EXHIBIT 4-232
DTE ENERGY COMPANY
AND
THE BANK OF NEW YORK,
AS PURCHASE CONTRACT AGENT
PURCHASE CONTRACT AGREEMENT
Dated as of June 25, 2002
TABLE OF CONTENTS
PAGE
ARTICLE I.
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.1 Definitions............................................................................1
SECTION 1.2 Compliance Certificates And Opinions..................................................13
SECTION 1.3 Form Of Documents Delivered To Agent..................................................13
SECTION 1.4 Acts Of Holders; Record Dates.........................................................14
SECTION 1.5 Notices...............................................................................15
SECTION 1.6 Notice To Holders; Waiver.............................................................16
SECTION 1.7 Effect Of Headings And Table Of Contents..............................................17
SECTION 1.8 Successors And Assigns................................................................17
SECTION 1.9 Separability Clause...................................................................17
SECTION 1.10 Benefits Of Agreement.................................................................17
SECTION 1.11 Governing Law.........................................................................17
SECTION 1.12 Legal Holidays........................................................................17
SECTION 1.13 Counterparts..........................................................................18
SECTION 1.14 Inspection Of Agreement...............................................................18
ARTICLE II.
CERTIFICATE FORMS
SECTION 2.1 Forms Of Certificates Generally.......................................................18
SECTION 2.2 Form Of Agent's Certificate Of Authentication.........................................19
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ARTICLE III.
THE EQUITY SECURITY UNITS AND STRIPPED EQUITY SECURITY UNITS
SECTION 3.1 Title And Terms; Denominations........................................................19
SECTION 3.2 Rights And Obligations Evidenced By The Certificates..................................20
SECTION 3.3 Execution, Authentication, Delivery And Dating........................................21
SECTION 3.4 Temporary Certificates................................................................21
SECTION 3.5 Registration; Registration Of Transfer And Exchange...................................22
SECTION 3.6 Book-Entry Interests..................................................................23
SECTION 3.7 Notices To Holders....................................................................24
SECTION 3.8 Appointment Of Successor Clearing Agency..............................................24
SECTION 3.9 Definitive Certificates...............................................................24
SECTION 3.10 Mutilated, Destroyed, Lost And Stolen Certificates....................................25
SECTION 3.11 Persons Deemed Owners.................................................................26
SECTION 3.12 Cancellation..........................................................................27
SECTION 3.13 Establishment Of Stripped Equity Security Units.......................................27
SECTION 3.14 Reestablishment Of Equity Security Units..............................................29
SECTION 3.15 Transfer Of Collateral Upon Occurrence Of Termination Event...........................30
SECTION 3.16 No Consent To Assumption..............................................................31
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ARTICLE IV.
THE NOTES
SECTION 4.1 Payment Of Interest; Rights To Interest Payments Preserved; Notice....................31
SECTION 4.2 Notice And Voting.....................................................................32
SECTION 4.3 Tax Event Redemption..................................................................32
ARTICLE V.
THE PURCHASE CONTRACTS; THE REMARKETING
SECTION 5.1 Purchase Of Shares Of Common Stock....................................................33
SECTION 5.2 Contract Adjustment Payments..........................................................35
SECTION 5.3 Deferral Of Contract Adjustment Payments..............................................36
SECTION 5.4 Payment Of Purchase Price; Remarketing................................................38
SECTION 5.5 Issuance Of Shares Of Common Stock....................................................42
SECTION 5.6 Adjustment Of Settlement Rate.........................................................43
SECTION 5.7 Notice Of Adjustments And Certain Other Events........................................49
SECTION 5.8 Termination Event; Notice.............................................................50
SECTION 5.9 Early Settlement......................................................................50
SECTION 5.10 Early Settlement Upon Merger..........................................................52
SECTION 5.11 Charges And Taxes.....................................................................54
SECTION 5.12 No Fractional Shares..................................................................54
SECTION 5.13 Registration Statement and Prospectus.................................................55
ARTICLE VI.
REMEDIES
SECTION 6.1 Unconditional Right Of Holders To Purchase Common Stock...............................55
SECTION 6.2 Restoration Of Rights And Remedies....................................................56
SECTION 6.3 Rights And Remedies Cumulative........................................................56
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SECTION 6.4 Delay or Omission Not Waiver..........................................................56
SECTION 6.5 Undertaking For Costs.................................................................56
SECTION 6.6 Waiver Of Stay Or Extension Laws......................................................56
ARTICLE VII.
THE AGENT
SECTION 7.1 Certain Duties, Rights And Immunities.................................................57
SECTION 7.2 Notice Of Default.....................................................................59
SECTION 7.3 Certain Rights Of Agent...............................................................59
SECTION 7.4 Not Responsible For Recitals, Etc.....................................................60
SECTION 7.5 May Hold Equity Security Units and Stripped Equity Security Units And Other
Dealings..............................................................................60
SECTION 7.6 Money Held In Custody.................................................................60
SECTION 7.7 Compensation And Reimbursement........................................................60
SECTION 7.8 Corporate Agent Required; Eligibility.................................................61
SECTION 7.9 Resignation And Removal; Appointment Of Successor.....................................61
SECTION 7.10 Acceptance Of Appointment By Successor................................................62
SECTION 7.11 Merger, Conversion, Consolidation Or Succession To Business...........................63
SECTION 7.12 Preservation Of Information; Communications To Holders................................63
SECTION 7.13 Failure to Act........................................................................64
SECTION 7.14 No Obligations Of Agent...............................................................64
SECTION 7.15 Tax Compliance........................................................................64
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ARTICLE VIII.
SUPPLEMENTAL AGREEMENTS
SECTION 8.1 Supplemental Agreements Without Consent Of Holders....................................65
SECTION 8.2 Supplemental Agreements With Consent Of Holders.......................................65
SECTION 8.3 Execution Of Supplemental Agreements..................................................66
SECTION 8.4 Effect Of Supplemental Agreements.....................................................67
SECTION 8.5 Reference To Supplemental Agreements..................................................67
ARTICLE IX.
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
SECTION 9.1 Covenant Not To Merge, Consolidate, Sell Or Convey Property Except Under
Certain Conditions....................................................................67
SECTION 9.2 Rights And Duties Of Successor Corporation............................................67
SECTION 9.3 Opinion Of Counsel Given To Agent.....................................................68
ARTICLE X.
COVENANTS
SECTION 10.1 Performance Under Purchase Contracts..................................................68
SECTION 10.2 Maintenance Of Office Or Agency.......................................................68
SECTION 10.3 Company To Reserve Common Stock.......................................................69
SECTION 10.4 Covenants As To Common Stock..........................................................69
SECTION 10.5 Statements Of Officer Of The Company As To Default....................................69
Exhibit A -- Form of Equity Security Unit Certificate
Exhibit B -- Form of Stripped Equity Security Unit Certificate
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Exhibit C -- Instruction from Purchase Contract Agent to Collateral Agent
(Collateral Substitution)
Exhibit D -- Instruction to Purchase Contract Agent
(Collateral Substitution)
Exhibit E -- Notice to Settle by Separate Cash
Exhibit F -- Form of Remarketing Agreement
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PURCHASE CONTRACT AGREEMENT (the "Agreement"), dated as of June 25,
2002, between DTE ENERGY COMPANY, a Michigan corporation (the "Company"), and
The Bank of New York, a New York banking corporation, acting as purchase
contract agent for the Holders of Equity Security Units and Stripped Equity
Security Units from time to time (the "Agent").
RECITALS
The Company has duly authorized the execution and delivery of this
Agreement and the Certificates evidencing the Equity Security Units and Stripped
Equity Security Units.
All things necessary to make the Purchase Contracts, when the
Certificates are executed by the Company and authenticated, executed on behalf
of the Holders and delivered by the Agent, as provided in this Agreement, the
valid and legally binding obligations of the Company, and to constitute this
Agreement a valid agreement of the Company, in accordance with its terms, have
been done.
WITNESSETH:
For and in consideration of the premises and the purchase of the Equity
Security Units by the Holders thereof, it is mutually agreed as follows:
ARTICLE I.
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.1 Definitions. For all purposes of this Agreement, except as
otherwise expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings
assigned to them in this Article and include the plural as well as the
singular, and nouns and pronouns of the masculine gender include the
feminine and neuter genders;
(b) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted
accounting principles in the United States;
(c) 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 or other subdivision; and
(d) the following terms have the meanings given to them in
this Section 1.1(d):
"Act" when used with respect to any Holder, has the meaning specified
in Section 1.4.
"Affiliate" has the same meaning as given to that term in Rule 405
promulgated under the Securities Act or any successor rule thereunder.
"Agent" means the Person named as the "Agent" in the first paragraph of
this instrument until a successor Agent shall have become such pursuant to the
applicable provisions of this Agreement, and thereafter "Agent" shall mean such
Person.
"Agreement" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more agreements
supplemental hereto entered into pursuant to the applicable provisions hereof.
"Applicable Market Value" has the meaning specified in Section 5.1(c).
"Applicable Ownership Interest" means, with respect to an Equity
Security Unit and the Treasury Securities in the Treasury Portfolio or the Tax
Event Treasury Portfolio, (A) a 1/40, or 2.5%, undivided beneficial ownership
interest in a $1,000 principal or interest amount of a principal or interest
strip in a U.S. Treasury security included in such Treasury Portfolio or Tax
Event Treasury Portfolio that matures on the Business Day immediately preceding
the Stock Purchase Date and (B) for the scheduled interest Payment Date on the
Notes that occurs on the Stock Purchase Date, in the case of the Treasury
Portfolio, or for each scheduled interest Payment Date on the Notes that occurs
after the Tax Event Redemption Date and on or before the Stock Purchase Date, in
the case of the Tax Event Treasury Portfolio, a 0.02875% undivided beneficial
ownership interest in a $1,000 principal or interest amount of a principal or
interest strip in a U.S. Treasury security included in the Treasury Portfolio or
the Tax Event Treasury Portfolio that matures on the Business Day immediately
preceding the applicable interest Payment Date or Dates.
"Applicants" has the meaning specified in Section 7.12(b).
"Bankruptcy Code" means Title 11 of the United States Code, or any
other law of the United States that from time to time provides a uniform system
of bankruptcy laws.
"Beneficial Owner" means, with respect to a Book-Entry Interest, a
Person who is the beneficial owner of such Book-Entry Interest as reflected on
the books of the Clearing Agency or on the books of a Person maintaining an
account with such Clearing Agency (directly as a Clearing Agency Participant or
as an indirect participant, in each case in accordance with the rules of such
Clearing Agency).
"Board of Directors" means either the board of directors of the Company
or any duly authorized committee of that board.
"Board Resolution" means (i) a copy of a resolution certified by the
Secretary or the Assistant Secretary of the Company to have been duly adopted by
the Board of Directors and to be in full force and effect on the date of such
certification, (ii) a copy of a unanimous written consent of the Board of
Directors or (iii) a certificate signed by the authorized officer or officers to
whom the Board of Directors has delegated its authority, and in each case,
delivered to the Agent.
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"Book-Entry Interest" means a beneficial interest in a Global
Certificate, ownership and transfers of which shall be maintained and made
through book entries by a Clearing Agency as described in Section 3.6.
"Business Day" means any day other than a Saturday, Sunday or any other
day on which banking institutions and trust companies in The State of New York
or at a place of payment are authorized or required by law, regulation or
executive order to be closed.
"Capital Stock" means any and all shares, interests, rights to
purchase, warrants, options, participations or other equivalents of or interests
in (however designated, whether voting or non-voting) corporate stock or similar
interests in other types of entities.
"Cash Merger" has the meaning set forth in Section 5.10.
"Cash Settlement" has the meaning set forth in Section 5.4(a).
"Certificate" means an Equity Security Unit Certificate or a Stripped
Equity Security Unit Certificate.
"Clearing Agency" means an organization registered as a "Clearing
Agency" pursuant to Section 17A of the Exchange Act that is acting as a
depositary for the Equity Security Units and Stripped Equity Security Units and
in whose name, or in the name of a nominee of that organization, shall be
registered a Global Certificate and which shall undertake to effect book-entry
transfers and pledges of the Equity Security Units and Stripped Equity Security
Units.
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time the Clearing
Agency effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.
"Closing Price" has the meaning specified in Section 5.1(c).
"Collateral" has the meaning specified in Section 2.1(a) of the Pledge
Agreement.
"Collateral Agent" means The Bank of New York, a New York banking
corporation, as Collateral Agent under the Pledge Agreement until a successor
Collateral Agent shall have become such pursuant to the applicable provisions of
the Pledge Agreement, and thereafter "Collateral Agent" shall mean the Person
who is then the Collateral Agent thereunder.
"Collateral Substitution" has the meaning specified in Section 3.13(a).
"Common Stock" means the common stock, without par value, of the
Company. At the date of this Agreement, each share of Common Stock has attached
to it the right to purchase from the Company one one-hundreth of a share of
Series A Junior Participating Preferred Stock, without par value, of the
Company, at a price of $90.00 per one one-hundreth of a preferred share, subject
to adjustment, as provided in the Rights Agreement, dated September 23, 1997,
between the Company and The Detroit Edison Company, as rights agent.
3
"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 provision of this Agreement, and thereafter "Company" shall
mean such successor.
"Constituent Person" has the meaning specified in Section 5.6(b).
"Contract Adjustment Payments" means, in the case of Equity Security
Units and Stripped Equity Security Units, the amount payable by the Company in
respect of each Purchase Contract constituting a part of such Equity Security
Units or Stripped Equity Security Units, equal to 4.15% per year of the Stated
Amount, in each case computed (1) for any full quarterly period on the basis of
a 360-day year of twelve 30-day months and (2) for any period shorter than a
full quarterly period, on the basis of a 30-day month and for periods less than
a month, on the basis of the actual number of days elapsed per 30-day month,
plus any Deferred Contract Adjustment Payments accumulated pursuant to Section
5.3.
"Corporate Trust Office" means the office of the Agent at which, at any
particular time, its corporate trust business shall be principally administered,
which office at the date hereof is located at 101 Barclay Street, New York, New
York 10286, Attention: Corporate Trust Administration.
"Corporation" includes corporations, limited liability companies, and
except for purposes of Article IX, associations, companies and business trusts.
"Coupon Rate" means the percentage rate per annum at which each Note
will bear interest initially.
"Current Market Price" has the meaning specified in Section 5.6(a)(8).
"Custodial Agent" means The Bank of New York, a New York banking
corporation, as Custodial Agent under the Pledge Agreement until a successor
Custodial Agent shall have become such pursuant to the applicable provisions of
the Pledge Agreement, and thereafter "Custodial Agent" shall mean the Person who
is then the Custodial Agent thereunder.
"Deferred Contract Adjustment Payments" has the meaning specified in
Section 5.3.
"Depositary" means, initially, DTC, until another Clearing Agency
becomes its successor.
"DTC" means The Depository Trust Company, the initial Clearing Agency.
"Early Settlement" has the meaning specified in Section 5.9(a).
"Early Settlement Amount" has the meaning specified in Section 5.9(a).
"Early Settlement Date" has the meaning specified in Section 5.9(a).
"Early Settlement Rate" has the meaning specified in Section 5.9(b).
4
"Equity Security Units" means the collective rights and obligations of
a Holder of an Equity Security Unit Certificate in respect of a Note or the
appropriate Applicable Ownership Interest in the Treasury Portfolio or the Tax
Event Treasury Portfolio, as the case may be, subject in each case to the Pledge
thereof, and the related Purchase Contract.
"Equity Security Unit Certificate" means a certificate evidencing the
rights and obligations of a Holder in respect of the number of Equity Security
Units specified on such certificate, substantially in the form of Exhibit A
hereto.
"Equity Security Unit Register" and "Equity Security Units Registrar"
have the respective meanings specified in Section 3.5(a).
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
and any statute successor thereto, in each case as amended from time to time,
and the rules and regulations promulgated thereunder.
"Expiration Date" has the meaning specified in Section 1.4(f).
"Expiration Time" has the meaning specified in Section 5.6(a)(6).
"Failed Remarketing" has the meaning specified in Section 5.4(b)(ii).
"Fair Market Value" with respect to securities distributed in a
Spin-Off means (a) in the case of any Spin-Off that is effected simultaneously
with an initial public offering of such securities, the initial public offering
price of those securities, and (b) in the case of any other Spin-Off, the
average of the Sale Prices of those securities over the first 10 Trading Days
after the effective date of such Spin-Off.
"Global Certificate" means a Certificate that evidences all or part of
the Equity Security Units or Stripped Equity Security Units and is registered in
the name of a Depositary or a nominee thereof.
"Holder" means the Person in whose name the Equity Security Units or
Stripped Equity Security Units evidenced by an Equity Security Unit Certificate
and/or a Stripped Equity Security Unit Certificate is registered in the related
Equity Security Unit Register and/or the Stripped Equity Security Unit Register,
as the case may be.
"Indenture" means the Amended and Restated Indenture, dated as of April
9, 2001, between the Company and the Trustee and as further supplemented by any
officers' certificate or supplemental indenture.
"Issuer Order" or "Issuer Request" means a written order or request
signed in the name of the Company by the Chairman of the Board, its President, a
Vice-President, its Treasurer, an Assistant Treasurer, its Controller, an
Assistant Controller, its Secretary or an Assistant Secretary and delivered to
the Agent.
"Last Failed Remarketing" has the meaning specified in Section
5.4(b)(ii).
5
"Merger Early Settlement" has the meaning specified in Section 5.10.
"Merger Early Settlement Amount" has the meaning specified in Section
5.10.
"Merger Early Settlement Date" has the meaning specified in Section
5.10.
"Non-electing Share" has the meaning specified in Section 5.6(b).
"Notes" means the series of senior debt securities of the Company
designated the 4.60% Senior Notes due 2007, to be issued under the Indenture.
"NYSE" has the meaning specified in Section 5.1.
"Officer's Certificate" means a certificate signed by the Chairman of
the Board, the President, a Vice-President, the Treasurer, an Assistant
Treasurer, the Controller, an Assistant Controller, the Secretary or an
Assistant Secretary of the Company and delivered to the Agent.
"Opinion of Counsel" means an opinion in writing signed by legal
counsel, who may be an employee of or counsel to the Company or an Affiliate.
"Outstanding Units" means, as of the date of determination, all Equity
Security Units and Stripped Equity Security Units evidenced by Certificates
theretofore authenticated, executed and delivered under this Agreement, except:
(i) If a Termination Event has occurred, (A) Stripped
Equity Security Units and (B) Equity Security Units for which
the related Note or the appropriate Applicable Ownership
Interest in the Treasury Portfolio or Tax Event Treasury
Portfolio, as the case may be, has been theretofore deposited
with the Agent in trust for the Holders of such Equity
Security Units;
(ii) Equity Security Units and Stripped Equity
Security Units evidenced by Certificates theretofore cancelled
by the Agent or delivered to the Agent for cancellation or
deemed cancelled pursuant to the provisions of this Agreement;
and
(iii) Equity Security Units and Stripped Equity
Security Units evidenced by Certificates in exchange for or in
lieu of which other Certificates have been authenticated,
executed on behalf of the Holder and delivered pursuant to
this Agreement, other than any such Certificate in respect of
which there shall have been presented to the Agent proof
satisfactory to it that such Certificate is held by a bona
fide purchaser in whose hands the Equity Security Units or
Stripped Equity Security Units evidenced by such Certificate
are valid obligations of the Company;
provided, that in determining whether the Holders of the requisite number of the
Equity Security Units or Stripped Equity Security Units have given any request,
demand, authorization, direction, notice, consent or waiver hereunder, Equity
Security Units and Stripped Equity Security Units
6
owned by the Company or any Affiliate of the Company shall be disregarded and
deemed not to be outstanding, except that, in determining whether the Agent
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Equity Security Units and Stripped
Equity Security Units that a Responsible Officer of the Agent actually knows to
be so owned shall be so disregarded. Equity Security Units or Stripped Equity
Security Units so owned that have been pledged in good faith may be regarded as
Outstanding Units if the pledgee establishes to the satisfaction of the Agent
the pledgee's right so to act with respect to such Equity Security Units or
Stripped Equity Security Units and that the pledgee is not the Company or any
Affiliate of the Company.
"Payment Date" means each February 16, May 16, August 16 and November
16, commencing August 16, 2002.
"Person" means any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Pledge" means the pledge under the Pledge Agreement of the Notes, the
Treasury Securities or the appropriate Applicable Ownership Interest in the
Treasury Portfolio or Tax Event Treasury Portfolio constituting a part of the
Equity Security Units, or the Treasury Securities constituting a part of the
Stripped Equity Security Units, property, cash, securities, financial assets and
security entitlements of the Collateral Account (as defined in the Pledge
Agreement) and any proceeds of any of the foregoing.
"Pledge Agreement" means the Pledge Agreement, dated as of the date
hereof, by and among the Company, the Collateral Agent, the Custodial Agent, the
Securities Intermediary and the Agent, on its own behalf and as attorney-in-fact
for the Holders from time to time of the Equity Security Units and Stripped
Equity Security Units.
"Pledged Applicable Ownership Interest in the Tax Event Treasury
Portfolio" has the meaning set forth in Section 2.1(c) of the Pledge Agreement.
"Pledged Applicable Ownership Interest in the Treasury Portfolio" has
the meaning set forth in Section 2.1(c) of the Pledge Agreement.
"Pledged Notes" has the meaning set forth in Section 2.1(c) of the
Pledge Agreement.
"Pledged Treasury Securities" has the meaning set forth in Section
2.1(c) of the Pledge Agreement.
"Predecessor Certificate" means a Predecessor Equity Security Unit
Certificate or a Predecessor Stripped Equity Security Unit Certificate.
"Predecessor Equity Security Unit Certificate" of any particular Equity
Security Unit Certificate means every previous Equity Security Unit Certificate
evidencing all or a portion of the rights and obligations of the Company and the
Holder under the Equity Security Units evidenced thereby; and, for the purposes
of this definition, any Equity Security Unit Certificate
7
authenticated and delivered under Section 3.10 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Equity Security Unit Certificate shall be
deemed to evidence the same rights and obligations of the Company and the Holder
as the mutilated, destroyed, lost or stolen Equity Security Unit Certificate.
"Predecessor Stripped Equity Security Unit Certificate" of any
particular Stripped Equity Security Unit Certificate means every previous
Stripped Equity Security Unit Certificate evidencing all or a portion of the
rights and obligations of the Company and the Holder under the Stripped Equity
Security Units evidenced thereby; and, for the purposes of this definition, any
Stripped Equity Security Unit Certificate authenticated and delivered under
Section 3.10 in exchange for or in lieu of a mutilated, destroyed, lost or
stolen Stripped Equity Security Unit Certificate shall be deemed to evidence the
same rights and obligations of the Company and the Holder as the mutilated,
destroyed, lost or stolen Stripped Equity Security Unit Certificate.
"Purchase Contract," when used with respect to any Equity Security
Units or Stripped Equity Security Units, means the contract forming a part of
such Equity Security Units or Stripped Equity Security Units and obligating the
Company to sell and the Holder of such Equity Security Units or Stripped Equity
Security Units to purchase Common Stock on the terms and subject to the
conditions set forth in Article Five.
"Purchase Contract Settlement Fund" has the meaning specified in
Section 5.5.
"Purchase Price" has the meaning specified in Section 5.1.
"Purchased Shares" has the meaning specified in Section 5.6(a)(6).
"Quotation Agent" means UBS Warburg LLC or Salomon Smith Barney Inc.,
or their respective successors or any other primary U.S. government securities
dealer in New York City selected by the Company.
"Record Date" for the distribution payable on any Payment Date means,
as to any Global Certificate, the Business Day immediately preceding such
Payment Date, and as to any other Certificate, the 15th day preceding such
Payment Date.
"Redemption Amount" means, (A) in the case of a Tax Event Redemption
occurring prior to the earlier of a successful remarketing of the Notes and the
Stock Purchase Date, for each Note the product of (i) the principal amount of
such Note and (ii) a fraction whose numerator is the applicable Tax Event
Treasury Portfolio Purchase Price and whose denominator is the aggregate
principal amount of Notes outstanding on the Tax Event Redemption Date, and (B)
in the case of a Tax Event Redemption occurring on or after the earlier of a
successful remarketing of the Notes and the Stock Purchase Date, for each Note
the principal amount of the Note.
"Redemption Price" means the redemption price per Note equal to the
Redemption Amount plus any accrued and unpaid interest on such Note to the date
of redemption.
"Reference Price" has the meaning specified in Section 5.1(a)(ii).
8
"Register" means the Equity Security Unit Register or the Stripped
Equity Security Unit Register, as applicable.
"Registrar" means the Equity Security Unit Registrar or the Stripped
Equity Security Unit Registrar, as applicable.
"Remarketing Agent" has the meaning specified in Section 5.4(b)(i).
"Remarketing Agreement" means the Remarketing Agreement entered into by
and among the Company, the Remarketing Agent and the Agent.
"Remarketing Date" means the third Business Day immediately preceding
May 16, 2005.
"Remarketing Fee" has the meaning specified in Section 5.4(b)(i).
"Remarketing Period" means any of the following three Business Day
periods: (i) the Remarketing Date and each of the two immediately succeeding
Business Days; (ii) the three Business Days immediately preceding July 1, 2005;
or (iii) the seventh, sixth and fifth Business Days immediately preceding August
16, 2005.
"Remarketing Value" means the sum of
(i) the value at the Remarketing Date or any
Subsequent Remarketing Date, as the case may be, of U.S.
Treasury securities that will pay, on the Business Day
immediately preceding the Payment Date falling on the Stock
Purchase Date, an amount of cash equal to the aggregate
interest payments that are scheduled to be payable on that
Payment Date, on (a) the Notes which are included in Equity
Security Units and (b) the Separate Notes that are to be
remarketed pursuant to Section 4.5(d) of the Pledge Agreement,
assuming for that purpose that the interest rate on the Notes
is equal to the Coupon Rate, and
(ii) the value at the Remarketing Date or the
Subsequent Remarketing Date, as the case may be, of U.S.
Treasury securities that will pay, on the Business Day
immediately preceding the Stock Purchase Date, an amount of
cash equal to the principal amount (a) of such Notes that are
included in Equity Security Units and (b) the Separate Notes
which are to be remarketed pursuant to Section 4.5(d) of the
Pledge Agreement,
provided that for purposes of clauses (i) and (ii) above, the Remarketing Value
shall be calculated on the assumptions that (x) the U.S. Treasury securities are
highly liquid and mature on or within 35 days prior to the Stock Purchase Date,
as determined in good faith by the Remarketing Agent in a manner intended to
minimize the cash value of the U.S. Treasury securities, and (y) the U.S.
Treasury securities are valued based on the ask-side price of the U.S. Treasury
securities at a time between 9:00 a.m. and 11:00 a.m., New York City time,
selected by the Remarketing Agent, on the Remarketing Date or any Subsequent
Remarketing Date, as the case may be, as determined on a third-day settlement
basis by a reasonable and customary means selected in good faith by the
Remarketing Agent, plus accrued interest to that date.
9
"Reorganization Event" has the meaning specified in Section 5.6(b).
"Reset Rate" has the meaning specified in Section 5.4(b)(i) and shall
be established pursuant to Section 5.4(b)(i) or (ii), as appropriate.
"Responsible Officer" means, when used with respect to the Agent, any
officer within the corporate trust department of the Agent (or any successor of
the Agent), including any Vice President, any assistant Vice President, the
treasurer, any assistant treasurer, any trust officer, any senior trust officer
or any other officer of the Agent who customarily performs functions similar to
those performed by the Persons who at the time shall be such officers,
respectively, or to whom any corporate trust matter is referred because of such
Person's knowledge of and familiarity with the particular subject and who, in
each of the above cases, shall have direct responsibility for the administration
of this Agreement.
"Sale Price" of the Common Stock or any securities distributed in a
Spin-Off, as the case may be, on any Trading Day means the closing sale price
per share (or if no closing sale price is reported, the average of the per share
bid and per share ask prices or, if more than one per share bid or per share ask
price, the average of the average per share bid and the average per share asked
prices) on such Trading Day as reported in composite transactions for the
principal U.S. securities exchange on which the Common Stock or such securities
are traded or, if the Common Stock or such securities are not listed on a U.S.
national or regional securities exchange, as reported by Nasdaq.
"Securities Act" means the Securities Act of 1933, as amended.
"Securities Intermediary" means The Bank of New York, a New York
banking corporation, in its capacity as Securities Intermediary under the Pledge
Agreement, together with its successors in such capacity.
"Separate Notes" has the meaning set forth in the Pledge Agreement.
"Settlement Date" means any Early Settlement Date or Merger Early
Settlement Date or the Stock Purchase Date.
"Settlement Rate" has the meaning specified in Section 5.1.
"Spin-Off" means a dividend or other distribution of shares of Capital
Stock of any class or series, or similar equity interests, of or relating to a
subsidiary or other business unit of the Company.
"Stated Amount" means, with respect to any one Equity Security Unit or
Stripped Equity Security Unit, $25.
"Stock Purchase Date" means August 16, 2005.
10
"Stripped Equity Security Units" means the collective rights and
obligations of a holder of a Stripped Equity Security Unit Certificate in
respect of a 1/40 undivided beneficial interest in a Treasury Security, subject
in each case to the Pledge thereof, and the related Purchase Contract.
"Stripped Equity Security Unit Certificate" means a certificate
evidencing the rights and obligations of a Holder in respect of the number of
Stripped Equity Security Units specified on such certificate, substantially in
the form of Exhibit B hereto.
"Stripped Equity Security Unit Register" and "Stripped Equity Security
Unit Registrar" have the respective meanings specified in Section 3.5(a).
"Subsequent Remarketing Date" means, provided there has been one or
more Failed Remarketings, the date on which the Remarketing Agent has
consummated a successful remarketing in accordance with Section 5.4 hereof, such
date to be no later than the fifth Business Day immediately preceding the Stock
Purchase Date.
"Tax Event" means the receipt by the Company of an opinion of a
nationally recognized tax counsel experienced in such matters to the effect that
there is more than an insubstantial risk that interest payable by the Company on
the Notes on the next Payment Date would not be deductible, in whole or in part,
by the Company for United States federal income tax purposes, as a result of (a)
any amendment to, or change (including any announced proposed change) in, the
laws (or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein affecting taxation, (b) any
amendment to or change in an official interpretation or application of such laws
or regulations by any legislative body, court, governmental agency or regulatory
authority or (c) any official interpretation or pronouncement that provides for
a position with respect to such laws or regulations that differs from the
generally accepted position on June 19, 2002, which amendment, change or
proposed change is effective or which interpretation or pronouncement is
announced on or after June 19, 2002.
"Tax Event Redemption" means, if a Tax Event shall occur and be
continuing, the redemption of the Notes, at the option of the Company, in whole
but not in part, on not less than 30 days nor more than 60 days' written notice.
"Tax Event Redemption Date" means the date upon which a Tax Event
Redemption is to occur.
"Tax Event Treasury Portfolio" means portfolio of principal or interest
strips of U.S. Treasury Securities that mature on (1) the Business Day
immediately preceding the Stock Purchase Date in an aggregate amount equal to
the aggregate principal amount of the Notes included in the Equity Security
Units on the Tax Event Redemption Date and (2) with respect to each scheduled
interest Payment Date on the Notes that occurs after the Tax Event Redemption
Date and on or before the Stock Purchase Date, interest or principal strips of
U.S. Treasury Securities that mature on the Business Day immediately preceding
such interest Payment Date in an aggregate amount equal to the aggregate
interest payment that would be due on the aggregate principal amount of the
Notes outstanding on the Tax Event Redemption Date.
11
"Tax Event Treasury Portfolio Purchase Price" means the lowest
aggregate price quoted by a primary U.S. government securities dealer in New
York City to the Quotation Agent on the third Business Day immediately preceding
the Tax Event Redemption Date for the purchase of the Treasury Portfolio for
settlement on the Tax Event Redemption Date.
"Termination Date" means the date, if any, on which a Termination Event
occurs.
"Termination Event" means the occurrence of any of the following
events:
(i) at any time on or prior to the Stock Purchase
Date, a judgment, decree or court order shall have been
entered granting relief under the Bankruptcy Code or any other
similar Federal or state law, adjudicating the Company to be
insolvent, or approving as properly filed a petition seeking
reorganization or liquidation of the Company under the
Bankruptcy Code or any other similar applicable federal or
state law, and, unless such judgment, decree or order shall
have been entered within 60 days prior to the Stock Purchase
Date, such decree or order shall have continued undischarged
and unstayed for a period of 60 days;
(ii) at any time on or prior to the Stock Purchase
Date, a judgment, decree or court order for the appointment of
a receiver or liquidator or trustee or assignee in bankruptcy
or insolvency of the Company or of its property, or for the
winding up or liquidation of its affairs, shall have been
entered, and, unless such judgment, decree or order shall have
been entered within 60 days prior to the Stock Purchase Date,
such judgment, decree or order shall have continued
undischarged and unstayed for a period of 60 days; or
(iii) at any time on or prior to the Stock Purchase
Date, the Company shall file a petition for relief under the
Bankruptcy Code or any other similar federal or state law, or
shall consent to the filing of a bankruptcy proceeding against
it, or shall file a petition or answer or consent seeking
reorganization or liquidation under the Bankruptcy Code or any
other similar federal or state law, or shall consent to the
filing of any such petition, or shall consent to the
appointment of a receiver or liquidator or trustee or assignee
in bankruptcy or insolvency of it or of its property, or shall
make an assignment for the benefit of creditors, or shall
admit in writing its inability to pay its debts generally as
they become due.
"Threshold Appreciation Price" has the meaning specified in Section
5.1(a)(i).
"TIA" means the Trust Indenture Act of 1939, as amended.
"Trading Day" has the meaning specified in Section 5.1(c).
"Transaction Documents" has the meaning specified in Section 7.1(a).
"Treasury Portfolio" has the meaning specified in Section 5.4(b)(i).
12
"Treasury Security" means a zero-coupon U.S. Treasury security (CUSIP
Number 912803AG8) maturing on August 15, 2005 that will pay $1,000 on such
maturity date.
"Trustee" means The Bank of New York, a New York banking corporation,
as trustee under the Indenture, or any successor thereto.
"Underwriting Agreement" means the Underwriting Agreement relating to
the Equity Security Units and Stripped Equity Security Units dated June 19, 2002
among the Company and the underwriters named therein.
"Vice-President" means any vice-president, whether or not designated by
a number or a word or words added before or after the title "vice-president."
SECTION 1.2 Compliance Certificates And Opinions. Except as otherwise
expressly provided by this Agreement, upon any application or request by the
Company to the Agent to take any action under any provision of this Agreement,
the Company shall furnish to the Agent an Officer's Certificate stating that all
conditions precedent, if any, provided for in this Agreement relating to the
proposed action have been complied with and, if requested by the Agent, an
Opinion of Counsel stating that, in the opinion of such counsel, all such
conditions precedent, if any, have been complied with, except that in the case
of any such application or request as to which the furnishing of such documents
is specifically required by any provision of this Agreement relating to such
particular application or request, no additional certificate or opinion need be
furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Agreement (other than the Officer's
Certificate provided for in Section 10.5) shall include:
(a) a statement that the Person signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he or she
has made such examination or investigation as is necessary to enable
such individual to express an informed opinion as to whether or not
such covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of such
individual, such condition or covenant has been complied with.
SECTION 1.3 Form Of Documents Delivered To Agent.
(a) In any case where several matters are required to be
certified by, or covered by an opinion of, any specified Person, it is
not necessary that all such matters be
13
certified by, or covered by the opinion of, only one such Person, or
that they be so certified or covered by only one document, but one such
Person may certify or give an opinion with respect to some matters and
one or more other such Persons as to other matters, and any such Person
may certify or give an opinion as to such matters in one or several
documents.
(b) Any certificate or opinion of an officer of the Company
may be based, insofar as it relates to legal matters, upon a
certificate or opinion of, or representations by, counsel, unless such
officer knows, or in the exercise of reasonable care should know, that
the certificate or opinion or representations with respect to the
matters upon which his certificate or opinion is based are erroneous.
Any such certificate or Opinion of Counsel may be based, insofar as it
relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that
the information with respect to such factual matters is in the
possession of the Company unless such counsel knows, or in the exercise
of reasonable care should know, that the certificate or opinion or
representations with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Agreement, they may, but need not, be consolidated and
form one instrument.
SECTION 1.4 Acts Of Holders; Record Dates.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Agreement to be given
or taken by Holders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders in
person or by agent duly appointed in writing; and, except as herein
otherwise expressly provided, such action shall become effective when
such instrument or instruments are delivered to the Agent and, where it
is hereby expressly required, to the Company. Such instrument or
instruments (and the action embodied therein and evidenced thereby) are
herein sometimes referred to as the "Act" of the Holders signing such
instrument or instruments. Proof of execution of any such instrument or
of a writing appointing any such agent shall be sufficient for any
purpose of this Agreement and (subject to Section 7.1) conclusive in
favor of the Agent and the Company, if made in the manner provided in
this Section.
(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved in any manner which the Agent
deems sufficient.
(c) The ownership of Equity Security Units or Stripped Equity
Security Units shall be proved by the Equity Security Unit Register or
the Stripped Equity Security Unit Register, as the case may be.
(d) Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Certificate shall
bind every future Holder of the same Certificate and the Holder of
every Certificate issued upon the registration of transfer
14
thereof or in exchange therefor or in lieu thereof in respect of
anything done, omitted or suffered to be done by the Agent or the
Company in reliance thereon, whether or not notation of such action is
made upon such Certificate.
(e) The Company may set any day as a record date for the
purpose of determining the Holders of Outstanding Units entitled to
give, make or take any request, demand, authorization, direction,
notice, consent, waiver or other action provided or permitted by this
Agreement to be given, made or taken by Holders of Equity Security
Units and Stripped Equity Security Units. If any record date is set
pursuant to this paragraph, the Holders of the Outstanding Units on
such record date, and no other Holders, shall be entitled to take the
relevant action with respect to the Equity Security Units or the
Stripped Equity Security Units, as the case may be, whether or not such
Holders remain Holders after such record date; provided that no such
action shall be effective hereunder unless taken on or prior to the
applicable Expiration Date by Holders of the requisite number of
Outstanding Units on such record date. Nothing in this paragraph shall
be construed to prevent the Company from setting a new record date for
any action for which a record date has previously been set pursuant to
this paragraph (whereupon the record date previously set shall
automatically and with no action by any Person be cancelled and of no
effect), and nothing in this paragraph shall be construed to render
ineffective any action taken by Holders of the requisite number of
Outstanding Units on the date such action is taken. Promptly after any
record date is set pursuant to this paragraph, the Company, at its own
expense, shall cause notice of such record date, the proposed action by
Holders and the applicable Expiration Date to be given to the Agent in
writing and to each Holder of Equity Security Units and Stripped Equity
Security Units in the manner set forth in Section 1.6. Notwithstanding
the foregoing, for purposes of distributions payable on any Payment
Date, the Record Date shall be, as to any Global Certificate, the
Business Day immediately preceding such Payment Date.
(f) With respect to any record date set pursuant to this
Section, the Company may designate any date as the "Expiration Date"
and from time to time may change the Expiration Date to any earlier or
later day; provided that no such change shall be effective unless
notice of the proposed new Expiration Date is given to the Agent in
writing, and to each Holder of Equity Security Units and Stripped
Equity Security Units in the manner set forth in Section 1.6, on or
prior to the existing Expiration Date. If an Expiration Date is not
designated with respect to any record date set pursuant to this
Section, the Company shall be deemed to have initially designated the
180th day after such record date as the Expiration Date with respect
thereto, subject to its right to change the Expiration Date as provided
in this paragraph. Notwithstanding the foregoing, no Expiration Date
shall be later than the 180th day after the applicable record date.
SECTION 1.5 Notices. Any request, demand, authorization, direction,
notice, consent, waiver or Act of Holders or other document provided or
permitted by this Agreement to be made upon, given or furnished to, or filed
with:
(a) the Agent by any Holder or by the Company shall be
sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if made, given, furnished
15
or filed in writing and personally delivered, mailed, first-class
postage prepaid, telecopied or delivered by overnight air courier
guaranteeing next day delivery, to the Agent at 101 Barclay Street, New
York, New York 10286 , Attention: Corporate Trust Administration,
telecopy: (212) 896-7298, or at any other address furnished in writing
by the Agent to the Holders and the Company; or
(b) the Company by the Agent or by any Holder shall be
sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if made, given, furnished or filed in writing and
personally delivered, mailed, first-class postage prepaid, telecopied
or delivered by overnight air courier guaranteeing next day delivery,
to the Company at DTE Energy Company, 2000 2nd Avenue, 850 WCB,
Detroit, Michigan 48226-1279, Attention: Assistant Treasurer, telecopy:
(313) 235-6743 or at any other address furnished in writing to the
Agent by the Company; or
(c) the Collateral Agent by the Agent, the Company or any
Holder shall be sufficient for every purpose hereunder (unless
otherwise herein expressly provided) if made, given, furnished or filed
in writing and personally delivered, mailed, first-class postage
prepaid, telecopied or delivered by overnight air courier guaranteeing
next day delivery, addressed to the Collateral Agent at 101 Barclay
Street, New York, New York 10286, Attention: Corporate Trust
Administration, telecopy: (212) 896-7298, or at any other address
furnished in writing by the Collateral Agent to the Agent, the Company
and the Holders; or
(d) the Trustee by the Company shall be sufficient for every
purpose hereunder (unless otherwise herein expressly provided) if made,
given, furnished or filed in writing and personally delivered, mailed,
first-class postage prepaid, telecopied or delivered by overnight air
courier guaranteeing next day delivery, addressed to the Trustee at 101
Barclay Street, New York, New York 10286, Attention: Corporate Trust
Administration, telecopy: (212) 896-7298 or at any other address
furnished in writing by the Trustee to the Company.
SECTION 1.6 Notice To Holders; Waiver.
(a) Where this Agreement provides for notice to Holders of any
event, such notice shall be sufficiently given (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage
prepaid, to each Holder affected by such event, at its address as it
appears in the applicable Register, not later than the latest date, and
not earlier than the earliest date, prescribed for the giving of such
notice. In any case where notice to Holders is given by mail, neither
the failure to mail such notice, nor any defect in any notice so mailed
to any particular Holder shall affect the sufficiency of such notice
with respect to other Holders. Where this Agreement provides for notice
in any manner, such notice may be waived in writing by the Person
entitled to receive such notice, either before or after the event, and
such waiver shall be the equivalent of such notice. Waivers of notice
by Holders shall be filed with the Agent, but such filing shall not be
a condition precedent to the validity of any action taken in reliance
upon such waiver.
16
(b) In case by reason of the suspension of regular mail
service or by reason of any other cause it shall be impracticable to
give such notice by mail, then such notification as shall be made with
the approval of the Agent shall constitute a sufficient notification
for every purpose hereunder.
SECTION 1.7 Effect Of Headings And Table Of Contents. The Article and
Section headings herein and the Table of Contents are for convenience only and
shall not affect the construction hereof.
SECTION 1.8 Successors And Assigns. All covenants and agreements in
this Agreement by the Company shall bind its successors and assigns, whether so
expressed or not.
SECTION 1.9 Separability Clause. In case any provision in this
Agreement or in the Equity Security Units or Stripped Equity Security Units
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions hereof and thereof shall not in any
way be affected or impaired thereby.
SECTION 1.10 Benefits Of Agreement. Nothing in this Agreement or in the
Equity Security Units or Stripped Equity Security Units, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder and, to the extent provided hereby, the Holders, any benefits or any
legal or equitable right, remedy or claim under this Agreement. The Holders from
time to time shall be beneficiaries of this Agreement and shall be bound by all
of the terms and conditions hereof and of the Equity Security Units and Stripped
Equity Security Units evidenced by their Certificates by their acceptance of
delivery of such Certificates.
SECTION 1.11 Governing Law. This Agreement and the Equity Security
Units and Stripped Equity Security Units shall be governed by and construed in
accordance with the laws of the State of New York, without regard to its
principles of conflicts of laws.
SECTION 1.12 Legal Holidays.
(a) In any case where any Payment Date shall not be a Business
Day, then (notwithstanding any other provision of this Agreement or the
Equity Security Unit Certificates) payments on the Notes shall not be
made on such date, but such payments shall be made on the next
succeeding Business Day with the same force and effect as if made on
such Payment Date, provided that no interest shall accrue or be payable
by the Company for the period from and after any such Payment Date,
except that if such next succeeding Business Day is in the next
succeeding calendar year, such payment shall be made on the immediately
preceding Business Day with the same force and effect as if made on
such Payment Date.
(b) If any date on which Contract Adjustment Payments are to
be made on the Purchase Contracts is not a Business Day, then payment
of the Contract Adjustment Payments payable on that date will be made
on the next succeeding day which is a Business Day, and no interest or
additional payment will be paid in respect of the delay. However, if
that Business Day is in the next succeeding calendar year, the payment
will
17
be made on the immediately preceding Business Day with the same force
and effect as if made on that Payment Date.
(c) In any case where the Stock Purchase Date shall not be a
Business Day, then (notwithstanding any other provision of this
Agreement or the Certificates), the Purchase Contracts shall not be
performed on such date, but the Purchase Contracts shall be performed
on the immediately following Business Day with the same force and
effect as if performed on the Stock Purchase Date.
SECTION 1.13 Counterparts. This Agreement may be executed in any number
of counterparts by the parties hereto, each of which, when so executed and
delivered, shall be deemed an original, but all such counterparts shall together
constitute one and the same instrument.
SECTION 1.14 Inspection Of Agreement. A copy of this Agreement shall be
available at all reasonable times during normal business hours at the Corporate
Trust Office for inspection by any Holder.
ARTICLE II.
CERTIFICATE FORMS
SECTION 2.1 Forms Of Certificates Generally.
(a) The Equity Security Unit Certificates (including the form
of Purchase Contract forming part of the Equity Security Units
evidenced thereby) shall be in substantially the form set forth in
Exhibit A hereto, with such letters, numbers or other marks of
identification or designation and such legends or endorsements printed,
lithographed or engraved thereon as may be required by the rules of any
securities exchange or quotation system on which the Equity Security
Units are listed or quoted for trading or any depositary therefor, or
as may, consistently herewith, be determined by the officers of the
Company executing such Equity Security Unit Certificates, as evidenced
by their execution of the Equity Security Unit Certificates.
(b) The definitive Equity Security Unit Certificates shall be
printed, lithographed or engraved on steel engraved borders or may be
produced in any other manner, all as determined by the officers of the
Company executing such Equity Security Unit Certificates, consistent
with the provisions of this Agreement, as evidenced by their execution
thereof.
(c) The Stripped Equity Security Unit Certificates (including
the form of Purchase Contracts forming part of the Stripped Equity
Security Units evidenced thereby) shall be in substantially the form
set forth in Exhibit B hereto, with such letters, numbers or other
marks of identification or designation and such legends or endorsements
printed, lithographed or engraved thereon as may be required by the
rules of any securities exchange or the quotation system on which the
Stripped Equity Security Units may be
18
listed or quoted for trading or any depositary therefor, or as may,
consistently herewith, be determined by the officers of the Company
executing such Stripped Equity Security Unit Certificates, as evidenced
by their execution of the Stripped Equity Security Unit Certificates.
(d) The definitive Stripped Equity Security Unit Certificates
shall be printed, lithographed or engraved on steel engraved borders or
may be produced in any other manner, all as determined by the officers
of the Company executing such Stripped Equity Security Unit
Certificates, consistent with the provisions of this Agreement, as
evidenced by their execution thereof.
(e) Every Global Certificate authenticated, executed on behalf
of the Holders and delivered hereunder shall bear a legend in
substantially the following form:
"THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING
OF THE PURCHASE CONTRACT AGREEMENT (AS HEREINAFTER DEFINED)
AND IS REGISTERED IN THE NAME OF THE CLEARING AGENCY OR A
NOMINEE THEREOF. THIS CERTIFICATE MAY NOT BE EXCHANGED IN
WHOLE OR IN PART FOR A CERTIFICATE REGISTERED, AND NO TRANSFER
OF THIS CERTIFICATE IN WHOLE OR IN PART MAY BE REGISTERED, IN
THE NAME OF ANY PERSON OTHER THAN SUCH CLEARING AGENCY OR A
NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED
IN THE PURCHASE CONTRACT AGREEMENT."
SECTION 2.2 Form Of Agent's Certificate Of Authentication.
(a) The form of the Agent's certificate of authentication of
the Equity Security Units shall be in substantially the form set forth
on the form of the Equity Security Unit Certificates.
(b) The form of the Agent's certificate of authentication of
the Stripped Equity Security Units shall be in substantially the form
set forth on the form of the Stripped Equity Security Unit
Certificates.
ARTICLE III.
THE EQUITY SECURITY UNITS AND STRIPPED EQUITY SECURITY UNITS
SECTION 3.1 Title And Terms; Denominations.
(a) The aggregate number of Equity Security Units and Stripped
Equity Security Units, if any, evidenced by Certificates authenticated,
executed on behalf of the Holders and delivered hereunder is limited to
6,000,000 (6,900,000 if the Underwriters' (as defined in the
Underwriting Agreement) over-allotment option pursuant to the
Underwriting Agreement is exercised in full), except for Certificates
authenticated,
19
executed and delivered upon registration of transfer of, in exchange
for, or in lieu of, other Certificates pursuant to Section 3.4, 3.5,
3.10, 3.13, 3.14, 5.9, 5.10 or 8.5.
(b) The Certificates shall be issuable only in registered form
and only in denominations of a single Equity Security Unit or a single
Stripped Equity Security Unit and any integral multiple thereof.
SECTION 3.2 Rights And Obligations Evidenced By The Certificates.
(a) Each Equity Security Unit Certificate shall evidence the
number of Equity Security Units specified therein, with each such
Equity Security Unit representing the ownership by the Holder thereof
of a beneficial interest in a Note or the appropriate Applicable
Ownership Interest in the Treasury Portfolio or Tax Event Treasury
Portfolio, as the case may be, subject to the Pledge of such Note or
such Applicable Ownership Interest in the Treasury Portfolio or Tax
Event Treasury Portfolio, as the case may be, by such Holder pursuant
to the Pledge Agreement, and the rights and obligations of the Holder
thereof and the Company under one Purchase Contract. The Agent as
attorney-in-fact for, and on behalf of, the Holder of each Equity
Security Unit shall pledge, pursuant to the Pledge Agreement, the Note
or the appropriate Applicable Ownership Interest in the Treasury
Portfolio or Tax Event Treasury Portfolio, as the case may be, forming
a part of such Equity Security Unit, to the Collateral Agent and grant
to the Collateral Agent a security interest in the right, title, and
interest of such Holder in such Note or such Applicable Ownership
Interest in the Treasury Portfolio or Tax Event Treasury Portfolio, as
the case may be, for the benefit of the Company, to secure the
obligation of the Holder under each Purchase Contract to purchase the
Common Stock of the Company. Prior to the purchase of shares of Common
Stock under each Purchase Contract, such Purchase Contracts shall not
entitle the Holders of Equity Security Unit Certificates to any of the
rights of a holder of shares of Common Stock, including, without
limitation, the right to vote or receive any dividends or other
payments or to consent or to receive notice as stockholders in respect
of the meetings of stockholders or for the election of directors of the
Company or for any other matter, or any other rights whatsoever as
stockholders of the Company.
(b) Each Stripped Equity Security Unit Certificate shall
evidence the number of Stripped Equity Security Units specified
therein, with each such Stripped Equity Security Unit representing the
ownership by the Holder thereof of a 1/40 undivided beneficial interest
in a Treasury Security, subject to the Pledge of such interest in such
Treasury Security by such Holder pursuant to the Pledge Agreement, and
the rights and obligations of the Holder thereof and the Company under
one Purchase Contract. Prior to the purchase of shares of Common Stock
under each Purchase Contract, such Purchase Contracts shall not entitle
the Holders of Stripped Equity Security Unit Certificates to any of the
rights of a holder of shares of Common Stock, including, without
limitation, the right to vote or receive any dividends or other
payments or to consent or to receive notice as stockholders in respect
of the meetings of stockholders or for the election of directors of the
Company or for any other matter, or any other rights whatsoever as
stockholders of the Company.
20
SECTION 3.3 Execution, Authentication, Delivery And Dating.
(a) Subject to the provisions of Sections 3.13 and 3.14, upon
the execution and delivery of this Agreement, and at any time and from
time to time thereafter, the Company may deliver Certificates executed
by the Company to the Agent for authentication, execution on behalf of
the Holders and delivery, together with its Issuer Order for
authentication of such Certificates, and the Agent in accordance with
such Issuer Order shall authenticate, execute on behalf of the Holders
and deliver such Certificates.
(b) The Certificates shall be executed on behalf of the
Company by the Chairman of the Board, its President, its Treasurer, any
Assistant Treasurer or any of its Vice Presidents and delivered to the
Agent. The signature of any of these officers on the Certificates may
be manual or facsimile.
(c) Certificates bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company
shall bind the Company, notwithstanding that such individuals or any of
them have ceased to hold such offices prior to the authentication and
delivery of such Certificates or did not hold such offices at the date
of such Certificates.
(d) No Purchase Contract evidenced by a Certificate shall be
valid until such Certificate has been executed on behalf of the Holder
by the manual or facsimile signature of an authorized officer of the
Agent, as such Holder's attorney-in-fact. Such signature by an
authorized officer of the Agent shall be conclusive evidence that the
Holder of such Certificate has entered into the Purchase Contracts
evidenced by such Certificate.
(e) Each Certificate shall be dated the date of its
authentication.
(f) No Certificate shall be entitled to any benefit under this
Agreement or be valid or obligatory for any purpose unless there
appears on such Certificate a certificate of authentication
substantially in the form provided for herein executed by an authorized
officer of the Agent by manual signature, and such certificate upon any
Certificate shall be conclusive evidence, and the only evidence, that
such Certificate has been duly authenticated and delivered hereunder.
SECTION 3.4 Temporary Certificates.
(a) Pending the preparation of definitive Certificates, the
Company shall execute and deliver to the Agent, and the Agent shall
authenticate, execute on behalf of the Holders, and deliver, in lieu of
such definitive Certificates, temporary Certificates which are in
substantially the form set forth in Exhibit A or Exhibit B hereto, as
the case may be, with such letters, numbers or other marks of
identification or designation and such legends or endorsements printed,
lithographed or engraved thereon as may be required by the rules of any
securities exchange on which the Equity Security Units or
21
Stripped Equity Security Units, as the case may be, are listed, or as
may, consistent herewith, be determined by the officers of the Company
executing such Certificates, as evidenced by their execution of the
Certificates.
(b) If temporary Certificates are issued, the Company will
cause definitive Certificates to be prepared without unreasonable
delay. After the preparation of definitive Certificates, the temporary
Certificates shall be exchangeable for definitive Certificates upon
surrender of the temporary Certificates at the Corporate Trust Office,
at the expense of the Company and without charge to the Holder. Upon
surrender for cancellation of any one or more temporary Certificates,
the Company shall execute and deliver to the Agent, and the Agent shall
authenticate, execute on behalf of the Holder, and deliver in exchange
therefor, one or more definitive Certificates of like tenor and
denominations and evidencing a like number of Equity Security Units or
Stripped Equity Security Units, as the case may be, as the temporary
Certificate or Certificates so surrendered. Until so exchanged, the
temporary Certificates shall in all respects evidence the same benefits
and the same obligations with respect to the Equity Security Units or
Stripped Equity Security Units, as the case may be, evidenced thereby
as definitive Certificates.
SECTION 3.5 Registration; Registration Of Transfer And Exchange.
(a) The Agent shall keep at the Corporate Trust Office a
register (the "Equity Security Unit Register") in which, subject to
such reasonable regulations as it may prescribe, the Agent shall
provide for the registration of Equity Security Unit Certificates and
of transfers of Equity Security Unit Certificates (the Agent, in such
capacity, the "Equity Security Units Registrar") and a register (the
"Stripped Equity Security Unit Register") in which, subject to such
reasonable regulations as it may prescribe, the Agent shall provide for
the registration of the Stripped Equity Security Unit Certificates and
transfers of Stripped Equity Security Unit Certificates (the Agent, in
such capacity, the "Stripped Equity Security Unit Registrar").
(b) Upon surrender for registration of transfer of any
Certificate at the Corporate Trust Office, the Company shall execute
and deliver to the Agent, and the Agent shall authenticate, execute on
behalf of the designated transferee or transferees, and deliver, in the
name of the designated transferee or transferees, one or more new
Certificates of like tenor and denominations, and evidencing a like
number of Equity Security Units or Stripped Equity Security Units, as
the case may be.
(c) At the option of the Holder, Certificates may be exchanged
for other Certificates, of like tenor and denominations and evidencing
a like number of Equity Security Units or Stripped Equity Security
Units, as the case may be, upon surrender of the Certificates to be
exchanged at the Corporate Trust Office. Whenever any Certificates are
so surrendered for exchange, the Company shall execute and deliver to
the Agent, and the Agent shall authenticate, execute on behalf of the
Holder, and deliver the Certificates which the Holder making the
exchange is entitled to receive.
22
(d) All Certificates issued upon any registration of transfer
or exchange of a Certificate shall evidence the ownership of the same
number of Equity Security Units or Stripped Equity Security Units, as
the case may be, and be entitled to the same benefits and subject to
the same obligations, under this Agreement as the Equity Security Units
or Stripped Equity Security Units, as the case may be, evidenced by the
Certificate surrendered upon such registration of transfer or exchange.
(e) Every Certificate presented or surrendered for
registration of transfer or for exchange shall (if so required by the
Agent) be duly endorsed, or be accompanied by a written instrument of
transfer in form satisfactory to the Company and the Agent duly
executed, by the Holder thereof or its attorney duly authorized in
writing.
(f) No service charge shall be made for any registration of
transfer or exchange of a Certificate, but the Company and the Agent
may require payment from the Holder of a sum sufficient to cover any
tax or other governmental charge that may be imposed in connection with
any registration of transfer or exchange of Certificates, other than
any exchanges pursuant to Sections 3.4, 3.9 and 8.5 not involving any
transfer.
(g) Notwithstanding the foregoing, the Company shall not be
obligated to execute and deliver to the Agent, and the Agent shall not
be obligated to authenticate, execute on behalf of the Holder and
deliver any Certificate presented or surrendered for registration of
transfer or for exchange on or after the Business Day immediately
preceding the earlier of the Stock Purchase Date or the Termination
Date. In lieu of delivery of a new Certificate, upon satisfaction of
the applicable conditions specified above in this Section and receipt
of appropriate registration or transfer instructions from such Holder,
the Agent shall,
(i) if the Stock Purchase Date has occurred, deliver
the shares of Common Stock issuable in respect of the Purchase
Contracts forming a part of the Equity Security Units or
Stripped Equity Security Units, as the case may be, evidenced
by such Certificate,
(ii) in the case of Equity Security Units, if a
Termination Event shall have occurred prior to the Stock
Purchase Date, transfer the Notes or the appropriate
Applicable Ownership Interest in the Treasury Portfolio or Tax
Event Treasury Portfolio, as applicable, relating to such
Equity Security Units or, in the case of Stripped Equity
Security Units, if a Termination Event shall have occurred
prior to the Stock Purchase Date, transfer the Treasury
Securities relating to such Stripped Equity Security Units,
in each case subject to the applicable conditions and in accordance
with the applicable provisions of Article V.
SECTION 3.6 Book-Entry Interests. The Certificates, on original
issuance, will be issued in the form of one or more fully registered Global
Certificates, to be delivered to the Depositary or its custodian by, or on
behalf of, the Company. Each such Global Certificate shall
23
initially be registered in the applicable Register in the name of the Depositary
or its nominee, and no Beneficial Owner will receive a definitive Certificate
representing such Beneficial Owner's interest in such Global Certificate, except
as provided in Section 3.9. The Agent shall enter into agreements with the
Depositary if so requested by the Company in order to effect the book-entry
provisions of this Agreement. Unless and until definitive, fully registered
Certificates have been issued to Beneficial Owners pursuant to Section 3.9:
(a) the provisions of this Section 3.6 shall be in full force
and effect;
(b) the Company shall be entitled to deal with the Clearing
Agency for all purposes of this Agreement (including receiving
approvals, votes or consents hereunder) as the Holder of the Equity
Security Units and Stripped Equity Security Units and the sole holder
of the Global Certificate(s) and shall have no obligation to the
Beneficial Owners;
(c) to the extent that the provisions of this Section 3.6
conflict with any other provisions of this Agreement, the provisions of
this Section 3.6 shall control; and
(d) the rights of the Beneficial Owners shall be exercised
only through the Clearing Agency and shall be limited to those
established by law and agreements between such Beneficial Owners and
the Clearing Agency and/or the Clearing Agency Participants. The
Clearing Agency will make book-entry transfers among Clearing Agency
Participants.
SECTION 3.7 Notices To Holders. Whenever a notice or other
communication to the Holders is required to be given under this Agreement, the
Company or the Company's agent shall give such notices and communications to the
Holders and, with respect to any Equity Security Units or Stripped Equity
Security Units registered in the name of a Clearing Agency or the nominee of a
Clearing Agency, the Company or the Company's agent shall, except as set forth
herein, have no obligations to the Beneficial Owners.
SECTION 3.8 Appointment Of Successor Clearing Agency. If any Clearing
Agency elects to discontinue its services as securities depositary with respect
to the Equity Security Units and Stripped Equity Security Units, the Company
may, in its sole discretion, appoint a successor Clearing Agency with respect to
the Equity Security Units and Stripped Equity Security Units.
SECTION 3.9 Definitive Certificates. If
(i) a Clearing Agency has notified the Company that
it is unwilling or unable to continue as securities depositary
and a successor Clearing Agency is not appointed within 90
days after such discontinuance pursuant to Section 3.8,
(ii) the Company determines not to have the Equity
Security Units and Stripped Equity Security Units represented
by Global Certificates or permit any of the Global
Certificates to be exchangeable or there is a continuing
default by the Company in respect of the Company's obligations
under one or more Purchase Contracts, the Indenture, this
Agreement, the Notes, the Equity Security Units, the Stripped
Equity Security Units, the Pledge Agreement or any other
principal
24
agreements or instruments executed in connection with the
issuance of Equity Securities Units or Stripped Equity
Security Units, or
(iii) a Clearing Agency has ceased to be qualified to
act as securities depositary with respect to the Equity
Securities Units and Stripped Equity Security Units and a
successor Clearing Agency is not appointed with 90 days after
the Company learns that such Clearing Agency is no longer
qualified,
then upon surrender of the Global Certificates representing the Book-Entry
Interests with respect to the Equity Security Units and Stripped Equity Security
Units by the Clearing Agency, accompanied by registration instructions, the
Company shall cause definitive Certificates to be delivered to Beneficial Owners
in accordance with the instructions of the Clearing Agency. The Company and the
Agent shall not be liable for any delay in delivery of such instructions and may
conclusively rely on and shall be protected in relying on, such instructions.
SECTION 3.10 Mutilated, Destroyed, Lost And Stolen Certificates.
(a) If any mutilated Certificate is surrendered to the Agent,
the Company shall execute and deliver to the Agent, and the Agent shall
authenticate, execute on behalf of the Holder, and deliver in exchange
therefor, a new Certificate at the cost of the Holder, evidencing the
same number of Equity Security Units or Stripped Equity Security Units,
as the case may be, and bearing a Certificate number not
contemporaneously outstanding.
(b) If there shall be delivered to the Company and the Agent
(i) evidence to their satisfaction of the destruction, loss or theft of
any Certificate, and (ii) such security or indemnity at the cost of the
Holder as may be required by them to hold each of them and any agent of
any of them harmless, then, in the absence of notice to the Company or
the Agent that such Certificate has been acquired by a bona fide
purchaser, the Company shall execute and deliver to the Agent, and the
Agent shall authenticate, execute on behalf of the Holder, and deliver
to the Holder, in lieu of any such destroyed, lost or stolen
Certificate, a new Certificate, evidencing the same number of Equity
Security Units or Stripped Equity Security Units, as the case may be,
and bearing a Certificate number not contemporaneously outstanding.
(c) Notwithstanding the foregoing, the Company shall not be
obligated to execute and deliver to the Agent, and the Agent shall not
be obligated to authenticate, execute on behalf of the Holder, and
deliver to the Holder, a Certificate on or after the Business Day
immediately preceding the earlier of the Stock Purchase Date or the
Termination Date. In lieu of delivery of a new Certificate, upon
satisfaction of the applicable conditions specified above in this
Section and receipt of appropriate registration or transfer
instructions from such Holder, the Agent shall (i) if the Stock
Purchase Date has occurred, deliver the shares of Common Stock issuable
in respect of the Purchase Contracts forming a part of the Equity
Security Units or Stripped Equity Security Units evidenced by such
Certificate, or (ii) if a Termination Event shall have occurred prior
to the Stock Purchase Date, transfer the Notes, the appropriate
Applicable Ownership Interest in the Treasury Portfolio or Tax Event
Treasury Portfolio, or the
25
Treasury Securities, as the case may be, evidenced thereby, in each
case subject to the applicable conditions and in accordance with the
applicable provisions of Article V.
(d) Upon the issuance of any new Certificate under this
Section, the Company and the Agent may require the payment by the
Holder of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses
(including the fees and expenses of the Agent) connected therewith.
(e) Every new Certificate issued pursuant to this Section in
lieu of any destroyed, lost or stolen Certificate shall constitute an
original additional contractual obligation of the Company and of the
Holder in respect of the Equity Security Units or Stripped Equity
Security Units, as the case may be, evidenced thereby, whether or not
the destroyed, lost or stolen Certificate (and the Equity Security
Units and Stripped Equity Security Units evidenced thereby) shall be at
any time enforceable by anyone, and shall be entitled to all the
benefits and be subject to all the obligations of this Agreement
equally and proportionately with any and all other Certificates
delivered hereunder.
(f) The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with
respect to the replacement or payment of mutilated, destroyed, lost or
stolen Certificates.
SECTION 3.11 Persons Deemed Owners.
(a) Prior to due presentment of a Certificate for registration
of transfer, the Company and the Agent, and any agent of the Company or
the Agent, may treat the Person in whose name such Certificate is
registered as the owner of the Equity Security Units or Stripped Equity
Security Units, as the case may be, evidenced thereby, for the purpose
of receiving interest payments on the Notes, receiving payment of
Contract Adjustment Payments, performance of the Purchase Contracts and
for all other purposes whatsoever (subject to Sections 4.1(a) and
5.2(a)), whether or not any such payments shall be overdue and
notwithstanding any notice to the contrary, and neither the Company nor
the Agent, nor any agent of the Company or the Agent, shall be affected
by notice to the contrary.
(b) Notwithstanding the foregoing, with respect to any Global
Certificate, nothing herein shall prevent the Company, the Agent or any
agent of the Company or the Agent, from giving effect to any written
certification, proxy or other authorization furnished by any Clearing
Agency (or its nominee), as a Holder, with respect to such Global
Certificate or impair, as between such Clearing Agency and owners of
beneficial interests in such Global Certificate, the operation of
customary practices governing the exercise of rights of such Clearing
Agency (or its nominee) as Holder of such Global Certificate. None of
the Company, the Agent, or any agent of the Company or the Agent, will
have any responsibility or liability for any aspect of the records
relating to or payments made on account of beneficial ownership
interests of a Global Certificate or maintaining, supervising or
reviewing any records relating to such beneficial ownership interests.
26
SECTION 3.12 Cancellation.
(a) All Certificates surrendered (i) for delivery of shares of
Common Stock on or after any Settlement Date; (ii) upon the transfer of
Notes, the appropriate Applicable Ownership Interest in the Treasury
Portfolio or Tax Event Treasury Portfolio, or Treasury Securities, as
the case may be, after the occurrence of a Termination Event; or (iii)
upon the registration of a transfer or exchange of an Equity Security
Unit or Stripped Equity Security Unit, as the case may be, shall, if
surrendered to any Person other than the Agent, be delivered to the
Agent and, if not already cancelled, shall be promptly cancelled by it.
The Company may at any time deliver to the Agent for cancellation any
Certificates previously authenticated, executed and delivered hereunder
which the Company may have acquired in any manner whatsoever, and all
Certificates so delivered shall, upon Issuer Order, be promptly
cancelled by the Agent. No Certificates shall be authenticated,
executed on behalf of the Holder and delivered in lieu of or in
exchange for any Certificates cancelled as provided in this Section,
except as expressly permitted by this Agreement. All cancelled
Certificates held by the Agent shall be disposed of by the Agent in
accordance with its customary procedures unless otherwise directed by
Issuer Order.
(b) If the Company or any Affiliate of the Company shall
acquire any Certificate, such acquisition shall not operate as a
cancellation of such Certificate unless and until such Certificate is
delivered to the Agent cancelled or for cancellation.
SECTION 3.13 Establishment Of Stripped Equity Security Units.
(a) Subject to the next succeeding sentence, a holder may
separate the Pledged Notes from the related Purchase Contracts in
respect of the Equity Security Units held by such Holder by
substituting for such Pledged Notes Treasury Securities that will pay,
on the Stock Purchase Date, an amount equal to the aggregate principal
amount of such Notes (a "Collateral Substitution"), at any time from
and after the date of this Agreement and prior to the earlier of a
successful remarketing of the Notes in accordance with the provisions
of Section 5.4 hereof or the date, if any, on which the Notes are
called for redemption by the Company in connection with a Tax Event
Redemption, by (i) depositing with the Collateral Agent Treasury
Securities having an aggregate principal amount at maturity equal to
the aggregate Stated Amount of such Equity Security Units, and (ii)
transferring the related Equity Security Units to the Agent accompanied
by a notice to the Agent, substantially in the form of Exhibit D
hereto, stating that the Holder has transferred the relevant amount of
Treasury Securities to the Collateral Agent and requesting that the
Agent instruct the Collateral Agent to release the Pledged Notes
underlying such Equity Security Units, whereupon the Agent shall
promptly give such instruction to the Collateral Agent, substantially
in the form of Exhibit C hereto. Notwithstanding the foregoing, Holders
may not effect Collateral Substitution during any period beginning
after 5:00 p.m., New York City time, on the fourth Business Day
immediately preceding the first Business Day of a Remarketing Period
and ending, if applicable, at 9:00 a.m., New York City time, on the
fourth Business Day immediately succeeding the third Business Day of
such Remarketing Period. Upon receipt of the
27
Treasury Securities described in clause (i) above and the instruction
described in clause (ii) above, in accordance with the terms of the
Pledge Agreement, the Collateral Agent will release to the Agent, on
behalf of the Holder, such Pledged Notes from the Pledge, free and
clear of the Company's security interest therein, and upon receipt
thereof the Agent shall promptly:
(i) cancel the related Equity Security Units;
(ii) transfer the Pledged Notes to the Holder; and
(iii) authenticate, execute on behalf of such Holder
and deliver to such Holder a Stripped Equity Security Unit
Certificate executed by the Company in accordance with Section
3.3 evidencing (x) the same number of Purchase Contracts as
were evidenced by the cancelled Equity Security Units and (y)
the amount of Treasury Securities deposited as provided above.
(b) Holders who elect to separate the Pledged Notes from the
related Purchase Contract and to substitute Treasury Securities for
such Pledged Notes shall be responsible for any fees or expenses
payable to the Collateral Agent for its services as Collateral Agent in
respect of the substitution, and the Company shall not be responsible
for any such fees or expenses.
(c) Collateral Substitutions may be made only in integral
multiples of 40 Equity Security Units.
(d) In the event a Holder making a Collateral Substitution
pursuant to this Section 3.13 fails to effect a book-entry transfer of
the Equity Security Units or fails to deliver an Equity Security Unit
Certificate to the Agent after depositing Treasury Securities with the
Collateral Agent, the Pledged Notes constituting a part of such Equity
Security Unit and any distributions on such Pledged Notes shall be held
in the name of the Agent or its nominee in trust for the benefit of
such Holder, until such Equity Security Units are so transferred or the
Equity Security Unit Certificate is so delivered, as the case may be,
or, with respect to an Equity Security Unit Certificate, such Holder
provides evidence satisfactory to the Company and the Agent that such
Equity Security Unit Certificate has been destroyed, lost or stolen,
together with any indemnity that may be required by the Agent and the
Company.
(e) Except as described in this Section 3.13, for so long as
the Purchase Contract underlying an Equity Security Unit remains in
effect, such Equity Security Units shall not be separable into its
constituent parts, and the rights and obligations of the Holder of such
Equity Security Units in respect of the Note and the Purchase Contract
comprising such Equity Security Units may be acquired, and may be
transferred and exchanged, only as an Equity Security Unit.
28
SECTION 3.14 Reestablishment Of Equity Security Units.
(a) Subject to the next succeeding sentence, a Holder of
Stripped Equity Security Units may reestablish Equity Security Units at
any time from and after the date of this Agreement and prior to the
earlier of a successful remarketing of the Notes in accordance with the
provisions of Section 5.4 hereof or the date, if any, on which the
Notes are called for redemption by the Company in connection with a Tax
Event Redemption, by (i) depositing with the Collateral Agent Notes
having an aggregate principal amount equal to the aggregate principal
amount at maturity of the Treasury Securities comprising part of the
Stripped Equity Security Units and (ii) transferring such Stripped
Equity Security Units to the Agent accompanied by a notice to the
Agent, substantially in the form of Exhibit D hereto, stating that the
Holder has transferred the relevant amount of Notes to the Collateral
Agent and requesting that the Agent instruct the Collateral Agent to
release the Pledged Treasury Securities underlying such Stripped Equity
Security Units, whereupon the Agent shall promptly give such
instruction to the Collateral Agent, substantially in the form of
Exhibit C hereto. Notwithstanding the foregoing, a Holder may not
reestablish Equity Security Units during any period beginning after
5:00 p.m., New York City time, on the fourth Business Day immediately
preceding the first Business Day of a Remarketing Period and, if
applicable, ending at 9:00 a.m., New York City time, on the fourth
business day immediately succeeding the third Business Day of such
Remarketing Period. Upon receipt of the Notes described in clause (i)
above and the instruction described in clause (ii) above, in accordance
with the terms of the Pledge Agreement, the Collateral Agent will
release to the Agent, on behalf of the Holder, such Pledged Treasury
Securities from the Pledge, free and clear of the Company's security
interest therein, and upon receipt thereof the Agent shall promptly:
(i) cancel the related Stripped Equity Security
Units;
(ii) transfer the Pledged Treasury Securities to the
Holder; and
(iii) authenticate, execute on behalf of such Holder
and deliver an Equity Security Unit Certificate executed by
the Company in accordance with Section 3.3 evidencing (x) the
same number of Purchase Contracts as were evidenced by the
cancelled Stripped Equity Security Units and (y) the principal
amount of Notes deposited as provided above.
(b) Equity Security Units may be reestablished only in
integral multiples of 40 Stripped Equity Security Units for 40 Equity
Security Units.
(c) Except as provided in this Section 3.14, for so long as
the Purchase Contract underlying a Stripped Equity Security Unit
remains in effect, such Stripped Equity Security Unit shall not be
separable into its constituent parts, and the rights and obligations of
the Holder of such Stripped Equity Security Unit in respect of the
Treasury Security and Purchase Contract comprising such Stripped Equity
Security Unit may be acquired, and may be transferred and exchanged,
only as a Stripped Equity Security Unit.
29
(d) Holders of Stripped Equity Security Units who reestablish
Equity Security Units shall be responsible for any fees or expenses
payable to the Collateral Agent for its services as Collateral Agent in
respect of the substitution, and the Company shall not be responsible
for any such fees or expenses.
(e) In the event a Holder who reestablishes Equity Security
Units pursuant to this Section 3.14 fails to effect a book-entry
transfer of the Stripped Equity Security Units or fails to deliver a
Stripped Equity Security Unit Certificate to the Agent after depositing
Pledged Notes with the Collateral Agent, the Treasury Securities
constituting a part of such Stripped Equity Security Units, and any
distributions on such Treasury Securities shall be held in the name of
the Agent or its nominee in trust for the benefit of such Holder, until
such Stripped Equity Security Units are so transferred or the Stripped
Equity Security Unit Certificate is so delivered, as the case may be,
or, with respect to a Stripped Equity Security Unit Certificate, such
Holder provides evidence satisfactory to the Company and the Agent that
such Stripped Equity Security Unit Certificate has been destroyed, lost
or stolen, together with any indemnity that may be required by the
Agent and the Company.
SECTION 3.15 Transfer Of Collateral Upon Occurrence Of Termination
Event. Upon the occurrence of a Termination Event and the transfer to the Agent
of the Notes, the appropriate Applicable Ownership Interest in the Treasury
Portfolio or Tax Event Treasury Portfolio underlying the Equity Security Units,
or the Treasury Securities underlying the Stripped Equity Security Units, as the
case may be, pursuant to the terms of the Pledge Agreement, the Agent shall
request transfer instructions with respect to such Notes or the appropriate
Applicable Ownership Interest in the Treasury Portfolio or Tax Event Treasury
Portfolio, or Treasury Securities, as the case may be, from each Holder by
written request mailed to such Holder at its address as it appears in the Equity
Security Unit Register or the Stripped Equity Security Unit Register, as the
case may be. Upon book-entry transfer of the Equity Security Units or Stripped
Equity Security Units, as the case may be, or delivery of an Equity Security
Unit Certificate or Stripped Equity Security Unit Certificate to the Agent with
such transfer instructions, the Agent shall transfer the Notes, the appropriate
Applicable Ownership Interest in the Treasury Portfolio or Tax Event Treasury
Portfolio underlying such Equity Security Units, or Treasury Securities
underlying the Stripped Equity Security Unit, as the case may be, to such Holder
by book-entry transfer, or other appropriate procedures, in accordance with such
instructions. In the event a Holder of Equity Security Units or Stripped Equity
Security Units fails to effect such transfer or delivery, the Notes, the
appropriate Applicable Ownership Interest in the Treasury Portfolio or Tax
Exempt Treasury Portfolio, as the case may be, underlying such Equity Security
Units, or Treasury Securities underlying such Stripped Equity Security Units, as
the case may be, and any distributions thereon, shall be held in the name of the
Agent or its nominee in trust for the benefit of such Holder, until such Equity
Security Units or Stripped Equity Security Units, as the case may be, are
transferred or the Equity Security Unit Certificate or Stripped Equity Security
Unit Certificate is surrendered or such Holder provides satisfactory evidence
that such Equity Security Unit Certificate or Stripped Equity Security Unit
Certificate has been destroyed, lost or stolen, together with any indemnity that
may be required by the Agent and the Company. In the case of the Treasury
Portfolio, Tax Event Treasury Portfolio or any Treasury Securities, the Agent
may dispose of the subject securities for cash and pay the applicable portion of
such cash to the
30
Holders in lieu of such Holders' Applicable Ownership Interest in such Treasury
Portfolio or Tax Event Treasury Portfolio, or any Treasury Securities, where
such Holder would otherwise have been entitled to receive less than $1,000 of
any such security.
SECTION 3.16 No Consent To Assumption. Each Holder of Equity Security
Units or Stripped Equity Security Units, as the case may be, by acceptance
thereof, shall be deemed expressly to have withheld any consent to the
assumption under Section 365 of the Bankruptcy Code or otherwise, of the
Purchase Contract by the Company, any receiver, liquidator or person or entity
performing similar functions or its trustee in the event that the Company
becomes the debtor under the Bankruptcy Code or subject to other similar state
or federal law providing for reorganization or liquidation.
ARTICLE IV.
THE NOTES
SECTION 4.1 Payment Of Interest; Rights To Interest Payments Preserved;
Notice.
(a) A payment on any Note or Applicable Ownership Interest in
the Treasury Portfolio or Tax Event Treasury Portfolio, as the case may
be, which is paid on any Payment Date other than a Payment Date with
respect to the Stated Amount due on the Applicable Ownership Interest
in the Treasury Portfolio or Tax Event Treasury Portfolio shall,
subject to receipt thereof by the Agent from the Collateral Agent (if
the Collateral Agent is the registered owner thereof) as provided by
the terms of the Pledge Agreement, be paid to the Person in whose name
the Equity Security Unit Certificate (or one or more Predecessor Equity
Security Unit Certificates) of which such Note or the appropriate
Applicable Ownership Interest in the Treasury Portfolio or Tax Event
Treasury Portfolio, as the case may be, is a part is registered at the
close of business on the Record Date for such Payment Date.
(b) Each Equity Security Unit Certificate evidencing Notes or
the appropriate Applicable Ownership Interest in the Treasury Portfolio
or Tax Event Treasury Portfolio, as the case may be, delivered under
this Agreement upon registration of transfer of or in exchange for or
in lieu of any other Equity Security Unit Certificate shall carry the
rights to interest accrued and unpaid, which were carried by the Notes
or the appropriate Applicable Ownership Interest in the Treasury
Portfolio or Tax Event Treasury Portfolio, as the case may be,
underlying such other Equity Security Unit Certificate.
(c) In the case of any Equity Security Units with respect to
which Early Settlement of the underlying Purchase Contract is effected
on an Early Settlement Date, Merger Early Settlement of the underlying
Purchase Contract is effected on a Merger Early Settlement Date, Cash
Settlement is effected on the eighth Business Day immediately preceding
the Stock Purchase Date, or a Collateral Substitution is effected, in
each case on a date that is after any Record Date and on or prior to
the next succeeding Payment Date, payments on the Note or the
appropriate or Applicable Ownership Interest in the Treasury Portfolio
or Tax Event Portfolio, as the case may be, underlying such
31
Equity Security Units otherwise payable on such Payment Date shall be
payable on such Payment Date notwithstanding such Early Settlement,
Merger Early Settlement, Cash Settlement or Collateral Substitution, as
the case may be, and such payments shall, subject to receipt thereof by
the Agent, be payable to the Person in whose name the Equity Security
Unit Certificate (or one or more Predecessor Equity Security Unit
Certificates) was registered at the close of business on the Record
Date. Except as otherwise expressly provided in the immediately
preceding sentence, in the case of any Equity Security Units with
respect to which Early Settlement, Merger Early Settlement or Cash
Settlement of the underlying Purchase Contract is effected, or with
respect to which a Collateral Substitution has been effected, payments
on the related Notes or payments on the appropriate Applicable
Ownership Interest in the Treasury Portfolio or Tax Event Treasury
Portfolio, as the case may be, that would otherwise be payable after
the applicable Settlement Date or after such Collateral Substitution,
as the case may be, shall not be payable hereunder to the Holder of
such Equity Security Units; provided, that to the extent that such
Holder continues to hold the Separate Notes that formerly comprised a
part of such Holder's Equity Security Units, such Holder shall be
entitled to receive the payments on such Separate Notes.
(d) By purchasing and accepting the Equity Security Units or
the Separate Notes, a Holder of the Equity Security Units or a holder
of the Separate Notes, as the case may be, will be deemed to have
agreed to treat for all U.S. federal income tax purposes the Notes
forming a part of such Equity Security Units or the Separate Notes, as
the case may be, as "contingent payment debt instrument" as the term is
used in Treasury regulations section 1275-4.
SECTION 4.2 Notice And Voting. Under the terms of the Pledge Agreement,
the Agent will be entitled to exercise the voting and any other consensual
rights pertaining to the Pledged Notes but only to the extent instructed by the
Holders as described below. Upon receipt of notice of any meeting at which
holders of Notes are entitled to vote or upon any solicitation of consents,
waivers or proxies of holders of Notes, the Agent shall, as soon as practicable
thereafter, mail to the Holders of Equity Security Units a notice (a) containing
such information as is contained in the notice or solicitation, (b) stating that
each Holder on the record date set by the Agent therefor (which, to the extent
possible, shall be the same date as the record date for determining the holders
of Notes entitled to vote) shall be entitled to instruct the Agent as to the
exercise of the voting rights pertaining to the Pledged Notes underlying their
Equity Security Units and (c) stating the manner in which such instructions may
be given. Upon the written request of the Holders of Equity Security Units on
such record date, the Agent shall endeavor insofar as practicable to vote or
cause to be voted, in accordance with the instructions set forth in such
requests, the maximum number of Pledged Notes as to which any particular voting
instructions are received. In the absence of specific instructions from the
Holder of an Equity Security Unit, the Agent shall abstain from voting the
Pledged Note underlying such Equity Security Units. The Company hereby agrees,
if applicable, to solicit Holders of Equity Security Units to timely instruct
the Agent in order to enable the Agent to vote such Pledged Notes.
SECTION 4.3 Tax Event Redemption. Upon the occurrence of a Tax Event
Redemption prior to the earlier of a successful remarketing of the Notes or the
Stock Purchase
32
Date, the Company shall instruct the Collateral Agent in writing to apply, and
upon such written instruction the Collateral Agent shall apply, out of the
aggregate Redemption Price for the Notes that are components of Equity Security
Units, an amount equal to the aggregate Redemption Amount for the Notes that are
components of Equity Security Units to purchase on behalf of the Holders of
Equity Security Units the Tax Event Treasury Portfolio and promptly remit the
remaining portion of such Redemption Price to the Agent for payment to the
Holders of such Equity Security Units. The Tax Event Treasury Portfolio will be
substituted for the Pledged Notes, and will be pledged to the Collateral Agent
in accordance with the terms of the Pledge Agreement to secure the obligation of
each Holder of an Equity Security Unit to purchase the Common Stock under the
Purchase Contract constituting a part of such Equity Security Units. Following
the occurrence of a Tax Event Redemption prior to the earlier of a successful
remarketing of the Notes or the Stock Purchase Date, the Holders of Equity
Security Units and the Collateral Agent shall have such security interests,
rights and obligations with respect to the Tax Event Treasury Portfolio as the
Holder of Equity Security Units and the Collateral Agent had in respect of the
Notes, as the case may be, subject to the Pledge thereof as provided in Articles
II, III, IV, V and VI of the Pledge Agreement, and any reference herein or in
the Certificates to the Note shall be deemed to be a reference to such Tax Event
Treasury Portfolio and any reference herein or in the Certificates to interest
on the Notes shall be deemed to be a reference to corresponding distributions on
the Tax Event Treasury Portfolio. The Company may cause to be made in any Equity
Security Unit Certificates thereafter to be issued such change in phraseology
and form (but not in substance) as may be appropriate to reflect the
substitution of the Tax Event Treasury Portfolio for Notes as collateral.
The Company shall cause notice of any Tax Event Redemption to be
mailed, at least 30 calendar days but not more than 60 calendar days before such
Tax Event Redemption Date, to each Holder of Notes to be redeemed at its
registered address.
Upon the occurrence of a Tax Event Redemption after the successful
remarketing of the Notes, the Redemption Price will be payable in cash to the
holders of the Notes.
ARTICLE V.
THE PURCHASE CONTRACTS; THE REMARKETING
SECTION 5.1 Purchase Of Shares Of Common Stock.
(a) Each Purchase Contract shall, unless an Early Settlement
has occurred in accordance with Section 5.9, or a Merger Early
Settlement has occurred in accordance with Section 5.10, obligate the
Holder of the related Equity Security Units or Stripped Equity Security
Units, as the case may be, to purchase, and the Company to sell, on the
Stock Purchase Date at a price equal to $25 (the "Purchase Price"), a
number of newly issued shares of Common Stock equal to the Settlement
Rate unless, on or prior to the Stock Purchase Date, there shall have
occurred a Termination Event with respect to the Equity Security Units
or Stripped Equity Security Units, as the case may be, of which such
Purchase Contract is a part. The "Settlement Rate" is equal to,
33
(i) if the Applicable Market Value (as defined below)
is greater than or equal to $51.90 (the "Threshold
Appreciation Price"), 0.4817 shares of Common Stock per
Purchase Contract,
(ii) if the Applicable Market Value is less than the
Threshold Appreciation Price, but is greater than $43.25 (the
"Reference Price"), the number of shares of Common Stock per
Purchase Contract equal to the Stated Amount of the related
Equity Security Units or Stripped Equity Security Units, as
the case may be, divided by the Applicable Market Value, and
(iii) if the Applicable Market Value is equal to or
less than the Reference Price, 0.5780 shares of Common Stock
per Purchase Contract,
in each case subject to adjustment as provided in Section 5.6 (and in
each case rounded upward or downward to the nearest 1/10,000th of a
share). As provided in Section 5.12, no fractional shares of Common
Stock will be issued upon settlement of Purchase Contracts.
(b) No fractional shares of Common Stock will be issued by the
Company with respect to the payment of Contract Adjustment Payments on
the Stock Purchase Date. In lieu of fractional shares otherwise
issuable with respect to such payment of Contract Adjustment Payments,
the Holder will be entitled to receive an amount in cash as provided in
Section 5.12.
(c) The "Applicable Market Value" means the average of the
Closing Prices per share of Common Stock on each of the 20 consecutive
Trading Days ending on the third Trading Day immediately preceding the
Stock Purchase Date. The "Closing Price" of the Common Stock on any
date of determination means the closing sale price (or, if no closing
price is reported, the last reported sale price) of the Common Stock on
the New York Stock Exchange (the "NYSE") on such date or, if the Common
Stock is not listed for trading on the NYSE on any such date, as
reported in the composite transactions for the principal United States
securities exchange on which the Common Stock is so listed, or if the
Common Stock is not so listed on a United States national or regional
securities exchange, as reported by The Nasdaq Stock Market, or, if the
Common Stock is not so reported, the last quoted bid price for the
Common Stock in the over-the-counter market as reported by the National
Quotation Bureau or similar organization, or, if such bid price is not
available, the market value of the Common Stock on such date as
determined by a nationally recognized independent investment banking
firm retained for this purpose by the Company. A "Trading Day" means a
day on which the Common Stock (A) is not suspended from trading on any
national or regional securities exchange or association or
over-the-counter market at the close of business and (B) has traded at
least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for
the trading of the Common Stock.
(d) Each Holder of an Equity Security Unit or Stripped Equity
Security Unit, as the case may be, by its acceptance thereof,
irrevocably authorizes the Agent to enter
34
into and perform the related Purchase Contract on its behalf as its
attorney-in-fact (including the execution of Certificates on behalf of
such Holder), agrees to be bound by the terms and provisions thereof,
covenants and agrees to perform its obligations under such Purchase
Contracts, and consents to the provisions hereof, irrevocably
authorizes the Agent as its attorney-in-fact to enter into and perform
the Pledge Agreement on its behalf as its attorney-in-fact, and
consents to and agrees to be bound by the Pledge of the Notes, the
appropriate Applicable Ownership Interest in the Treasury Portfolio or
Tax Event Treasury Portfolio, as the case may be, or the Treasury
Securities, pursuant to the Pledge Agreement; provided that upon a
Termination Event, the rights of the Holder of such Equity Security
Units or Stripped Equity Security Units, as the case may be, under the
Purchase Contract may be enforced without regard to any other rights or
obligations. Each Holder of an Equity Security Unit or Stripped Equity
Security Unit, as the case may be, by its acceptance thereof, further
covenants and agrees, that, to the extent and in the manner provided in
Section 5.4 and the Pledge Agreement, but subject to the terms thereof,
payments in respect of the Notes, the appropriate Applicable Ownership
Interest in the Treasury Portfolio or Tax Event Treasury Portfolio, as
the case may be, in the case of Holders of Equity Security Units, or
the Treasury Securities, in the case of Holders of Stripped Equity
Security Units, to be paid upon settlement of such Holder's obligations
to purchase Common Stock under the Purchase Contract, shall be paid on
the Stock Purchase Date by the Collateral Agent to the Company in
satisfaction of such Holder's obligations under such Purchase Contract.
(e) Upon registration of transfer of a Certificate, the
transferee shall be bound (without the necessity of any other action on
the part of such transferee) under the terms of this Agreement, the
Purchase Contracts underlying such Certificate and the Pledge
Agreement, and the transferor shall be released from the obligations
under this Agreement, the Purchase Contracts underlying the
Certificates so transferred and the Pledge Agreement. The Company
covenants and agrees, and each Holder of a Certificate, by its
acceptance thereof, likewise covenants and agrees, to be bound by the
provisions of this paragraph.
SECTION 5.2 Contract Adjustment Payments.
(a) Contract Adjustment Payments shall accrue on each Purchase
Contract constituting a part of an Equity Security Unit or Stripped
Equity Security Unit at 4.15% per year of the Stated Amount of such
Equity Security Units or Stripped Equity Security Units, from and
including June 25, 2002 through but excluding the Stock Purchase Date,
provided that no Contract Adjustment Payment shall accrue after an
Early Settlement or Merger Early Settlement. Subject to Section 5.3
herein, the Company shall pay, on each Payment Date, the Contract
Adjustment Payments, if any, payable in respect of each Purchase
Contract to the Person in whose name a Certificate (or one or more
Predecessor Certificates) is registered at the close of business on the
Record Date immediately preceding such Payment Date in such coin or
currency of the United States as at the time of payment shall be legal
tender for payments. The Contract Adjustment Payments, if any, will be
payable at the office in New York, New York, maintained for that
purpose or, at the option of the Company, by check mailed to the
address of the
35
Person entitled thereto at such Person's address as it appears on the
Register or by wire transfer to the account designated to the Agent by
a prior written notice by such Person delivered at least ten Business
Days prior to the applicable Payment Date.
(b) Upon the occurrence of a Termination Event, the Company's
obligation to pay Contract Adjustment Payments (including any
accumulated Deferred Contract Adjustment Payments), if any, shall
cease.
(c) Each Certificate delivered under this Agreement upon
registration of transfer of or in exchange for or in lieu of (including
as a result of a Collateral Substitution or the re-establishment of an
Equity Security Unit) any other Certificate shall carry the rights to
Contract Adjustment Payments, if any, accumulated and unpaid, and to
accumulate Contract Adjustment Payments, if any, which were carried by
the Purchase Contracts underlying such other Certificates.
(d) Subject to Sections 5.9 and 5.10, in the case of any
Equity Security Units or Stripped Equity Security Units, as the case
may be, with respect to which Early Settlement or Merger Early
Settlement of the underlying Purchase Contract is effected on an Early
Settlement Date or a Merger Early Settlement Date, respectively, or in
respect of which Cash Settlement of the underlying Purchase Contract is
effected on the eighth Business Day immediately preceding the Stock
Purchase Date, or with respect to which a Collateral Substitution or an
establishment or re-establishment of an Equity Security Unit pursuant
to Section 3.13 or Section 3.14 is effected, in each case on a date
that is after any Record Date and on or prior to the next succeeding
Payment Date, Contract Adjustment Payments on the Purchase Contract
underlying such Equity Security Units or Stripped Equity Security
Units, as the case may be, otherwise payable on such Payment Date shall
be payable on such Payment Date notwithstanding such Cash Settlement,
Early Settlement, Merger Early Settlement, Collateral Substitution or
establishment or re-establishment of Equity Security Units, and such
Contract Adjustment Payments shall be paid to the Person in whose name
the Certificate evidencing such Equity Security Units or Stripped
Equity Security Units (or one or more Predecessor Certificates) is
registered at the close of business on such Record Date. Except as
otherwise expressly provided in the immediately preceding sentence, in
the case of any Equity Security Units or Stripped Equity Security Units
with respect to which Cash Settlement (in the case of Equity Security
Units only), Early Settlement or Merger Early Settlement is effected or
with respect to which a Collateral Substitution or an establishment or
re-establishment of an Equity Security Unit has been effected, Contract
Adjustment Payments, if any, that would otherwise be payable after the
Early Settlement Date, Merger Early Settlement Date, Collateral
Substitution or such establishment or re-establishment with respect to
such Purchase Contract shall not be payable.
SECTION 5.3 Deferral Of Contract Adjustment Payments.
(a) The Company shall have the right, at any time prior to the
Stock Purchase Date, to defer the payment of any or all of the Contract
Adjustment Payments otherwise payable on any Payment Date, but only if
the Company shall give the Holders and the
36
Agent written notice of its election to defer each such deferred
Contract Adjustment Payment (specifying the amount to be deferred) at
least ten Business Days prior to the earlier of (i) the next succeeding
Payment Date or (ii) the date the Company is required to give notice of
the Record Date or Payment Date with respect to payment of such
Contract Adjustment Payments to the NYSE or other applicable
self-regulatory organization or to Holders of the Equity Security Units
and Stripped Equity Security Units, but in any event not less than one
Business Day prior to such Record Date. Any Contract Adjustment
Payments so deferred shall, to the extent permitted by law, bear
additional Contract Adjustment Payments thereon at the rate of 8.75%
per year (computed on the basis of a 360-day year of twelve 30-day
months), compounding on each succeeding Payment Date, until paid in
full (such deferred installments of Contract Adjustment Payments, if
any, together with the additional Contract Adjustment Payments
accumulated thereon, being referred to herein as the "Deferred Contract
Adjustment Payments"). Deferred Contract Adjustment Payments, if any,
shall be due on the next succeeding Payment Date except to the extent
that payment is deferred pursuant to this Section 5.3. No Contract
Adjustment Payments may be deferred to a date that is after the Stock
Purchase Date and no such deferral period may end other than on a
Payment Date. If the Purchase Contracts are terminated upon the
occurrence of a Termination Event, the Holder's right to receive
Contract Adjustment Payments and Deferred Contract Adjustment Payments,
if any, will terminate. In the event that the Company elects to defer
Contract Adjustment Payments in part, such deferral shall be pro rata
in respect of all outstanding Purchase Contracts.
(b) In the event that the Company elects to defer the payment
of Contract Adjustment Payments on the Purchase Contracts until a
Payment Date prior to the Stock Purchase Date, then all Deferred
Contract Adjustment Payments, if any, shall be payable to the
registered Holders as of the close of business on the Record Date
immediately preceding such Payment Date.
(c) In the event that the Company elects to defer the payment
of Contract Adjustment Payments on the Purchase Contracts until the
Stock Purchase Date, the Company may elect to pay each Holder on the
Stock Purchase Date, in lieu of a cash payment, a number of shares of
Common Stock (in addition to a number of shares of Common Stock equal
to the Settlement Rate) equal to (A) the aggregate amount of Deferred
Contract Adjustment Payments payable to such Holder (net of any
required tax withholding on such Deferred Contract Adjustment Payment,
which shall be remitted to the appropriate taxing jurisdiction) divided
by (B) the Applicable Market Value.
(d) No fractional shares of Common Stock will be issued by the
Company with respect to the payment of Deferred Contract Adjustment
Payments on the Stock Purchase Date. In lieu of fractional shares
otherwise issuable with respect to such payment of Deferred Contract
Adjustment Payments, the Holder will be entitled to receive an amount
in cash as provided in Section 5.12.
(e) In the event the Company exercises its option to defer the
payment of Contract Adjustment Payments then, until the Deferred
Contract Adjustment Payments have been paid, the Company shall not, and
shall not permit any subsidiary of the
37
Company to, declare or pay dividends on, make distributions with
respect to, or redeem, purchase or acquire, or make a liquidation
payment with respect to, any of the Company's Common Stock other than:
(i) purchases, redemptions or acquisitions of shares
of Common Stock in connection with any employment contract,
benefit plan or other similar arrangement with or for the
benefit of employees, officers or directors or a stock
purchase or dividend reinvestment plan, or the satisfaction by
the Company of its obligations pursuant to any contract or
security outstanding on the date the Company exercises its
right to defer the Contract Adjustment Payments;
(ii) as a result of a reclassification of the
Company's Capital Stock or the exchange or conversion of one
class or series of the Company's Capital Stock for another
class or series of the Company's Capital Stock;
(iii) the purchase of fractional interests of the
Common Stock pursuant to the conversion or exchange provisions
of such Common Stock or the security being converted or
exchanged;
(iv) dividends or distributions payable solely in the
Company's Common Stock (or rights to acquire Common Stock) or
repurchases, acquisitions or redemptions of Common Stock in
connection with the issuance or exchange of the Common Stock
(or securities convertible into or exchangeable for shares of
the Company's Common Stock); or
(v) redemptions, exchanges or repurchases of any
rights outstanding under a shareholder rights plan or the
declaration or payment thereunder of a dividend or
distribution of or with respect to rights in the future.
SECTION 5.4 Payment Of Purchase Price; Remarketing.
(a) Unless a Tax Event Redemption, Termination Event, Merger
Early Settlement or Early Settlement has occurred, or a remarketing has
not been successful as of June 30, 2005, each Holder of an Equity
Security Unit may pay in cash ("Cash Settlement") the Purchase Price
for the shares of Common Stock to be purchased pursuant to a Purchase
Contract if such Holder notifies the Agent by use of a notice in
substantially the form of Exhibit E hereto of its intention to make a
Cash Settlement. Such notice shall be made not earlier than 9:00 a.m.,
New York City time, on the tenth Business Day immediately preceding the
Stock Purchase Date and no later than 5:00 p.m., New York City time, on
the ninth Business Day immediately preceding the Stock Purchase Date.
The Agent shall promptly notify the Collateral Agent of the receipt of
such a notice from a Holder intending to make a Cash Settlement.
(i) A Holder of an Equity Security Unit who has so
notified the Agent of its intention to make a Cash Settlement
is required to pay the Purchase Price to the Collateral Agent
prior to 11:00 a.m., New York City time, on the eighth
38
Business Day immediately preceding the Stock Purchase Date in
lawful money of the United States by certified or cashiers'
check or wire transfer, in each case payable to or upon the
order of the Company. Any cash received by the Collateral
Agent will be paid to the Company on the Stock Purchase Date
in settlement of the Purchase Contract in accordance with the
terms of this Agreement and the Pledge Agreement.
(ii) If a Holder of an Equity Security Unit fails to
notify the Agent of its intention to make a Cash Settlement in
accordance with paragraph (a) above, or does notify the Agent
as provided in paragraph (a)(i) above of its intention to pay
the Purchase Price in cash, but fails to make such payment as
required by paragraph (a)(i) above, the Holder shall be deemed
to have consented to the disposition of the Pledged Notes
pursuant to the remarketing to occur in the Remarketing Period
commencing the seventh Business Day immediately preceding the
Stock Purchase Date as described in paragraph (b) below.
(b) (1) The Company shall engage a nationally recognized
investment bank (the "Remarketing Agent") pursuant to the Remarketing
Agreement to be mutually agreed on by the Company, the Agent and the
Remarketing Agent, but substantially as set forth in Exhibit F hereto,
to sell the Notes of Holders of Equity Security Units and holders of
Separate Notes that have elected to participate in the remarketing
pursuant to the procedures set forth in Section 4.5(d) of the Pledge
Agreement. On the seventh Business Day immediately preceding the first
Business Day of any Remarketing Period, the Remarketing Agent shall
give holders of Separate Notes notice of the remarketing (the form of
which notice to be provided by the Company) by release of such
information by means of Bloomberg and Reuters newswire or any
successor(s) to such service(s). The Agent shall notify, by 10:00 a.m.,
New York City time, on the third Business Day immediately preceding the
first Business Day of any Remarketing Period, the Remarketing Agent and
the Collateral Agent of the aggregate number of Notes of Equity
Security Unit Holders to be remarketed. On the third Business Day
immediately preceding the first Business Day of any Remarketing Period,
no later than by 10:00 a.m. New York City time, pursuant to the terms
of the Pledge Agreement, the Custodial Agent will notify the
Remarketing Agent of the aggregate number of Separate Notes to be
remarketed. On the third Business Day immediately preceding the first
Business Day of any Remarketing Period, the Collateral Agent and the
Custodial Agent, pursuant to the terms of the Pledge Agreement, will
deliver for remarketing to the Remarketing Agent all Notes to be
remarketed. Upon receipt of such notice from the Custodial Agent and
such Notes from the Collateral Agent and the Custodial Agent, the
Remarketing Agent will, on the Remarketing Date and on any Subsequent
Remarketing Date in accordance with the provisions of Section
5.4(b)(ii) below, use its commercially reasonable best efforts to (i)
establish a rate of interest that, in the opinion of the Remarketing
Agent, will, when applied to the Notes included in the remarketing,
enable the then current aggregate market value of the Notes to have a
value equal to approximately, but not less than, 100.50% of the
Remarketing Value as of the Remarketing Date or as of any Subsequent
Remarketing Date, as the case may be (the "Reset Rate") and (ii) sell
such Notes on such date at a price equal to approximately, but not less
than, 100.50% of the Remarketing Value. The
39
Remarketing Agent will deduct as a remarketing fee an amount not
exceeding 25 basis points (0.25%) of the total proceeds from the
remarketing (the "Remarketing Fee"). The Remarketing Agent will use the
remaining proceeds from the successful remarketing to purchase the
appropriate U.S. Treasury securities (the "Treasury Portfolio") (with
the CUSIP numbers, if any, selected by the Remarketing Agent) described
in clauses (i) and (ii) of the definition of Remarketing Value related
to the Notes of Holders of Equity Security Units that were remarketed.
On or prior to the third Business Day following the Remarketing Date
(or in the event that the Notes are not successfully remarketed on the
Remarketing Date, on or prior to the third Business Day immediately
following the applicable Subsequent Remarketing Date), the Remarketing
Agent shall deliver such Treasury Portfolio to the Agent, which shall
thereupon deliver such Treasury Portfolio to the Collateral Agent. The
Collateral Agent, for the benefit of the Company, will thereupon apply
such Treasury Portfolio, in accordance with the Pledge Agreement, to
secure such Holders' obligations under the Purchase Contracts. The
Remarketing Agent will remit (1) the portion of the proceeds from the
remarketing attributable to the Separate Notes to the holders of
Separate Notes that were remarketed and (2) the remaining portion of
the proceeds, less those proceeds used to purchase the Treasury
Portfolio, to the Holders of the Equity Security Units that were
remarketed, all determined on a pro rata basis, in each case, net of
the remarketing fee, on or prior to the third Business Day following
the Remarketing Date (or in the event that the Notes are not
successfully remarketed on the Remarketing Date, on or prior to the
third Business Day immediately following the applicable Subsequent
Remarketing Date for a successful remarketing). Holders whose Notes are
so remarketed will not otherwise be responsible for the payment of any
Remarketing Fee in connection therewith.
(i) If, in spite of using its commercially reasonable
best efforts, the Remarketing Agent cannot establish the Reset
Rate and remarket the Notes included in the remarketing at a
price equal to approximately, but not less than, 100.50% of
the Remarketing Value on the Remarketing Date, the Remarketing
Agent will attempt to again establish the Reset Rate and
remarket the Notes included in the remarketing at a price
equal to approximately, but not less than, 100.50% of the
Remarketing Value on each of the two immediately following
Business Days. If the Remarketing Agent cannot remarket the
Notes included in the remarketing at a price equal to
approximately, but not less than, 100.50% of the Remarketing
Value on either of those days, it will attempt to establish
the Reset Rate and remarket the Notes included in the
remarketing at a price equal to approximately, but not less
than, 100.50% of the Remarketing Value on each of the three
Business Days immediately preceding July 1, 2005. If the
Remarketing Agent cannot establish the Reset Rate and remarket
the Notes included in the remarketing at a price equal to
approximately, but not less than, 100.50% of the Remarketing
Value on any of the three Business Days immediately preceding
July 1, 2005, the Remarketing Agent will further attempt to
establish the Reset Rate and remarket the Notes included in
the remarketing at a price equal to approximately, but not
less than, 100.50% of the Remarketing Value on each of the
seventh, sixth and fifth Business Days immediately preceding
the Stock
40
Purchase Date. If the Remarketing Agent cannot establish the
Reset Rate and remarket the Notes included in the remarketing
at a price equal to approximately, but not less than, 100.50%
of the Remarketing Value on any of the Remarketing Date or the
two Business Days immediately following the Remarketing Date,
on any of the three Business Days immediately preceding July
1, 2005 or on the seventh or sixth or fifth Business Day
immediately preceding the Stock Purchase Date, the remarketing
on each such date will be deemed to have failed (each, a
"Failed Remarketing"). In addition, if, in spite of using its
commercially reasonable best efforts, the Remarketing Agent
fails to remarket the Notes included in the remarketing at
100.50% of the Remarketing Value in accordance with the terms
of the Pledge Agreement by 4:00 p.m., New York City time, on
the last Business Day in a Remarketing Period, a "Last Failed
Remarketing" will be deemed to have occurred for that
Remarketing Period. Within three Business Days following the
date of any Last Failed Remarketing, the Remarketing Agent
shall return any Notes delivered to it to the Collateral
Agent. In the event of a Last Failed Remarketing on the fifth
Business Day immediately preceding the Stock Purchase Date,
(1) the Reset Rate on the Notes will be determined as set
forth in the Notes and (2) an event of default shall be deemed
to have occurred under this Agreement and the Pledge Agreement
and in accordance with the terms of the Pledge Agreement, the
Collateral Agent, for the benefit of the Company, shall, in
respect of the Notes comprising components of Equity Security
Units, exercise its rights as a secured party with respect to
such Notes, including those actions specified in subsection
(b) (iii) below; provided, that if upon a Last Failed
Remarketing on the fifth Business Day immediately preceding
the Stock Purchase Date, the Collateral Agent delivers a Note
to the Company in full satisfaction of the Holder's obligation
under the related Purchase Contract, any accrued and unpaid
interest on such Note will become payable by the Company to
the Agent for payment to the Holder of the Equity Security
Units to which such Note relates. Such payment will be made by
the Company on or prior to 11:00 a.m., New York City time, on
the Stock Purchase Date in lawful money of the United States
by certified or cashier's check or wire transfer in
immediately available funds payable to or upon the order of
the Agent. The Company will cause a notice of any Last Failed
Remarketing to be released by means of Bloomberg and Reuters
newswire or any successor(s) to such service(s). In addition,
the Company will request, not later than seven nor more than
15 calendar days prior to any Remarketing Period, that the
Depositary notify its participants holding Notes, Equity
Security Units or Stripped Equity Security Units, as the case
may be, of the remarketing.
(ii) With respect to any Notes that constitute part
of Equity Security Units that are subject to a Last Failed
Remarketing on the fifth Business Day immediately preceding
the Stock Purchase Date, the Collateral Agent for the benefit
of the Company reserves all of its rights as a secured party
with respect thereto and, subject to applicable law and
Section 5.4 (e) below, may, among other things, permit the
Company to cause the Notes to be sold or to retain and
41
cancel such Notes, in either case, in full satisfaction of the
Holders' obligations under the Purchase Contracts.
(c) Upon the maturity of the Pledged Treasury Securities
underlying the Stripped Equity Security Units and the Pledged
Applicable Ownership Interest in the Treasury Portfolio or the Pledged
Applicable Ownership Interest in the Tax Event Treasury Portfolio, as
the case may be, underlying the Equity Security Units on the Stock
Purchase Date, the Collateral Agent shall remit to the Company an
amount equal to the aggregate Purchase Price applicable to such Equity
Security Units and Stripped Equity Security Units, as payment for the
Common Stock issuable upon settlement thereof without receiving any
instructions from the Holders of such Equity Security Units and
Stripped Equity Security Units. In the event the payments in respect of
the Pledged Treasury Securities, Pledged Applicable Ownership Interest
in the Treasury Portfolio or Pledged Applicable Ownership Interest in
the Tax Event Treasury Portfolio underlying Equity Security Units or
Stripped Equity Security Units, as the case may be, is in excess of the
Purchase Price of the Purchase Contract being settled thereby, the
Collateral Agent will distribute such excess to the Agent for the
benefit of the Holder of such Equity Security Units or Stripped Equity
Security Units, as the case may be, when received.
(d) Any distribution to Holders of excess funds and interest
described in Section 5.4(b) and (c) above shall be payable at the
office of the Agent in The City of New York maintained for that purpose
or, at the option of the Holder or the holder of Separate Notes, as
applicable, by check mailed to the address of the Person entitled
thereto at such address as it appears on the Register or by wire
transfer to an account specified by the Holder or the holder of
Separate Notes, as applicable.
(e) The obligations of each Holder to pay the Purchase Price
are non-recourse obligations and except to the extent paid by Cash
Settlement, Early Settlement or Merger Early Settlement, are payable
solely out of the proceeds of any Collateral pledged to secure the
obligations of the Holders and in no event will Holders be liable for
any deficiency between such payments and the Purchase Price.
(f) Notwithstanding anything to the contrary herein, the
Company shall not be obligated to issue any Common Stock in respect of
a Purchase Contract or deliver any certificates therefor to the Holder
of the related Equity Security Units or Stripped Equity Security Units,
as the case may be, unless the Company shall have received payment in
full for the shares of Common Stock to be purchased thereunder by such
Holder in the manner herein set forth.
(g) In the event of a successful remarketing, the interest
rate on all of the outstanding Notes (whether or not included in the
remarketing) shall be adjusted to the Reset Rate.
SECTION 5.5 Issuance Of Shares Of Common Stock. Unless a Termination
Event shall have occurred on or prior to the Stock Purchase Date or an Early
Settlement or a Merger Early Settlement shall have occurred, on the Stock
Purchase Date, upon its receipt of payment for
42
the shares of Common Stock purchased by the Holders pursuant to the foregoing
provisions of this Article and subject to Section 5.6, the Company shall issue
and deposit with the Agent, for the benefit of the Holders of the Outstanding
Units, one or more certificates representing the newly issued shares of Common
Stock registered in the name of the Agent (or its nominee) as custodian for the
Holders (such certificates for shares of Common Stock, together with any
dividends or distributions for which a record date and payment date for such
dividend or distribution has occurred after the Stock Purchase Date, being
hereinafter referred to as the "Purchase Contract Settlement Fund") to which the
Holders are entitled hereunder. Subject to the foregoing, upon surrender of a
Certificate to the Agent on or after the Stock Purchase Date, together with
settlement instructions thereon duly completed and executed, the Holder of such
Certificate shall be entitled to receive in exchange therefor a certificate
representing that number of whole shares of Common Stock which such Holder is
entitled to receive pursuant to the provisions of this Article V (after taking
into account all Equity Security Units and Stripped Equity Security Units then
held by such Holder) together with cash in lieu of fractional shares as provided
in Section 5.12 and any dividends or distributions with respect to such shares
constituting part of the Purchase Contract Settlement Fund, but without any
interest thereon, and the Certificate so surrendered shall forthwith be
cancelled. Such shares shall be registered in the name of the Holder or the
Holder's designee as specified in the settlement instructions provided by the
Holder to the Agent. If any shares of Common Stock issued in respect of a
Purchase Contract are to be registered to a Person other than the Person in
whose name the Certificate evidencing such Purchase Contract is registered, no
such registration shall be made unless the Person requesting such registration
has paid any transfer and other taxes required by reason of such registration in
a name other than that of the registered Holder of such Certificate or has
established to the satisfaction of the Company that such tax either has been
paid or is not payable.
SECTION 5.6 Adjustment Of Settlement Rate.
(a) Adjustments for Dividends, Distributions, Stock Splits,
Etc.
(1) Stock Dividends. In case the Company shall pay or
make a dividend or other distribution on the Common Stock in
Common Stock, the Settlement Rate, as in effect at the opening
of business on the day following the date fixed for the
determination of stockholders entitled to receive such
dividend or other distribution shall be increased by dividing
such Settlement Rate by a fraction of which the numerator
shall be the number of shares of Common Stock outstanding at
the close of business on the date fixed for such determination
and the denominator shall be the sum of such number of shares
and the total number of shares constituting such dividend or
other distribution, such increase to become effective
immediately after the opening of business on the day following
the date fixed for such determination. For the purposes of
this paragraph (1), the number of shares of Common Stock at
the time outstanding shall not include shares held in the
treasury of the Company but shall include any shares issuable
in respect of any scrip certificates issued in lieu of
fractions of shares of Common Stock. The Company will not pay
any dividend or make any distribution on shares of Common
Stock held in the treasury of the Company.
43
(2) Stock Purchase Rights. In case the Company shall
issue rights, options or warrants to all holders of its Common
Stock entitling them to subscribe for or purchase shares of
Common Stock at a price per share less than the Current Market
Price per share of the Common Stock on the date fixed for the
determination of stockholders entitled to receive such rights,
options or warrants (other than pursuant to a dividend
reinvestment, share purchase or similar plan), the Settlement
Rate in effect at the opening of business on the day following
the date fixed for such determination shall be increased by
dividing such Settlement Rate by a fraction, the numerator of
which shall be the number of shares of Common Stock
outstanding at the close of business on the date fixed for
such determination plus the number of shares of Common Stock
which the aggregate of the offering price of the total number
of shares of Common Stock so offered for subscription or
purchase would purchase at such Current Market Price and the
denominator of which shall be the number of shares of Common
Stock outstanding at the close of business on the date fixed
for such determination plus the number of shares of Common
Stock so offered for subscription or purchase, such increase
to become effective immediately after the opening of business
on the day following the date fixed for such determination.
For the purposes of this paragraph (2), the number of shares
of Common Stock at any time outstanding shall not include
shares held in the treasury of the Company but shall include
any shares issuable in respect of any scrip certificates
issued in lieu of fractions of shares of Common Stock.
(3) Stock Splits; Reverse Splits. In case outstanding
shares of Common Stock shall be subdivided or split into a
greater number of shares of Common Stock, the Settlement Rate
in effect at the opening of business on the day following the
day upon which such subdivision or split becomes effective
shall be proportionately increased, and, conversely, in case
outstanding shares of Common Stock shall each be combined into
a smaller number of shares of Common Stock, the Settlement
Rate in effect at the opening of business on the day following
the day upon which such combination becomes effective shall be
proportionately reduced, such increase or reduction, as the
case may be, to become effective immediately after the opening
of business on the day following the day upon which such
subdivision, split or combination becomes effective.
(4) Debt or Asset Distributions. (i) In case the
Company shall, by dividend or otherwise, distribute to all
holders of its Common Stock evidences of its indebtedness,
shares of Capital Stock of the Company, securities, cash or
other assets (excluding any dividend or distribution covered
by clause (1) above or (2) above and any dividend or
distribution paid exclusively in cash and any dividend, shares
of capital stock of any class or series, or similar equity
interests, of or relating to a subsidiary or other business
unit in the case of a Spin-Off referred to in the next
paragraph), the Settlement Rate shall be adjusted so that the
same shall equal the rate determined by dividing the
Settlement Rate in effect immediately prior to the close of
business on the date fixed for the determination of
stockholders entitled to receive such distribution by a
fraction, the numerator of
44
which shall be the Current Market Price per share of the
Common Stock on the date fixed for such determination less the
then fair market value (as determined by the Board of
Directors, whose determination shall be conclusive and
described in a Board Resolution filed with the Agent) of the
portion of the evidences of indebtedness, shares of Capital
Stock of the Company, securities, cash or other assets so
distributed applicable to one share of Common Stock and the
denominator of which shall be such Current Market Price per
share of the Common Stock, such adjustment to become effective
immediately prior to the opening of business on the day
following the date fixed for the determination of stockholders
entitled to receive such distribution. In any case in which
this paragraph (4) is applicable, paragraph (2) of this
Section shall not be applicable.
(ii) In the case of a Spin-Off, the
Settlement Rate in effect immediately before the
close of business on the record date fixed for
determination of stockholders entitled to receive
that distribution will be increased by multiplying
the Settlement Rate by a fraction, the numerator of
which is the Current Market Price per share of the
Common Stock plus the Fair Market Value of the
portion of those shares of Capital Stock or similar
equity interests so distributed applicable to one
share of Common Stock and the denominator of which is
the Current Market Price per share of the Common
Stock. Any adjustment to the settlement rate under
this paragraph 4(ii) will occur at the earlier of (1)
the tenth Trading Day from, and including, the
effective date of the Spin-Off and (2) the date of
the securities being offered in the "Initial Public
Offering" of the Spin-Off, if that Initial Public
Offering is effected simultaneously with the
Spin-Off. For purposes of this Section 5.6(a)(4)(ii),
the term "Initial Public Offering" means the first
time securities of the same class or type as the
securities being distributed in the spin-off are
offered to the public for cash in a bona fide
offering.
(5) Cash Distributions. In case the Company shall, by
dividend or otherwise, distribute to all holders of its Common
Stock cash (excluding any cash that is distributed in a
Reorganization Event to which Section 5.6(b) applies or as
part of a distribution referred to in paragraph (4) of this
Section) (i) in an aggregate amount that, combined together
with (ii) the aggregate amount of any other distributions to
all holders of its Common Stock made exclusively in cash
within the 12 months preceding the date of payment of such
distribution and in respect of which no adjustment pursuant to
this paragraph (5) or paragraph (6) of this Section has been
made and (iii) the aggregate of any cash plus the fair market
value as of the date of the expiration of the tender or
exchange offer referred to below (as determined by the Board
of Directors, whose determination shall be conclusive and
described in a Board Resolution) of consideration payable in
respect of any tender or exchange offer by the Company or any
of its subsidiaries for all or any portion of the Common Stock
concluded within the 12 months preceding the date of payment
of the distribution described in clause (i) above and in
respect of which no adjustment pursuant to this paragraph (5)
or paragraph (6)
45
of this Section has been made, exceeds 15% of the product of
the Current Market Price per share of the Common Stock on the
date for the determination of holders of shares of Common
Stock entitled to receive such distribution times the number
of shares of Common Stock outstanding on such date, then, and
in each such case, immediately after the close of business on
such date for determination, the Settlement Rate shall be
increased so that the same shall equal the rate determined by
dividing the Settlement Rate in effect immediately prior to
the close of business on the date fixed for determination of
the stockholders entitled to receive such distribution by a
fraction (A) the numerator of which shall be equal to the
Current Market Price per share of the Common Stock on the date
fixed for such determination less an amount equal to the
quotient of (x) the combined amount distributed or payable in
the transactions described in clauses (i), (ii) and (iii)
above and (y) the number of shares of Common Stock outstanding
on such date for determination and (B) the denominator of
which shall be equal to the Current Market Price per share of
the Common Stock on such date for determination.
(6) Tender Offers. In case (i) a tender or exchange
offer made by the Company or any subsidiary of the Company for
all or any portion of the Common Stock shall expire and such
tender or exchange offer (as amended upon the expiration
thereof) shall require the payment to stockholders (based on
the acceptance (up to any maximum specified in the terms of
the tender or exchange offer) of Purchased Shares) of an
aggregate consideration having a fair market value (as
determined by the Board of Directors, whose determination
shall be conclusive and described in a Board Resolution) that
combined together with (ii) the aggregate of the cash plus the
fair market value (as determined by the Board of Directors,
whose determination shall be conclusive and described in a
Board Resolution), as of the expiration of such tender or
exchange offer, of consideration payable in respect of any
other tender or exchange offer, by the Company or any
subsidiary of the Company for all or any portion of the Common
Stock expiring within the 12 months preceding the expiration
of such tender or exchange offer and in respect of which no
adjustment pursuant to paragraph (5) of this Section or this
paragraph (6) has been made and (iii) the aggregate amount of
any distributions to all holders of the Company's Common Stock
made exclusively in cash within the 12 months preceding the
expiration of such tender or exchange offer and in respect of
which no adjustment pursuant to paragraph (5) of this Section
or this paragraph (6) has been made, exceeds 15% of the
product of the Current Market Price per share of the Common
Stock as of the last time (the "Expiration Time") tenders
could have been made pursuant to such tender or exchange offer
(as it may be amended) times the number of shares of Common
Stock outstanding (including any tendered shares) on the
Expiration Time, then, and in each such case, immediately
prior to the opening of business on the day after the date of
the Expiration Time, the Settlement Rate shall be adjusted so
that the same shall equal the rate determined by dividing the
Settlement Rate immediately prior to the close of business on
the date of the Expiration Time by a fraction (A) the
numerator of which shall be equal to (x) the product of (I)
the
46
Current Market Price per share of the Common Stock on the date
of the Expiration Time and (II) the number of shares of Common
Stock outstanding (including any tendered shares) on the
Expiration Time less (y) the amount of cash plus the fair
market value (determined as aforesaid) of the aggregate
consideration payable to stockholders based on the
transactions described in clauses (i), (ii) and (iii) above
(assuming in the case of clause (i) the acceptance, up to any
maximum specified in the terms of the tender or exchange
offer, of Purchased Shares), and (B) the denominator of which
shall be equal to the product of (x) the Current Market Price
per share of the Common Stock as of the Expiration Time and
(y) the number of shares of Common Stock outstanding
(including any tendered shares) as of the Expiration Time less
the number of all shares validly tendered and not withdrawn as
of the Expiration Time (the shares deemed so accepted, up to
any such maximum, being referred to as the "Purchased
Shares").
(7) Reclassification. The reclassification of Common
Stock into securities including securities other than Common
Stock (other than any reclassification upon a Reorganization
Event to which Section 5.6(b) applies) shall be deemed to
involve (i) a distribution of such securities other than
Common Stock to all holders of Common Stock (and the effective
date of such reclassification shall be deemed to be "the date
fixed for the determination of stockholders entitled to
receive such distribution" and the "date fixed for such
determination" within the meaning of paragraph (4) of this
Section), and (ii) a subdivision, split or combination, as the
case may be, of the number of shares of Common Stock
outstanding immediately prior to such reclassification into
the number of shares of Common Stock outstanding immediately
thereafter (and the effective date of such reclassification
shall be deemed to be "the day upon which such subdivision or
split becomes effective" or "the day upon which such
combination becomes effective," as the case may be, and "the
day upon which such subdivision, split or combination becomes
effective" within the meaning of paragraph (3) of this
Section).
(8) "Current Market Price". The "Current Market
Price" of the Common Stock means (a) on any day the average of
the Sales Prices for the 5 consecutive Trading Days preceding
the earlier of the day preceding the day in question and the
day before the "ex date" with respect to the issuance or
distribution requiring computation, (b) in the case of any
Spin-Off that is effected simultaneously with an Initial
Public Offering of the securities being distributed in the
Spin-Off, the Sale Price of the Common Stock on the Trading
Day on which the initial public offering price of the
securities being distributed in the Spin-Off is determined,
and (c) in the case of any other Spin-Off, the average of the
Sale Prices of the Common Stock over the first 10 Trading Days
after the effective date of such Spin-Off. For purposes of
this paragraph, the term "ex date," when used with respect to
any issuance or distribution, shall mean the first date on
which the Common Stock trades regular way on such exchange or
in such market without the right to receive such issuance or
distribution.
47
(9) Calculation of Adjustments. All adjustments to
the Settlement Rate shall be calculated to the nearest
1/10,000th of a share of Common Stock (or if there is not a
nearest 1/10,000th of a share to the next lower 1/10,000th of
a share). No adjustment in the Settlement Rate shall be
required unless such adjustment would require an increase or
decrease of at least one percent therein; provided, that any
adjustments which by reason of this subparagraph are not
required to be made shall be carried forward and taken into
account in any subsequent adjustment. If an adjustment is made
to the Settlement Rate pursuant to paragraph (1), (2), (3),
(4), (5), (6), (7) or (10) of this Section 5.6(a), an
adjustment shall also be made to the Applicable Market Value
solely to determine which of clauses (i), (ii) or (iii) of the
definition of Settlement Rate in Section 5.1(a) will apply on
the Stock Purchase Date. Such adjustment shall be made by
multiplying the Applicable Market Value by a fraction, the
numerator of which shall be the Settlement Rate immediately
after such adjustment pursuant to paragraph (1), (2), (3),
(4), (5), (6), (7) or (10) of this Section 5.6(a) and the
denominator of which shall be the Settlement Rate immediately
before such adjustment; provided, that if such adjustment to
the Settlement Rate is required to be made pursuant to the
occurrence of any of the events contemplated by paragraph (1),
(2), (3), (4), (5), (7) or (10) of this Section 5.6(a) during
the period taken into consideration for determining the
Applicable Market Value, appropriate and customary adjustments
shall be made to the Settlement Rate.
(10) Increase of Settlement Rate. The Company may
make such increases in the Settlement Rate, in addition to
those required by this Section, as it considers to be
advisable in order to avoid or diminish any income tax to any
holders of shares of Common Stock resulting from any dividend
or distribution of stock or issuance of rights or warrants to
purchase or subscribe for stock or from any event treated as
such for income tax purposes or for any other reasons.
(b) Adjustment for Consolidation, Merger or Other
Reorganization Event. In the event of
(1) any consolidation or merger of the Company with
or into another Person (other than a merger or consolidation
in which the Company is the continuing corporation and in
which the Common Stock outstanding immediately prior to the
merger or consolidation is not exchanged for cash, securities
or other property of the Company or another corporation),
(2) any sale, transfer, lease or conveyance to
another Person of the property of the Company as an entirety
or substantially as an entirety,
(3) any statutory exchange of securities of the
Company with another Person (other than in connection with a
merger or acquisition), or
(4) any liquidation, dissolution or winding up of the
Company other than as a result of or after the occurrence of a
Termination Event
48
(any such event, a "Reorganization Event"), each share of Common Stock covered
by each Purchase Contract forming a part of an Equity Security Unit or Stripped
Equity Security Unit, as the case may be, immediately prior to such
Reorganization Event shall, after such Reorganization Event, be converted for
purposes of the Purchase Contract into the kind and amount of securities, cash
and other property receivable in such Reorganization Event (without any interest
thereon, and without any right to dividends or distribution thereon which have a
record date that is prior to the Stock Purchase Date) per share of Common Stock
by a holder of Common Stock that (i) is not a Person with which the Company
consolidated or into which the Company merged or which merged into the Company
or to which such sale or transfer was made, as the case may be (any such Person,
a "Constituent Person"), or an Affiliate of a Constituent Person to the extent
such Reorganization Event provides for different treatment of Common Stock held
by Affiliates of the Company and non-Affiliates, and (ii) failed to exercise his
rights of election, if any, as to the kind or amount of securities, cash and
other property receivable upon such Reorganization Event (provided that if the
kind or amount of securities, cash and other property receivable upon such
Reorganization Event is not the same for each share of Common Stock held
immediately prior to such Reorganization Event by other than a Constituent
Person or an Affiliate thereof and in respect of which such rights of election
shall not have been exercised ("Non-electing Share"), then for the purpose of
this Section the kind and amount of securities, cash and other property
receivable upon such Reorganization Event by each Non-electing Share shall be
deemed to be the kind and amount so receivable per share by a plurality of the
Non-electing Shares). On the Stock Purchase Date, the Settlement Rate then in
effect will be applied to the value on the Stock Purchase Date of such
securities, cash or other property.
In the event of such a Reorganization Event, the Person formed by such
consolidation, merger or exchange or the Person which acquires the assets of the
Company or, in the event of a liquidation or dissolution of the Company, the
Company or a liquidating trust created in connection therewith, shall execute
and deliver to the Agent an agreement supplemental hereto providing that the
Holder of each Outstanding Unit shall have the rights provided by this Section
5.6. Such supplemental agreement shall provide for adjustments which, for events
subsequent to the effective date of such supplemental agreement, shall be as
nearly equivalent as may be practicable to the adjustments provided for in this
Section. The above provisions of this Section shall similarly apply to
successive Reorganization Events.
SECTION 5.7 Notice Of Adjustments And Certain Other Events.
(a) Whenever the Settlement Rate is adjusted as herein
provided, the Company shall:
(i) forthwith compute the Settlement Rate and the
Applicable Market Value in accordance with Section 5.6 and
prepare and transmit to the Agent an Officer's Certificate
setting forth the Settlement Rate and the Applicable Market
Value, the method of calculation thereof in reasonable detail,
and the facts requiring such adjustment and upon which such
adjustment is based; and
(ii) as soon as practicable following the occurrence
of an event that requires an adjustment to the Settlement Rate
pursuant to Section 5.6 (or if the
49
Company is not aware of such occurrence, as soon as
practicable after becoming so aware), provide a written notice
to the Holders of the Equity Security Units and Stripped
Equity Security Units of the occurrence of such event and a
statement in reasonable detail setting forth the method by
which the adjustment to the Settlement Rate and the Applicable
Market Value was determined and setting forth the adjusted
Settlement Rate and the Applicable Market Value.
(b) The Agent shall not at any time be under any duty or
responsibility to any Holder of Equity Security Units or Stripped
Equity Security Units to determine whether any facts exist which may
require any adjustment of the Settlement Rate and the Applicable Market
Value, or with respect to the nature or extent or calculation of any
such adjustment when made, or with respect to the method employed in
making the same. The Agent shall not be accountable with respect to the
validity or value (or the kind or amount) of any shares of Common
Stock, or of any securities or property, which may at the time be
issued or delivered with respect to any Purchase Contract; and the
Agent makes no representation with respect thereto. The Agent shall not
be responsible for any failure of the Company to issue, transfer or
deliver any shares of Common Stock pursuant to a Purchase Contract or
to comply with any of the duties, responsibilities or covenants of the
Company contained in this Article.
SECTION 5.8 Termination Event; Notice. The Purchase Contracts and all
obligations and rights of the Company and the Holders thereunder, including the
rights and obligations of Holders to purchase Common Stock, shall immediately
and automatically terminate, without the necessity of any notice or action by
any Holder, the Agent or the Company, if, on or prior to the Stock Purchase
Date, a Termination Event shall have occurred. Upon and after the occurrence of
a Termination Event, the Equity Security Units shall thereafter represent the
right to receive the Notes or the appropriate Applicable Ownership Interest in
the Treasury Portfolio or Tax Event Treasury Portfolio, as the case may be,
forming a part of such Equity Security Units, and the Stripped Equity Security
Units shall thereafter represent the right to receive the Treasury Securities
forming a part of such Stripped Equity Security Units, in each case in
accordance with the provisions of Section 4.3 of the Pledge Agreement. Upon the
occurrence of a Termination Event, the Company shall promptly but in no event
later than two Business Days thereafter give written notice to the Agent, the
Collateral Agent and to the Holders, at their addresses as they appear in the
Register.
SECTION 5.9 Early Settlement.
(a) Subject to and upon compliance with the provisions of this
Section 5.9, Purchase Contracts underlying Equity Security Units or
Stripped Equity Security Units having an aggregate Stated Amount equal
to $1,000 or an integral multiple thereof, may, at the option of the
Holder thereof, be settled early ("Early Settlement") not later than
11:00 a.m., New York City time, on the eleventh Business Day
immediately preceding the Stock Purchase Date; provided, however, that
no Holder may effect an Early Settlement during the period starting at
5:00 p.m., New York City time, on the fourth Business Day immediately
preceding the first Business Day of any Remarketing Period and ending
9:00 a.m., New York City time, on the fourth Business Day immediately
50
succeeding the third Business Day in such Remarketing Period. In order
to exercise the right to effect Early Settlement with respect to any
Purchase Contracts, the Holder of the Certificate evidencing the
related Equity Security Units or Stripped Equity Security Units, as the
case may be, shall deliver such Certificate to the Agent at the
Corporate Trust Office duly endorsed for transfer to the Company or in
blank with the form of Election to Settle Early on the reverse thereof
duly completed and accompanied by payment payable to the Company in
immediately available funds in an amount (the "Early Settlement
Amount") equal to (A) the product of (i) the Stated Amount of such
Equity Security Units or Stripped Equity Security Units, as the case
may be, multiplied by (ii) the number of Purchase Contracts with
respect to which the Holder has elected to effect Early Settlement,
plus (B) if such delivery is made with respect to any Purchase
Contracts during the period from the close of business on any Record
Date next preceding any Payment Date to the opening of business on such
Payment Date, an amount equal to the Contract Adjustment Payments, if
any, payable on such Payment Date with respect to such Purchase
Contracts; provided that no payment shall be required pursuant to
clause (B) of this sentence if the Company shall have elected to defer
the Contract Adjustment Payments that would otherwise be payable on
such Payment Date. Except as provided in the immediately preceding
sentence and subject to Section 5.2(d), no payment or adjustment shall
be made upon Early Settlement of any Purchase Contract on any Contract
Adjustment Payments accumulated on such Purchase Contract or on account
of any dividends on the Common Stock issued upon such Early Settlement.
If the foregoing requirements are first satisfied with respect to
Purchase Contracts underlying any Equity Security Units or Stripped
Equity Security Units, as the case may be, at or prior to 5:00 p.m.,
New York City time, on a Business Day, such day shall be the "Early
Settlement Date" with respect to such Equity Security Units or Stripped
Equity Security Units, as the case may be, and if such requirements are
first satisfied after 5:00 p.m., New York City time, on a Business Day
or on a day that is not a Business Day, the "Early Settlement Date"
with respect to such Equity Security Units or Stripped Equity Security
Units, as the case may be, shall be the next succeeding Business Day.
If the Treasury Portfolio or the Tax Event Treasury Portfolio
has replaced the Notes as a component of the Equity Security Units
following the occurrence of a successful remarketing of the Notes or a
Tax Event Redemption Date, respectively, holders of Equity Security
Units may effect Early Settlement only in multiples of 80,000 Equity
Security Units.
(b) Upon Early Settlement of any Purchase Contract by the
Holder of the related Equity Security Units or Stripped Equity Security
Units, as the case may be, the Company shall issue, and the Holder
shall be entitled to receive, 0.4817 shares of Common Stock on account
of such Purchase Contract (the "Early Settlement Rate"). The Early
Settlement Rate shall be adjusted in the same manner and at the same
time as the Settlement Rate is adjusted. As promptly as practicable
after Early Settlement of Purchase Contracts in accordance with the
provisions of this Section 5.9, the Company shall issue and shall
deliver to the Agent at the Corporate Trust Office a certificate or
certificates for the full number of shares of Common Stock issuable
upon such Early
51
Settlement together with payment in lieu of any fraction of a share, as
provided in Section 5.12.
(c) No later than the third Business Day after the applicable
Early Settlement Date the Company shall cause (i) the shares of Common
Stock issuable upon Early Settlement of Purchase Contracts to be issued
and delivered, and (ii) the related Pledged Notes or Pledged Applicable
Ownership Interest in the Treasury Portfolio or Pledged Applicable
Ownership Interest in the Tax Event Treasury Portfolio, in the case of
Equity Security Units, or the related Pledged Treasury Securities, in
the case of Stripped Equity Security Units, to be released from the
Pledge by the Collateral Agent and transferred, in each case, to the
Agent for delivery to the Holder thereof or the Holder's designee.
(d) Upon Early Settlement of any Purchase Contracts, and
subject to receipt of shares of Common Stock from the Company and the
Pledged Notes, Pledged Applicable Ownership Interest in the Treasury
Portfolio, Pledged Applicable Ownership Interest in the Tax Event
Treasury Portfolio or Pledged Treasury Securities, as the case may be,
from the Collateral Agent, as applicable, the Agent shall, in
accordance with the instructions provided by the Holder thereof on the
applicable form of Election to Settle Early on the reverse of the
Certificate evidencing the related Equity Security Units or Stripped
Equity Security Units, as the case may be, (i) transfer to the Holder
the Pledged Notes, Pledged Applicable Ownership Interest in the
Treasury Portfolio, Pledged Applicable Ownership Interest in the Tax
Event Treasury Portfolio or Pledged Treasury Securities, as the case
may be, forming a part of such Equity Security Units or Stripped Equity
Security Units, as the case may be, and (ii) deliver to the Holder a
certificate or certificates for the full number of shares of Common
Stock issuable upon such Early Settlement together with payment in lieu
of any fraction of a share, as provided in Section 5.12.
(e) In the event that Early Settlement is effected with
respect to Purchase Contracts underlying less than all the Equity
Security Units or Stripped Equity Security Units, as the case may be,
evidenced by a Certificate, upon such Early Settlement the Company
shall execute and the Agent shall authenticate, execute and deliver to
the Holder thereof, at the expense of the Company, a Certificate
evidencing the Equity Security Units or Stripped Equity Security Units,
as the case may be, as to which Early Settlement was not effected.
SECTION 5.10 Early Settlement Upon Merger.
(a) In the event of a merger or consolidation of the Company
of the type described in clause (1) of Section 5.6(b) in which the
Common Stock outstanding immediately prior to such merger or
consolidation is exchanged for consideration consisting of at least 30%
cash or cash equivalents (any such event a "Cash Merger"), then the
Company (or the successor to the Company hereunder) shall be required
to offer the Holder of each Equity Security Unit or Stripped Equity
Security Unit, as the case may be, the right to settle the Purchase
Contract underlying such Equity Security Units or Stripped Equity
Security Units, as the case may be, prior to the Stock Purchase Date
("Merger Early Settlement") as provided herein. On or before the fifth
Business Day
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after the consummation of a Cash Merger, the Company or, at the request
and expense of the Company, the Agent, shall give all Holders notice of
the occurrence of the Cash Merger and of the right of Merger Early
Settlement arising as a result thereof. The Company shall also deliver
a copy of such notice to the Agent and the Collateral Agent.
Each such notice shall contain:
(i) the date, which shall be not less than 20 nor
more than 30 calendar days after the date of such notice, on
which the Merger Early Settlement will be effected (the
"Merger Early Settlement Date");
(ii) the date, which shall be on or one Business Day
prior to the Merger Early Settlement Date, by which the Merger
Early Settlement right must be exercised;
(iii) the Settlement Rate in effect as a result of
such Cash Merger and the kind and amount of securities, cash
and other property receivable by the Holder upon settlement of
each Purchase Contract pursuant to Section 5.6(b); and
(iv) the instructions a Holder must follow to
exercise the Merger Early Settlement right.
(b) To exercise a Merger Early Settlement right, a Holder
shall deliver to the Agent at the Corporate Trust Office on or before
5:00 p.m., New York City time, on the date specified in the notice
(which date shall be no later than 5:00 p.m., New York City time, on
the Business Day immediately preceding the Merger Early Settlement
Date) the Certificate(s) evidencing the Equity Security Units or
Stripped Equity Security Units, as the case may be, with respect to
which the Merger Early Settlement right is being exercised duly
endorsed for transfer to the Company or in blank with the form of
Election to Settle Early on the reverse thereof duly completed and
accompanied by payment payable to the Company in the form of a wire
transfer of immediately available funds or a certified or cashier's
check in an amount equal to the Early Settlement Amount (the "Merger
Early Settlement Amount").
(c) On the Merger Early Settlement Date, the Company shall
deliver or cause to be delivered (i) the cash, securities and other
property to be received by such exercising Holder, equal to the
Settlement Rate as adjusted pursuant to Section 5.6, in respect of the
number of Purchase Contracts for which such Merger Early Settlement
right was exercised, and (ii) the related Pledged Notes, Pledged
Applicable Ownership Interest in the Treasury Portfolio or Pledged
Applicable Ownership Interest in the Tax Event Treasury Portfolio, in
the case of Equity Security Units, or Pledged Treasury Securities, in
the case of Stripped Equity Security Units, to be released from the
Pledge by the Collateral Agent and transferred, in each case, to the
Agent for delivery to the Holder thereof or the Holder's designee. In
the event a Merger Early Settlement right shall be exercised by a
Holder in accordance with the terms hereof, all references herein to
Stock Purchase Date shall be deemed to refer to such Merger Early
Settlement Date.
53
(d) Upon Merger Early Settlement of any Purchase Contracts,
and subject to receipt of such net cash, securities or other property
from the Company and the Pledged Notes, Pledged Applicable Ownership
Interest in the Treasury Portfolio, Pledged Applicable Ownership
Interest in the Tax Event Treasury Portfolio or Pledged Treasury
Securities, as the case may be, from the Collateral Agent, as
applicable, the Agent shall, in accordance with the instructions
provided by the Holder thereof on the applicable form of Election to
Settle Early on the reverse of the Certificate evidencing the related
Equity Security Units or Stripped Equity Security Units, as the case
may be, (i) transfer to the Holder the Pledged Notes, Pledged
Applicable Ownership Interest in the Treasury Portfolio, Pledged
Applicable Ownership Interest in the Tax Event Treasury Portfolio, or
Pledged Treasury Securities, as the case may be, forming a part of such
Equity Security Units or Stripped Equity Security Units, as the case
may be, and (ii) deliver to the Holder such cash, securities or other
property issuable upon such Merger Early Settlement together with
payment in lieu of any fraction of a share, as provided in Section
5.12.
(e) In the event that Merger Early Settlement is effected with
respect to Purchase Contracts underlying less than all the Equity
Security Units or Stripped Equity Security Units, as the case may be,
evidenced by a Certificate, upon such Merger Early Settlement the
Company (or the successor to the Company hereunder) shall execute and
the Agent shall authenticate, execute and deliver to the Holder
thereof, at the expense of the Company, a Certificate evidencing the
Equity Security Units or Stripped Equity Security Units, as the case
may be, as to which Merger Early Settlement was not effected.
If the Treasury Portfolio or the Tax Event Treasury Portfolio
has replaced the Notes as a component of the Equity Security Units
following the occurrence of a successful remarketing of the Notes or a
Tax Event Redemption Date, respectively, holders of Equity Security
Units may effect Merger Early Settlement only in multiples of 80,000
Equity Security Units.
SECTION 5.11 Charges And Taxes. The Company will pay all stock transfer
and similar taxes attributable to the initial issuance and delivery of the
shares of Common Stock pursuant to the Purchase Contracts and in payment of any
Deferred Contract Adjustment Payments; provided, that the Company shall not be
required to pay any such tax or taxes which may be payable in respect of any
exchange of or substitution for a Certificate evidencing an Equity Security Unit
or Stripped Equity Security Unit, as the case may be, or any issuance of a share
of Common Stock in a name other than that of the registered Holder of a
Certificate surrendered in respect of the Equity Security Units and Stripped
Equity Security Units evidenced thereby, other than in the name of the Agent, as
custodian for such Holder, and the Company shall not be required to issue or
deliver such share certificates or Certificates unless and until the Person or
Persons requesting the transfer or issuance thereof shall have paid to the
Company the amount of such tax or shall have established to the satisfaction of
the Company that such tax has been paid or that no such tax is due.
SECTION 5.12 No Fractional Shares. No fractional shares or scrip
representing fractional shares of Common Stock shall be issued or delivered upon
settlement on the Stock Purchase Date or upon Early Settlement or Merger Early
Settlement of any Purchase Contracts.
54
If Certificates evidencing more than one Purchase Contract shall be surrendered
for settlement at one time by the same Holder, the number of full shares of
Common Stock which shall be delivered upon settlement shall be computed on the
basis of the aggregate number of Purchase Contracts evidenced by the
Certificates so surrendered. Instead of any fractional share of Common Stock
which would otherwise be deliverable upon settlement of any Purchase Contracts
on the applicable Settlement Date or upon Early Settlement or Merger Early
Settlement, the Company, through the Agent, shall make a cash payment in respect
of such fractional shares in an amount equal to the value of such fractional
shares times the Applicable Market Value. The Company shall provide the Agent
from time to time with sufficient funds to permit the Agent to make all cash
payments required by this Section 5.12 in a timely manner.
SECTION 5.13 Registration Statement and Prospectus. To permit and
enable the Holders to exercise their rights of Cash Settlement, Early Settlement
or Merger Early Settlement under Section 5.4(a), 5.9 or 5.10, as the case may
be, if and to the extent required by applicable law, regulations or
interpretations in effect at the time in the view of counsel to the Company, the
Company shall use commercially reasonable efforts, (i) to have a registration
statement relating to the Common Stock effective under the Securities Act and
(ii) to furnish a current final prospectus and, if applicable, a final
prospectus supplement, in each case in a form that may be used in connection
with the settlement and delivery of the Common Stock pursuant to such Cash
Settlement, Early Settlement or Merger Early Settlement under Section 5.4(a),
5.9 or 5.10, as applicable. The Company shall also take all such actions as may
(upon advice of counsel to the Company) be necessary or desirable under state
securities or blue sky laws in connection with any such Cash Settlement, Early
Settlement or Merger Early Settlement under Section 5.4(a), 5.9 or 5.10, as
applicable. The Company shall pay all expenses relating thereto.
ARTICLE VI.
REMEDIES
SECTION 6.1 Unconditional Right Of Holders To Purchase Common Stock.
The Holder of any Equity Security Units or Stripped Equity Security Units, as
the case may be, shall have the right, which is absolute and unconditional,
(a) subject to the right of the Company to defer payment
thereof pursuant to Section 5.3, and to the forfeiture of any Deferred
Contract Adjustment Payments upon Early Settlement pursuant to Section
5.9(a) or upon Merger Early Settlement pursuant to Section 5.10 or upon
the occurrence of a Termination Event, to receive payment of each
installment of the Contract Adjustment Payments, if any, with respect
to the Purchase Contract constituting a part of such Equity Security
Units or Stripped Equity Security Units, as the case may be, on the
respective Payment Date for such Equity Security Units or Stripped
Equity Security Units, as the case may be, and
(b) to purchase Common Stock pursuant to the Purchase Contract
constituting a part of such Equity Security Units or Stripped Equity
Security Units and to institute suit for the enforcement of any such
right to purchase Common Stock, and such rights shall not be impaired
without the consent of such Holder.
55
SECTION 6.2 Restoration Of Rights And Remedies. If any Holder has
instituted any proceeding to enforce any right or remedy under this Agreement
and such proceeding has been discontinued or abandoned for any reason, or has
been determined adversely to such Holder, then and in every such case, subject
to any determination in such proceeding, the Company and such Holder shall be
restored severally and respectively to their former positions hereunder and
thereafter all rights and remedies of such Holder shall continue as though no
such proceeding had been instituted.
SECTION 6.3 Rights And Remedies Cumulative. Except as otherwise
provided with respect to the replacement or payment of mutilated, destroyed,
lost or stolen Certificates in the last paragraph of Section 3.10, no right or
remedy herein conferred upon or reserved to the Holders is intended to be
exclusive of any other right or remedy, and every right and remedy shall, to the
extent permitted by law, be cumulative and in addition to every other right and
remedy given hereunder or now or hereafter existing at law or in equity or
otherwise. The assertion or employment of any right or remedy hereunder, or
otherwise, shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.
SECTION 6.4 Delay or Omission Not Waiver. No delay or omission of any
Holder to exercise any right or remedy upon a default shall impair any such
right or remedy or constitute a waiver of any such right. Every right and remedy
given by this Article or by law to the Holders may be exercised from time to
time, and as often as may be deemed expedient, by such Holders.
SECTION 6.5 Undertaking For Costs. All parties to this Agreement agree,
and each Holder of an Equity Security Unit or Stripped Equity Security Unit, as
the case may be, by its acceptance of such Equity Security Units or Stripped
Equity Security Units, as the case may be, shall be deemed to have agreed, that
any court may in its discretion require, in any suit for the enforcement of any
right or remedy under this Agreement, or in any suit against the Agent for any
action taken, suffered or omitted by it as Agent, the filing by any party
litigant in such suit of an undertaking to pay the costs of such suit, and that
such court may in its discretion assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in such suit, having due regard to
the merits and good faith of the claims or defenses made by such party litigant;
provided that the provisions of this Section shall not apply to any suit
instituted by the Company, to any suit instituted by the Agent, to any suit
instituted by any Holder, or group of Holders, holding in the aggregate more
than 10% of the Outstanding Units, or to any suit instituted by any Holder for
the enforcement of distributions on any Notes on any Purchase Contract on or
after the respective Payment Date therefor in respect of any Equity Security
Units or Stripped Equity Security Units, as the case may be, held by such
Holder, or for enforcement of the right to purchase shares of Common Stock under
the Purchase Contract constituting part of any Equity Security Units or Stripped
Equity Security Units, as the case may be, held by such Holder.
SECTION 6.6 Waiver Of Stay Or Extension Laws. The Company covenants (to
the extent that it may lawfully do so) that it will not at any time insist upon,
or plead, or in any manner whatsoever claim or take the benefit or advantage of,
any stay or extension law wherever enacted, now or at any time hereafter in
force, which may affect the covenants or the performance of this Agreement; and
the Company (to the extent that it may lawfully do so)
56
hereby expressly waives all benefit or advantage of any such law, but will
suffer and permit the execution of every such power as though no such law had
been enacted.
ARTICLE VII.
THE AGENT
SECTION 7.1 Certain Duties, Rights And Immunities.
(a) The Agent shall act as agent for the Holders of the Equity
Security Units and Stripped Equity Security Units hereunder with such
powers as are specifically vested in the Agent by the terms of this
Agreement, the Pledge Agreement, the Remarketing Agreement, the Notes
and the Equity Security Units and Stripped Equity Security Units, and
any documents evidencing thereof or related thereto (the "Transaction
Documents"), together with such other powers as are reasonably
incidental thereto. The Agent:
(1) shall have no duties or responsibilities except
those expressly set forth in the Transaction Documents and no
implied covenants or obligations shall be inferred from any
Transaction Documents against the Agent, nor shall the Agent
be bound by the provisions of any agreement by any party
hereto beyond the specific terms hereof;
(2) shall be entitled conclusively to rely upon (x)
any certification, order, judgment, opinion, notice or other
communication (including, without limitation, any thereof by
telephone or facsimile) reasonably 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), (y)
the truth of the statements and the correctness of the
opinions expressed therein and (z) advice and statements of
legal counsel and other experts selected by the Agent;
(3) as to any matters not expressly provided for by
any Transaction Document, shall in all cases be fully
protected in acting, or in refraining from acting, hereunder
or thereunder in accordance with instructions given by the
Company or the Holders in accordance with the Transaction
Documents;
(4) shall not be responsible for any recitals
contained in any Transaction Document, or in any certificate
or other document referred to or provided for in, or received
by it under, any Transaction Document or the Equity Security
Units or Stripped Equity Security Units, or for the value,
validity, effectiveness, genuineness, enforceability or
sufficiency of any Transaction Document (other than as against
the Agent) or the Equity Security Units or Stripped Equity
Security Units or any other document referred to or provided
for herein or therein or for any failure by the Company, any
Holder or any other Person (except the Agent) to perform any
of its obligations hereunder or thereunder or for the
perfection, priority or, except as expressly required hereby,
57
existence, validity, perfection or maintenance of any security
interest created under the Pledge Agreement, or for the use or
application by the Company of the proceeds in respect of the
Purchase Contracts;
(5) shall not be required to initiate or conduct any
litigation or collection proceedings hereunder;
(6) shall 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 herein or
in connection herewith or therewith, except for its own gross
negligence, bad faith or willful misconduct; and
(7) shall not be required to advise any party as to
selling or retaining, or taking or refraining from taking any
action with respect to, the Equity Security Units or Stripped
Equity Security Units or other rights under any Transaction
Document.
(b) No provision of any Transaction Document shall be
construed to relieve the Agent from liability for its own negligent
action, its own negligent failure to act, its own bad faith, or its own
willful misconduct, except that:
(1) this paragraph (b) shall not be construed to
limit the effect of paragraph (a) of this Section;
(2) the Agent shall not be liable for any error of
judgment made in good faith by a Responsible Officer, unless
it shall be proved that the Agent was grossly negligent in
ascertaining the pertinent facts; and
(3) in no event shall the Agent be required to expend
or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder.
(c) In no event shall the Agent or its officers, employees or
agents be liable for any special, indirect, individual, punitive or
consequential loss or damages, lost profits or loss of business,
arising in connection with any Transaction Document, whether or not the
likelihood of such loss or damage was known to the Agent, and
regardless of the form of action.
(d) Whether or not therein expressly so provided, every
provision of every Transaction Document relating to the conduct or
affecting the liability of or affording protection to the Agent shall
be subject to the provisions of this Section.
(e) The Agent is authorized to execute and deliver the Pledge
Agreement and the Remarketing Agreement and any supplement thereto in
its capacity as Agent.
(f) The Agent shall have no liability whatsoever for the
action or inaction of any Clearing Agency or any book-entry system
thereof. In no event shall any Clearing
58
Agency or any book-entry system thereof be deemed an agent or
subcustodian of the Agent.
(g) The Agent shall not be responsible or liable for any
failure or delay in the performance of its obligations under any
Transaction Document arising out of or caused, directly or indirectly,
by circumstances beyond its reasonable control, including, without
limitation, acts of God; acts of terrorism; earthquakes; fires; floods;
wars; civil or military disturbances; sabotage; epidemics; riots;
interruptions, loss or malfunctions of utilities, computer (hardware or
software) or communications service; accidents; labor disputes; acts of
civil or military authority; governmental actions; or inability to
obtain labor, material, equipment or transportation.
SECTION 7.2 Notice Of Default. Within 30 days after the occurrence of
any default by the Company hereunder of which a Responsible Officer of the Agent
has actual knowledge, the Agent shall transmit by mail to the Company and the
Holders of Equity Security Units and Stripped Equity Security Units, as their
names and addresses appear in the Register, notice of such default hereunder,
unless such default shall have been cured or waived.
SECTION 7.3 Certain Rights Of Agent. Subject to the provisions of
Section 7.1:
(a) request or direction of the Company mentioned herein shall
be sufficiently evidenced by an Officer's Certificate, Issuer Order or
Issuer Request, and any resolution of the Board of Directors of the
Company may be sufficiently evidenced by a Board Resolution;
(b) whenever in the administration of this Agreement the Agent
shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, the Agent (unless
other evidence be herein specifically prescribed) may, in the absence
of bad faith on its part, rely upon an Officer's Certificate of the
Company;
(c) the Agent may consult with counsel and the advice of such
counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered
or omitted by it hereunder in good faith and in reliance thereon;
(d) the Agent shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of indebtedness
or other paper or document, but the Agent, in its discretion, may make
reasonable further inquiry or investigation into such facts or matters
related to the execution, delivery and performance of the Purchase
Contracts as it may see fit, and, if the Agent shall determine to make
such further inquiry or investigation, it shall be given a reasonable
opportunity to examine the books, records and premises of the Company,
personally or by agent or attorney; and
59
(e) the Agent may execute any of the powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys or an Affiliate of the Agent and the Agent shall not be
responsible for any misconduct or negligence on the part of any agent
or attorney or an Affiliate appointed with due care by it hereunder.
SECTION 7.4 Not Responsible For Recitals, Etc. The recitals contained
herein and in the Certificates shall be taken as the statements of the Company.
SECTION 7.5 May Hold Equity Security Units and Stripped Equity Security
Units And Other Dealings. Any Registrar or any other agent of the Company, or
the Agent and its Affiliates, in their individual or any other capacity, may
become the owner or pledgee of Equity Security Units or Stripped Equity Security
Units, as the case may be, and may otherwise deal with the Company, the
Collateral Agent or any other Person with the same rights it would have if it
were not Registrar or such other agent, or the Agent. The Agent and its
Affiliates may (without having to account therefor to the Company or any Holder
of Equity Security Units or Stripped Equity Security Units or holder of Separate
Notes) accept deposits from, lend money to, make their investments in and
generally engage in any kind of banking, trust or other business with the
Company, any Holder of Equity Security Units or Stripped Equity Security Units
and any holder of Separate Notes (and any of their respective subsidiaries or
Affiliates) as if it were not acting as the Agent and the Agent and their
Affiliates may accept fees and other consideration from the Company, any Holder
of Equity Security Units or Stripped Equity Security Units or any holder of
Separate Notes without having to account for the same to any such Person.
SECTION 7.6 Money Held In Custody. Money held by the Agent in custody
hereunder need not be segregated from the Agent's other funds except to the
extent required by law or provided herein. The Agent shall be under no
obligation to invest or pay interest on any money received by it hereunder
except as otherwise agreed in writing with the Company.
SECTION 7.7 Compensation And Reimbursement. The Company agrees:
(a) to pay to the Agent from time to time compensation for all
services rendered by it hereunder or under the Transaction Documents as
shall be agreed in writing from time to time between the Company and
the Agent;
(b) to reimburse the Agent upon its request for all reasonable
expenses, disbursements and advances incurred or made by the Agent in
accordance with any provision of this Agreement or the Transaction
Documents (including the reasonable compensation and the reasonable
expenses and disbursements of its agents and counsel), except any such
expense, disbursement or advance as shall have been caused by its own
negligence, willful misconduct or bad faith; and
(c) to fully indemnify the Agent and any predecessor Agent for, and to
hold it harmless against, any and all loss, liability, claim, damage or
reasonable out-of-pocket expense incurred without gross negligence,
willful misconduct or bad faith on its part, arising out of or in
connection with the acceptance or administration of its duties under
the Transaction Documents, including the costs and expenses (including
reasonable fees
60
and expenses of counsel) of defending itself against any claim or
liability in connection with the exercise or performance of any of its
powers or duties under the Transaction Documents. The Agent shall
promptly notify the Company of any third party claim which may give
rise to the indemnity hereunder and give the Company the opportunity to
participate in the defense of such claim with counsel reasonably
satisfactory to the indemnified party, and no such claim shall be
settled without the written consent of the Company, which consent shall
not be unreasonably withheld, provided that any failure to give any
such notice shall not affect the obligation of the Company under this
Section.
The provisions of this Section 7.7 shall survive the termination of this
Agreement or the resignation or removal of the Agent.
SECTION 7.8 Corporate Agent Required; Eligibility. There shall at all
times be an Agent hereunder which shall be a Corporation organized and doing
business under the laws of the United States of America, any State thereof or
the District of Columbia, authorized under such laws to exercise corporate trust
powers, having (or being a member of a bank holding company having) a combined
capital and surplus of at least $50,000,000, subject to supervision or
examination by federal or state authority and having a Corporate Trust Office in
the Borough of Manhattan, The City of New York, if there be such a Corporation,
qualified and eligible under this Article and willing to act on reasonable
terms. If such Corporation publishes reports of condition at least annually,
pursuant to law or to the requirements of said supervising or examining
authority, then for the purposes of this Section, the combined capital and
surplus of such Corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. If at
any time the Agent shall cease to be eligible in accordance with the provisions
of this Section, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article.
SECTION 7.9 Resignation And Removal; Appointment Of Successor.
(a) No resignation or removal of the Agent and no appointment
of a successor Agent pursuant to this Article shall become effective
until the acceptance of appointment by the successor Agent in
accordance with the applicable requirements of Section 7.10.
(b) The Agent may resign at any time by giving written notice
thereof to the Company 60 days prior to the effective date of such
resignation. If the instrument of acceptance by a successor Agent
required by Section 7.10 shall not have been delivered to the Agent
within 30 days after the giving of such notice of resignation, the
resigning Agent may petition at the expense of the Company any court of
competent jurisdiction for the appointment of a successor Agent.
(c) The Agent may be removed at any time by Act of the Holders
of a majority in number of the Outstanding Units delivered to the Agent
and the Company. If the instrument of acceptance by a successor Agent
required by Section 7.10 shall not have been delivered to the Agent
within 30 days after the giving of such notice of resignation,
61
the Holders or the resigning Agent may petition any court of competent
jurisdiction for the appointment of a successor Agent.
(d) If at any time:
(1) the Agent fails to comply with Section 310(b) of
the TIA, as if the Agent were a trustee under an indenture
qualified under the TIA, after written request therefor by the
Company or by any Holder who has been a bona fide Holder of an
Equity Security Unit or Stripped Equity Security Unit for at
least six months; or
(2) the Agent shall cease to be eligible under
Section 7.8 and shall fail to resign after written request
therefor by the Company or by any such Holder; or
(3) the Agent shall become incapable of acting or
shall be adjudged a bankrupt or insolvent or a receiver of the
Agent or of its property shall be appointed or any public
officer shall take charge or control of the Agent or of its
property or affairs for the purpose of rehabilitation,
conservation or liquidation;
then, in any such case, (x) the Company by a Board Resolution may remove the
Agent, or (y) any Holder who has been a bona fide Holder of an Equity Security
Unit or Stripped Equity Security Unit for at least six months may, on behalf of
himself and all others similarly situated, petition any court of competent
jurisdiction for the removal of the Agent and the appointment of a successor
Agent.
(e) If the Agent shall resign, be removed or become incapable
of acting, or if a vacancy shall occur in the office of Agent for any
cause, the Company, by a Board Resolution, shall promptly appoint a
successor Agent and shall comply with the applicable requirements of
Section 7.10. If no successor Agent shall have been so appointed by the
Company and accepted appointment in the manner required by Section
7.10, any Holder who has been a bona fide Holder of an Equity Security
Unit or Stripped Equity Security Unit for at least six months may, on
behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the appointment of a successor Agent.
(f) Company shall give, or shall cause such successor Agent to
give, notice of each resignation and each removal of the Agent and each
appointment of a successor Agent by mailing written notice of such
event by first-class mail, postage prepaid, to all Holders as their
names and addresses appear in the applicable Register. Each notice
shall include the name of the successor Agent and the address of its
Corporate Trust Office.
SECTION 7.10 Acceptance Of Appointment By Successor.
(a) In case of the appointment hereunder of a successor Agent,
every such successor Agent so appointed shall execute, acknowledge and
deliver to the Company and to the retiring Agent an instrument
accepting such appointment, and thereupon the resignation or removal of
the retiring Agent shall become effective and such successor
62
Agent, without any further act, deed or conveyance, shall become vested
with all the rights, powers, agencies and duties of the retiring Agent;
but, on the request of the Company or the successor Agent, such
retiring Agent shall, upon payment of its charges pursuant to Section
7.7, execute and deliver an instrument transferring to such successor
Agent all the rights, powers and trusts of the retiring Agent and duly
assign, transfer and deliver to such successor Agent all property and
money held by such retiring Agent hereunder.
(b) Upon request of any such successor Agent, the Company
shall execute any and all instruments for more fully and certainly
vesting in and confirming to such successor Agent all such rights,
powers and agencies referred to in paragraph (a) of this Section.
(c) No successor Agent shall accept its appointment unless at
the time of such acceptance such successor Agent shall be qualified and
eligible under this Article.
SECTION 7.11 Merger, Conversion, Consolidation Or Succession To
Business. Any Corporation into which the Agent 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 Agent shall be a party, or any
Corporation succeeding to all or substantially all the corporate trust business
of the Agent, shall be the successor of the Agent hereunder, provided such
Corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Certificates shall have been
authenticated and executed on behalf of the Holders, but not delivered, by the
Agent then in office, any successor by merger, conversion or consolidation to
such Agent shall adopt such authentication and execution and deliver the
Certificates so authenticated and executed with the same effect as if such
successor Agent had itself authenticated and executed such Equity Security Units
and Stripped Equity Security Units.
SECTION 7.12 Preservation Of Information; Communications To Holders.
(a) The Agent shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders received by
the Agent in its capacity as Registrar.
(b) If three or more Holders (herein referred to as
"Applicants") apply in writing to the Agent, and furnish to the Agent
reasonable proof that each such applicant has owned an Equity Security
Unit or Stripped Equity Security Unit, as the case may be, for a period
of at least six months preceding the date of such application, and such
application states that the applicants desire to communicate with other
Holders with respect to their rights under this Agreement or under the
Equity Security Units or Stripped Equity Security Units, as the case
may be, and is accompanied by a copy of the form of proxy or other
communication which such applicants propose to transmit, then the Agent
shall mail to all the Holders copies of the form of proxy or other
communication which is specified in such request, with reasonable
promptness after a tender to the Agent of the materials to be mailed
and of payment, or provision, in the absence of bad faith, satisfactory
to the Agent for the payment, of the reasonable expenses of such
mailing.
63
SECTION 7.13 Failure to Act. In the event of any ambiguity in the
provisions of any Transaction Document or any dispute between or conflicting
claims by or among the parties hereto or any other Person, the Agent shall be
entitled, after prompt notice to the Company and the Holders of Equity Security
Units and Stripped Equity Security Units, at its sole option, to refuse to
comply with any and all such claims, demands or instructions so long as such
dispute or conflict shall continue, and the 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 Agent shall be
entitled to refuse to act until either (i) 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, reasonably satisfactory to the Agent, or (ii) the Agent shall have
received security or an indemnity reasonably satisfactory to the Agent
sufficient to save the Agent harmless from and against any and all loss,
liability or reasonable out-of-pocket expense which the Agent may incur by
reason of its acting without bad faith, willful misconduct or gross negligence.
The Agent may in addition elect to commence an interpleader action or seek other
judicial relief or orders as the Agent may deem necessary. Notwithstanding
anything contained herein to the contrary, the Agent shall not be required to
take any action that is in its opinion contrary to law or to the terms of any
Transaction Document, or which would in its opinion subject it or any of its
officers, employees or directors to liability.
SECTION 7.14 No Obligations Of Agent. Except to the extent otherwise
provided in this Agreement, the Agent assumes no obligation and shall not be
subject to any liability under this Agreement, the Pledge Agreement or any
Purchase Contract in respect of the obligations of the Holder of any Equity
Security Units or Stripped Equity Security Units thereunder. The Company agrees,
and each Holder of a Certificate, by such Holder's acceptance thereof, shall be
deemed to have agreed, that the Agent's execution of the Certificates on behalf
of the Holders shall be solely as agent and attorney-in-fact for the Holders,
and that the Agent shall have no obligation to perform such Purchase Contracts
on behalf of the Holders, except to the extent expressly provided in Article V.
SECTION 7.15 Tax Compliance.
(a) The Agent, on its own behalf and on behalf of the Company,
will comply with all applicable certification, information reporting
and withholding (including "backup" withholding) requirements imposed
on it as a paying agent by applicable tax laws, regulations or
administrative practice with respect to any payments made with respect
to the Equity Security Units and Stripped Equity Security Units.
(b) The Agent shall comply with any reasonable written
direction timely received from the Company with respect to the
application of such requirements to particular payments or Holders or
in other particular circumstances, and may for purposes of this
Agreement rely on any such direction in accordance with the provisions
of Section 7.1(a)(2).
64
(c) The Agent shall maintain all appropriate records
documenting compliance with such requirements, and shall make such
records available, on written request, to the Company or its authorized
representative within a reasonable period of time after receipt of such
request.
ARTICLE VIII.
SUPPLEMENTAL AGREEMENTS
SECTION 8.1 Supplemental Agreements Without Consent Of Holders. Without
the consent of any Holders, the Company, when authorized by a Board Resolution,
and the Agent, at any time and from time to time, may enter into one or more
agreements supplemental hereto, in form satisfactory to the Company and the
Agent, for any of the following purposes:
(a) to evidence the succession of another Person to the
Company, and the assumption by any such successor of the covenants of
the Company herein and in the Certificates; or
(b) to add to the covenants of the Company for the benefit of
the Holders, or to surrender any right or power herein conferred upon
the Company; or
(c) to evidence and provide for the acceptance of appointment
hereunder by a successor Agent; or
(d) to make provision with respect to the rights of Holders
pursuant to the requirements of Section 5.6(b) or 5.10; or
(e) to cure any ambiguity, to correct or supplement any
provisions herein which may be inconsistent with any other provisions
herein, or to make any other provisions with respect to such matters or
questions arising under this Agreement, provided such action shall not
adversely affect the interests of the Holders.
SECTION 8.2 Supplemental Agreements With Consent Of Holders.
(a) With the consent of the Holders of not less than a
majority of the outstanding Equity Security Units and Stripped Equity
Security Units voting together as one class, by Act of said Holders
delivered to the Company and the Agent, the Company, when authorized by
a Board Resolution, and the Agent may enter into an agreement or
agreements supplemental hereto, in form satisfactory to the Company and
the Agent, for the purpose of modifying in any manner the terms of the
Purchase Contracts, or the provisions of this Agreement or the rights
of the Holders in respect of the Equity Security Units and Stripped
Equity Security Units; provided, that, except as contemplated herein,
no such supplemental agreement shall, without the consent of the Holder
of each Outstanding Unit affected thereby:
(1) change any Payment Date;
65
(2) change the amount or the type of Collateral
required to be Pledged to secure a Holder's Obligations under
the Purchase Contract, impair the right of the Holder of any
Purchase Contract to receive distributions on the related
Collateral (except for the rights of Holders of Equity
Security Units to substitute the Treasury Securities for the
Pledged Notes, Pledged Applicable Ownership Interest in the
Treasury Portfolio or Pledged Applicable Ownership Interest in
the Tax Event Treasury Portfolio, or the rights of holders of
Stripped Equity Security Units to substitute Notes for the
Pledged Treasury Securities) or otherwise adversely affect the
Holder's rights in or to such Collateral or materially
adversely alter the rights in or to such Collateral;
(3) reduce any Contract Adjustment Payments, if any,
or any Deferred Contract Adjustment Payment, or change any
place where, or the coin or currency in which, any Contract
Adjustment Payment is payable;
(4) impair the right to institute suit for the
enforcement of any Purchase Contract, any Contract Adjustment
Payment, if any, or any Deferred Contract Adjustment Payment,
if any;
(5) reduce the number of shares of Common Stock to be
purchased pursuant to any Purchase Contract, increase the
price to purchase shares of Common Stock upon settlement of
any Purchase Contract, change the Stock Purchase Date or
otherwise materially adversely affect the Holder's rights
under any Purchase Contract; or
(6) reduce the percentage of the outstanding Purchase
Contracts the consent of whose Holders is required for any
such supplemental agreement;
provided, that if any amendment or proposal referred to above would
adversely affect only the Equity Security Units or the Stripped Equity
Security Units, then only the affected class of Holder 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 or, in the case of proposals specified in clauses (1) through
(6) above, 100% of such class.
(b) It shall not be necessary for any Act of Holders under
this Section to approve the particular form of any proposed
supplemental agreement, but it shall be sufficient if such Act shall
approve the substance thereof.
SECTION 8.3 Execution Of Supplemental Agreements. In executing, or
accepting the additional agencies created by, any supplemental agreement
permitted by this Article or the modifications thereby of the agencies created
by this Agreement, the Agent shall be provided and (subject to Section 7.1)
shall be fully protected in relying upon, an Opinion of Counsel stating that the
execution of such supplemental agreement is authorized or permitted by this
Agreement. The Agent may, but shall not be obligated to, enter into any such
supplemental agreement which affects the Agent's own rights, duties or
immunities under this Agreement or otherwise.
66
SECTION 8.4 Effect Of Supplemental Agreements. Upon the execution of
any supplemental agreement under this Article, this Agreement shall be modified
in accordance therewith, and such supplemental agreement 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
hereunder shall be bound thereby.
SECTION 8.5 Reference To Supplemental Agreements. Certificates
authenticated, executed on behalf of the Holders and delivered after the
execution of any supplemental agreement pursuant to this Article may, and shall
if required by the Agent, bear a notation in form approved by the Agent as to
any matter provided for in such supplemental agreement. If the Company shall so
determine, new Certificates so modified as to conform, in the opinion of the
Agent and the Company, to any such supplemental agreement may be prepared and
executed by the Company and authenticated, executed on behalf of the Holders and
delivered by the Agent in exchange for outstanding Certificates.
ARTICLE IX.
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
SECTION 9.1 Covenant Not To Merge, Consolidate, Sell Or Convey Property
Except Under Certain Conditions. The Company covenants that it will not (a)
merge or consolidate with any other Person or (b) sell, assign, transfer, lease
or convey all or substantially all of its properties and assets to any Person or
group of affiliated Persons in one transaction or a series of related
transactions other than, with respect to clause (b), a direct or indirect
wholly-owned subsidiary of the Company, unless (i) either the Company shall be
the continuing Corporation, or the successor (if other than the Company) shall
be a Corporation organized and existing under the laws of the United States of
America or a State thereof or the District of Columbia and such Corporation
shall expressly assume all the obligations of the Company under the Purchase
Contracts, the Notes, this Agreement, the Remarketing Agreement and the Pledge
Agreement by one or more supplemental agreements in form reasonably satisfactory
to the Agent and the Collateral Agent, executed and delivered to the Agent and
the Collateral Agent by such Corporation, and (ii) the Company or such successor
Corporation, as the case may be, shall not, immediately after such merger or
consolidation, or such sale, assignment, transfer, lease or conveyance, be in
default in the performance of any covenant or condition hereunder, under any of
the Purchase Contracts, under the Remarketing Agreement, or under the Pledge
Agreement. Notwithstanding anything herein to the contrary, a wholly-owned
subsidiary of the Company to whom the Company has sold, assigned, transferred,
leased or conveyed all or substantially all of its properties and assets shall
be required to expressly assume by a supplemental agreement, executed and
delivered to the Agent, in form satisfactory to the Agent, all the obligations
of the Company under Section 7.7.
SECTION 9.2 Rights And Duties Of Successor Corporation.
(a) In case of any such consolidation, merger, sale,
assignment, transfer, lease or conveyance and upon any such assumption
by a successor Corporation in accordance with Section 9.1, such
successor Corporation shall succeed to and be substituted for the
67
Company with the same effect as if it had been named herein as the
Company and thereafter, except in the case of a lease, the predecessor
Person shall be relieved of all obligations and covenants under the
Purchase Contracts, the Notes, this Agreement, the Remarketing
Agreement and the Pledge Agreement. Such successor Corporation
thereupon may cause to be signed, and may issue either in its own name
or in the name of the Company, any or all of the Certificates
evidencing Equity Security Units and Stripped Equity Security Units
issuable hereunder which theretofore shall not have been signed by the
Company and delivered to the Agent; and, upon the order of such
successor Corporation, instead of the Company, and subject to all the
terms, conditions and limitations in this Agreement prescribed, the
Agent shall authenticate and execute on behalf of the Holders and
deliver any Certificates which previously shall have been signed and
delivered by the officers of the Company to the Agent for
authentication and execution, and any Certificate evidencing Equity
Security Units or Stripped Equity Security Units which such successor
Corporation thereafter shall cause to be signed and delivered to the
Agent for that purpose. All the Certificates so issued shall in all
respects have the same legal rank and benefit under this Agreement as
the Certificates theretofore or thereafter issued in accordance with
the terms of this Agreement as though all of such Certificates had been
issued at the date of the execution hereof.
(b) In case of any such consolidation, merger, sale,
assignment, transfer, lease or conveyance such change in phraseology
and form (but not in substance) may be made in the Certificates
evidencing Equity Security Units and Stripped Equity Security Units
thereafter to be issued as may be appropriate.
SECTION 9.3 Opinion Of Counsel Given To Agent. The Agent, subject to
Sections 7.1 and 7.3, shall receive an Opinion of Counsel as conclusive evidence
that any such consolidation, merger, sale, assignment, transfer, lease or
conveyance, and any such assumption, complies with the provisions of this
Article and that all conditions precedent to the consummation of any such
consolidation, merger, sale, assignment, transfer, lease or conveyance have been
met.
ARTICLE X.
COVENANTS
SECTION 10.1 Performance Under Purchase Contracts. The Company
covenants and agrees for the benefit of the Holders from time to time of the
Equity Security Units and Stripped Equity Security Units that it will duly and
punctually perform its obligations under the Purchase Contracts in accordance
with the terms of the Purchase Contracts and this Agreement.
SECTION 10.2 Maintenance Of Office Or Agency.
(a) The Company will maintain in the Borough of Manhattan, The
City of New York an office or agency where Certificates may be
presented or surrendered for payment of Contract Adjustment Payments,
acquisition of shares of Common Stock upon settlement of the Purchase
Contracts on any Settlement Date and for transfer of Collateral
68
upon occurrence of a Termination Event, where Certificates may be
surrendered for registration of transfer or exchange, for a Collateral
Substitution or reestablishment of Equity Security Units and where
notices and demands to or upon the Company in respect of the Equity
Security Units and Stripped Equity Security Units and this Agreement
may be served. The Company will give prompt written notice to the Agent
of the location, and any change in the location, of such office or
agency. If at any time the Company shall fail to maintain any such
required office or agency or shall fail to furnish the Agent with the
address thereof, such presentations, surrenders, notices and demands
may be made or served at the Corporate Trust Office, and the Company
hereby appoints the Agent as its agent to receive all such
presentations, surrenders, notices and demands.
(b) The Company may also from time to time designate one or
more other offices or agencies where Certificates may be presented or
surrendered for any or all such purposes and may from time to time
rescind such designations; provided, that no such designation or
rescission shall in any manner relieve the Company of its obligation to
maintain an office or agency in the Borough of Manhattan, The City of
New York for such purposes. The Company will give prompt written notice
to the Agent of any such designation or rescission and of any change in
the location of any such other office or agency. The Company hereby
designates as the place of payment for the Equity Security Units and
Stripped Equity Security Units the Corporate Trust Office and appoints
the Agent at its Corporate Trust Office as paying agent in such city.
SECTION 10.3 Company To Reserve Common Stock. The Company shall at all
times prior to the Stock Purchase Date reserve and keep available, free from
preemptive rights, out of its authorized but unissued Common Stock or treasury
Common Stock the full number of shares of Common Stock issuable against tender
of payment in respect of all Purchase Contracts constituting a part of the
Equity Security Units and Stripped Equity Security Units evidenced by
outstanding Certificates.
SECTION 10.4 Covenants As To Common Stock. The Company covenants that
all shares of Common Stock which may be issued against tender of payment in
respect of any Purchase Contract constituting a part of the Outstanding Units
will, upon issuance, be duly authorized, validly issued, fully paid and
nonassessable.
SECTION 10.5 Statements Of Officer Of The Company As To Default. The
Company will deliver to the Agent, within 120 days after the end of each fiscal
year of the Company ending after the date hereof, an Officer's Certificate,
stating whether or not to the best knowledge of the signer thereof the Company
is in default in the performance and observance of any of the terms, provisions
and conditions hereof, and if the Company shall be in default, specifying all
such defaults and the nature and status thereof of which such Officer may have
knowledge. The Company shall deliver to the Agent, as soon as possible and in
any event within five days after the Company becomes aware of the occurrence of
any default under this Agreement or an event which, with notice or the lapse of
time or both, would constitute a default under this Agreement, an Officers'
Certificate setting forth the details of such default and the action which the
Company proposes to take with respect thereto.
[SIGNATURE PAGES FOLLOW]
69
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
DTE ENERGY COMPANY
By:
-------------------------------------
Name: D.R. Murphy
Title: Assistant Treasurer
THE BANK OF NEW YORK,
as Purchase Contract Agent
By:
-------------------------------------
Name:
Title:
70
EXHIBIT A
FORM OF EQUITY SECURITY UNIT CERTIFICATE
[FOR INCLUSION IN GLOBAL CERTIFICATES ONLY - THIS CERTIFICATE IS A
GLOBAL CERTIFICATE WITHIN THE MEANING OF THE PURCHASE CONTRACT AGREEMENT (AS
HEREINAFTER DEFINED) AND IS REGISTERED IN THE NAME OF THE CLEARING AGENCY OR A
NOMINEE THEREOF. THIS CERTIFICATE MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A
CERTIFICATE REGISTERED, AND NO TRANSFER OF THIS CERTIFICATE IN WHOLE OR IN PART
MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH CLEARING AGENCY OR
A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE
CONTRACT AGREEMENT.
Unless this Certificate is presented by an authorized representative of
The Depository Trust Company (55 Water Street, New York, New York) to the
Company or its agent for registration of transfer, exchange or payment, and any
Certificate issued is registered in the name of Cede & Co., or such other name
as requested by an authorized representative of The Depository Trust Company,
and any payment hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL since the registered owner
hereof, Cede & Co., has an interest herein.]
(Form of Face of Equity Security Unit Certificate)
No. ______________ CUSIP No. 233331 20 6
Number of Equity Security Units____________
This Equity Security Unit Certificate certifies that [For inclusion in
Global Certificates only --Cede & Co.] is the registered Holder of the number of
Equity Security Units set forth above [For inclusion in Global Certificates only
- -- or such other number of Equity Security Units reflected in the Schedule of
Increases or Decreases in Global Certificates attached hereto]. Each Equity
Security Unit represents (i) either (a) beneficial ownership by the Holder of
one 4.60% Senior Note due 2007 (the "Note") of DTE ENERGY COMPANY, a Michigan
corporation (the "Company"), having a principal amount of $25, subject to the
Pledge of such Note by such Holder pursuant to the Pledge Agreement, or (b) if
the Note has been remarketed by the Remarketing Agent, the appropriate
Applicable Ownership Interest in the Treasury Portfolio, subject to the Pledge
of such Applicable Ownership Interest in the Treasury Portfolio by such Holder
pursuant to the Pledge Agreement, or (c) if a Tax Event Redemption has occurred,
the appropriate Applicable Ownership Interest in the Tax Event Treasury
Portfolio subject to the Pledge of such Applicable Ownership Interest in the Tax
Event Treasury Portfolio pursuant to the Pledge Agreement, and (ii) the rights
and obligations of the Holder under one Purchase Contract with the Company. All
capitalized terms used herein which are defined in the Purchase Contract
Agreement have the meaning set forth therein.
Pursuant to the Pledge Agreement, the Note or the appropriate
Applicable Ownership Interest in the Treasury Portfolio or Applicable Ownership
Interest in the Tax Event Treasury Portfolio, as the case may be, constituting
part of each Equity Security Unit evidenced hereby has
A-1
been pledged to the Collateral Agent, for the benefit of the Company, to secure
the obligations of the Holder under the Purchase Contract comprising a part of
such Equity Security Unit.
The Pledge Agreement provides that all payments in respect of the
Pledged Notes, Pledged Applicable Ownership Interest in the Treasury Portfolio
or Pledged Applicable Ownership Interest in the Tax Event Treasury Portfolio
received by the Collateral Agent shall be paid by the Collateral Agent by wire
transfer in same day funds (i) in the case of (A) quarterly cash distributions
on Equity Security Units which include Pledged Notes, Pledged Applicable
Ownership Interest in the Treasury Portfolio or Pledged Applicable Ownership
Interest in the Tax Event Treasury Portfolio and (B) any payments in respect of
the Notes, Applicable Ownership Interest in the Treasury Portfolio or Applicable
Ownership Interest in the Tax Event Treasury Portfolio, as the case may be, that
have been released from the Pledge pursuant to the Pledge Agreement, to the
Agent to the account designated by the Agent, no later than 11:00 a.m., New York
City time, on the Business Day such payment is received by the Collateral Agent
(provided that in the event such payment is received by the Collateral Agent on
a day that is not a Business Day or after 9:00 a.m., New York City time, on a
Business Day, then such payment shall be made no later than 9:30 a.m., New York
City time, on the next succeeding Business Day) and (ii) in the case of payments
in respect of any Pledged Notes, Pledged Applicable Ownership Interest in the
Treasury Portfolio or Pledged Applicable Ownership Interest in the Tax Event
Treasury Portfolio, as the case may be, to be paid upon settlement of such
Holder's obligations to purchase Common Stock under the Purchase Contract, to
the Company on the Stock Purchase Date (as defined herein) in accordance with
the terms of the Pledge Agreement, in full satisfaction of the respective
obligations of the Holders of the Equity Security Units of which such Pledged
Notes, Pledged Applicable Ownership Interest in the Treasury Portfolio or
Pledged Applicable Ownership Interest in the Tax Event Treasury Portfolio, as
the case may be, are a part under the Purchase Contracts forming a part of such
Equity Security Units. Quarterly distributions on Equity Security Units that
include Pledged Notes, Pledged Applicable Ownership Interest in the Treasury
Portfolio or Pledged Applicable Ownership Interest in the Tax Event Treasury
Portfolio, as the case may be, which are payable quarterly in arrears on
February 16, May 16, August 16 and November 16 each year commencing August 16,
2002 (a "Payment Date"), shall, subject to receipt thereof by the Agent from the
Collateral Agent (if the Collateral Agent is the registered owner thereof), be
paid to the Person in whose name this Equity Security Unit Certificate (or a
Predecessor Equity Security Unit Certificate) is registered at the close of
business on the Record Date for such Payment Date.
Each Purchase Contract evidenced hereby obligates the Holder of this
Equity Security Unit Certificate to purchase, and the Company to sell, on August
16, 2005 (the "Stock Purchase Date"), at a price equal to $25 (the "Stated
Amount"), a number of newly issued shares of Common Stock, without par value
("Common Stock"), of the Company, equal to the Settlement Rate, unless on or
prior to the Stock Purchase Date there shall have occurred a Termination Event
or a Cash Settlement, Early Settlement or Merger Early Settlement with respect
to the Equity Security Units of which such Purchase Contract is a part, all as
provided in the Purchase Contract Agreement and more fully described on the
reverse hereof. The Purchase Price (as defined herein) for the shares of Common
Stock purchased pursuant to each Purchase Contract evidenced hereby, if not paid
earlier, shall be paid on the Stock Purchase Date by application of payments
received in respect of the Pledged Notes pursuant to a successful remarketing,
Pledged
A-2
Applicable Ownership Interest in the Treasury Portfolio or Pledged Applicable
Ownership Interest in the Tax Event Treasury Portfolio (as specified in clause
(A) of the definition of "Applicable Ownership Interest"), as the case may be,
pledged to secure the obligations of the Holder under such Purchase Contract.
Payments on the Notes or the appropriate Applicable Ownership Interest
in the Treasury Portfolio or Applicable Ownership Interest in the Tax Event
Treasury Portfolio, as the case may be, will be payable at the office of the
Agent in The City of New York or, at the option of the Company, by check mailed
to the address of the Person entitled thereto as such address appears on the
Equity Security Unit Register or by wire transfer to an account specified by
such Person at least ten Business Days prior to the applicable Payment Date.
The Company shall pay on each Payment Date in respect of each Purchase
Contract forming part of an Equity Security Unit evidenced hereby an amount (the
"Contract Adjustment Payment") equal to 4.15% per year of the Stated Amount,
computed (1) for any full quarterly period, on the basis of a 360-day year of
twelve 30-day months and (2) for any period shorter than a full quarterly
period, on the basis of a 30-day month and for periods less than a month, on the
basis of the actual number of days elapsed per 30-day month, subject to deferral
at the option of the Company as provided in the Purchase Contract Agreement and
more fully described on the reverse hereof (provided that if any date on which a
Contract Adjustment Payment is to be made on the Purchase Contracts is not a
Business Day, then payment of such Contract Adjustment Payment payable on such
date will be made on the next succeeding day which is a Business Day, and no
interest or payment will be paid in respect of such delay, except that if such
next succeeding Business Day is in the next succeeding calendar year, then such
payment will be made on the immediately preceding Business Day with the same
force and effect as it made on such Payment Date). Such Contract Adjustment
Payments shall be payable to the Person in whose name this Equity Security Unit
Certificate (or a Predecessor Equity Security Unit Certificate) is registered at
the close of business on the Record Date for such Payment Date.
Contract Adjustment Payments will be payable at the office of the Agent
in The City of New York or, at the option of the Company, by check mailed to the
address of the Person entitled thereto as such address appears on the Equity
Security Unit Register or by wire transfer to the account designated to the
Agent by a prior written notice by such Person delivered at least ten Business
Days prior to the applicable Payment Date.
Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Agent by manual signature, this Equity Security Unit Certificate shall not
be entitled to any benefit under the Pledge Agreement or the Purchase Contract
Agreement or be valid or obligatory for any purpose.
A-3
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
DTE ENERGY COMPANY
By:
-------------------------------------
Name:
Title:
HOLDER SPECIFIED ABOVE (as to
obligations of such Holder under the
Purchase Contracts evidenced hereby)
By: THE BANK OF NEW YORK, not
individually but solely as
Attorney-in-Fact of such Holder
By:
-------------------------------------
Authorized Signatory
A-4
AGENT'S CERTIFICATE OF AUTHENTICATION
This is one of the Equity Security Unit Certificates referred to in the
within-mentioned Purchase Contract Agreement.
THE BANK OF NEW YORK,
as Purchase Contract Agent
Dated: By:
-------------------------------------
Authorized Signatory
A-5
(Form of Reverse of Equity Security Unit Certificate)
Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of June 25, 2002 (as may be supplemented from time
to time, the "Purchase Contract Agreement"), between the Company and The Bank of
New York, as Purchase Contract Agent (including its successors thereunder,
herein called the "Agent"), to which Purchase Contract Agreement and
supplemental agreements thereto reference is hereby made for a description of
the respective rights, limitations of rights, obligations, duties and immunities
thereunder of the Agent, the Company, and the Holders and of the terms upon
which the Equity Security Unit Certificates are, and are to be, executed and
delivered. In the case of any inconsistency between this Certificate and the
Purchase Contract Agreement, the terms of the Purchase Contract Agreement shall
prevail.
Each Purchase Contract evidenced hereby obligates the Holder of this
Equity Security Unit Certificate to purchase, and the Company to sell, on the
Stock Purchase Date at a price equal to $25 (the "Purchase Price"), a number of
shares of Common Stock of the Company equal to the Settlement Rate, unless, on
or prior to the Stock Purchase Date, there shall have occurred a Termination
Event or an Early Settlement, Merger Early Settlement or Cash Settlement with
respect to the Equity Security Units of which such Purchase Contract is a part.
The "Settlement Rate" is equal to (a) if the Applicable Market Value (as defined
below) is greater than or equal to $51.90 (the "Threshold Appreciation Price"),
0.4817 shares of Common Stock per Purchase Contract, (b) if the Applicable
Market Value is less than the Threshold Appreciation Price but is greater than
$43.25 (the "Reference Price"), the number of shares of Common Stock per
Purchase Contract equal to the Stated Amount divided by the Applicable Market
Value and (c) if the Applicable Market Value is less than or equal to the
Reference Price, 0.5780 shares of Common Stock per Purchase Contract, in each
case subject to adjustment as provided in the Purchase Contract Agreement. No
fractional shares of Common Stock will be issued upon settlement of Purchase
Contracts, as provided in the Purchase Contract Agreement.
The "Applicable Market Value" means the average of the Closing Price
per share of Common Stock on each of the 20 consecutive Trading Days ending on
the third Trading Day immediately preceding the Stock Purchase Date.
The "Closing Price" of the Common Stock on any date of determination
means the closing sale price (or, if no closing price is reported, the last
reported sale price) of the Common Stock on the New York Stock Exchange (the
"NYSE") on such date or, if the Common Stock is not listed for trading on the
NYSE on any such date, as reported in the composite transactions for the
principal United States securities exchange on which the Common Stock is so
listed, or if the Common Stock is not so listed on a United States national or
regional securities exchange, as reported by The Nasdaq Stock Market, or, if the
Common Stock is not so reported, the last quoted bid price for the Common Stock
in the over-the-counter market as reported by the National Quotation Bureau or
similar organization, or, if such bid price is not available, the market value
of the Common Stock on such date as determined by a nationally recognized
independent investment banking firm retained for this purpose by the Company.
A-6
A "Trading Day" means a day on which the Common Stock (A) is not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (B) has
traded at least once on the national or regional securities exchange or
association or over-the- counter market that is the primary market for the
trading of the Common Stock.
Each Purchase Contract evidenced hereby may be settled prior to the
Stock Purchase Date through Early Settlement, Merger Early Settlement or Cash
Settlement, in accordance with the terms of the Purchase Contract Agreement.
In accordance with the terms of the Purchase Contract Agreement, the
Holder of this Equity Security Unit Certificate shall pay the Purchase Price for
the shares of Common Stock purchased pursuant to each Purchase Contract
evidenced hereby (i) by effecting a Cash Settlement, Early Settlement or Merger
Early Settlement, (ii) by application of payments received in respect of the
Pledged Applicable Ownership Interest in the Treasury Portfolio acquired from
the proceeds of a remarketing of the related Pledged Notes underlying the Equity
Security Units represented by this Equity Security Unit Certificate, or (iii) if
a Tax Event Redemption Date has occurred prior to the successful remarketing of
the Notes by application of payments received in respect of the Pledged
Applicable Ownership Interest in the Tax Event Treasury Portfolio purchased by
the Collateral Agent on behalf of the Holder of this Equity Security Unit
Certificate. If, as provided in the Purchase Contract Agreement, upon the
occurrence of a Last Failed Remarketing on the fifth Business Day immediately
proceeding the Stock Purchase Date the Collateral Agent, for the benefit of the
Company, exercises its rights as a secured creditor with respect to the Pledged
Notes related to this Equity Security Unit Certificate, any accrued and unpaid
interest on such Pledged Notes will become payable by the Company to the Holder
of this Equity Security Unit Certificate in the manner provided for in the
Purchase Contract Agreement.
The Company shall not be obligated to issue any shares of Common Stock
in respect of a Purchase Contract or deliver any certificates therefor to the
Holder unless it shall have received payment in full of the aggregate Purchase
Price for the shares of Common Stock to be purchased thereunder in the manner
herein set forth.
Under the terms of the Pledge Agreement, the Agent will be entitled to
exercise the voting and any other consensual rights pertaining to the Pledged
Notes. Upon receipt of notice of any meeting at which holders of Notes are
entitled to vote or upon the solicitation of consents, waivers or proxies of
holders of Notes, the Agent shall, as soon as practicable thereafter, mail to
the Holders of Equity Security Units a notice (a) containing such information as
is contained in the notice or solicitation, (b) stating that each such Holder on
the record date set by the Agent therefor (which, to the extent possible, shall
be the same date as the record date for determining the holders of Notes
entitled to vote) shall be entitled to instruct the Agent as to the exercise of
the voting rights pertaining to the Pledged Notes constituting a part of such
Holder's Equity Security Units and (c) stating the manner in which such
instructions may be given. Upon the written request of the Holders of Equity
Security Units on such record date, the Agent shall endeavor insofar as
practicable to vote or cause to be voted, in accordance with the instructions
set forth in such requests, the maximum number of Pledged Notes as to which any
particular voting instructions are received. In the absence of specific
instructions from the Holder of an
A-7
Equity Security Unit, the Agent shall abstain from voting the Pledged Note
evidenced by such Equity Security Units.
The Equity Security Unit Certificates are issuable only in registered
form and only in denominations of a single Equity Security Unit and any integral
multiple thereof. The transfer of any Equity Security Unit Certificate will be
registered and Equity Security Unit Certificates may be exchanged as provided in
the Purchase Contract Agreement. The Equity Security Unit Registrar may require
a Holder, among other things, to furnish appropriate endorsements and transfer
documents permitted by the Purchase Contract Agreement. No service charge shall
be required for any such registration of transfer or exchange, but the Company
and the Agent may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith. The Holder of an Equity
Security Unit may substitute for the Pledged Notes, securing its obligations
under the related Purchase Contract Treasury Securities in accordance with the
terms of the Purchase Contract Agreement and the Pledge Agreement. From and
after such Collateral Substitution, the Equity Security Units for which such
Pledged Treasury Securities secures the Holder's obligation under the Purchase
Contract shall be referred to as a "Stripped Equity Security Unit." A Holder
that elects to substitute a Treasury Security for Pledged Notes, thereby
creating Stripped Equity Security Units, shall be responsible for any fees or
expenses payable in connection therewith. Except as provided in the Purchase
Contract Agreement, for so long as the Purchase Contract underlying an Equity
Security Unit remains in effect, such Equity Security Unit shall not be
separable into its constituent parts, and the rights and obligations of the
Holder of such Equity Security Unit in respect of the Pledged Note, and Purchase
Contract constituting such Equity Security Unit may be transferred and exchanged
only as an Equity Security Unit.
A Holder of Stripped Equity Security Units may reestablish Equity
Security Units by delivering to the Collateral Agent Notes in exchange for the
release of the Pledged Treasury Securities in accordance with the terms of the
Purchase Contract Agreement and the Pledge Agreement.
Subject to the next succeeding paragraph, the Company shall pay, on
each Payment Date, the Contract Adjustment Payments, if any, payable in respect
of each Purchase Contract to the Person in whose name the Equity Security Unit
Certificate evidencing such Purchase Contract is registered at the close of
business on the Record Date for such Payment Date. Contract Adjustment Payments,
if any, will be payable at the office of the Agent in The City of New York or,
at the option of the Company, by check mailed to the address of the Person
entitled thereto at such address as it appears on the Equity Security Unit
Register or by wire transfer to the account designated by such Person in writing
at least ten Business Days prior to the applicable Payment Date.
The Company shall have the right, at any time prior to the Stock
Purchase Date, to defer the payment of any or all of the Contract Adjustment
Payments otherwise payable on any Payment Date, but only if the Company shall
give the Holders and the Agent written notice of its election to defer Contract
Adjustment Payments as provided in the Purchase Contract Agreement. Any Contract
Adjustment Payments so deferred shall, to the extent permitted by law, bear
additional Contract Adjustment Payments thereon at the rate of 4.15% per year
A-8
(computed on the basis of a 360-day year of twelve 30-day months), compounding
on each succeeding Payment Date, until paid in full (such deferred installments
of Contract Adjustment Payments, if any, together with the additional Contract
Adjustment Payments, if any, accumulated thereon, are referred to herein as the
"Deferred Contract Adjustment Payments"). Deferred Contract Adjustment Payments,
if any, shall be due on the next succeeding Payment Date except to the extent
that payment is deferred pursuant to the Purchase Contract Agreement. No
Contract Adjustment Payments may be deferred to a date that is after the Stock
Purchase Date and no such deferral period may end other than on a Payment Date.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments on the Purchase Contracts until a Payment Date prior to the
Stock Purchase Date, then all Deferred Contract Adjustment Payments, if any,
shall be payable to the registered Holders as of the close of business on the
Record Date immediately preceding such Payment Date.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments on the Purchase Contracts until the Stock Purchase Date, the
Holder of this Equity Security Unit Certificate will receive on the Stock
Purchase Date, if the Company so elects, in lieu of a cash payment, a number of
shares of Common Stock (in addition to the number of shares of Common Stock
equal to the Settlement Rate) equal to (i) the aggregate amount of Deferred
Contract Adjustment Payments payable to the Holder of this Equity Security Unit
Certificate divided by (ii) the Applicable Market Value.
In the event the Company exercises its option to defer the payment of
Contract Adjustment Payments, then, until the Deferred Contract Adjustment
Payments have been paid, the Company shall not, and shall not permit any
subsidiary of the Company to, declare or pay dividends on, make distributions
with respect to, or redeem, purchase or acquire, or make a liquidation payment
with respect to, any of its Common Stock other than (i) purchases, redemptions
or acquisitions of shares of Common Stock in connection with any employment
contract, benefit plan or other similar arrangement with or for the benefit of
employees, officers or directors or a stock purchase or dividend reinvestment
plan, or the satisfaction by the Company of its obligations pursuant to any
contract or security outstanding on the date the Company exercises its rights to
defer the Contract Adjustment Payments; (ii) as a result of a reclassification
of the Company's Capital Stock or the exchange or conversion of one class or
series of for another class or series of the Company's Capital Stock; (iii) the
purchase of fractional interests in shares of the Company's Common Stock
pursuant to the conversion or exchange provisions of such Common Stock or the
security being converted or exchanged; (iv) dividends or distributions payable
solely in the Company's Common Stock (or rights to acquire Common Stock) or
repurchases, acquisitions or redemptions of Common Stock in connection with the
issuance or exchange of the Common Stock (or securities convertible into or
exchangeable for shares of the Company's Common Stock); or (v) redemptions,
exchanges or repurchases of any rights outstanding under a shareholder rights
plan or the declaration or payment thereunder of a dividend or distribution of
or with respect to rights in the future.
The Purchase Contracts and all obligations and rights of the Company
and the Holders thereunder, including, without limitation, the rights of the
Holders to receive and the obligation of the Company to pay Contract Adjustment
Payments, if any, or any Deferred Contract
A-9
Adjustment Payments, and the rights of the Holders to purchase Common Stock,
shall immediately and automatically terminate, without the necessity of any
notice or action by any Holder, the Agent or the Company, if, on or prior to the
Stock Purchase Date, a Termination Event shall have occurred. Upon the
occurrence of a Termination Event, the Company shall promptly but in no event
later than two Business Days thereafter give written notice to the Agent, the
Collateral Agent and to the Holders, at their addresses as they appear in the
Equity Security Unit Register. Upon and after the occurrence of a Termination
Event, the Collateral Agent shall release the Pledged Notes, Pledged Applicable
Ownership Interest in the Treasury Portfolio or Pledged Applicable Ownership
Interest in the Tax Event Treasury Portfolio, as the case may be, from the
Pledge in accordance with the provisions of the Pledge Agreement.
Upon registration of transfer of this Equity Security Unit Certificate,
the transferee shall be bound (without the necessity of any other action on the
part of such transferee, except as may be required by the Agent pursuant to the
Purchase Contract Agreement), under the terms of the Purchase Contract Agreement
and the Purchase Contracts evidenced hereby and the transferor shall be released
from the obligations under the Purchase Contracts evidenced by this Equity
Security Unit Certificate. The Company covenants and agrees, and the Holder, by
its acceptance hereof, likewise covenants and agrees, to be bound by the
provisions of this paragraph.
The Holder of this Equity Security Unit Certificate, by its acceptance
hereof, authorizes the Agent to enter into and perform the related Purchase
Contracts forming part of the Equity Security Units evidenced hereby on his
behalf as his attorney-in-fact, expressly withholds any consent to the
assumption (i.e., affirmance) of the Purchase Contracts by the Company or its
trustee in the event that the Company becomes the subject of a case under the
Bankruptcy Code, agrees to be bound by the terms and provisions thereof,
covenants and agrees to perform such Holder's obligations under such Purchase
Contracts, consents to the provisions of the Purchase Contract Agreement,
authorizes the Agent to enter into and perform the Pledge Agreement on such
Holder's behalf as attorney-in-fact, and consents to the Pledge of the Notes or
the appropriate Applicable Ownership Interest in the Treasury Portfolio or
Applicable Ownership Interest in the Tax Event Treasury Portfolio, as the case
may be, underlying this Equity Security Unit Certificate pursuant to the Pledge
Agreement. The Holder further covenants and agrees, that, to the extent and in
the manner provided in the Purchase Contract Agreement and the Pledge Agreement,
but subject to the terms thereof, payments in respect of the Pledged Notes,
Pledged Applicable Ownership Interest in the Treasury Portfolio or Pledged
Applicable Ownership Interest in the Tax Event Treasury Portfolio, as the case
may be, to be paid upon settlement of such Holder's obligations to purchase
Common Stock under the Purchase Contract, shall be paid on the Stock Purchase
Date by the Collateral Agent to the Company in satisfaction of such Holder's
obligations under such Purchase Contract and such Holder shall acquire no right,
title or interest in such payments.
Each Holder of any Equity Security Units or Stripped Equity Security
Units, and each Beneficial Owner thereof, by its acceptance thereof or of its
interest therein, further agrees to treat (i) itself as the owner of the related
Notes, Applicable Ownership Interest in the Treasury Portfolio, Applicable
Ownership Interest in the Tax Event Treasury Portfolio or Treasury Securities,
as the case may be, (ii) the Notes as indebtedness of the Company, and (iii) the
Purchase Contract and the Notes, the Treasury Portfolio, the Tax Event Treasury
Portfolio of
A-10
Treasury Securities, as the case may be, as separate financial instruments, in
each case, for all tax purposes.
Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of a majority of the
Purchase Contracts.
The Purchase Contracts shall for all purposes be governed by, and
construed in accordance with, the laws of the State of New York, without regard
to its principles of conflicts of laws.
The Company, the Agent and its Affiliates and any agent of the Company
or the Agent may treat the Person in whose name this Equity Security Unit
Certificate is registered as the owner of the Equity Security Units evidenced
hereby for the purpose of receiving quarterly payments on the Notes, the
Applicable Ownership Interest in the Treasury Portfolio or the Applicable
Ownership Interest in the Tax Event Treasury Portfolio, as the case may be,
receiving payments of Contract Adjustment Payments, if any, and any Deferred
Contract Adjustment Payments, performance of the Purchase Contracts and for all
other purposes whatsoever (subject to the Record Date provisions hereof),
whether or not any payments in respect thereof be overdue and notwithstanding
any notice to the contrary, and neither the Company, the Agent, such Affiliates
nor any such agent shall be affected by notice to the contrary.
The Purchase Contracts shall not, prior to the settlement thereof,
entitle the Holder to any of the rights of a holder of shares of Common Stock.
A copy of the Purchase Contract Agreement is available for inspection
at the offices of the Agent.
A-11
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
UNIF GIFT MIN ACT - Custodian
----------------------------------------
(cust) (minor)
Under Uniform Gifts to Minors Act
----------------------------------------
(State)
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and not as tenants in
common
Additional abbreviations may also be used though not in the above list.
A-12
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
unto____________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please insert Social Security or Taxpayer I.D. or other Identifying Number of
Assignee)_______________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please Print or Type Name and Address Including Postal Zip Code of Assignee)
the within Equity Security Unit Certificates and all rights thereunder, hereby
irrevocably constituting and appointing ____________________________ attorney to
transfer said Equity Security Unit Certificates on the books of DTE ENERGY
COMPANY with full power of substitution in the premises.
Dated: _______________________ Signature: ______________________________________
NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Equity Security Unit Certificates in every
particular, without alteration or enlargement or any change whatsoever.
Signature Guarantee: ___________________________________________________________
A-13
SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for shares of Common Stock
deliverable upon settlement on or after the Stock Purchase Date of the Purchase
Contracts underlying the number of Equity Security Units evidenced by this
Equity Security Unit Certificate be registered in the name of, and delivered,
together with a check in payment for any fractional share, to the undersigned at
the address indicated below unless a different name and address have been
indicated below. If shares are to be registered in the name of a Person other
than the undersigned, the undersigned will pay any transfer tax payable incident
thereto.
Dated: ___________________ Signature:______________________________
Signature Guarantee:____________________
(if assigned to another person)
If shares are to be registered in the REGISTERED HOLDER Please print
name of and delivered to a Person other name and address of Registered Holder:
than the Holder, please (i) print such
Person's name and address and (ii)
provide a guarantee of your signature:
___________________________________ ________________________________________
Name Name
___________________________________ ________________________________________
Address Address
Social Security or other Taxpayer
Identification Number, if any
A-14
ELECTION TO SETTLE EARLY
The undersigned Holder of this Equity Security Unit Certificate hereby
irrevocably exercises the option to effect Early Settlement in accordance with
the terms of the Purchase Contract Agreement with respect to the Purchase
Contracts underlying the number of Equity Security Units evidenced by this
Equity Security Unit Certificate specified below. The option to effect Early
Settlement may be exercised only with respect to Purchase Contracts underlying
Equity Security Units with an aggregate Stated Amount equal to $1,000 or an
integral multiple thereof, subject to the provisions of the within-mentioned
Purchase Contract Agreement relating to Early Settlement following a successful
remarketing or a Tax Event Redemption Date. The undersigned Holder directs that
a certificate for shares of Common Stock deliverable upon such Early Settlement
be registered in the name of, and delivered, together with a check in payment
for any fractional share and any Equity Security Unit Certificate representing
any Equity Security Units evidenced hereby as to which Early Settlement of the
related Purchase Contracts is not effected, to the undersigned at the address
indicated below unless a different name and address have been indicated below.
Pledged Notes, Pledged Applicable Ownership Interest in the Treasury Portfolio
or the Pledged Applicable Ownership Interest in the Tax Event Treasury
Portfolio, as the case may be, deliverable upon such Early Settlement will be
transferred in accordance with the transfer instructions set forth below. If
shares are to be registered in the name of a Person other than the undersigned,
the undersigned will pay any transfer tax payable incident thereto.
Dated: ___________________ Signature: _____________________________
Signature Guarantee: ___________________
Number of Equity Security Units evidenced hereby as to which Early Settlement of
the related Purchase Contracts is being elected:
If shares of Common Stock are to be REGISTERED HOLDER
registered in the name of and
delivered to and Pledged Notes,
Pledged Applicable Ownership Interest
in the Treasury Portfolio or Pledged
Applicable Ownership Interest in the Please print name and address of
Tax Event Treasury Portfolio, as the Registered Holder:
case may be, are to be transferred to
a Person other than the Holder, please
print such Person's name and address:
___________________________________ ________________________________________
Name Name
___________________________________ ________________________________________
Address Address
Social Security or other Taxpayer
Identification Number, if any
A-15
Transfer instructions for Pledged Notes, Pledged Applicable Ownership Interest
in the Treasury Portfolio or the Pledged Applicable Ownership Interest in the
Tax Event Treasury Portfolio, as the case may be, transferable upon Early
Settlement or a Termination Event:
A-16
(TO BE ATTACHED TO GLOBAL CERTIFICATES)
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The following increases or decreases in this Global Certificate have been made:
Amount of Decrease Stated Amount of the
in Stated Amount of Amount of Increase in Global Certificate
the Global Stated Amount of the Following Such Signature of
Date Certificate Global Certificate Decrease or Increase Authorizing Officer
- --------------------- --------------------- ----------------------- ---------------------- ----------------------
A-17
EXHIBIT B
FORM OF STRIPPED EQUITY SECURITY UNIT CERTIFICATE
[FOR INCLUSION IN GLOBAL CERTIFICATES ONLY -- THIS CERTIFICATE IS A GLOBAL
CERTIFICATE WITHIN THE MEANING OF THE PURCHASE CONTRACT AGREEMENT (AS
HEREINAFTER DEFINED) AND IS REGISTERED IN THE NAME OF A CLEARING AGENCY OR A
NOMINEE THEREOF. THIS CERTIFICATE MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A
CERTIFICATE REGISTERED, AND NO TRANSFER OF THIS CERTIFICATE IN WHOLE OR IN PART
MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH CLEARING AGENCY OR
A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE
CONTRACT AGREEMENT.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company (55 Water Street, New York, New York) to the Company or
its agent for registration of transfer, exchange or payment, and any Certificate
issued is registered in the name of Cede & Co., or such other name as requested
by an authorized representative of The Depository Trust Company, and any payment
hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE
OR OTHERWISE BY A PERSON IS WRONGFUL since the registered owner hereof, Cede &
Co., has an interest herein.]
[Form of Face of Stripped Equity Security Unit Certificate]
No. ___________________ CUSIP No. 233331 30 5
Number of Stripped Equity Security Units _______________
This Stripped Equity Security Unit Certificate certifies that [For
inclusion in Global Certificates only -- Cede & Co.] is the registered Holder of
the number of Stripped Equity Security Units set forth above [For inclusion in
Global Certificates only -- or such other number of Stripped Equity Security
Units reflected in the Schedule of Increases or Decreases in Global Certificate
attached hereto]. Each Stripped Equity Security Unit represents (i) a 1/40
undivided beneficial ownership interest in a Treasury Security, subject to the
Pledge of such interest in such Treasury Security by such Holder pursuant to the
Pledge Agreement, and (ii) the rights and obligations of the Holder under one
Purchase Contract with DTE ENERGY COMPANY, a Michigan corporation (the
"Company"). All capitalized terms used herein which are defined in the Purchase
Contract Agreement have the meaning set forth therein.
Pursuant to the Pledge Agreement, the Treasury Security constituting
part of each Stripped Equity Security Unit evidenced hereby has been pledged to
the Collateral Agent, for the benefit of the Company, to secure the obligations
of the Holder under the Purchase Contract comprising a part of such Stripped
Equity Security Unit.
Each Purchase Contract evidenced hereby obligates the Holder of this
Stripped Equity Security Unit Certificate to purchase, and the Company to sell,
on August 16, 2005 (the "Stock Purchase Date"), at a price equal to $25 (the
"Stated Amount"), a number of shares of Common
B-1
Stock, without par value ("Common Stock"), of the Company, equal to the
Settlement Rate, unless on or prior to the Stock Purchase Date there shall have
occurred a Termination Event or an Early Settlement or Merger Early Settlement
with respect to the Stripped Equity Security Units of which such Purchase
Contract is a part, all as provided in the Purchase Contract Agreement and more
fully described on the reverse hereof. The Purchase Price (as defined herein)
for the shares of Common Stock purchased pursuant to each Purchase Contract
evidenced hereby, if not paid earlier, shall be paid on the Stock Purchase Date
by application of payments received in respect of the Pledged Treasury
Securities pledged to secure the obligations under such Purchase Contract in
accordance with the terms of the Pledge Agreement.
The Company shall pay on each Payment Date in respect of each Purchase
Contract forming part of a Stripped Equity Security Unit evidenced hereby an
amount (the "Contract Adjustment Payments") equal to 4.15% per year of the
Stated Amount, computed (1) for any full quarterly period, on the basis of a
360-day year of twelve 30-day months and (2) for any period shorter than a full
quarterly period on the basis of a 30-day month and for periods less than a
month, on the basis of the actual number of days elapsed per 30-day month,
subject to deferral at the option of the Company as provided in the Purchase
Contract Agreement and more fully described on the reverse hereof (provided that
if any date on which Contract Adjustment Payments are to be made on the Purchase
Contracts is not a Business Day, then payment of the Contract Adjustment
Payments payable on that date will be made on the next succeeding day which is a
Business Day, and no interest or payment will be paid in respect of the delay,
except that if such next succeeding Business Day is in the next succeeding
calendar year, such payment will be made on the immediately preceding Business
Day with the same force and effect as if made on such Payment Date). Such
Contract Adjustment Payments shall be payable to the Person in whose name this
Stripped Equity Security Unit Certificate (or a Predecessor Stripped Equity
Security Unit Certificate) is registered at the close of business on the Record
Date for such Payment Date.
Contract Adjustment Payments, if any, will be payable at the office of
the Agent in the City of New York or, at the option of the Company, by check
mailed to the address of the Person entitled thereto at such address as it
appears on the Stripped Equity Security Unit Register or by wire transfer to the
account designated by such Person in writing at least ten Business Days prior to
the applicable Payment Date.
Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Agent by manual signature, this Stripped Equity Security Unit Certificate
shall not be entitled to any benefit under the Pledge Agreement or the Purchase
Contract Agreement or be valid or obligatory for any purpose.
B-2
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
DTE ENERGY COMPANY
By:______________________________________
Name:
Title:
HOLDER SPECIFIED ABOVE (as to obligations
of such Holder under the
Purchase Contracts)
By: THE BANK OF NEW YORK, not individually but
solely as Attorney-in-Fact of such Holder
By:___________________________________
Authorized Signatory
B-3
AGENT'S CERTIFICATE OF AUTHENTICATION
This is one of the Stripped Equity Security Units referred to in the
within-mentioned Purchase Contract Agreement.
THE BANK OF NEW YORK, as Purchase
Contract Agent
Dated: By:_______________________________
Authorized Signatory
B-4
(Reverse of Stripped Equity Security Unit Certificate)
Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of June 25, 2002 (as may be supplemented from time
to time, the "Purchase Contract Agreement"), between the Company and The Bank of
New York, as Purchase Contract Agent (including its successors thereunder,
herein called the "Agent"), to which the Purchase Contract Agreement and
supplemental agreements thereto reference is hereby made for a description of
the respective rights, limitations of rights, obligations, duties and immunities
thereunder of the Agent, the Company and the Holders and of the terms upon which
the Stripped Equity Security Unit Certificates are, and are to be, executed and
delivered. In the case of any inconsistency between this Certificate and the
Purchase Contract Agreement, the terms of the Purchase Contract Agreement shall
prevail.
Each Purchase Contract evidenced hereby obligates the Holder of this
Stripped Equity Security Unit Certificate to purchase, and the Company to sell,
on the Stock Purchase Date at a price equal to $25 (the "Purchase Price"), a
number of shares of Common Stock of the Company equal to the Settlement Rate,
unless, on or prior to the Stock Purchase Date, there shall have occurred a
Termination Event or an Early Settlement or Merger Early Settlement respect to
the Stripped Equity Security Units of which such Purchase Contract is a part.
The "Settlement Rate" is equal to (a) if the Applicable Market Value (as defined
below) is greater than or equal to $51.90 (the "Threshold Appreciation Price"),
0.4817 shares of Common Stock per Purchase Contract, (b) if the Applicable
Market Value is less than the Threshold Appreciation Price but is greater than
$43.25, the number of shares of Common Stock per Purchase Contract equal to the
Stated Amount divided by the Applicable Market Value and (c) if the Applicable
Market Value is less than or equal to $43.25, 0.5780 shares of Common Stock per
Purchase Contract, in each case subject to adjustment as provided in the
Purchase Contract Agreement. No fractional shares of Common Stock will be issued
upon settlement of Purchase Contracts, as provided in the Purchase Contract
Agreement.
The "Applicable Market Value" means the average of the Closing Price
per share of Common Stock on each of the 20 consecutive Trading Days ending on
the third Trading Day immediately preceding the Stock Purchase Date.
The "Closing Price" of the Common Stock on any date of determination
means the closing sale price (or, if no closing price is reported, the last
reported sale price) of the Common Stock on the New York Stock Exchange (the
"NYSE") on such date or, if the Common Stock is not listed for trading on the
NYSE on any such date, as reported in the composite transactions for the
principal United States securities exchange on which the Common Stock is so
listed, or if the Common Stock is not so listed on a United States national or
regional securities exchange, as reported by The Nasdaq Stock Market, or, if the
Common Stock is not so reported, the last quoted bid price for the Common Stock
in the over-the-counter market as reported by the National Quotation Bureau or
similar organization, or, if such bid price is not available, the market value
of the Common Stock on such date as determined by a nationally recognized
independent investment banking firm retained for this purpose by the Company.
B-5
A "Trading Day" means a day on which the Common Stock (A) is not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (B) has
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of the Common Stock.
Each Purchase Contract evidenced hereby may be settled prior to the
Stock Purchase Date through Early Settlement or Merger Early Settlement, in
accordance with the terms of the Purchase Contract Agreement.
In accordance with the terms of the Purchase Contract Agreement, the
Holder of this Stripped Equity Security Unit Certificate shall pay the Purchase
Price for the shares of Common Stock purchased pursuant to each Purchase
Contract evidenced hereby (i) by effecting an Early Settlement or Merger Early
Settlement or (ii) by application of payments received in respect of the Pledged
Treasury Securities underlying the Stripped Equity Security Units represented by
this Stripped Equity Security Unit Certificate.
The Company shall not be obligated to issue any shares of Common Stock
in respect of a Purchase Contract or deliver any certificates therefor to the
Holder unless it shall have received payment in full of the aggregate Purchase
Price for the shares of Common Stock to be purchased thereunder in the manner
herein set forth.
The Stripped Equity Security Unit Certificates are issuable only in
registered form and only in denominations of a single Stripped Equity Security
Unit and any integral multiple thereof. The transfer of any Stripped Equity
Security Unit Certificate will be registered and Stripped Equity Security Unit
Certificates may be exchanged as provided in the Purchase Contract Agreement.
The Stripped Equity Security Unit Registrar may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents permitted by
the Purchase Contract Agreement. No service charge shall be required for any
such registration of transfer or exchange, but the Company and the Agent may
require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith. The Holder of a Stripped Equity Security
Unit may substitute for the Pledged Treasury Securities securing its obligations
under the related Purchase Contract in accordance with the terms of the Purchase
Contract Agreement and the Pledge Agreement. From and after such substitution,
the Stripped Equity Security Unit for which such Pledged Notes secures the
Holder's obligation under the Purchase Contract shall be referred to as an
"Equity Security Unit." A Holder that elects to substitute Notes for Pledged
Treasury Securities, thereby reestablishing Equity Security Units, shall be
responsible for any fees or expenses payable in connection therewith. Except as
provided in the Purchase Contract Agreement, for so long as the Purchase
Contract underlying a Stripped Equity Security Unit remains in effect, such
Stripped Equity Security Unit shall not be separable into its constituent parts,
and the rights and obligations of the Holder of such Stripped Equity Security
Units in respect of the Pledged Treasury Security and the Purchase Contract
constituting such Stripped Equity Security Units may be transferred and
exchanged only as a Stripped Equity Security Unit.
B-6
Subject to the next succeeding paragraph, the Company shall pay, on
each Payment Date, the Contract Adjustment Payments, payable in respect of each
Purchase Contract to the Person in whose name the Stripped Equity Security Unit
Certificate evidencing such Purchase Contract is registered at the close of
business on the Record Date for such Payment Date. Contract Adjustment Payments,
if any, will be payable at the office of the Agent in the City of New York or,
at the option of the Company, by check mailed to the address of the Person
entitled thereto at such address as it appears on the Stripped Equity Security
Unit Register or by wire transfer to the account designated by such Person in
writing at least ten Business Days prior to the applicable Payment Date.
The Company shall have the right, at any time prior to the Stock
Purchase Date, to defer the payment of any or all of the Contract Adjustment
Payments otherwise payable on any Payment Date, but only if the Company shall
give the Holders and the Agent written notice of its election to defer Contract
Adjustment Payments as provided in the Purchase Contract Agreement. Any Contract
Adjustment Payments so deferred shall, to the extent permitted by law, bear
additional Contract Adjustment Payments thereon at the rate of 4.15% per year
(computed on the basis of a 360-day year of twelve 30-day months), compounding
on each succeeding Payment Date, until paid in full (such deferred installments
of Contract Adjustment Payments, if any, together with the additional Contract
Adjustment Payments accumulated thereon, are referred to herein as the "Deferred
Contract Adjustment Payments"). Deferred Contract Adjustment Payments, if any,
shall be due on the next succeeding Payment Date except to the extent that
payment is deferred pursuant to the Purchase Contract Agreement. No Contract
Adjustment Payments may be deferred to a date that is after the Stock Purchase
Date and no such deferral period may end other than on a Payment Date.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments on the Purchase Contracts until a Payment Date prior to the
Stock Purchase Date, then all Deferred Contract Adjustment Payments, if any,
shall be payable to the registered Holders as of the close of business on the
Record Date immediately preceding such Payment Date.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments on the Purchase Contracts until the Stock Purchase Date, the
Holder of this Stripped Equity Security Unit Certificate will receive on the
Stock Purchase Date, if the Company so elects, in lieu of a cash payment, a
number of shares of Common Stock (in addition to the number of shares of Common
Stock equal to the Settlement Rate) equal to (i) the aggregate amount of
Deferred Contract Adjustment Payments payable to the Holder of this Stripped
Equity Security Unit Certificate divided by (ii) the Applicable Market Value.
In the event the Company exercises its option to defer the payment of
Contract Adjustment Payments, then, until the Deferred Contract Adjustment
Payments have been paid, the Company shall not, and shall not permit any
subsidiary of the Company to, declare or pay dividends on, make distributions
with respect to, or redeem, purchase or acquire, or make a liquidation payment
with respect to, any of its Common Stock other than (i) purchases, redemptions
or acquisitions of shares of Common Stock in connection with any employment
contract, benefit plan or other similar arrangement with or for the benefit of
employees, officers or directors or a stock purchase or dividend reinvestment
plan, or the satisfaction by the
B-7
Company of its obligations pursuant to any contract or security outstanding on
the date the Company exercises its rights to defer the Contract Adjustment
Payments; (ii) as a result of a reclassification of the Company's Capital Stock
or the exchange or conversion of one class or series of the Company's Capital
Stock for another class or series of the Company's Capital Stock; (iii) the
purchase of fractional interests in shares of the Company's Common Stock
pursuant to the conversion or exchange provisions of such Common Stock or the
security being converted or exchanged; (iv) dividends or distributions payable
solely in Common Stock (or rights to acquire Common Stock) or repurchases,
acquisitions or redemptions of Common Stock in connection with the issuance or
exchange of the Common Stock (or securities convertible into or exchangeable for
shares of the Company's Common Stock); or (v) redemptions, exchanges or
repurchases of any rights outstanding under a shareholder rights plan or the
declaration or payment thereunder of a dividend or distribution of or with
respect to rights in the future.
The Purchase Contracts and all obligations and rights of the Company
and the Holders thereunder, including, without limitation, the rights of the
Holders to receive and the obligation of the Company to pay Contract Adjustment
Payments, if any, or any Deferred Contract Adjustment Payments, and the rights
and obligations of Holders to purchase Common Stock, shall immediately and
automatically terminate, without the necessity of any notice or action by any
Holder, the Agent or the Company, if, on or prior to the Stock Purchase Date, a
Termination Event shall have occurred. Upon the occurrence of a Termination
Event, the Company shall promptly but in no event later than two Business Days
thereafter give written notice to the Agent, the Collateral Agent and to the
Holders, at their addresses as they appear in the Stripped Equity Security Unit
Register. Upon and after the occurrence of a Termination Event, the Collateral
Agent shall release the Pledged Treasury Securities from the Pledge in
accordance with the provisions of the Pledge Agreement.
Upon registration of transfer of this Stripped Equity Security Unit
Certificate, the transferee shall be bound (without the necessity of any other
action on the part of such transferee, except as may be required by the Agent
pursuant to the Purchase Contract Agreement), under the terms of the Purchase
Contract Agreement and the Purchase Contracts evidenced hereby and the
transferor shall be released from the obligations under the Purchase Contracts
evidenced by this Stripped Equity Security Unit Certificate. The Company
covenants and agrees, and the Holder, by his acceptance hereof, likewise
covenants and agrees, to be bound by the provisions of this paragraph.
The Holder of this Stripped Equity Security Unit Certificate, by his
acceptance hereof, authorizes the Agent to enter into and perform the related
Purchase Contracts forming part of the Stripped Equity Security Units evidenced
hereby on his behalf as its attorney-in-fact, expressly withholds any consent to
the assumption (i.e., affirmance) of the Purchase Contracts by the Company or
its trustee in the event that the Company becomes the subject of a case under
the Bankruptcy Code, agrees to be bound by the terms and provisions thereof,
covenants and agrees to perform such Holder's obligations under such Purchase
Contracts, consents to the provisions of the Purchase Contract Agreement,
authorizes the Agent to enter into and perform the Pledge Agreement on such
Holder's behalf as attorney-in-fact, and consents to the Pledge of the Treasury
Securities underlying this Stripped Equity Security Unit Certificate pursuant to
the Pledge Agreement. The Holder further covenants and agrees, that, to the
extent and in the
B-8
manner provided in the Purchase Contract Agreement and the Pledge Agreement, but
subject to the terms thereof, payments in respect of the Pledged Treasury
Securities, to be paid upon settlement of such Holder's obligations to purchase
Common Stock under the Purchase Contract, shall be paid on the Stock Purchase
Date by the Collateral Agent to the Company in satisfaction of such Holder's
obligations under such Purchase Contract and such Holder shall acquire no right,
title or interest in such payments.
Each Holder of any Equity Security Units or Stripped Equity Security
Units, and each Beneficial Owner thereof, by its acceptance thereof or of its
interest therein, further agrees to treat (i) itself as the owner of the related
Notes, Applicable Ownership Interest in the Treasury Portfolio, Applicable
Ownership Interest in the Tax Event Treasury Portfolio or Treasury Securities,
as the case may be, (ii) the Notes as indebtedness of the Company, and (iii) the
Purchase Contract and the Notes, the Treasury Portfolio, the Tax Event Treasury
Portfolio of Treasury Securities, as the case may be, as separate financial
instruments, in each case, for all tax purposes.
Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of a majority of the
Purchase Contracts.
The Purchase Contracts shall for all purposes be governed by, and
construed in accordance with, the laws of the State of New York, without regard
to its principles of conflicts of laws.
The Company, the Agent and its Affiliates and any agent of the Company
or the Agent may treat the Person in whose name this Stripped Equity Security
Unit Certificate is registered as the owner of the Stripped Equity Security
Units evidenced hereby for the purpose of receiving any Contract Adjustment
Payments and any Deferred Contract Adjustment Payments, performance of the
Purchase Contracts and for all other purposes whatsoever (subject to the Record
Date provisions hereof), whether or not any payments in respect thereof be
overdue and notwithstanding any notice to the contrary, and neither the Company,
the Agent, such Affiliate, nor any such agent shall be affected by notice to the
contrary.
The Purchase Contracts shall not, prior to the settlement thereof,
entitle the Holder to any of the rights of a holder of shares of Common Stock.
A copy of the Purchase Contract Agreement is available for inspection at the
offices of the Agent.
B-9
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:
TEN COM - as tenants in common
UNIF GIFT MIN ACT - Custodian
---------------------------------
(cust) (minor)
Under Uniform Gifts to Minors Act
---------------------------------
(State)
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and not as tenants in
common
Additional abbreviations may also be used though not in the above list.
B-10
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
unto
______________________________________________________________________________
______________________________________________________________________________
(Please insert Social Security or Taxpayer I.D. or other Identifying Number of
Assignee)
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Please Print or Type Name and Address Including Postal Zip Code of Assignee)
the within Stripped Equity Security Unit Certificates and all rights thereunder,
hereby irrevocably constituting and appointing ____________________________
attorney to transfer said Equity Security Unit Certificates on the books of DTE
ENERGY COMPANY with full power of substitution in the premises.
Dated: _______________________ Signature:_______________________________
NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Stripped Equity Security Unit Certificates
in every particular, without alteration or enlargement or any change whatsoever.
Signature Guarantee:_____________________________________________________
B-11
SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for shares of Common Stock
deliverable upon settlement on or after the Stock Purchase Date of the Purchase
Contracts underlying the number of Stripped Equity Security Units evidenced by
this Stripped Equity Security Unit Certificate be registered in the name of, and
delivered, together with a check in payment for any fractional share, to the
undersigned at the address indicated below unless a different name and address
have been indicated below. If shares are to be registered in the name of a
Person other than the undersigned, the undersigned will pay any transfer tax
payable incident thereto.
Dated:___________________________ Signature:________________________________
Signature Guarantee:______________________
(if assigned to another person)
If shares are to be registered in REGISTERED HOLDER Please print name and
the name of and delivered to a address Registered Holder:
Person other than the Holder,
please (i) print such Person's
name and address and (ii) provide
a guarantee of your signature:
________________________________ ___________________________________
Name Name
________________________________ ___________________________________
Address Address
Social Security or other Taxpayer
Identification Number, if any
B-12
ELECTION TO SETTLE EARLY
The undersigned Holder of this Stripped Equity Security Unit Certificate hereby
irrevocably exercises the option to effect Early Settlement in accordance with
the terms of the Purchase Contract Agreement with respect to the Purchase
Contracts underlying the number of Stripped Equity Security Units evidenced by
this Stripped Equity Security Unit Certificate specified below. The option to
effect Early Settlement may be exercised only with respect to Purchase Contracts
underlying Stripped Equity Security Units with an aggregate Stated Amount equal
to $1,000 or an integral multiple thereof. The undersigned Holder directs that a
certificate for shares of Common Stock deliverable upon such Early Settlement be
registered in the name of, and delivered, together with a check in payment for
any fractional share and any Stripped Equity Security Unit Certificate
representing any Stripped Equity Security Units evidenced hereby as to which
Early Settlement of the related Purchase Contracts is not effected, to the
undersigned at the address indicated below unless a different name and address
have been indicated below. Pledged Notes deliverable upon such Early Settlement
will be transferred in accordance with the transfer instructions set forth
below. If shares are to be registered in the name of a Person other than the
undersigned, the undersigned will pay any transfer tax payable incident thereto.
Dated:__________________________ Signature:________________________________
Signature Guarantee:______________________
Number of Stripped Equity Security Units evidenced hereby as to which Early
Settlement of the related Purchase Contracts is being elected:
If shares of Common Stock are to be REGISTERED HOLDER
registered in the name of and delivered
to and Pledged Notes are to be transferred
to a Person other than the Holder, please Please print name and address of
print such Person's name and address: Registered Holder:
______________________________________ __________________________________
Name Name
______________________________________ __________________________________
Address Address
Social Security or other Taxpayer Identification Number,
if any
Transfer instructions for Pledged Treasury Securities transferable upon Early
Settlement or a Termination Event:
B-13
(TO BE ATTACHED TO GLOBAL CERTIFICATES)
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The following increases or decreases in this Global Certificate have been made:
Amount of Decrease Stated Amount of the
in Stated Amount of Amount of Increase in Global Certificate
the Global Stated Amount of the Following Such Signature of
Date Certificate Global Certificate Decrease or Increase Authorizing Officer
- ------------------------- ---------------------- ----------------------- ---------------------- ----------------------
B-14
EXHIBIT C
INSTRUCTION FROM PURCHASE CONTRACT AGENT TO
COLLATERAL AGENT
THE BANK OF NEW YORK,
as Collateral Agent
101 Barclay Street
New York, New York 10286
Attn: Corporate Trust Administration
Re: Equity Security Units of DTE ENERGY COMPANY (the "Company")
------------------------------------------
We hereby notify you in accordance with Section [4.1] [4.2] of the Pledge
Agreement, dated as of June 25, 2002 (the "Pledge Agreement") among the Company,
you, as Collateral Agent, Custodial Agent and Securities Intermediary and us, as
Purchase Contract Agent and as attorney-in-fact for the holders of [Equity
Security Units] [Stripped Equity Security Units] from time to time, that the
holder of Equity Security Units and Stripped Equity Security Units listed below
(the "Holder") has elected to substitute [$_____ aggregate principal amount of
Treasury Securities (CUSIP No. 912803AG8)] [$_______ aggregate principal amount
of Notes, the Applicable Ownership Interest of the Treasury Portfolio or the
Applicable Ownership Interest in the Tax Event Treasury Portfolio, as the case
may be,] in exchange for the related [Pledged Notes, the appropriate Pledged
Applicable Ownership Interest of the Treasury Portfolio or the appropriate
Pledged Applicable Ownership Interest in the Tax Event Treasury Portfolio, as
the case may be,] [Pledged Treasury Securities] held by you in accordance with
the Pledge Agreement and has delivered to us a notice stating that the Holder
has Transferred [Treasury Securities] [Notes, the appropriate Applicable
Ownership Interest of the Treasury Portfolio or the appropriate Applicable
Ownership Interest in the Tax Event Treasury Portfolio, as the case may be,] to
you, as Collateral Agent. We hereby instruct you, upon receipt of such [Pledged
Treasury Securities] [Pledged Notes, the appropriate Pledged Applicable
Ownership Interest of the Treasury Portfolio or the appropriate Pledged
Applicable Ownership Interest in the Tax Event Treasury Portfolio, as the case
may be,], and upon the payment by such Holder of any applicable fees, to release
the [Notes, the appropriate Applicable Ownership Interest of the Treasury
Portfolio or the appropriate Applicable Ownership Interest in the Tax Event
Treasury Portfolio, as the case may be,] [Treasury Securities] related to such
[Equity Security Units] [Stripped Equity Security Units] to us in accordance
with the Holder's instructions. Capitalized terms used herein but not defined
shall have the meaning set forth in the Pledge Agreement.
Date: _____________________
THE BANK OF NEW YORK,
as Purchase Contract Agent
By:____________________________
Name:
Title:
C-1
Please print name and address of Registered Holder electing to substitute
[Treasury Securities] [Notes, the appropriate Applicable Ownership Interest in
the Treasury Portfolio or the appropriate Applicable Ownership Interest in the
Tax Event Treasury Portfolio] for the [Pledged Notes, the appropriate Pledged
Applicable Ownership Interest in the Treasury Portfolio or the appropriate
Pledged Applicable Ownership Interest in the Tax Event Treasury Portfolio]
[Pledged Treasury Securities]:
Name:__________________________________________________________________________
Social Security or other Taxpayer Identification Number, if any:_______________
Address:_______________________________________________________________________
DTC Account No._______________________________
C-2
EXHIBIT D
INSTRUCTION TO PURCHASE CONTRACT AGENT
THE BANK OF NEW YORK,
as Purchase Contract Agent
101 Barclay Street
New York, New York 10286
Attn: Corporate Trust Administration
Telecopy: (212) 896-7298
Re: Equity Security Units of DTE ENERGY COMPANY (the "Company")
The undersigned Holder hereby notifies you that it has delivered to The Bank of
New York, as Collateral Agent, Custodial Agent and Securities Intermediary
[$_______ aggregate principal amount of Treasury Securities (CUSIP No.
912803AG8)] [$_______ aggregate principal amount of Notes, the appropriate
Applicable Ownership Interest in the Treasury Portfolio or the appropriate
Applicable Ownership Interest in the Tax Event Treasury Portfolio, as the case
may be] in exchange for the related [Pledged Notes, Pledged Applicable Ownership
Interest in the Treasury Portfolio or the appropriate Pledged Applicable
Ownership Interest in the Tax Event Treasury Portfolio, as the case may be]
[Pledged Treasury Securities] held by the Collateral Agent, in accordance with
Section [4.1] [4.2] of the Pledge Agreement, dated June 25, 2002 (the "Pledge
Agreement"), among you, the Company and the Collateral Agent. The undersigned
Holder has paid the Collateral Agent all applicable fees relating to such
exchange. The undersigned Holder hereby instructs you to instruct the Collateral
Agent to release to you on behalf of the undersigned Holder the [Pledged Notes,
the appropriate Pledged Applicable Ownership Interest in the Treasury Portfolio
or the appropriate Pledged Applicable Ownership Interest in the Tax Event
Treasury Portfolio, as the case may be] [Pledged Treasury Securities] related to
such [Equity Security Units] [Stripped Equity Security Units]. Capitalized terms
used herein but not defined shall have the meaning set forth in the Pledge
Agreement.
Date: ____________________ Signature:___________________________________
Signature Guarantee:_________________________
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
Please print name and address of Registered Holder:___________________________
Name:_________________________________________________________________________
Social Security or other Taxpayer Identification Number, if any:______________
Address:______________________________________________________________________
DTC Participant No. _______________________
D-1
EXHIBIT E
NOTICE TO SETTLE BY SEPARATE CASH
THE BANK OF NEW YORK,
as Purchase Contract Agent
101 Barclay Street
New York, New York 10286
Attn: Corporate Trust Administration
Telecopy: (212) 896-7298
Re: Equity Security Units of DTE ENERGY COMPANY (the "Company")
The undersigned Holder hereby irrevocably notifies you in accordance with
Section 5.4 of the Purchase Contract Agreement dated as of June 25, 2002 among
the Company and yourselves, as Purchase Contract Agent and as Attorney-in-Fact
for the Holders of the Purchase Contracts, that such Holder has elected to pay
to the Collateral Agent, on or prior to 11:00 a.m., New York City time, on the
eighth Business Day immediately preceding the Stock Purchase Date, (in lawful
money of the United States by [certified or cashiers check or] wire transfer, in
each case in immediately available funds), $_________ as the Purchase Price for
the shares of Common Stock issuable to such Holder by the Company under the
related Purchase Contract on the Stock Purchase Date. The undersigned Holder
hereby instructs you to notify promptly the Collateral Agent of the undersigned
Holder's election to make such cash settlement with respect to the Purchase
Contracts related to such Holder's Equity Security Units.
Dated: ____________________ Signature: _________________________________
Signature Guarantee: _______________________
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
Please print name and address of Registered Holder:____________________________
Social Security or other Taxpayer Identification Number, if any:_______________
DTC Participant No._____________________
E-1
EXHIBIT F
FORM OF REMARKETING AGREEMENT
F-1