursuant thereto, the giving of any Call Notice, Hold Notice or other
notice with respect hereto, and the giving of any consent or taking of any other
action with respect hereto, and neither the Company nor the Trustee or Goldman,
Sachs & Co. or any such agent shall be affected by any notice to the contrary.
9. Notices. For as long as this Bond (or any portion hereof) is
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issued in the form of a Global Security, each Call Notice, 10% Requirement
Notice and any other notice to be given to the holder of this Bond (or any such
portion) shall be deemed to have been duly given to such holder when given to
the Depositary, or its nominee, in accordance with its Applicable Procedures.
If at any time this Bond (or any portion hereof) is not issued in the
form of a Global Security, each Call Notice, 10% Requirement Notice and any
other notice to be given to the holder of this Bond (or any such portion) shall
be deemed to have been duly given to such holder upon the mailing of such notice
to the registered holder at such holder's address as it appears on the books of
the Company maintained for such purpose pursuant to the Indenture as of the
close of business preceding the day such notice is given.
Neither the failure to give any notice nor any defect in any notice
given to the holder of this Bond or any other Bond shall affect the sufficiency
of any notice given to another holder of any Bonds.
With respect to this Bond, whether or not issued in the form of a
Global Security, Hold Notices may be given by the registered holder hereof to
the Trustee only by facsimile transmission or by mail and must actually be
received by the Trustee at the following address no later than 10:00 A.M., New
York City time, on the seventh Market Day prior to the Reset Date:
The Chase Manhattan Bank as Trustee
55 Water Street, 2nd Floor
North Building
New York, New York 10041
Attention: Tender Operations Area
Facsimile No.: 212-638-7380/81
Hold Notices may be given with respect to this Bond only by the registered
holder hereof.
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10. No recourse shall be had for the payment of the principal of, or
the interest on, this Bond or of the Face Value upon any exercise of the Call
Option or of the Put Price upon any exercise of the Put Option, or for any claim
based hereon, or otherwise in respect hereof, or based on or in respect of the
Indenture or any indenture supplemental thereto, against any incorporator,
stockholder, officer or director, as such, past, present or future, of the
Company or of any successor corporation or entity, whether by virtue of any
constitution, statute or rule of law or by the enforcement of any assessment or
penalty or otherwise, all such liability being, by the acceptance hereof and as
part of the consideration for the issue hereof, expressly waived and released.
11. Provisions Relating to Goldman, Sachs & Co. Insofar as the
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provisions of this Bond purport to provide rights to Goldman, Sachs & Co.
against any holder of this Bond, such rights (including such rights to purchase
this Bond pursuant to the Call Option) shall be rights of the Company and shall
be enforceable by the Company against such holder. Each holder of this Bond
shall hold this Bond (and by holding the same shall be deemed to have agreed to
do so) subject to the foregoing. Without limiting the foregoing, Goldman, Sachs
& Co. may take any action under this Bond (including giving any notice, making
any determination and effecting any settlement pursuant to paragraphs 2, 4 and 5
hereof) that the provisions of this Bond contemplate may be taken by Goldman,
Sachs & Co.
Pursuant to section 6 of the Calculation Agency Agreement, dated as of
March 16, 1998, Goldman, Sachs & Co. has agreed with the Company, for the
benefit of the applicable holder of this Bond from time to time, that, if
Goldman, Sachs & Co. exercises the Call Option, Goldman, Sachs & Co. will
purchase this Bond from the registered holder hereof on the Reset Date, upon the
terms and subject to the conditions set forth herein. Except as may be expressly
provided in section 6 of such agreement, no holder of this Bond shall have any
right, remedy or claim against Goldman, Sachs & Co. under this Bond, the
Indenture or such agreement.
No provision of this Bond shall be invalid or unenforceable by reason
of any reference herein to Goldman, Sachs & Co. In addition, no provision of
this paragraph shall be construed to impair or otherwise affect any rights that
Goldman, Sachs & Co. may have at any time as a holder of any Securities.
12. Governing Law. As provided in the Indenture, this Bond shall for
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all purposes be governed by and construed in accordance with the laws of the
State of New York.
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