Exhibit 4.2
THE CHUBB CORPORATION
and
BNY MIDWEST TRUST COMPANY, as Collateral Agent, Custodial Agent and
Securities Intermediary
and
BANK ONE TRUST COMPANY, N.A., as Purchase Contract Agent
PLEDGE AGREEMENT
Dated as of June 24, 2003
TABLE OF CONTENTS
PAGE
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ARTICLE 1
DEFINITIONS
Section 1.01. Definitions...................................................................... 2
ARTICLE 2
PLEDGE
Section 2.01. Pledge........................................................................... 6
Section 2.02. Control.......................................................................... 6
Section 2.03. Termination...................................................................... 6
ARTICLE 3
DISTRIBUTIONS ON PLEDGED COLLATERAL
Section 3.01. Income And Distributions......................................................... 7
Section 3.02. Principal Payments Following Termination Event................................... 7
Section 3.03. Principal Payments Prior To Or On Purchase Contract Settlement Date.............. 7
Section 3.04. Payments To Purchase Contract Agent.............................................. 8
Section 3.05. Assets Not Properly Released..................................................... 8
ARTICLE 4
CONTROL
Section 4.01. Establishment Of Collateral Account.............................................. 8
Section 4.02. Treatment As Financial Assets.................................................... 9
Section 4.03. Sole Control By Collateral Agent................................................. 9
Section 4.04. Securities Intermediary's Jurisdiction........................................... 9
Section 4.05. No Other Claims.................................................................. 9
Section 4.06. Investment And Release........................................................... 10
Section 4.07. Statements And Confirmations..................................................... 10
Section 4.08. Tax Allocations.................................................................. 10
Section 4.09. No Other Agreements.............................................................. 10
Section 4.10. Powers Coupled With An Interest.................................................. 10
Section 4.11. Waiver Of Lien; Waiver Of Set-off................................................ 10
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ARTICLE 5
INITIAL DEPOSIT; CREATION OF TREASURY UNITS AND RECREATION OF
CORPORATE UNITS
Section 5.01. Initial Deposit Of Senior Notes................................................. 11
Section 5.02. Creation Of Treasury Units...................................................... 11
Section 5.03. Recreation Of Corporate Units................................................... 12
Section 5.04. Termination Event............................................................... 13
Section 5.05. Cash Settlement................................................................. 15
Section 5.06. Early Settlement And Cash Merger Early Settlement............................... 16
Section 5.07. Application Of Proceeds In Settlement Of Purchase Contracts..................... 17
Section 5.08. Special Event Redemption........................................................ 19
ARTICLE 6
VOTING RIGHTS -- PLEDGED SENIOR NOTES
Section 6.01. Voting Rights................................................................... 20
ARTICLE 7
RIGHTS AND REMEDIES
Section 7.01. Rights And Remedies Of The Collateral Agent..................................... 20
Section 7.02. Special Event Redemption........................................................ 21
Section 7.03. Successful Remarketing.......................................................... 22
Section 7.04. Substitutions................................................................... 22
ARTICLE 8
REPRESENTATIONS AND WARRANTIES; COVENANTS
Section 8.01. Representations And Warranties.................................................. 22
Section 8.02. Covenants....................................................................... 23
ARTICLE 9
THE COLLATERAL AGENT, THE CUSTODIAL AGENT AND THE SECURITIES
INTERMEDIARY
Section 9.01. Appointment, Powers And Immunities.............................................. 24
Section 9.02. Instructions Of The Company..................................................... 25
Section 9.03. Reliance By Collateral Agent And Securities Intermediary........................ 25
Section 9.04. Certain Rights.................................................................. 26
Section 9.05. Merger, Conversation, Consolidation Or Succession To Business................... 26
Section 9.06. Rights In Other Capacities...................................................... 26
Section 9.07. Non-reliance On Collateral Agent, The Custodial Agent And
Securities Intermediary......................................................... 27
Section 9.08. Compensation And Indemnity...................................................... 27
Section 9.09. Failure To Act.................................................................. 28
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Section 9.10. Resignation Of Collateral Agent, The Custodial Agent And Securities Intermediary 29
Section 9.11. Right To Appoint Agent Or Advisor............................................... 30
Section 9.12. Survival........................................................................ 30
Section 9.13. Exculpation..................................................................... 30
ARTICLE 10
AMENDMENT
Section 10.01. Amendment Without Consent Of Holders........................................... 30
Section 10.02. Amendment With Consent Of Holders.............................................. 31
Section 10.03. Execution Of Amendments........................................................ 32
Section 10.04. Effect Of Amendments........................................................... 32
Section 10.05. Reference Of Amendments........................................................ 32
ARTICLE 11
MISCELLANEOUS
Section 11.01. No Waiver...................................................................... 33
Section 11.02. Governing Law; Submission To Jurisdiction...................................... 33
Section 11.03. Notices........................................................................ 33
Section 11.04. Successors And Assigns......................................................... 34
Section 11.05. Counterparts................................................................... 34
Section 11.06. Severability................................................................... 34
Section 11.07. Expenses, Etc.................................................................. 34
Section 11.08. Security Interest Absolute..................................................... 35
Section 11.09. Notice Of Special Event, Special Event Redemption And Termination Event........ 35
Exhibit A -- Instruction from Purchase Contract Agent to Collateral Agent
(Creation of Treasury Units)
Exhibit B -- Instruction from Collateral Agent to Securities Intermediary
(Creation of Treasury Units)
Exhibit C -- Instruction from Purchase Contract Agent to Collateral Agent
(Recreation of Corporate Units)
Exhibit D -- Instruction from Collateral Agent to Securities Intermediary
(Recreation of Corporate Units)
Exhibit E -- Notice of Cash Settlement from Securities Intermediary to
Purchase Contract Agent (Cash Settlement Amounts)
Exhibit F -- Instruction to Custodial Agent
(Regarding Remarketing)
Exhibit G -- Instruction to Custodial Agent
(Regarding Withdrawal from Remarketing)
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PLEDGE AGREEMENT
PLEDGE AGREEMENT dated as of June 24, 2003 among THE CHUBB CORPORATION,
a New Jersey corporation (the "COMPANY"), BNY MIDWEST TRUST COMPANY, an Illinois
trust company, as collateral agent (in such capacity, together with its
successors in such capacity, the "COLLATERAL AGENT"), as custodial agent (in
such capacity, together with its successors in such capacity, the "CUSTODIAL
AGENT"), and as securities intermediary (as defined in Section 8-102(a)(14) of
the UCC) with respect to the Collateral Account (in such capacity, together with
its successors in such capacity, the "SECURITIES INTERMEDIARY"), and BANK ONE
TRUST COMPANY, N.A., a national banking association, as purchase contract agent
and as attorney-in-fact of the Holders from time to time of the Units (in such
capacity, together with its successors in such capacity, the "PURCHASE CONTRACT
AGENT") under the Purchase Contract Agreement.
RECITALS
WHEREAS, the Company and the Purchase Contract Agent are parties to the
Purchase Contract Agreement dated as of the date hereof (as modified and
supplemented and in effect from time to time, the "PURCHASE CONTRACT
AGREEMENT"), pursuant to which 16,000,000 (or 18,400,000 Corporate Units if the
underwriters exercise their option to purchase additional Corporate Units in
full) Corporate Units will be issued.
WHEREAS, each Corporate Unit represents (a) a stock purchase contract
(a "PURCHASE CONTRACT") pursuant to which the Holder will pay to the Company on
the Purchase Contract Settlement Date the Stated Amount and thereby purchase a
number of shares of the Company's common stock, par value $1.00 per share
("COMMON STOCK"), equal to the Settlement Rate and (b) either a Senior Note or
an Applicable Ownership Interest in the Treasury Portfolio.
WHEREAS, pursuant to the terms of the Purchase Contract Agreement and
the Purchase Contracts, the Holders of the Units have irrevocably authorized the
Purchase Contract Agent, as attorney-in-fact of such Holders, among other
things, to execute and deliver this Agreement on behalf of such Holders and to
grant the pledge provided herein of the Collateral to secure the Obligations.
NOW, THEREFORE, the Company, the Collateral Agent, the Custodial Agent,
the Securities Intermediary and the Purchase Contract Agent agree as follows:
ARTICLE 1
DEFINITIONS
Section 1.01. Definitions. For all purposes of this Agreement, except
as otherwise expressly provided or unless the context otherwise requires:
(a) the words "HEREIN," "HEREOF" and "HEREUNDER" and other words
of similar import refer to this Agreement as a whole and not to any particular
Article, Section, Exhibit or other subdivision;
(b) the following terms which are defined in the UCC shall have
the meanings set forth therein: "CERTIFICATED SECURITY," "CONTROL," "FINANCIAL
ASSET," "ENTITLEMENT ORDER," "SECURITIES ACCOUNT" and "SECURITY ENTITLEMENT";
(c) capitalized terms used herein and not defined herein have the
meanings assigned to them in the Purchase Contract Agreement; and
(d) the following terms have the meanings given to them in this
Section 1.01(d):
"AGREEMENT" means this Pledge Agreement, as the same may be amended,
modified or supplemented from time to time.
"CASH" means any coin or currency of the United States as at the time
shall be legal tender for payment of public and private debts.
"COLLATERAL" means the collective reference to:
(i) the Collateral Account and all investment property
and other financial assets from time to time credited to the Collateral
Account and all security entitlements with respect thereto, including,
without limitation, (A) the Senior Notes and security entitlements
relating thereto that are represented by the Corporate Units from time
to time, (B) the Applicable Ownership Interests (as specified in clause
(i) of the definition of such term) of the Holders with respect to the
Treasury Portfolio that are represented by the Corporate Units from
time to time; (C) any Treasury Securities and security entitlements
relating thereto delivered from time to time upon creation of Treasury
Units in accordance with Section 5.02 hereof and (D) payments made by
Holders pursuant to Section 5.05 hereof;
(ii) all powers and rights now owned or hereafter acquired
under or with respect to the Collateral; and
(iii) all Proceeds of any of the foregoing (whether such
Proceeds arise before or after the commencement of any proceeding under
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any applicable bankruptcy, insolvency or other similar law, by or
against the pledgor or with respect to the pledgor).
"COLLATERAL ACCOUNT" means the securities account of BNY Midwest Trust
Company, an Illinois trust company, as Collateral Agent, maintained by the
Securities Intermediary and designated "BNY Midwest Trust Company, as Collateral
Agent of The Chubb Corporation, as pledgee of Bank One Trust Company, N.A., as
the Purchase Contract Agent on behalf of and as attorney-in-fact for the
Holders".
"COMPANY" means the Person named as the "Company" in the first
paragraph of this instrument until a successor shall have become such pursuant
to the applicable provisions of the Purchase Contract Agreement, and thereafter
"Company" shall mean such successor.
"CORPORATE UNIT" means the collective rights and obligations of a
Holder of a Corporate Units Certificate in respect of a Senior Note or an
appropriate Applicable Ownership Interests in the Treasury Portfolio, as the
case may be, subject in each case to the Pledge thereof, and the Purchase
Contract represented thereby; provided that the appropriate Applicable Ownership
Interests (as specified in clause (ii) of the definition of such term) in the
Treasury Portfolio shall not be subject to the Pledge.
"CORPORATE UNITS CERTIFICATE " means a certificate evidencing the
rights and obligations of a Holder in respect of the number of Corporate Units
specified on such certificate.
"OBLIGATIONS" means, with respect to each Holder, all obligations and
liabilities of such Holder under such Holder's Purchase Contract, the Purchase
Contract Agreement and this Agreement or any other document made, delivered or
given in connection herewith or therewith, in each case whether on account of
principal, interest (including, without limitation, interest accruing before and
after the filing of any petition in bankruptcy, or the commencement of any
insolvency, reorganization or like proceeding, relating to such Holder, whether
or not a claim for post-filing or post-petition interest is allowed in such
proceeding), fees, indemnities, costs, expenses or otherwise (including, without
limitation, all fees and disbursements of counsel to the Company or the
Collateral Agent or the Securities Intermediary that are required to be paid by
the Holder pursuant to the terms of any of the foregoing agreements).
"PERMITTED INVESTMENTS" means any one of the following, in each case
maturing on the Business Day following the date of acquisition:
(1) any evidence of indebtedness with an original
maturity of 365 days or less issued, or directly and fully guaranteed
or insured, by the United States of America or any agency or
instrumentality thereof
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(provided that the full faith and credit of the United States of
America is pledged in support of the timely payment thereof or such
indebtedness constitutes a general obligation of it);
(2) deposits, certificates of deposit or acceptances with
an original maturity of 365 days or less of any institution which is a
member of the Federal Reserve System having combined capital and
surplus and undivided profits of not less than $500 million at the time
of deposit (and which may include the Collateral Agent);
(3) investments with an original maturity of 365 days or
less of any Person that is fully and unconditionally guaranteed by a
bank referred to in clause (2);
(4) repurchase agreements and reverse repurchase
agreements relating to marketable direct obligations issued or
unconditionally guaranteed by the United States of America or issued by
any agency thereof and backed as to timely payment by the full faith
and credit of the United States of America;
(5) investments in commercial paper, other than
commercial paper issued by the Company or its affiliates, of any
corporation incorporated under the laws of the United States or any
State thereof, which commercial paper has a rating at the time of
purchase at least equal to "A-1" by Standard & Poor's Ratings Services
("S&P") or at least equal to "P-1" by Moody's Investors Service, Inc.
("MOODY'S"); and
(6) investments in money market funds (including, but not
limited to, money market funds managed by the Collateral Agent or an
affiliate of the Collateral Agent) registered under the Investment
Company Act of 1940, as amended, rated in the highest applicable rating
category by S&P or Moody's.
"PERSON" means any legal person, including, without limitation, any
individual, corporation, estate, partnership, joint venture, association,
joint-stock company, limited liability company, trust, unincorporated
organization or government or any agency or political subdivision thereof.
"PLEDGE" means the lien and security interest created by this
Agreement.
"PLEDGED APPLICABLE OWNERSHIP INTERESTS" means the Applicable Ownership
Interests (as specified in clause (i) of the definition thereof) of the Holders
with respect to the Treasury Portfolio and security entitlements with respect
thereto from time to time credited to the Collateral Account and not then
released from the Pledge.
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"PLEDGED SENIOR NOTES" means Senior Notes and security entitlements
with respect thereto from time to time credited to the Collateral Account and
not then released from the Pledge.
"PLEDGED SECURITIES" means the Pledged Senior Notes, the Pledged
Applicable Ownership Interests and the Pledged Treasury Securities,
collectively.
"PLEDGED TREASURY SECURITIES" means Treasury Securities and security
entitlements with respect thereto from time to time credited to the Collateral
Account and not then released from the Pledge.
"PROCEEDS" has the meaning ascribed thereto in the UCC and includes,
without limitation, all interest, dividends, cash, instruments, securities,
financial assets and other property received, receivable or otherwise
distributed upon the sale (including, without limitation, the Remarketing),
exchange, collection or disposition of any financial assets from time to time
held in the Collateral Account.
"PURCHASE CONTRACT AGENT" has the meaning specified in the paragraph
preceding the recitals of this Agreement.
"SEPARATE SENIOR NOTES" means Senior Notes which are not represented by
Corporate Units.
"TRADES" means the Treasury/Reserve Automated Debt Entry System
maintained by the Federal Reserve Bank of New York pursuant to the TRADES
Regulations.
"TRADES REGULATIONS" means the regulations of the United States
Department of the Treasury, published at 31 C.F.R. Part 357, as amended from
time to time. Unless otherwise defined herein, all terms defined in the TRADES
Regulations are used herein as therein defined.
"TRANSFER" means (i) in the case of certificated securities in
registered form, delivery as provided in ss.8-301(a) of the UCC, indorsed to the
transferee or in blank by an effective endorsement; (ii) in the case of Treasury
Securities, registration of the transferee as the owner of such Treasury
Securities on TRADES; and (iii) in the case of security entitlements, including,
without limitation, security entitlements with respect to Treasury Securities, a
securities intermediary indicating by book entry that such security entitlement
has been credited to the transferee's securities account.
"TREASURY SECURITIES" means (i) zero-coupon U.S. treasury securities
that mature on July 15, 2006 (CUSIP No. 912820BT3) and, during the period
between July 15, 2006 and August 15, 2006, the Proceeds from such Treasury
Securities, and (ii) zero-coupon U.S. treasury securities that mature on August
15, 2006 (CUSIP No. 912833CQ1).
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"TREASURY UNIT" means, following the substitution of Treasury
Securities for Senior Notes as collateral to secure a Holder's Obligations, the
collective rights and obligations of a Holder of a Treasury Units Certificate in
respect of such Treasury Securities, subject to the Pledge thereof, and the
related Purchase Contract.
"TREASURY UNITS CERTIFICATE" means a certificate evidencing the rights
and obligations of a Holder in respect of the number of Treasury Units specified
on such certificate.
"UCC" means the Uniform Commercial Code as in effect in the State of
New York from time to time.
"VALUE" means, with respect to any item of Collateral on any date, as
to (1) Cash, the face amount thereof, (2) Treasury Securities or Senior Notes,
the aggregate principal amount thereof at maturity and (3) Applicable Ownership
Interests (as specified in clause (i) of the definition of such term), the
appropriate percentage of the aggregate principal amount at maturity of the
Treasury Portfolio.
ARTICLE 2
PLEDGE
Section 2.01. Pledge. Each Holder, acting through the Purchase
Contract Agent as such Holder's attorney-in-fact, and the Purchase Contract
Agent, acting solely as such attorney-in-fact, hereby pledges and grants to the
Collateral Agent, as agent of and for the benefit of the Company, a continuing
first priority security interest in and to, and a lien upon and right of set-off
against, all of such Holder's right, title and interest in and to the Collateral
to secure the prompt and complete payment and performance when due (whether at
stated maturity, by acceleration or otherwise) of such Holder's Obligations. The
Collateral Agent shall have all of the rights, remedies and recourses with
respect to the Collateral afforded a secured party by the UCC, in addition to,
and not in limitation of, the other rights, remedies and recourses afforded to
the Collateral Agent by this Agreement.
Section 2.02. Control. The Collateral Agent shall have control of the
Collateral Account pursuant to the provisions of Article 4 of this Agreement.
Section 2.03. Termination. As to each Holder, this Agreement and the
Pledge created hereby shall terminate upon the satisfaction of such Holder's
Obligations. Upon such termination, the Collateral Agent shall instruct the
Securities Intermediary to Transfer such Holder's portion of the Collateral to
the Purchase Contract Agent for distribution to such Holder, free and clear of
the Pledge created hereby.
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ARTICLE 3
DISTRIBUTIONS ON PLEDGED COLLATERAL
Section 3.01. Income And Distributions. The Collateral Agent shall
transfer all income and distributions received by the Securities Intermediary on
account of the Pledged Senior Notes, the Pledged Applicable Ownership Interests
or Permitted Investments from time to time held in the Collateral Account (ABA
No. 021000018, A/C No. 252997, Re: The Chubb Corporation) to the Purchase
Contract Agent for distribution to the applicable Holders as provided in the
Purchase Contracts or Purchase Contract Agreement.
Section 3.02. Principal Payments Following Termination Event.
Following a Termination Event, the Collateral Agent shall instruct the
Securities Intermediary to transfer all principal payments it receives, if any,
in respect of (1) the Pledged Senior Notes, (2) the Pledged Applicable Ownership
Interests, and (3) the Pledged Treasury Securities, to the Purchase Contract
Agent for the benefit of the applicable Holders for distribution to such Holders
in accordance with their respective interests, free and clear of the Pledge
created hereby.
Section 3.03. Principal Payments Prior To Or On Purchase Contract
Settlement Date. (a) Subject to the provisions of Sections 5.06 and 5.08, and
except as provided in clause 3.03(b) below, if no Termination Event shall have
occurred, all principal payments received by the Securities Intermediary in
respect of (1) the Pledged Senior Notes, (2) the Pledged Applicable Ownership
Interests and (3) the Pledged Treasury Securities, shall be held and invested
in Permitted Investments until the Purchase Contract Settlement Date, and
distributed on the Purchase Contract Settlement Date as provided in Section
5.07 hereof. Any balance remaining in the Collateral Account shall be released
from the Pledge and transferred to the Purchase Contract Agent for the benefit
of the applicable Holders for distribution to such Holders in accordance with
their respective interests, free and clear of the Pledge created thereby. The
Company shall instruct the Collateral Agent in writing as to the type of
Permitted Investments in which any payments made under this Section shall be
invested, provided, however, that if the Company fails to deliver such
instructions by 10:30 a.m. (New York City time) on the day such payments are
received by the Collateral Agent, the Collateral Agent shall instruct the
Securities Intermediary to invest such payments in the Permitted Investments
described in clause (6) of the definition of Permitted Investments. In no event
shall the Collateral Agent be liable for the selection of Permitted Investments
or for investment losses incurred thereon. The Collateral Agent shall have no
liability in respect of losses incurred as a result of the failure of the
Company to provide timely written investment direction.
(b) All principal payments received by the Securities Intermediary
in respect of (1) the Senior Notes, (2) the Applicable Ownership Interests (as
specified in clause (i) of the definition thereof) in the Treasury Portfolio and
(3) the Treasury Securities or security entitlements thereto, that, in each
case, have
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been released from the Pledge pursuant hereto shall be transferred to the
Purchase Contract Agent for the benefit of the applicable Holders for
distribution to such Holders in accordance with their respective interests.
Section 3.04. Payments To Purchase Contract Agent. The Securities
Intermediary shall use commercially reasonable efforts to deliver payments to
the Purchase Contract Agent hereunder to the account designated by the Purchase
Contract Agent for such purpose not later than 12:00 p.m. (New York City time)
on the Business Day such payment is received by the Securities Intermediary;
provided, however, that if such payment is received on a day that is not a
Business Day or after 11:00 a.m. (New York City time) on a Business Day, then
the Securities Intermediary shall use all commercially reasonable efforts to
deliver such payment to the Purchase Contract Agent no later than 10:30 a.m.
(New York City time) on the next succeeding Business Day.
Section 3.05. Assets Not Properly Released. If the Purchase Contract
Agent or any Holder shall receive any principal payments on account of financial
assets credited to the Collateral Account and not released from the Pledge in
accordance with this Agreement, the Purchase Contract Agent or such Holder shall
hold the same as trustee of an express trust for the benefit of the Company and,
upon receipt of an Officers' Certificate of the Company so directing, promptly
deliver the same to the Securities Intermediary for credit to the Collateral
Account or to the Company for application to the Obligations of the Holders, and
the Purchase Contract Agent and Holders shall acquire no right, title or
interest in any such payments of principal amounts so received. The Purchase
Contract Agent shall have no liability under this Section 3.05 unless and until
it has been notified in writing that such payment was delivered to it
erroneously and shall have no liability for any action taken, suffered or
omitted to be taken prior to its receipt of such notice.
ARTICLE 4
CONTROL
Section 4.01. Establishment Of Collateral Account. The Securities
Intermediary hereby confirms that:
(a) the Securities Intermediary has established the Collateral
Account;
(b) the Collateral Account is a securities account;
(c) subject to the terms of this Agreement, the Securities
Intermediary shall identify in its records the Collateral Agent as the
entitlement holder entitled to exercise the rights that comprise any financial
asset credited to the Collateral Account;
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(d) all property delivered to the Securities Intermediary pursuant
to this Agreement or the Purchase Contract Agreement, including any Applicable
Ownership Interests in the Treasury Portfolio and the Permitted Investments,
will be credited promptly to the Collateral Account; and
(e) all securities or other property underlying any financial
assets credited to the Collateral Account shall be ERROR! BOOKMARK NOT DEFINED.
registered in the name of the Purchase Contract Agent and indorsed to the
Securities Intermediary or in blank, ERROR! BOOKMARK NOT DEFINED. registered in
the name of the Securities Intermediary or ERROR! BOOKMARK NOT DEFINED. credited
to another securities account maintained in the name of the Securities
Intermediary. In no case will any financial asset credited to the Collateral
Account be registered in the name of the Purchase Contract Agent or any Holder
or specially indorsed to the Purchase Contract Agent or any Holder unless such
financial asset has been further indorsed to the Securities Intermediary or in
blank.
Section 4.02. Treatment As Financial Assets. Each item of property
(whether investment property, financial asset, security, instrument or cash)
credited to the Collateral Account shall be treated as a financial asset.
Section 4.03. Sole Control By Collateral Agent. Except as provided in
Section 6.01, at all times prior to the termination of the Pledge, the
Collateral Agent shall have sole control of the Collateral Account, and the
Securities Intermediary shall take instructions and directions with respect to
the Collateral Account solely from the Collateral Agent. If at any time the
Securities Intermediary shall receive an entitlement order issued by the
Collateral Agent and relating to the Collateral Account, the Securities
Intermediary shall comply with such entitlement order without further consent by
the Purchase Contract Agent or any Holder or any other Person. Except as
otherwise permitted under this Agreement, until termination of the Pledge, the
Securities Intermediary will not comply with any entitlement orders issued by
the Purchase Contract Agent or any Holder.
Section 4.04. Securities Intermediary's Jurisdiction. The Collateral
Account, and the rights and obligations of the Securities Intermediary, the
Collateral Agent, the Purchase Contract Agent and the Holders with respect
thereto, shall be governed by the laws of the State of New York. Regardless of
any provision in any other agreement, for purposes of the UCC, New York shall be
deemed to be the Securities Intermediary's jurisdiction.
Section 4.05. No Other Claims. Except for the claims and interest of
the Collateral Agent and of the Purchase Contract Agent and the Holders in the
Collateral Account, the Securities Intermediary (without having conducted any
investigation) does not know of any claim to, or interest in, the Collateral
Account or in any financial asset credited thereto. If any Person asserts any
lien, encumbrance or adverse claim (including any writ, garnishment, judgment,
warrant of attachment, execution or similar process) against the Collateral
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Account or in any financial asset carried therein, the Securities Intermediary
will promptly notify the Collateral Agent and the Purchase Contract Agent.
Section 4.06. Investment And Release. All proceeds of financial assets
from time to time deposited in the Collateral Account shall be invested and
reinvested as provided in this Agreement. At all times prior to termination of
the Pledge, no property shall be released from the Collateral Account except in
accordance with this Agreement or upon written instructions of the Collateral
Agent.
Section 4.07. Statements And Confirmations. The Securities Intermediary
will promptly send copies of all statements, confirmations and other
correspondence concerning the Collateral Account and any financial assets
credited thereto simultaneously to each of the Purchase Contract Agent and the
Collateral Agent at their addresses for notices under this Agreement.
Section 4.08. Tax Allocations. The Purchase Contract Agent shall report
all items of income, gain, expense and loss recognized in the Collateral
Account, to the extent such reporting is required by law, to the Internal
Revenue Service authorities in the manner required by law. Neither the
Securities Intermediary nor the Collateral Agent shall have any tax reporting
duties hereunder.
Section 4.09. No Other Agreements. The Securities Intermediary has not
entered into, and prior to the termination of the Pledge will not enter into,
any agreement with any other Person relating to the Collateral Account or any
financial assets credited thereto, including, without limitation, any agreement
to comply with entitlement orders of any Person other than the Collateral Agent.
Section 4.10. Powers Coupled With An Interest. The rights and powers
granted in this Article 4 to the Collateral Agent have been granted in order to
perfect its security interests in the Collateral Account, are powers coupled
with an interest and will be affected neither by the bankruptcy of the Purchase
Contract Agent or any Holder nor by the lapse of time. The obligations of the
Securities Intermediary under this Article 4 shall continue in effect until the
termination of the Pledge.
Section 4.11. Waiver Of Lien; Waiver Of Set-off. The Securities
Intermediary waives any security interest, lien or right to make deductions or
setoffs that it may now have or hereafter acquire in or with respect to the
Collateral Account, any financial asset credited thereto or any security
entitlement in respect thereof. Neither the financial assets credited to the
Collateral Account nor the security entitlements in respect thereof will be
subject to deduction, set-off, banker's lien, or any other right in favor of any
person other than the Company.
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ARTICLE 5
INITIAL DEPOSIT; CREATION OF TREASURY UNITS AND RECREATION OF CORPORATE UNITS
Section 5.01. Initial Deposit Of Senior Notes. (a) Prior to or
concurrently with the execution and delivery of this Agreement, the Purchase
Contract Agent, on behalf of the initial Holders of the Corporate Units, shall
Transfer to the Securities Intermediary, for credit to the Collateral Account,
the Senior Notes or security entitlements relating thereto, and, in the case of
security entitlements, the Securities Intermediary shall indicate by book-entry
that a securities entitlement to such Senior Notes has been credited to the
Collateral Account.
(b) The Collateral Agent may, at any time or from time to time, in
its sole discretion, cause any or all securities or other property underlying
any financial assets credited to the Collateral Account to be registered in the
name of the Securities Intermediary, the Collateral Agent or their respective
nominees; provided, however, that unless any Event of Default (as defined in the
Indenture) shall have occurred and be continuing, the Collateral Agent agrees
not to cause any Senior Notes to be so re-registered.
Section 5.02. Creation Of Treasury Units. (a) So long as the Treasury
Portfolio has not replaced the Senior Notes represented by the Corporate Units,
a Holder of Corporate Units shall have the right, at any time prior to 5:00
p.m. (New York City time) on the fifth Business Day immediately preceding the
Purchase Contract Settlement Date, to create Treasury Units by substitution of
Treasury Securities or security entitlements with respect thereto for the
Pledged Senior Notes represented by such Holder's Corporate Units, in integral
multiples of 40 Corporate Units by:
(i) Transferring to the Securities Intermediary for
credit to the Collateral Account Treasury Securities or security
entitlements with respect thereto having a Value equal to the aggregate
principal amount of the Pledged Senior Notes to be released,
accompanied by a notice, substantially in the form of Exhibit D to the
Purchase Contract Agreement, whereupon the Purchase Contract Agent
shall deliver to the Collateral Agent a notice, substantially in the
form of Exhibit A hereto, (A) stating that such Holder has notified
the Purchase Contract Agent that such Holder has Transferred Treasury
Securities or security entitlements with respect thereto to the
Collateral Agent for credit to the Collateral Account, (B) stating the
Value of the Treasury Securities or security entitlements with respect
thereto Transferred by such Holder and (C) requesting that the
Collateral Agent release from the Pledge the Pledged Senior Notes that
are represented by such Corporate Units; and
(ii) delivering the related Corporate Units to the
Purchase Contract Agent.
11
Upon receipt of such notice and confirmation that Treasury Securities
or security entitlements with respect thereto have been credited to the
Collateral Account as described in such notice, the Collateral Agent shall
instruct the Securities Intermediary by a notice, substantially in the form of
Exhibit B, to release such Pledged Senior Notes from the Pledge by Transfer to
the Purchase Contract Agent for distribution to such Holder or as instructed by
such Holder, free and clear of the Pledge created hereby.
If the Treasury Portfolio has replaced the Senior Notes represented by
the Corporate Units and subject to the conditions of the Purchase Contract
Agreement, a Holder may, at any time on or prior to the second Business Day
immediately preceding the Purchase Contract Settlement Date, substitute Treasury
Securities for the Applicable Ownerships Interests in the Treasury Portfolio
with respect to such Corporate Units, but only in multiples of 64,000 Corporate
Units. In such an event, the Holder shall transfer the required amount of
Treasury Securities to the Securities Intermediary, for credit to the Collateral
Account, and the Purchase Contract Agent shall request the Collateral Agent to
instruct the Securities Intermediary to release the Pledge of and transfer to
the Holder or as instructed by such Holder the appropriate Applicable Ownership
Interests in the Treasury Portfolio in the manner set forth above.
(b) Upon credit to the Collateral Account of Treasury Securities
or security entitlements with respect thereto delivered by a Holder of Corporate
Units and receipt of the related instruction from the Collateral Agent, the
Securities Intermediary shall release such Pledged Senior Notes or Applicable
Ownership Interest in the Treasury Portfolio, as the case may be, and shall
promptly Transfer the same to the Purchase Contract Agent for distribution to
such Holder, free and clear of the Pledge created hereby.
Section 5.03. Recreation Of Corporate Units. (a) So long as the
Treasury Portfolio has not replaced the Senior Notes represented by the
Corporate Units, at any time prior to 5:00 p.m. (New York City time) on the
fifth Business Day immediately preceding the Purchase Contract Settlement Date,
a Holder of Treasury Units shall have the right to recreate Corporate Units by
substitution of Senior Notes or security entitlements with respect thereto for
Pledged Treasury Securities in integral multiples of 40 Treasury Units by:
(i) Transferring to the Securities Intermediary for
credit to the Collateral Account Senior Notes or security entitlements
with respect thereto having a principal amount equal to the Value of
the Pledged Treasury Securities to be released, accompanied by a
notice, substantially in the form of Exhibit D to the Purchase Contract
Agreement, whereupon the Purchase Contract Agent shall deliver to the
Collateral Agent a notice, substantially in the form of Exhibit C
hereto, stating that such Holder has Transferred the Senior Notes or
security entitlements with respect thereto to the Collateral Account
for credit to the Collateral Account and
12
requesting that the Collateral Agent release from the Pledge the
Pledged Treasury Securities related to such Treasury Units; and
(ii) delivering the related Treasury Units to the Purchase
Contract Agent.
Upon receipt of such notice and confirmation that Senior Notes or
security entitlements with respect thereto have been credited to the Collateral
Account as described in such notice, the Collateral Agent shall instruct the
Securities Intermediary by a notice substantially in the form of Exhibit D
hereto to release such Pledged Treasury Securities from the Pledge by Transfer
to the Purchase Contract Agent for distribution to such Holder, free and clear
of the Pledge created hereby.
If the Treasury Portfolio has replaced the Senior Notes represented by
the Corporate Units, a Holder may, at any time on or prior to the second
Business Day immediately preceding the Purchase Contract Settlement Date,
substitute the Applicable Ownership Interests in the Treasury Portfolio for the
Pledged Treasury Securities, but only in multiples of 64,000 Treasury Units. In
such an event, the Holder shall Transfer the required Applicable Ownership
Interests in the Treasury Portfolio to the Securities Intermediary, for credit
to the Collateral Account, and the Purchase Contract Agent shall request the
Collateral Agent to instruct the Securities Intermediary to release and transfer
to the Holder the appropriate Pledged Treasury Securities in the manner set
forth above.
(b) Upon credit to the Collateral Account of Senior Notes or
security entitlements with respect thereto delivered by a Holder of Treasury
Units and receipt of the related instruction from the Collateral Agent, the
Securities Intermediary shall release such Pledged Treasury Securities or
Applicable Ownership Interests in the Treasury Portfolio and shall promptly
Transfer the same to the Purchase Contract Agent for distribution to such
Holder, free and clear of the Pledge created hereby.
Section 5.04. Termination Event. (a) Upon receipt by the Collateral
Agent of written notice from the Company or the Purchase Contract Agent that a
Termination Event has occurred, the Collateral Agent shall release all
Collateral from the Pledge and shall promptly instruct the Securities
Intermediary to Transfer:
(i) any Pledged Senior Notes or security entitlements
with respect thereto or Pledged Applicable Ownership Interests;
(ii) any Pledged Treasury Securities, and
(iii) any payments by Holders (or the Permitted Investments
of such payments) pursuant to Section 5.05 hereof,
13
to the Purchase Contract Agent for the benefit of the Holders for distribution
to such Holders, in accordance with their respective interests, free and clear
of the Pledge created hereby; provided, however, if any Holder shall be entitled
to receive less than $1,000 with respect to its interest in the Applicable
Ownership Interests (as specified in clause (i) of the definition of such term)
in the Treasury Portfolio, the Purchase Contract Agent shall dispose of such
interest for cash and deliver to such Holder cash in lieu of delivering the
Applicable Ownership Interests (as specified in clause (i) of the definition of
such term) in the Treasury Portfolio.
(b) If such Termination Event shall result from the Company's
becoming a debtor under the Bankruptcy Code, and if the Collateral Agent shall
for any reason fail promptly to effectuate the release and Transfer of all
Pledged Senior Notes, Pledged Applicable Ownership Interests, Pledged Treasury
Securities and payments by Holders (or the Permitted Investments of such
payments) pursuant to Section 5.05 hereof and Proceeds of any of the foregoing,
as the case may be, as provided by this Section 5.04, the Purchase Contract
Agent shall:
(i) use its best efforts to obtain an opinion of a
nationally recognized law firm to the effect that, notwithstanding the
Company's being the debtor in such a bankruptcy case, the Collateral
Agent will not be prohibited from releasing or Transferring the
Collateral as provided in this Section 5.04, and shall deliver or cause
to be delivered such opinion to the Collateral Agent within ten days
after the occurrence of such Termination Event, and if (A) the
Purchase Contract Agent shall be unable to obtain such opinion within
ten days after the occurrence of such Termination Event or (B) the
Collateral Agent shall continue, after delivery of such opinion, to
refuse to effectuate the release and Transfer of all Pledged Senior
Notes, Pledged Applicable Ownership Interests, Pledged Treasury
Securities and the payments by Holders (or the Permitted Investments
of such payments) pursuant to Section 5.05 hereof and Proceeds of any
of the foregoing, as the case may be, as provided in this Section
5.04, then the Purchase Contract Agent shall within fifteen days
after the occurrence of such Termination Event commence an action or
proceeding in the court having jurisdiction of the Company's case
under the Bankruptcy Code seeking an order requiring the Collateral
Agent to effectuate the release and transfer of all Pledged Senior
Notes, Pledged Applicable Ownership Interests, Pledged Treasury
Securities and the payments by Holders (or the Permitted Investments
of such payments) pursuant to Section 5.05 hereof and Proceeds of any
of the foregoing, or as the case may be, as provided by this Section
5.04; or
(ii) commence an action or proceeding like that described
in clause 5.04(b)(i) hereof within ten days after the occurrence of
such Termination Event.
14
Section 5.05. Cash Settlement. (a) Upon receipt by the Collateral
Agent of (1) a notice from the Purchase Contract Agent promptly after the
receipt by the Purchase Contract Agent of a notice from a Holder of Corporate
Units or Treasury Units that such Holder has elected, in accordance with the
procedures specified in Section 5.02(c)(i) or (f)(i) of the Purchase Contract
Agreement, respectively, to effect a Cash Settlement and (2) payment by such
Holder by deposit in the Collateral Account prior to 11:00 a.m. (New York City
time) on the fourth Business Day immediately preceding the Purchase Contract
Settlement Date of the Settlement Price in lawful money of the United States by
certified or cashier's check or wire transfer of immediately available funds
payable to or upon the order of the Securities Intermediary, then the
Collateral Agent shall:
(i) instruct the Securities Intermediary promptly to
invest any such Cash in Permitted Investments;
(ii) instruct the Securities Intermediary to release from
the Pledge such Holder's related Pledged Senior Notes, Pledged
Applicable Ownership Interests or Pledged Treasury Securities, as
applicable, as to which such Holder has effected a Cash Settlement
pursuant to this Section 5.05(a); and
(iii) instruct the Securities Intermediary to Transfer all
such Pledged Senior Notes, Pledged Applicable Ownership Interests or
the Pledged Treasury Securities, as the case may be, to the Purchase
Contract Agent for distribution to such Holder, in each case free and
clear of the Pledge created hereby.
The Company shall instruct the Collateral Agent in writing as to the
type of Permitted Investments in which any such Cash shall be invested;
provided, however, that if the Company fails to deliver such written
instructions by 10:30 a.m. (New York City time) on the day such Cash is received
by the Collateral Agent or to be reinvested by the Securities Intermediary, the
Collateral Agent shall instruct the Securities Intermediary to invest such Cash
in the Permitted Investments described in clause (6) of the definition of
Permitted Investments. In no event shall the Collateral Agent or Securities
Intermediary be liable for the selection of Permitted Investments or for
investment losses incurred thereon. The Collateral Agent and Securities
Intermediary shall have no liability in respect of losses incurred as a result
of the failure of the Company to provide timely written investment direction.
Upon receipt of the proceeds upon the maturity of the Permitted
Investments on the Purchase Contract Settlement Date, the Collateral Agent shall
instruct the Securities Intermediary to (A) pay the portion of such proceeds and
deliver any certified or cashier's checks received, in an aggregate amount equal
to the Settlement Price, to the Company on the Purchase Contract Settlement
Date, and (B) release any amounts in excess of the Settlement Price earned from
such
15
Permitted Investments to the Purchase Contract Agent for distribution to such
Holder.
(b) If a Holder of Corporate Units (if the Treasury Portfolio has
not replaced the Senior Notes represented by such Corporate Units) (i) fails
to notify the Purchase Contract Agent of its intention to make a Cash
Settlement as provided in paragraph 5.02(c)(i) of the Purchase Contract
Agreement or (ii) does notify the Purchase Contract Agent of its intention to
pay the Settlement Price in cash, but fails to make such payment as required by
paragraph 5.02(c)(ii) of the Purchase Contract Agreement, such Holder shall be
deemed to have consented to the disposition of such Holder's Pledged Senior
Notes in accordance with paragraph 5.02(c)(iii) of the Purchase Contract
Agreement.
(c) If a Holder of a Treasury Unit or a Holder of a Corporate Unit
(if the Treasury Portfolio has replaced the Senior Notes represented by such
Corporate Unit) (i) fails to notify the Purchase Contract Agent of its
intention to make a Cash Settlement as provided in paragraph 5.02(f)(i) of the
Purchase Contract Agreement or (ii) does notify the Purchase Contract Agent as
provided in paragraph 5.02(f)(ii) of the Purchase Contract Agreement of its
intention to pay the Settlement Price in cash, but fails to make such payment
as required by paragraph 5.02(f)(ii) of the Purchase Contract Agreement, such
Holder shall be deemed to have elected to pay the Settlement Price in
accordance with paragraph 5.02(f)(iii) of the Purchase Contract Agreement.
(d) As soon as practicable after 11:00 a.m. (New York City time)
on the fourth Business Day immediately preceding the Purchase Contract
Settlement Date, the Collateral Agent shall deliver to the Purchase Contract
Agent a notice, substantially in the form of Exhibit E hereto, stating (i) the
amount of Cash that it has received with respect to the Cash Settlement of
Corporate Units, (ii) the amount of Cash that it has received with respect to
the Cash Settlement of Treasury Units and (iii) the amount of Pledged Senior
Notes to be remarketed in the Final Remarketing pursuant to Section
5.02(c)(iii) of the Purchase Contract Agreement.
Section 5.06. Early Settlement And Cash Merger Early Settlement. Upon
receipt by the Collateral Agent of a notice from the Purchase Contract Agent
that a Holder of Units has elected to effect either (i) Early Settlement of its
obligations under the Purchase Contracts represented by such Units in accordance
with the terms of the Purchase Contracts and Section 5.07 of the Purchase
Contract Agreement or (ii) Cash Merger Early Settlement of its obligations under
the Purchase Contracts represented by such Units in accordance with the terms of
the Purchase Contracts and Section 5.04(b)(2) of the Purchase Contract Agreement
(which notice shall set forth the number of such Purchase Contracts as to which
such Holder has elected to effect Early Settlement or Cash Merger Early
Settlement), and that the Purchase Contract Agent has received from such Holder,
and paid to the Company as confirmed in writing by the Company, the related
16
Settlement Price pursuant to the terms of the Purchase Contracts and the
Purchase Contract Agreement and that all conditions to such Early Settlement or
Cash Merger Early Settlement, as the case may be, have been satisfied, then the
Collateral Agent shall release from the Pledge, (1) Pledged Senior Notes or the
Pledged Applicable Ownership Interests in the case of a Holder of Corporate
Units or (2) Pledged Treasury Securities, in the case of a Holder of Treasury
Units, in each case with a Value equal to the product of (x) the Stated Amount
times (y) the number of Purchase Contracts as to which such Holder has elected
to effect Early Settlement or Cash Merger Early Settlement, and shall instruct
the Securities Intermediary to Transfer all such Pledged Applicable Ownership
Interests or Pledged Senior Notes or Pledged Treasury Securities, as the case
may be, to the Purchase Contract Agent for distribution to such Holder, in each
case free and clear of the Pledge created hereby. A holder of Treasury Units may
settle early only in integral multiples of 40 Treasury Units, and a Holder of
Corporate Units, if the Treasury Portfolio has replaced the Senior Notes
represented by such Corporate Units, may settle early only in integral multiples
of 64,000 Corporate Units.
Section 5.07. Application Of Proceeds In Settlement Of Purchase
Contracts. (a) If a Holder of Corporate Units (if the Treasury Portfolio has
not replaced the Senior Notes represented by such Corporate Units) has not
elected to make an effective Cash Settlement by notifying the Purchase Contract
Agent in the manner provided for in Section 5.02(c)(i) of the Purchase Contract
Agreement or does notify the Purchase Contract Agent as provided in paragraph
5.02(c)(i) of the Purchase Contract Agreement of its intention to pay the
Settlement Price in cash, but fails to make such payment as required by
paragraph 5.02(c)(ii) of the Purchase Contract Agreement, such Holder shall be
deemed to have elected to pay for the shares of Common Stock to be issued under
such Purchase Contracts from the Proceeds of the Final Remarketing of the
related Pledged Senior Notes. In the event of a Successful Final Remarketing,
the Collateral Agent shall instruct the Securities Intermediary to Transfer the
related Pledged Senior Notes to the Remarketing Agent upon confirmation of
deposit by the Remarketing Agent of the Proceeds of such Final Remarketing
(less, to the extent permitted by the Remarketing Agreement, the Remarketing
Fee) in the Collateral Account. The Collateral Agent shall instruct the
Securities Intermediary to invest the Proceeds of the Final Remarketing in
Permitted Investments set forth in clause (6) of the definition of Permitted
Investments. On the Purchase Contract Settlement Date, the Collateral Agent
shall, in consultation with the Purchase Contract Agent, instruct the
Securities Intermediary to remit a portion of the Proceeds from such Final
Remarketing equal to the aggregate principal amount of such Pledged Senior
Notes to the Company to satisfy in full such Holder's obligations to pay the
Settlement Price to purchase the shares of Common Stock under the related
Purchase Contracts and to remit the balance of the Proceeds from the Final
Remarketing, if any, to the Purchase Contract Agent for distribution to such
Holder.
17
If the Remarketing Agent advises the Collateral Agent in writing that
there has been a Failed Final Remarketing, the Collateral Agent, for the benefit
of the Company shall, at the written direction of the Company, exercise the
Company's rights as a secured party with respect to the Pledged Notes in
accordance with applicable law or deliver the Pledged Notes to the Company to
retain to the extent permitted by applicable law. Whether or not the Company
directs the Collateral Agent to take either such action, the Holder's
obligations to pay the Stated Amount for the shares of Common Stock will be
deemed to be satisfied in full.
(b) If a Holder of a Treasury Unit or a Holder of a Corporate Unit
(if the Treasury Portfolio has replaced the Senior Notes represented by such
Corporate Unit) has not elected to make an effective Cash Settlement by
notifying the Purchase Contract Agent in the manner provided for in Section
5.02(f)(i) of the Purchase Contract Agreement, or has given such notice but
failed to make such payment in the manner required by Section 5.02(f)(ii) of the
Purchase Contract Agreement, such Holder shall be deemed to have elected to pay
for the shares of Common Stock to be issued under such Purchase Contracts from
the Proceeds of the related Pledged Treasury Securities or Pledged Applicable
Ownership Interests, as the case may be. Promptly, after 11:00 a.m. (New York
City time) on the Business Day immediately prior to the Purchase Contract
Settlement Date, the Collateral Agent shall instruct the Securities Intermediary
to invest the Cash Proceeds of the maturing Pledged Treasury Securities or
Pledged Applicable Ownership Interests, as the case may be, in Permitted
Investments set forth in clause (6) of the definition of Permitted Investments,
unless prior to 10:30 a.m. (New York City time) on such date, the Company shall
otherwise instruct the Collateral Agent in writing as to the type of Permitted
Investments in which any such Cash Proceeds shall be invested. In no event shall
the Collateral Agent be liable for the selection of Permitted Investments or for
investment losses incurred thereon. The Collateral Agent shall have no liability
in respect of losses incurred as a result of the failure of the Company to
provide timely written investment direction. Without receiving any instruction
from any such Holder, the Collateral Agent shall instruct the Securities
Intermediary to remit the Proceeds of the related Pledged Treasury Securities or
Pledged Applicable Ownership Interests, as the case may be, to the Company in
settlement of such Purchase Contracts on the Purchase Contract Settlement Date.
In the event the sum of the Proceeds from the related Pledged Treasury
Securities or Pledged Applicable Ownership Interests, as the case may be, and
the investment earnings from the investment in Permitted Investments exceeds the
aggregate Settlement Price of the Purchase Contracts being settled thereby, the
Collateral Agent shall instruct the Securities Intermediary to transfer such
excess, when received, to the Purchase Contract Agent for distribution to such
Holder.
(c) Prior to 5:00 p.m. (New York City time) on the fifth Business
Day immediately preceding the applicable Remarketing Date, but no earlier than
the Payment Date immediately preceding such date, Holders of Separate Senior
Notes may elect to have their Separate Senior Notes remarketed under the
Remarketing
18
Agreement, by delivering their Separate Senior Notes along with a notice of such
election, substantially in the form of Exhibit F hereto, to the Custodial Agent.
After such time, such election shall become an irrevocable election to have such
Separate Senior Notes remarketed in such Remarketing and, if such Remarketing
fails, in any subsequent Remarketing. The Custodial Agent shall hold Separate
Senior Notes in an account separate from the Collateral Account in which the
Pledged Securities shall be held. Holders of Separate Senior Notes electing to
have their Separate Senior Notes remarketed will also have the right to withdraw
that election by written notice to the Custodial Agent, substantially in the
form of Exhibit G hereto, prior to 5:00 p.m. (New York City time) on the fifth
Business Day immediately preceding the applicable Remarketing Date, upon which
notice the Custodial Agent shall return such Separate Senior Notes to such
Holder.
By 11:00 a.m. (New York City time) on the Business Day immediately
preceding the applicable Remarketing Date, the Custodial Agent shall notify the
Remarketing Agent of the aggregate principal amount of the Separate Senior Notes
to be remarketed and deliver to the Remarketing Agent for remarketing all
Separate Senior Notes delivered to the Custodial Agent pursuant to this Section
5.07(c) and not validly withdrawn prior to such date. In the event of a
Successful Remarketing, after deducting the Remarketing Fee (to the extent
permitted under the terms of the Remarketing Agreement), the Remarketing Agent
will remit to the Custodial Agent the remaining portion of the proceeds of such
Remarketing for payment to the Holders of the remarketed Separate Senior Notes,
in accordance with their respective interests. In the event of a Failed
Remarketing, the Remarketing Agent will promptly return such Separate Senior
Notes to the Custodial Agent, and, in the event of a Failed Final Remarketing,
the Custodial Agent shall deliver such Separate Senior Notes to the appropriate
Holders.
Section 5.08. Special Event Redemption. If the Collateral Agent
receives written notice that a Special Event Redemption has occurred while
Senior Notes are still credited to the Collateral Account, the Collateral Agent
shall cause the Redemption Amount to be deposited in the Collateral Account and
shall instruct the Securities Intermediary to apply the Redemption Amount to
purchase the Treasury Portfolio, and to credit the Applicable Ownership
Interests (as specified in clause (i) of the definition of such term) in the
Treasury Portfolio to the Collateral Account and transfer the Applicable
Ownership Interests (as specified in clause (ii)(y) of the definition of such
term) in the Treasury Portfolio to the Purchase Contract Agent for distribution
to the Holders of the Corporate Units. Upon credit to the Collateral Account of
the Applicable Ownership Interests (as specified in clause (i) of the definition
of such term) in the Treasury Portfolio having a Value equal to the aggregate
principal amount of the Pledged Senior Notes, the Collateral Agent shall cause
the Securities Intermediary to release the Pledged Senior Notes from the
Collateral Account and promptly transfer the Pledged Senior Notes to the
Company.
19
ARTICLE 6
VOTING RIGHTS -- PLEDGED SENIOR NOTES
Section 6.01. Voting Rights. Subject to the terms of Section 4.02 of
the Purchase Contract Agreement, the Purchase Contract Agent may exercise, or
refrain from exercising, any and all voting and other consensual rights
pertaining to the Pledged Senior Notes or any part thereof for any purpose not
inconsistent with the terms of this Agreement and in accordance with the terms
of the Purchase Contract Agreement; provided, that the Purchase Contract Agent
shall not exercise or shall not refrain from exercising such right, as the case
may be, if, in the judgment of the Purchase Contract Agent, such action would
impair or otherwise have a material adverse effect on the value of all or any of
the Pledged Senior Notes; and provided, further, that the Purchase Contract
Agent shall give the Company and the Collateral Agent at least five Business
Days' prior written notice of the manner in which it intends to exercise, or its
reasons for refraining from exercising, any such right. Upon receipt of any
notices and other communications in respect of any Pledged Senior Notes,
including notice of any meeting at which holders of the Senior Notes are
entitled to vote or solicitation of consents, waivers or proxies of holders of
the Senior Notes, the Collateral Agent shall use reasonable efforts to send
promptly to the Purchase Contract Agent such notice or communication, and as
soon as reasonably practicable after receipt of a written request therefor from
the Purchase Contract Agent, execute and deliver to the Purchase Contract Agent
such proxies and other instruments in respect of such Pledged Senior Notes (in
form and substance satisfactory to the Collateral Agent) as are prepared by the
Company and delivered to the Purchase Contract Agent with respect to the Pledged
Senior Notes.
ARTICLE 7
RIGHTS AND REMEDIES
Section 7.01. Rights And Remedies Of The Collateral Agent. (a) In
addition to the rights and remedies specified in Section 5.07 hereof or
otherwise available at law or in equity, after an event of default (as
specified in Section 7.01(b) below) hereunder, the Collateral Agent shall have
all of the rights and remedies with respect to the Collateral of a secured
party under the UCC (whether or not the UCC is in effect in the jurisdiction
where the rights and remedies are asserted) and the TRADES Regulations and such
additional rights and remedies to which a secured party is entitled under the
laws in effect in any jurisdiction where any rights and remedies hereunder may
be asserted. Without limiting the generality of the foregoing, such remedies
may include, to the extent permitted by applicable law, (1) retention of the
Pledged Senior Notes, Pledged Treasury Securities or the applicable Pledged
Applicable Ownership Interests in full satisfaction of the Holders' obligations
under the Purchase Contracts and the Purchase Contract Agreement or (2) sale of
the Pledged Senior Notes, Pledged
20
Treasury Securities or the applicable Pledged Applicable Ownership Interests in
one or more public or private sales.
(b) Without limiting any rights or powers otherwise granted by
this Agreement to the Collateral Agent, in the event the Collateral Agent is
unable to make payments to the Company on account of the applicable Pledged
Applicable Ownership Interests, or on account of principal payments of any
Pledged Treasury Securities as provided in Article 3 hereof, in satisfaction of
the Obligations of the Holder of the Units represented by such applicable
Pledged Applicable Ownership Interests or such Pledged Treasury Securities, as
applicable, under the related Purchase Contracts, the inability to make such
payments shall constitute an event of default hereunder and the Collateral Agent
shall have and may exercise, with reference to such Pledged Treasury Securities
or Pledged Applicable Ownership Interests, as applicable, any and all of the
rights and remedies available to a secured party under the UCC and the TRADES
Regulations after default by a debtor, and as otherwise granted herein or under
any other law.
(c) Without limiting any rights or powers otherwise granted by
this Agreement to the Collateral Agent, the Collateral Agent is hereby
irrevocably authorized to receive and collect all payments of (i) the
principal amount of the Pledged Senior Notes, (ii) the principal amount of the
Pledged Treasury Securities and (iii) the principal amount of the Pledged
Applicable Ownership Interests, subject, in each case, to the provisions of
Article 3 hereof, and as otherwise granted herein.
(d) The Purchase Contract Agent and each Holder of Units agrees
that, from time to time, upon the written request of the Collateral Agent or the
Purchase Contract Agent, such Holder shall execute and deliver such further
documents and do such other acts and things as the Collateral Agent may
reasonably request or as may be necessary or advisable in order to maintain the
Pledge, and the perfection and priority thereof, and to confirm the rights of
the Collateral Agent hereunder. The Purchase Contract Agent shall have no
liability to any Holder for executing any documents or taking any such acts
requested by the Collateral Agent hereunder, except for liability for its own
grossly negligent acts, its own grossly negligent failure to act or its own
willful misconduct.
Section 7.02. Special Event Redemption. Upon the occurrence of a
Special Event Redemption while Senior Notes are still credited to the Collateral
Account, the Collateral Agent is hereby authorized to present the Pledged Senior
Notes for payment as may be required by their respective terms and to direct the
Indenture Trustee to remit the Redemption Price to the Securities Intermediary
for credit to the Collateral Account on or prior to 12:30 p.m., New York City
time on such Special Event Redemption Date, by federal funds check or wire
transfer of immediately available funds. Upon receipt of such funds, the Pledged
Senior Notes shall be released from the Collateral Account. Upon the crediting
of such
21
funds to the Collateral Account, the Collateral Agent, at the written direction
of the Company, shall instruct the Securities Intermediary to (a) apply an
amount equal to the Redemption Amount of such funds to purchase the Treasury
Portfolio from the Quotation Agent, (b) credit to the Collateral Account the
Applicable Ownership Interests specified in clause (i) of the definition of
such term and (c) promptly remit the remaining portion of such funds, if any,
to the Purchase Contract Agent for payment to the Holders of Corporate Units,
in accordance with their respective interests.
Section 7.03. Successful Remarketing. In the event of a Successful
Remarketing prior to the Final Remarketing Date, the Collateral Agent shall, at
the direction of the Company, instruct the Securities Intermediary to (i)
Transfer the Pledged Senior Notes to the Remarketing Agent upon confirmation of
deposit by the Remarketing Agent of the Proceeds of such Successful Remarketing
(after deducting any Remarketing Fee to the extent permitted under the terms of
the Remarketing Agreement) in the Collateral Account, (ii) apply an amount equal
to the Treasury Portfolio Purchase Price to purchase from the Quotation Agent
the Treasury Portfolio, (iii) credit the Applicable Ownership Interests
specified in clause (i) of the definition of such term to the Collateral
Account, and (iv) promptly remit the remaining portion of such Proceeds to the
Purchase Contract Agent for payment to the Holders of Corporate Units, in
accordance with their respective interests. With respect to Separate Senior
Notes, any Proceeds of such Remarketing (after deducting any Remarketing Fee to
the extent permitted under the terms of the Remarketing Agreement) attributable
to the Separate Senior Notes will be remitted to the Custodial Agent for payment
to the holders of Separate Senior Notes. The Pledged Applicable Ownership
Interests thus credited to the Collateral Account will secure the obligation of
all Holders of Corporate Units to purchase Common Stock of the Company under the
Purchase Contracts represented by such Corporate Units, in substitution for the
Pledged Senior Notes, which shall be released from the Collateral Account. In
the event of a Failed Final Remarketing, the Pledged Senior Notes shall remain
credited to the Collateral Account.
Section 7.04. Substitutions. Whenever a Holder has the right to
substitute Treasury Securities, Senior Notes or security entitlements for any of
them or the appropriate Applicable Ownership Interests (as defined in clause (i)
of the definition of such term) in the Treasury Portfolio, as the case may be,
for financial assets held in the Collateral Account, such substitution shall not
constitute a novation of the security interest created hereby.
ARTICLE 8
REPRESENTATIONS AND WARRANTIES; COVENANTS
Section 8.01. Representations And Warranties. Each Holder from time to
time, acting through the Purchase Contract Agent as attorney-in-fact (it being
22
understood that the Purchase Contract Agent shall not be liable for any
representation or warranty made by or on behalf of a Holder), hereby represents
and warrants to the Collateral Agent (with respect to such Holder's interest in
the Collateral), which representations and warranties shall be deemed repeated
on each day a Holder Transfers Collateral, that:
(a) such Holder has the power to grant a security interest in and
lien on the Collateral;
(b) such Holder is the sole beneficial owner of the Collateral
and, in the case of Collateral delivered in physical form, is the sole holder of
such Collateral and is the sole beneficial owner of, or has the right to
Transfer, the Collateral it Transfers to the Collateral Agent for credit to the
Collateral Account, free and clear of any security interest, lien, encumbrance,
call, liability to pay money or other restriction other than the security
interest and lien granted under Article 2 hereof;
(c) upon the Transfer of the Collateral to the Collateral Agent
for credit to the Collateral Account, the Collateral Agent, for the benefit of
the Company, will have a valid and perfected first priority security interest
therein (assuming that any central clearing operation or any securities
intermediary or other entity not within the control of the Holder involved in
the Transfer of the Collateral, including the Collateral Agent and the
Securities Intermediary, gives the notices and takes the action required of it
hereunder and under applicable law for perfection of that interest and assuming
the establishment and exercise of control pursuant to Article 4 hereof); and
(d) the execution and performance by the Holder of its obligations
under this Agreement will not result in the creation of any security interest,
lien or other encumbrance on the Collateral other than the security interest and
lien granted under Article 2 hereof or violate any provision of any existing law
or regulation applicable to it or of any mortgage, charge, pledge, indenture,
contract or undertaking to which it is a party or which is binding on it or any
of its assets.
Section 8.02. Covenants. The Holders from time to time, acting through
the Purchase Contract Agent as their attorney-in-fact (it being understood that
the Purchase Contract Agent shall not be liable for any covenant made by or on
behalf of a Holder), hereby covenant to the Collateral Agent that for so long as
the Collateral remains subject to the Pledge:
(a) neither the Purchase Contract Agent nor such Holders will
create or purport to create or allow to subsist any mortgage, charge, lien,
pledge or any other security interest whatsoever over the Collateral or any part
of it other than pursuant to this Agreement; and
23
(b) neither the Purchase Contract Agent nor such Holders will sell
or otherwise dispose (or attempt to dispose) of the Collateral or any part of it
except for the beneficial interest therein, subject to the Pledge hereunder,
transferred in connection with the Transfer of any Units.
ARTICLE 9
THE COLLATERAL AGENT, THE CUSTODIAL AGENT AND THE SECURITIES INTERMEDIARY
It is hereby agreed as follows:
Section 9.01. Appointment, Powers And Immunities. The Collateral Agent,
the Custodial Agent or Securities Intermediary shall act as agent for the
Company hereunder with such powers as are specifically vested in the Collateral
Agent, the Custodial Agent or Securities Intermediary, as the case may be, by
the terms of this Agreement. The Collateral Agent, the Custodial Agent and
Securities Intermediary shall:
(a) have no duties or responsibilities except those expressly set
forth in this Agreement and no implied covenants or obligations shall be
inferred from this Agreement against the Collateral Agent, the Custodial Agent
and Securities Intermediary, nor shall the Collateral Agent, the Custodial Agent
and Securities Intermediary be bound by the provisions of any agreement by any
party hereto beyond the specific terms hereof;
(b) not be responsible for any recitals contained in this
Agreement, or in any certificate or other document referred to or provided for
in, or received by it under, this Agreement, the Certificates or the Purchase
Contract Agreement, or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement (other than as against the
Collateral Agent, the Custodial Agent or Securities Intermediary, as the case
may be), the Purchase Contracts, the Senior Notes, any Collateral or the
Purchase Contract Agreement or any other document referred to or provided for
herein or therein or for any failure by the Company or any other Person (except
the Collateral Agent, the Custodial Agent or Securities Intermediary, as the
case may be) to perform any of its obligations hereunder or thereunder or for
the perfection, priority or, except as expressly required hereby, maintenance of
any security interest created hereunder;
(c) not be required to initiate or conduct any litigation or
collection proceedings hereunder (except pursuant to directions furnished under
Section 9.02 hereof, subject to Section 9.08 hereof);
(d) not be responsible for any action taken or omitted to be taken
by it hereunder or under any other document or instrument referred to or
provided for
24
herein or in connection herewith or therewith, except for its own gross
negligence or willful misconduct; and
(e) not be required to advise any party as to selling or
retaining, or taking or refraining from taking any action with respect to, any
securities or other property deposited hereunder.
Subject to the foregoing, during the term of this Agreement, the Collateral
Agent, the Custodial Agent and the Securities Intermediary shall take all
reasonable action in connection with the safekeeping and preservation of the
Collateral hereunder as determined by industry standards.
No provision of this Agreement shall require the Collateral Agent,
Custodial Agent or Securities Intermediary to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its duties
hereunder. In no event shall the Collateral Agent, Custodial Agent or Securities
Intermediary be liable for any amount in excess of the Value of the Collateral.
None of the Collateral Agent, the Custodial Agent or the Securities
Intermediary has any obligation or responsibility to file UCC financing
statements.
Section 9.02. Instructions Of The Company. The Company shall have the
right, by one or more written instruments executed and delivered to the
Collateral Agent, to direct the time, method and place of conducting any
proceeding for the realization of any right or remedy available to the
Collateral Agent, or of exercising any power conferred on the Collateral Agent,
or to direct the taking or refraining from taking of any action authorized by
this Agreement; provided, however, that (i) such direction shall not conflict
with the provisions of any law or of this Agreement or involve the Collateral
Agent in personal liability and (ii) the Collateral Agent shall be indemnified
to its satisfaction as provided herein. Nothing contained in this Section 9.02
shall impair the right of the Collateral Agent in its discretion to take any
action or omit to take any action which it deems proper and which is not
inconsistent with such direction.
Section 9.03. Reliance By Collateral Agent And Securities Intermediary.
Each of the Securities Intermediary, the Custodial Agent and the Collateral
Agent shall be entitled to rely conclusively upon any certification, order,
judgment, opinion, notice or other written communication (including, without
limitation, any thereof by e-mail or similar electronic means, telecopy, telex
or facsimile) believed by it to be genuine and correct and to have been signed
or sent by or on behalf of the proper Person or Persons (without being required
to determine the correctness of any fact stated therein) and consult with and
conclusively rely upon advice, opinions and statements of legal counsel and
other experts selected by the Collateral Agent, the Custodial Agent or the
Securities Intermediary, as the case may be. As to any matters not expressly
provided for by this Agreement, the Collateral Agent, the Custodial Agent and
the Securities Intermediary shall in all
25
cases be fully protected in acting, or in refraining from acting, hereunder in
accordance with instructions given by the Company in accordance with this
Agreement.
Section 9.04. Certain Rights. (a) Whenever in the administration of
the provisions of this Agreement the Collateral Agent, the Custodial Agent or
the Securities Intermediary shall deem it necessary or desirable that a matter
be proved or established prior to taking or suffering any action to be taken
hereunder, such matter (unless other evidence in respect thereof be herein
specifically prescribed) may, in the absence of gross negligence or bad faith
on the part of the Collateral Agent, the Custodial Agent or the Securities
Intermediary, be deemed to be conclusively proved and established by a
certificate signed by one of the Company's officers, and delivered to the
Collateral Agent, the Custodial Agent or the Securities Intermediary and such
certificate, in the absence of gross negligence or bad faith on the part of the
Collateral Agent, the Custodial Agent or the Securities Intermediary, shall be
full warrant to the Collateral Agent, the Custodial Agent or the Securities
Intermediary for any action taken, suffered or omitted by it under the
provisions of this Agreement upon the faith thereof.
(b) The Collateral Agent, the Custodial Agent or the Securities
Intermediary shall not be bound to make any investigation into the facts or
matters stated in any resolution, certificate, statement, instrument, opinion,
report, notice, request, consent, entitlement order, approval or other paper or
document.
Section 9.05. Merger, Conversation, Consolidation Or Succession To
Business. Any corporation into which the Collateral Agent, the Custodial Agent
or the Securities Intermediary 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 Collateral Agent, the Custodial Agent or the
Securities Intermediary shall be a party, or any corporation succeeding to the
business of the Collateral Agent, the Custodial Agent or the Securities
Intermediary shall be the successor of the Collateral Agent, the Custodial Agent
or the Securities Intermediary hereunder without the execution or filing of any
paper with any party hereto or any further act on the part of any of the parties
hereto except where an instrument of transfer or assignment is required by law
to effect such succession, anything herein to the contrary notwithstanding.
Section 9.06. Rights In Other Capacities. The Collateral Agent, the
Custodial Agent and the Securities Intermediary and their affiliates may
(without having to account therefor to the Company) accept deposits from, lend
money to, make their investments in and generally engage in any kind of banking,
trust or other business with the Purchase Contract Agent, any other Person
interested herein and any Holder of Units (and any of their respective
subsidiaries or affiliates) as if it were not acting as the Collateral Agent,
the Custodial Agent or the Securities Intermediary, as the case may be, and the
Collateral Agent, the Custodial Agent, the Securities Intermediary and their
affiliates may accept fees
26
and other consideration from the Purchase Contract Agent and any Holder of Units
without having to account for the same to the Company; provided that each of the
Securities Intermediary, the Custodial Agent and the Collateral Agent covenants
and agrees with the Company that it shall not accept, receive or permit there to
be created in favor of itself and shall take no affirmative action to permit
there to be created in favor of any other Person, any security interest, lien or
other encumbrance of any kind in or upon the Collateral other than the lien
created by the Pledge.
Section 9.07. Non-reliance On Collateral Agent, The Custodial Agent And
Securities Intermediary. None of the Securities Intermediary, the Custodial
Agent or the Collateral Agent shall be required to keep itself informed as to
the performance or observance by the Purchase Contract Agent or any Holder of
Units of this Agreement, the Purchase Contract Agreement, the Units or any other
document referred to or provided for herein or therein or to inspect the
properties or books of the Purchase Contract Agent or any Holder of Units. None
of the Collateral Agent, the Custodial Agent or the Securities Intermediary
shall have any duty or responsibility to provide the Company with any credit or
other information concerning the affairs, financial condition or business of the
Purchase Contract Agent or any Holder of Units (or any of their respective
affiliates) that may come into the possession of the Collateral Agent, the
Custodial Agent or the Securities Intermediary or any of their respective
affiliates.
Section 9.08. Compensation And Indemnity. The Company agrees to:
(a) pay the Collateral Agent, the Custodial Agent and the
Securities Intermediary from time to time such compensation as shall be agreed
in writing between the Company and the Collateral Agent, the Custodial Agent or
the Securities Intermediary, as the case may be, for all services rendered by
them hereunder;
(b) indemnify and hold harmless the Collateral Agent, the
Custodial Agent, the Securities Intermediary and each of their respective
directors, officers, agents and employees (collectively, the "INDEMNITEES"),
from and against any and all claims, liabilities, losses, damages, fines,
penalties and expenses (including reasonable fees and expenses of counsel)
(collectively, "Losses" and individually, a "LOSS") that may be imposed on,
incurred by, or asserted against, the Indemnitees or any of them for following
any instructions or other directions upon which either the Collateral Agent, the
Custodial Agent or the Securities Intermediary is entitled to rely pursuant to
the terms of this Agreement, provided that the Collateral Agent, the Custodial
Agent or the Securities Intermediary has not acted with gross negligence or
engaged in willful misconduct or bad faith with respect to the specific Loss
against which indemnification is sought; and
(c) in addition to and not in limitation of paragraph (b)
immediately above, indemnify and hold the Indemnitees and each of them harmless
from and
27
against any and all Losses that may be imposed on, incurred by or asserted
against, the Indemnitees or any of them in connection with or arising out of the
Collateral Agent's, the Custodial Agent's or the Securities Intermediary's
acceptance or performance of its powers and duties under this Agreement,
provided it has not been determined that the Collateral Agent, the Custodial
Agent or the Securities Intermediary acted with gross negligence or engaged in
willful misconduct or bad faith with respect to the specific Loss against which
indemnification is sought.
The provisions of this Section and Section 11.07 shall survive the
resignation or removal of the Collateral Agent, Custodial Agent or Securities
Intermediary and the termination of this Agreement.
Section 9.09. Failure To Act. In the event of any ambiguity in the
provisions of this Agreement or any dispute between or conflicting claims by or
among the parties hereto or any other Person with respect to any funds or
property deposited hereunder, the Securities Intermediary shall comply with all
instructions and entitlement orders of the Collateral Agent and shall not be or
become liable in any way to any of the parties hereto for such compliance. In
the event of any ambiguity in the provisions of this Agreement or any dispute
between or conflicting claims by or among the parties hereto or any other Person
with respect to any funds or property deposited hereunder, then at its sole
option, each of the Collateral Agent and the Custodial Agent shall be entitled,
after prompt notice to the Company and the Purchase Contract Agent, to refuse to
comply with any and all claims, demands or instructions with respect to such
property or funds so long as such dispute or conflict shall continue, and the
Collateral Agent and the Custodial Agent shall not be or become liable in any
way to any of the parties hereto for its failure or refusal to comply with such
conflicting claims, demands or instructions. The Collateral Agent and the
Custodial Agent and shall be entitled to refuse to act until either:
(a) such conflicting or adverse claims or demands shall have been
finally determined by a court of competent jurisdiction or settled by agreement
between the conflicting parties as evidenced in a writing satisfactory to the
Collateral Agent or the Custodial Agent; or
(b) the Collateral Agent or the Custodial Agent shall have
received security or an indemnity satisfactory to it sufficient to save it
harmless from and against any and all loss, liability or reasonable
out-of-pocket expense which it may incur by reason of its acting.
The Collateral Agent, the Custodial Agent and the Securities Intermediary may in
addition elect to commence an interpleader action or seek other judicial relief
or orders as the Collateral Agent, the Custodial Agent or the Securities
Intermediary may deem necessary. Notwithstanding anything contained herein to
the contrary, none of the Collateral Agent, the Custodial Agent or the
Securities Intermediary shall be required to take any action that is in its
opinion contrary to law or to the
28
terms of this Agreement, or which would in its opinion subject it or any of its
officers, employees or directors to liability.
Section 9.10. Resignation Of Collateral Agent, The Custodial Agent And
Securities Intermediary. Subject to the appointment and acceptance of a
successor Collateral Agent, Custodial Agent or Securities Intermediary as
provided below:
(i) the Collateral Agent, the Custodial Agent and the
Securities Intermediary may resign at any time by giving notice thereof
to the Company and the Purchase Contract Agent as attorney-in-fact for
the Holders of Units;
(ii) the Collateral Agent, the Custodial Agent and the
Securities Intermediary may be removed at any time by the Company; and
(iii) if the Collateral Agent, the Custodial Agent or the
Securities Intermediary fails to perform any of its material
obligations hereunder in any material respect for a period of not less
than 20 days after receiving written notice of such failure by the
Purchase Contract Agent and such failure shall be continuing, the
Collateral Agent, the Custodial Agent and the Securities Intermediary
may be removed by the Purchase Contract Agent, acting at the direction
of the Holders of Units.
The Purchase Contract Agent shall promptly notify the Company of any removal of
the Collateral Agent, the Custodial Agent or the Securities Intermediary
pursuant to clause (iii) of this Section 9.10. Upon any such resignation or
removal, the Company shall have the right to appoint a successor Collateral
Agent, Custodial Agent or Securities Intermediary, as the case may be, which
shall not be an Affiliate of the Purchase Contract Agent. If no successor
Collateral Agent, Custodial Agent or Securities Intermediary shall have been so
appointed and shall have accepted such appointment within 30 days after the
retiring Collateral Agent's, Custodial Agent's or Securities Intermediary's
giving of notice of resignation or the Company's or the Purchase Contract
Agent's giving notice of such removal, then the retiring or removed Collateral
Agent, Custodial Agent or Securities Intermediary may petition any court of
competent jurisdiction, at the expense of the Company, for the appointment of a
successor Collateral Agent, Custodial Agent or Securities Intermediary. The
Collateral Agent, the Custodial Agent and the Securities Intermediary shall each
be a bank or a national banking association which has an office (or an agency
office) in New York City with a combined capital and surplus of at least
$50,000,000. Upon the acceptance of any appointment as Collateral Agent,
Custodial Agent or Securities Intermediary hereunder by a successor Collateral
Agent, Custodial Agent or Securities Intermediary, as the case may be, such
successor Collateral Agent, Custodial Agent or Securities Intermediary, as the
case may be, shall thereupon succeed to and become vested with all the rights,
powers, privileges and duties of the retiring
29
Collateral Agent, Custodial Agent or Securities Intermediary, as the case may
be, and the retiring Collateral Agent, Custodial Agent or Securities
Intermediary, as the case may be, shall take all appropriate action, subject to
payment of any amounts then due and payable to it hereunder, to transfer any
money and property held by it hereunder (including the Collateral) to such
successor. The retiring Collateral Agent, Custodial Agent or Securities
Intermediary shall, upon such succession, be discharged from its duties and
obligations as Collateral Agent, Custodial Agent or Securities Intermediary
hereunder. After any retiring Collateral Agent's, Custodial Agent's or
Securities Intermediary's resignation hereunder as Collateral Agent, Custodial
Agent or Securities Intermediary, the provisions of this Article 9 shall
continue in effect for its benefit in respect of any actions taken or omitted to
be taken by it while it was acting as the Collateral Agent, Custodial Agent or
Securities Intermediary. Any resignation or removal of the Collateral Agent,
Custodial Agent or Securities Intermediary hereunder, at a time when such Person
is acting as the Collateral Agent, Custodial Agent or Securities Intermediary,
shall be deemed for all purposes of this Agreement as the simultaneous
resignation or removal of the Collateral Agent, Securities Intermediary or
Custodial Agent, as the case may be.
Section 9.11. Right To Appoint Agent Or Advisor. The Collateral Agent
shall have the right to appoint agents or advisors in connection with any of its
duties hereunder, and the Collateral Agent shall not be liable for any action
taken or omitted by, or in reliance upon the advice of, such agents or advisors
selected in good faith. The appointment of agents pursuant to this Section 9.11
shall be subject to prior written consent of the Company, which consent shall
not be unreasonably withheld.
Section 9.12. Survival. The provisions of this Article 9 shall survive
termination of this Agreement and the resignation or removal of the Collateral
Agent, the Custodial Agent or the Securities Intermediary.
Section 9.13. Exculpation. Anything contained in this Agreement to the
contrary notwithstanding, in no event shall the Collateral Agent, the Custodial
Agent or the Securities Intermediary or their officers, directors, employees or
agents be liable under this Agreement to any third party for indirect, special,
punitive, or consequential loss or damage of any kind whatsoever, including, but
not limited to, lost profits, whether or not the likelihood of such loss or
damage was known to the Collateral Agent, the Custodial Agent or the Securities
Intermediary, or any of them and regardless of the form of action.
ARTICLE 10
AMENDMENT
Section 10.01. Amendment Without Consent Of Holders. Without the
consent of any Holders, the Company, when authorized by a Board Resolution,
30
the Collateral Agent, the Custodial Agent, the Securities Intermediary and the
Purchase Contract Agent, at any time and from time to time, may amend this
Agreement, in form satisfactory to the Company, the Collateral Agent, the
Custodial Agent, the Securities Intermediary and the Purchase Contract Agent,
to:
(a) evidence the succession of another Person to the Company and
the assumption by any such successor of the covenants of the Company;
(b) evidence and provide for the acceptance of appointment
hereunder by a successor Collateral Agent, Custodial Agent, Securities
Intermediary or Purchase Contract Agent;
(c) add to the covenants of the Company for the benefit of the
Holders, or surrender any right or power herein conferred upon the Company,
provided that such covenants or such surrender do not adversely affect the
validity, perfection or priority of the Pledge created hereunder; or
(d) cure any ambiguity (or formal defect), correct or supplement
any provisions herein which may be inconsistent with any other such provisions
herein, or make any other provisions with respect to such matters or questions
arising under this Agreement, provided that such action shall not adversely
affect the interests of the Holders in any material respect.
Section 10.02. Amendment With Consent Of Holders. With the consent of
the Holders of not less than a majority of the Purchase Contracts at the time
outstanding, including without limitation the consent of the Holders obtained in
connection with a tender or an exchange offer, by Act of such Holders delivered
to the Company, the Purchase Contract Agent, the Custodial Agent, the Securities
Intermediary and the Collateral Agent, as the case may be, the Company, when
duly authorized by a Board Resolution, the Purchase Contract Agent, the
Collateral Agent, the Securities Intermediary and the Collateral Agent may amend
this Agreement for the purpose of modifying in any manner the provisions of this
Agreement or the rights of the Holders in respect of the Units; provided,
however, that no such supplemental agreement shall, without the unanimous
consent of the Holders of each Outstanding Unit adversely affected thereby in
any material respect:
(a) change the amount or type of Collateral represented by a Unit
(except for the rights of holders of Corporate Units to substitute the Treasury
Securities for the Pledged Senior Notes or the Pledged Applicable Ownership
Interests, as the case may be, or the rights of Holders of Treasury Units to
substitute Senior Notes or the Applicable Ownership Interests (as specified in
clause (i) of the definition of such term) in the Treasury Portfolio, as
applicable, for the Pledged Treasury Securities), impair the right of the Holder
of any Unit to receive distributions on the Collateral represented thereby or
otherwise adversely affect the Holder's rights in or to such Collateral; or
31
(b) otherwise effect any action that would require the consent of
the Holder of each Outstanding Unit affected thereby pursuant to the Purchase
Contract Agreement if such action were effected by a modification or amendment
of the provisions of the Purchase Contract Agreement; or
(c) reduce the percentage of Purchase Contracts the consent of
whose Holders is required for the modification or amendment of the provisions of
this Agreement;
provided that if any amendment or proposal referred to above would adversely
affect only the Corporate Units or only the Treasury Units, then only the
affected class of Holders as of the record date for the Holders entitled to vote
thereon will be entitled to vote on such amendment or proposal, and such
amendment or proposal shall not be effective except with the consent of Holders
of not less than a majority of such class; provided, further, that the unanimous
consent of the Holders of each outstanding Purchase Contract of such class
affected thereby shall be required to approve any amendment or proposal
specified in clauses (a) through (c) above.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed amendment, but it shall be
sufficient if such Act shall approve the substance thereof.
Section 10.03. Execution Of Amendments. In executing any amendment
permitted by this Article, the Collateral Agent, the Custodial Agent, the
Securities Intermediary and the Purchase Contract Agent shall be entitled to
receive and (subject to Section 7.01 of the Purchase Contract Agreement with
respect to the Purchase Contract Agent) shall be fully authorized and protected
in relying upon, an Opinion of Counsel stating that the execution of such
amendment is authorized or permitted by this Agreement and that all conditions
precedent, if any, to the execution and delivery of such amendment have been
satisfied. The Collateral Agent, Custodial Agent, Securities Intermediary and
Purchase Contract Agent may, but shall not be obligated to, enter into any such
amendment which affects their own respective rights, duties or immunities under
this Agreement or otherwise.
Section 10.04. Effect Of Amendments. Upon the execution of any
amendment under this Article, this Agreement shall be modified in accordance
therewith, and such amendment shall form a part of this Agreement for all
purposes; and every Holder of Certificates theretofore or thereafter
authenticated, executed on behalf of the Holders and delivered under the
Purchase Contract Agreement shall be bound thereby.
Section 10.05. Reference Of Amendments. Certificates authenticated,
executed on behalf of the Holders and delivered after the execution of any
amendment pursuant to this Section may, and shall if required by the Collateral
32
Agent or the Purchase Contract Agent, bear a notation in form approved by the
Purchase Contract Agent and the Collateral Agent as to any matter provided for
in such amendment. If the Company shall so determine, new Certificates so
modified as to conform, in the opinion of the Collateral Agent, the Purchase
Contract Agent and the Company, to any such amendment may be prepared and
executed by the Company and authenticated, executed on behalf of the Holders and
delivered by the Purchase Contract Agent in accordance with the Purchase
Contract Agreement in exchange for Certificates representing Outstanding Units.
ARTICLE 11
MISCELLANEOUS
Section 11.01. No Waiver. No failure on the part of the Company, the
Collateral Agent, the Custodial Agent, the Securities Intermediary or any of
their respective agents to exercise, and no course of dealing with respect to,
and no delay in exercising, any right, power or remedy hereunder shall operate
as a waiver thereof; nor shall any single or partial exercise by the Company,
the Collateral Agent, the Custodial Agent, the Securities Intermediary or any of
their respective agents of any right, power or remedy hereunder preclude any
other or further exercise thereof or the exercise of any other right, power or
remedy. The remedies herein are cumulative and are not exclusive of any remedies
provided by law.
Section 11.02. Governing Law; Submission To Jurisdiction. THIS
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK. The Company, the Collateral Agent, the Custodial Agent,
the Securities Intermediary and the Holders from time to time of the Units,
acting through the Purchase Contract Agent as their attorney-in-fact, hereby
submit to the nonexclusive jurisdiction of the United States District Court for
the Southern District of New York and of any New York state court sitting in New
York City for the purposes of all legal proceedings arising out of or relating
to this Agreement or the transactions contemplated hereby. The Company, the
Collateral Agent, the Custodial Agent, the Securities Intermediary and the
Holders from time to time of the Units, acting through the Purchase Contract
Agent as their attorney-in-fact, irrevocably waive, to the fullest extent
permitted by applicable law, any objection which they may now or hereafter have
to the laying of the venue of any such proceeding brought in such a court and
any claim that any such proceeding brought in such a court has been brought in
an inconvenient forum.
Section 11.03. Notices. All notices, requests, consents and other
communications provided for herein (including, without limitation, any
modifications of, or waivers or consents under, this Agreement) shall be given
or made in writing (including, without limitation, by telecopy) delivered to the
intended recipient at the "ADDRESS FOR NOTICES" specified below its name on the
33
signature pages hereof or, as to any party, at such other address as shall be
designated by such party in a notice to the other parties. Except as otherwise
provided in this Agreement, all such communications shall be deemed to have been
duly given when transmitted by telecopier or personally delivered or, in the
case of a mailed notice, upon receipt, in each case given or addressed as
aforesaid.
Section 11.04. Successors And Assigns. This Agreement shall be binding
upon and inure to the benefit of the respective successors and assigns of the
Company, the Collateral Agent, the Custodial Agent, the Securities Intermediary
and the Purchase Contract Agent, and the Holders from time to time of the Units,
by their acceptance of the same, shall be deemed to have agreed to be bound by
the provisions hereof and to have ratified the agreements of, and the grant of
the Pledge hereunder by, the Purchase Contract Agent.
Section 11.05. Counterparts. This Agreement may be executed in any
number of counterparts, all of which taken together shall constitute one and the
same instrument, and any of the parties hereto may execute this Agreement by
signing any such counterpart.
Section 11.06. Severability. If any provision hereof is invalid and
unenforceable in any jurisdiction, then, to the fullest extent permitted by law,
(i) the other provisions hereof shall remain in full force and effect in such
jurisdiction and shall be liberally construed in order to carry out the
intentions of the parties hereto as nearly as may be possible and (ii) the
invalidity or unenforceability of any provision hereof in any jurisdiction shall
not affect the validity or enforceability of such provision in any other
jurisdiction.
Section 11.07. Expenses, Etc.. The Company agrees to reimburse the
Collateral Agent, the Custodial Agent and the Securities Intermediary for:
(a) all reasonable costs and expenses of the Collateral Agent, the
Custodial Agent and the Securities Intermediary (including, without limitation,
the reasonable fees and expenses of counsel to the Collateral Agent, the
Custodial Agent and the Securities Intermediary), in connection with (i) the
negotiation, preparation, execution and delivery or performance of this
Agreement and (ii) defined. any modification, supplement or waiver of any of
the terms of this Agreement;
(b) all reasonable costs and expenses of the Collateral Agent, the
Custodial Agent and the Securities Intermediary (including, without limitation,
reasonable fees and expenses of counsel) in connection with (i). any
enforcement or proceedings resulting or incurred in connection with causing any
Holder of Units to satisfy its obligations under the Purchase Contracts
represented by the Units and (ii). the enforcement of this Section 11.07;
(c) all transfer, stamp, documentary or other similar taxes,
assessments or charges levied by any governmental or revenue authority in
respect of this
34
Agreement or any other document referred to herein and all costs, expenses,
taxes, assessments and other charges incurred in connection with any filing,
registration, recording or perfection of any security interest contemplated
hereby;
(d) all reasonable fees and expenses of any agent or advisor
appointed by the Collateral Agent and consented to by the Company under Section
9.11 of this Agreement; and
(e) any other out-of-pocket costs and expenses reasonably incurred
by the Collateral Agent, the Custodial Agent and the Securities Intermediary in
connection with the performance of their duties hereunder.
Section 11.08. Security Interest Absolute. All rights of the Collateral
Agent and security interests hereunder, and all obligations of the Holders from
time to time hereunder, shall be absolute and unconditional irrespective of:
(a) any lack of validity or enforceability of any provision of the
Purchase Contracts or the Units or any other agreement or instrument relating
thereto;
(b) any change in the time, manner or place of payment of, or any
other term of, or any increase in the amount of, all or any of the obligations
of Holders of the Units under the related Purchase Contracts, or any other
amendment or waiver of any term of, or any consent to any departure from any
requirement of, the Purchase Contract Agreement or any Purchase Contract or any
other agreement or instrument relating thereto; or
(c) any other circumstance which might otherwise constitute a
defense available to, or discharge of, a borrower, a guarantor or a pledgor.
Section 11.09. Notice Of Special Event, Special Event Redemption And
Termination Event. Upon the occurrence of a Special Event, a Special Event
Redemption or a Termination Event, the Company shall deliver written notice to
the Purchase Contract Agent, the Collateral Agent and the Securities
Intermediary. Upon the written request of the Collateral Agent or the Securities
Intermediary, the Company shall inform such party whether or not a Special
Event, a Special Event Redemption or a Termination Event has occurred.
[SIGNATURES ON THE FOLLOWING PAGE]
35
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
THE CHUBB CORPORATION BANK ONE TRUST COMPANY
N.A., as Purchase Contract Agent
and as attorney-in-fact of the Holders
from time to time of the Units
By: /s/ JOHN D. FINNEGAN By: /s/ SANDRA WHALEN
-------------------------------- -------------------
Name: John D. Finnegan Name: Sandra Whalen
Title: Chief Executive Officer Title: Vice President
Address for Notices: Address for Notices:
The Chubb Corporation Bank One Trust Company, N.A.
15 Mountain View Road 153 West 51st Street
Warren, New Jersey 07061-1615 New York, New York 10019
Attention: General Counsel Attn: Sandra Becker-Whalen
Fax: 908-903-3607 Fax: 212-373-1383
BNY MIDWEST TRUST COMPANY,
as Collateral Agent, Custodial Agent and
Securities Intermediary
By: /s/ LINDA GARCIA
----------------------------------------
Name: Linda Garcia
Title: Assistant Treasurer
Address for Notices:
BNY Midwest Trust Company
2 North LaSalle Street, Suite 1020
Chicago, Illinois 60602
Attention: Corporate Finance
Fax: (312) 827-8542
EXHIBIT A
INSTRUCTION
FROM PURCHASE CONTRACT AGENT
TO COLLATERAL AGENT
(Creation of Treasury Units)
BNY Midwest Trust Company
The Collateral Agent
2 North LaSalle Street, Suite 1020
Chicago, Illinois 60602
Attention: Corporate Finance
Fax: (312) 827-8542
Re: _________ Corporate Units of The Chubb Corporation (the
"COMPANY")
The securities account of BNY Midwest Trust Company, as
Collateral Agent, maintained by the Securities Intermediary
and designated "Bank One Trust Company, N.A., as Collateral
Agent of The Chubb Corporation, as pledgee of BNY Midwest
Trust Company, as the Purchase Contract Agent on behalf of and
as attorney-in-fact for the Holders" (the "COLLATERAL
ACCOUNT")
Please refer to the Pledge Agreement, dated as of June 24, 2003 (the
"PLEDGE AGREEMENT"), among the Company, you, as Collateral Agent, as Securities
Intermediary and as Custodial Agent and the undersigned, as Purchase Contract
Agent and as attorney-in-fact for the holders of Corporate Units from time to
time. Capitalized terms used herein but not defined shall have the meaning set
forth in the Pledge Agreement.
We hereby notify you in accordance with Section 5.02 of the Pledge
Agreement that the holder of securities named below (the "HOLDER") has elected
to substitute $__________ Value of Treasury Securities maturing on [July/August]
15, 2006 or security entitlements with respect thereto in exchange for an equal
Value of Pledged Senior Notes relating to _________ Corporate Units and has
delivered to the undersigned a notice stating that the Holder has Transferred
such Treasury Securities or security entitlements with respect thereto to the
Securities Intermediary, for credit to the Collateral Account.
We hereby request that you instruct the Securities Intermediary, upon
confirmation that such Treasury Securities or security entitlements thereto have
been credited to the Collateral Account, to release to the undersigned an equal
Value of Pledged Senior Notes in accordance with Section 5.02 of the Pledge
Agreement.
BANK ONE TRUST COMPANY,
N.A.,
Date: as Purchase Contract Agent and as
attorney-in-fact of the Holders from
time to time of the Units
By: ______________________________________
Name:
Title:
Please print name and address of Holder electing to substitute Treasury
Securities or security entitlements with respect thereto for the Pledged Senior
Notes:
____________________________________ ____________________________________
Name Social Security or other Taxpayer
Identification Number, if any
____________________________________
Address
____________________________________
____________________________________
EXHIBIT B
INSTRUCTION
FROM COLLATERAL AGENT
TO SECURITIES INTERMEDIARY
(Creation of Treasury Units)
BNY Midwest Trust Company
Securities Intermediary
2 North LaSalle Street, Suite 1020
Chicago, Illinois 60602
Attention: Corporate Finance
Fax: (312) 827-8542
Re: __________ Corporate Units of The Chubb Corporation (the
"COMPANY")
The securities account of BNY Midwest Trust Company, as
Collateral Agent, maintained by the Securities Intermediary
and designated BNY Midwest Trust Company, as Collateral Agent
of The Chubb Corporation, as pledgee of Bank One Trust
Company, N.A., as the Purchase Contract Agent on behalf of and
as attorney-in-fact for the Holders (the "COLLATERAL ACCOUNT")
Please refer to the Pledge Agreement, dated as of June 24, 2003 (the
"PLEDGE AGREEMENT"), among the Company, you, as Securities Intermediary, Bank
One Trust Company, N.A., as Purchase Contract Agent and as attorney-in-fact for
the holders of Corporate Units from time to time, and the undersigned, as
Collateral Agent. Capitalized terms used herein but not defined shall have the
meanings set forth in the Pledge Agreement.
When you have confirmed that $__________ Value of Treasury Securities
maturing on [July/August] 15, 2006 or security entitlements thereto has been
credited to the Collateral Account by or for the benefit of _________, as Holder
of Corporate Units (the "HOLDER"), you are hereby instructed to release from the
Collateral Account an equal Value of Pledged Senior Notes or security
entitlements with respect thereto relating to _____ Corporate Units of the
Holder by Transfer to the Purchase Contract Agent.
BNY MIDWEST TRUST
COMPANY,
as Collateral Agent
Dated:_______________
By: ________________________
Name:
Title:
Please print name and address of Holder:
____________________________________ ____________________________________
Name Social Security or other Taxpayer
Identification Number, if any
____________________________________
Address
____________________________________
____________________________________
EXHIBIT C
INSTRUCTION
FROM PURCHASE CONTRACT AGENT
TO COLLATERAL AGENT
(Recreation of Corporate Units )
BNY Midwest Trust Company
The Collateral Agent
2 North LaSalle Street, Suite 1020
Chicago, Illinois 60602
Attention: Corporate Finance
Fax: (312) 827-8542
Re: ____________ Treasury Units of The Chubb Corporation (the "COMPANY")
Please refer to the Pledge Agreement dated as of June 24, 2003 (the
"PLEDGE AGREEMENT"), among the Company, you, as Collateral Agent, as Securities
Intermediary, as Custodial Agent and the undersigned, as Purchase Contract Agent
and as attorney-in-fact for the holders of Treasury Units from time to time.
Capitalized terms used herein but not defined shall have the meaning set forth
in the Pledge Agreement.
We hereby notify you in accordance with Section 5.03(a) of the Pledge
Agreement that the holder of securities named below (the "HOLDER") has elected
to substitute $__________ Value of Senior Notes or security entitlements with
respect thereto in exchange for $__________ Value of Pledged Treasury
Securities maturing on [July/August] 15, 2006 and has delivered to the
undersigned a notice stating that the holder has Transferred such Senior Notes
or security entitlements with respect thereto to the Securities Intermediary,
for credit to the Collateral Account.
We hereby request that you instruct the Securities Intermediary, upon
confirmation that such Senior Notes or security entitlements with respect
thereto have been credited to the Collateral Account, to release to the
undersigned $__________ Value of Treasury Securities maturing on [July/August]
15, 2006 or security entitlements with respect thereto related to _____ Treasury
Units of such Holder in accordance with Section 5.03(a) of the Pledge Agreement.
BANK ONE TRUST COMPANY,
N.A.
as Purchase Contract Agent
Dated:_______________ By: ________________________
Name:
Title:
Please print name and address of Holder electing to substitute Senior Notes or
security entitlements with respect thereto for Pledged Treasury Securities:
____________________________________ ____________________________________
Name Social Security or other Taxpayer
Identification Number, if any
____________________________________
Address
____________________________________
____________________________________
EXHIBIT D
INSTRUCTION
FROM COLLATERAL AGENT
TO SECURITIES INTERMEDIARY
(Recreation of Corporate Units)
BNY Midwest Trust Company
The Securities Intermediary
2 North LaSalle Street, Suite 1020
Chicago, Illinois 60602
Attention: Corporate Finance
Fax: (312) 827-8542
Re: ___________ Treasury Units of The Chubb Corporation (the "COMPANY")
The securities account of BNY Midwest Trust Company, as Collateral
Agent, maintained by the Securities Intermediary and designated BNY
Midwest Trust Company, as Collateral Agent of The Chubb Corporation, as
pledgee of Bank One Trust Company, N.A., as the Purchase Contract Agent
on behalf of and as attorney-in-fact for the Holders" (the "COLLATERAL
ACCOUNT")
Please refer to the Pledge Agreement dated as of June 24, 2003 (the
"PLEDGE AGREEMENT"), among the Company, you, as Securities Intermediary,
Custodial Agent and Collateral Agent and Bank One Trust Company, N.A., as
Purchase Contract Agent and as attorney-in-fact for the holders of Corporate
Units from time to time, and the undersigned, as Collateral Agent. Capitalized
terms used herein but no defined shall have the meaning set forth in the Pledge
Agreement.
When you have confirmed that $ __________ Value of Senior Notes or
security entitlements with respect thereto has been credited to the Collateral
Account by or for the benefit of ________________, as Holder of Treasury Units
(the "HOLDER"), you are hereby instructed to release from the Collateral Account
$ __________ Value of Treasury Securities maturing on [July/August] 15, 2006 or
security entitlements thereto by Transfer to the Purchase Contract Agent.
BNY MIDWEST TRUST
COMPANY,
as Collateral Agent
Dated:_______________ By: ________________________
Name:
Title:
____________________________________ ____________________________________
Name Social Security or other Taxpayer
Identification Number, if any
____________________________________
Address
____________________________________
____________________________________
EXHIBIT E
NOTICE OF CASH SETTLEMENT FROM COLLATERAL
AGENT TO PURCHASE CONTRACT AGENT
(Cash Settlement Amounts)
Bank One Trust Company, N.A.
The Purchase Contract Agent
153 West 51st Street
New York, New York 10019
Fax: (212) 373-1383
Attention: Corporate Trust Administration
Re: __________ Corporate Units of The Chubb Corporation
(the "COMPANY")
__________ Treasury Units of the Company
Please refer to the Pledge Agreement dated as of June 24, 2003 (the
"PLEDGE AGREEMENT"), by and among you, the Company, and BNY Midwest Trust
Company, as Collateral Agent, Custodial Agent and Securities Intermediary.
Unless otherwise defined herein, terms defined in the Pledge Agreement are used
herein as defined therein.
In accordance with Section 5.05(d) of the Pledge Agreement, we hereby
notify you that as of 11:00 a.m. (New York City time) on the fourth Business Day
immediately preceding August 16, 2006 (the "PURCHASE CONTRACT SETTLEMENT DATE"),
we have received (i) $ _______________ in immediately available funds paid in an
aggregate amount equal to the Settlement Price due to the Company on the
Purchase Contract Settlement Date with respect to ________________ Corporate
Units, (ii) $ ___________ in immediately available funds paid in an aggregate
amount equal to the Settlement Price due to the Company on the Purchase Contract
Settlement Date with respect to ______ Treasury Units and (iii) based on the
funds received set forth in clause (i) above, an aggregate principal amount of
$_________ of Pledged Senior Notes are to be tendered for purchase in the Final
Remarketing.
BNY MIDWEST TRUST
COMPANY,
as Collateral Agent
Dated:_______________ By: ________________________
Name:
Title:
EXHIBIT F
INSTRUCTION TO CUSTODIAL AGENT REGARDING
REMARKETING
BNY Midwest Trust Company
The Custodial Agent
2 North LaSalle Street, Suite 1020
Chicago, Illinois 60602
Attention: Corporate Finance
Fax: (312) 827-8542
Re: Senior Notes Due August 16, 2008 of The Chubb Corporation (the
"COMPANY")
The undersigned hereby notifies you in accordance with Section 5.07(c)
of the Pledge Agreement, dated as of June 24, 2003 (the "PLEDGE AGREEMENT"),
among the Company, you, as Collateral Agent, Custodial Agent and Securities
Intermediary and Bank One Trust Company, N.A., as the Purchase Contract Agent
and as attorney-in-fact for the holders of Corporate Units from time to time,
that the undersigned elects to deliver $______________ aggregate principal
amount of Separate Senior Notes for delivery to the Remarketing Agent prior to
5:00 p.m. (New York City time) on the fifth Business Day immediately preceding
the _______ Remarketing Date for remarketing pursuant to Section 5.07(c) of the
Pledge Agreement. The undersigned will, upon request of the Remarketing Agent,
execute and deliver any additional documents deemed by the Remarketing Agent or
by the Company to be necessary or desirable to complete the sale, assignment and
transfer of the Separate Senior Notes tendered hereby. Capitalized terms used
herein but not defined shall have the meaning set forth in the Pledge Agreement.
The undersigned hereby instructs you, upon receipt of the Proceeds of
such remarketing from the Remarketing Agent, to deliver such Proceeds to the
undersigned in accordance with the instructions indicated herein under "A.
Payment Instructions." The undersigned hereby instructs you, in the event of a
Failed Final Remarketing, upon receipt of the Separate Senior Notes tendered
herewith from the Remarketing Agent, to deliver such Separate Senior Notes to
the person(s) and the address(es) indicated herein under "B. Delivery
Instructions."
With this notice, the undersigned hereby (i) represents and warrants
that the undersigned has full power and authority to tender, sell, assign and
transfer the Separate Senior Notes tendered hereby and that the undersigned is
the record owner of any Senior Notes tendered herewith in physical form or a
participant in The Depository Trust Company ("DTC") and the beneficial owner of
any Senior Notes tendered herewith by book-entry transfer to your account at
DTC, (ii)
agrees to be bound by the terms and conditions of Section 5.07(c) of the Pledge
Agreement and (iii) acknowledges and agrees that after 5:00 p.m. (New York City
time) on the fifth Business Day immediately preceding the ________ Remarketing
Date, such election shall become an irrevocable election to have such Separate
Senior Notes remarketed in the Remarketing and, in the case of a Failed
Remarketing, in any subsequent Remarketing, and that the Separate Senior Notes
tendered herewith will only be returned in the event of a Failed Final
Remarketing.
Date:_______________
____________________________________
By: ______________________________
Name:
Title:
Signature Guarantee:__________
____________________________________ ____________________________________
Name Social Security or other Taxpayer
Identification Number, if any
____________________________________
Address
____________________________________
____________________________________
A. PAYMENT INSTRUCTIONS
Proceeds of the remarketing should be paid by check in the name of the person(s)
set forth below and mailed to the address set forth below.
Name(s)
(Please Print)
Address
(Please Print)
(Zip Code)
(Tax Identification or Social Security Number)
B. DELIVERY INSTRUCTIONS
In the event of a failed final remarketing, Senior Notes which are in physical
form should be delivered to the person(s) set forth below and mailed to the
address set forth below.
Name(s)
(Please Print)
Address
(Please Print)
(Zip Code)
(Tax Identification or Social Security Number)
In the event of a failed final remarketing, Senior Notes which are in book-entry
form should be credited to the account at The Depository Trust Company set forth
below.
__________________
DTC Account Number
Name of Account Party:_________________________________
EXHIBIT G
INSTRUCTION TO CUSTODIAL AGENT REGARDING
WITHDRAWAL FROM REMARKETING
BNY Midwest Trust Company
The Custodial Agent
2 North LaSalle Street, Suite 1020
Chicago, Illinois 60602
Attention: Corporate Finance
Fax: (312) 827-8542
Re: Senior Notes due August 16, 2008 of The Chubb Corporation
(the "COMPANY")
The undersigned hereby notifies you in accordance with Section 5.07(c)
of the Pledge Agreement, dated as of June 24, 2003 (the "PLEDGE AGREEMENT"),
among the Company and you, as Collateral Agent, Custodial Agent and Securities
Intermediary, and Bank One Trust Company, N.A., as Purchase Contract Agent and
as attorney-in-fact for the holders of Corporate Units from time to time, that
the undersigned elects to withdraw the $_________ aggregate principal amount of
Separate Senior Notes delivered to the Collateral Agent on _________, 200_ for
remarketing pursuant to Section 5.07(c) of the Pledge Agreement. The undersigned
hereby instructs you to return such Senior Notes to the undersigned in
accordance with the undersigned's instructions. With this notice, the
Undersigned hereby agrees to be bound by the terms and conditions of Section
5.07(c) of the Pledge Agreement. Capitalized terms used herein but not defined
shall have the meaning set forth in the Pledge Agreement.
Date:_______________ ____________________________________
By: ________________________________
Name:
Title:
Signature Guarantee:____________
____________________________________ ____________________________________
Name Social Security or other Taxpayer
Identification Number, if any
____________________________________
Address
____________________________________
____________________________________