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EXHIBIT 4(o)
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CMS ENERGY CORPORATION
AND
AS PURCHASE CONTRACT AGENT
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PURCHASE CONTRACT AGREEMENT
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DATED AS OF __________, 199
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TABLE OF CONTENTS
PAGE
RECITALS ............................................................... 1
ARTICLE I
Definitions and Other Provisions ....................................... 1
Section 1.1. Definitions. .............................................. 1
Act ................................................................ 2
Affiliate .......................................................... 2
Agent .............................................................. 2
Agreement .......................................................... 2
Applicable Market Value ............................................ 2
Bankruptcy Code .................................................... 2
Board of Directors ................................................. 2
Board Resolution ................................................... 2
Business Day ....................................................... 2
Closing Price ...................................................... 3
Collateral Agent ................................................... 3
Common Stock ....................................................... 3
Company ............................................................ 3
Corporate Trust Office ............................................. 3
Current Market Price ............................................... 3
Depositary ......................................................... 3
Deferred Yield Enhancement Payments ................................ 3
Early Settlement ................................................... 3
Early Settlement Amount ............................................ 4
Early Settlement Date .............................................. 4
Early Settlement Rate .............................................. 4
Exchange Act ....................................................... 4
Excess Treasury Notes .............................................. 4
Expiration Date .................................................... 4
Expiration Time .................................................... 4
Final Settlement Date .............................................. 4
Final Settlement Fund .............................................. 4
Global Security Certificate ........................................ 4
Holder ............................................................. 4
Issuer Order ....................................................... 4
Issuer Request ..................................................... 4
NYSE ............................................................... 5
Officers' Certificate .............................................. 5
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Opinion of Counsel .................................................. 5
Outstanding Securities .............................................. 5
Outstanding Security Certificates ................................... 6
Payment Date ........................................................ 6
Person .............................................................. 6
Pledge .............................................................. 6
Pledge Agreement .................................................... 6
Predecessor Security Certificate .................................... 6
Purchase Contract ................................................... 7
Purchased Shares .................................................... 7
Record Date ......................................................... 7
Reorganization Event ................................................ 7
Responsible Officer ................................................. 7
Security ............................................................ 7
Security Certificate ................................................ 7
Security Register ................................................... 7
Security Registrar .................................................. 7
Settlement Rate ..................................................... 7
Stated Amount ....................................................... 7
Termination Date .................................................... 7
Termination Event ................................................... 8
Threshold Appreciation Price ........................................ 8
TIA ................................................................. 8
Trading Day ......................................................... 8
Treasury Notes ...................................................... 9
Underwriting Agreement .............................................. 9
Vice President ...................................................... 9
Yield Enhancement Payment ........................................... 9
Section 1.2. Compliance Certificates and
Opinions. ...................................................... 9
Section 1.3. Form of Documents Delivered to
Agent. ......................................................... 10
Section 1.4. Acts of Holders; Record Dates. ........................... 11
Section 1.5. Notices, etc., to Agent and the
Company. ....................................................... 13
Section 1.6. Notice to Holders; Waiver. .............................. 13
Section 1.7. Effect of Headings and Table
of Contents. ................................................... 14
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Section 1.8. Successors and Assigns. .................................. 14
Section 1.9. Separability Clause. ...................................... 14
Section 1.10. Benefits of Agreement. .................................... 14
Section 1.11. Governing Law. ............................................ 15
Section 1.12. Legal Holidays. ........................................... 15
Section 1.13. Counterparts. ............................................. 15
Section 1.14. Inspection of Agreement. ................................. 15
ARTICLE II
Security Certificate Forms ................................................ 16
Section 2.1. Forms of Security Certificates Generally................... 16
Section 2.2. Form of Agent's Certificate of Authentication.............. 16
ARTICLE III
The Securities ........................................................... 17
Section 3.1. Title and Terms; Denominations. ........................... 17
Section 3.2. Rights and Obligations Evidenced by the Security
Certificates. ................................................... 17
Section 3.3. Execution, Authentication, Delivery and Dating. ........... 18
Section 3.4. Temporary Security Certificates. ......................... 19
Section 3.5. Registration; Registration of Transfer
and Exchange. .................................................. 20
Section 3.6. Mutilated, Destroyed, Lost and Stolen
Security Certificates. ......................................... 22
Section 3.7. Persons Deemed Owners. ................................... 24
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Section 3.8. Cancellation. ............................................ 25
Section 3.9. Securities Not Separable. ................................ 25
Section 3.10 No Consent to Assumption ................................. 26
ARTICLE IV
The Treasury Notes ....................................................... 26
Section 4.1. Payment of Interest; Interest Rights
Preserved. ..................................................... 26
Section 4.2. Transfer of Treasury Notes Upon Occurrence
of Termination Event. ........................................... 27
ARTICLE V
The Purchase Contracts ................................................... 28
Section 5.1. Purchase of Shares of Common Stock. ...................... 28
Section 5.2. Yield Enhancement Payments. .............................. 30
Section 5.3. Deferral of Payment Dates For Yield
Enhancement Payment. ........................................... 31
Section 5.4. Payment of Purchase Price. ................................ 32
Section 5.5. Issuance of Shares of Common Stock. ...................... 33
Section 5.6. Adjustment of Settlement Rate. ........................... 34
Section 5.7. Notice of Adjustments and Certain Other Events. .......... 41
Section 5.8. Termination Event; Notice. ............................... 42
Section 5.9. Early Settlement. ........................................ 42
Section 5.10. No Fractional Shares. ..................................... 44
Section 5.11. Charges and Taxes. ....................................... 45
ARTICLE VI
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Remedies .................................................................. 46
Section 6.1. Unconditional Right of Holders to
Receive Yield Enhancement Payment................................ 46
Section 6.2. Restoration of Rights and Remedies. ....................... 46
Section 6.3. Rights and Remedies Cumulative. ........................... 46
Section 6.4. Delay or Omission Not Waiver. ............................ 47
Section 6.5. Undertaking for Costs. ................................... 47
Section 6.6. Waiver of Stay or Extension Laws. ........................ 47
ARTICLE VII
The Agent ................................................................ 48
Section 7.1. Certain Duties and Responsibilities. ...................... 48
Section 7.2. Notice of Default. ....................................... 49
Section 7.3. Certain Rights of Agent. ................................. 49
Section 7.4. Not Responsible for Recitals or Issuance
of Securities. ................................................. 50
Section 7.5. May Hold Securities. ..................................... 51
Section 7.6. Money Held in Trust. ..................................... 51
Section 7.7. Compensation and Reimbursement. ........................... 51
Section 7.8. Corporate Agent Required; Eligibility. .................... 52
Section 7.9. Resignation and Removal; Appointment
of Successor. ................................................... 52
Section 7.10. Acceptance of Appointment by Successor. ................... 54
Section 7.11. Merger, Conversion, Consolidation or Succession to
Business. ...................................................... 54
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Section 7.12. Preservation of Information;
Communications to Holders. ...................................... 55
Section 7.13. No Obligations of Agent. .................................. 56
Section 7.14. Tax Compliance. .......................................... 56
ARTICLE VIII
Supplemental Agreements ................................................. 57
Section 8.1. Supplemental Agreements Without Consent of
Holders. ....................................................... 57
Section 8.2. Supplemental Agreements with Consent of
Holders. ....................................................... 57
Section 8.3. Execution of Supplemental Agreements. .................... 59
Section 8.4. Effect of Supplemental Agreements. ....................... 59
Section 8.5. Reference to Supplemental Agreements. .................... 59
ARTICLE IX
Consolidation, Merger, Sale or Conveyance.................................. 60
Section 9.1. Covenant Not to Merge, Consolidate, Sell
or Convey Property Except Under Certain
Conditions. .................................................... 60
Section 9.2. Rights and Duties of Successor
Corporation. .................................................... 60
Section 9.3. Opinion of Counsel to Agent. ............................. 61
ARTICLE X
Covenants ................................................................. 61
Section 10.1. Performance Under Purchase Contracts ...................... 61
Section 10.2. Maintenance of Office or Agency. .......................... 62
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Section 10.3. Company to Reserve Common Stock. ......................... 62
Section 10.4. Covenants as to Common Stock. ............................. 63
Section 10.5. Statements of Officers of the Company
as to Default. ................................................. 63
EXHIBIT A
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PURCHASE CONTRACT AGREEMENT, dated as of __________, 1997, between CMS
Energy Corporation, a Michigan corporation (the "Company"), and ___________,
acting as purchase contract agent for the Holders of Securities from time to
time (the "Agent").
RECITALS
The Company has duly authorized the execution and delivery of this
Agreement and the Security Certificates evidencing the Securities.
All things necessary to make the Company's obligations under the
Securities, when the Security Certificates are executed by the Company and
authenticated, executed on behalf of the Holders and delivered by the Agent, as
in this Agreement provided, the valid obligations of the Company, and to
constitute these presents 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
Securities by the Holders thereof, it is mutually agreed as follows:
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:
(1) 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
(2) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Agreement as
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a whole and not to any particular Article, Section or other subdivision.
"Act" when used with respect to any Holder, has the meaning specified in
Section 1.4.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"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 the
Person who is then the Agent hereunder.
"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.
"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.
"Board Resolution" means the board of directors of the Company or a duly
authorized committee of that board.
"Board Resolution" means one or more resolutions of the Board of
Directors, a copy of which has been certified by the Secretary or an
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
and delivered to the Agent.
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"Business Day" means any day that is not a Saturday, Sunday or a day on
which the NYSE or banking institutions or trust companies in The City of New
York are authorized or obligated by law or executive order to be closed.
"Closing Price" has the meaning specified in Section 5.1.
"Collateral Agent" means , 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.
"Common Stock" means the Common Stock, par value $.01 per share, of the
Company.
"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.
"Corporate Trust Office" means the principal corporate trust office of the
Agent at which, at any particular time, its corporate trust business shall be
administered, which office at the date hereof is located at ,
except that for purposes of Section 10.2, such term shall mean the office or
agency of the Agent in the Borough of Manhattan, the City of
New York, which office at the date hereof is located at
"Current Market Price" has the meaning specified in Section 5.6(a)(8).
"Deferred Yield Enhancement Payments" has the meaning specified in Section
5.3.
"Depositary" means a clearing agency registered under the Exchange Act
that is designated to act as Depositary for the Securities as contemplated by
Section 3.5.
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"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).
"Exchange Act" means the Securities Exchange Act of 1934 and any statute
successor thereto, in each case as amended from time to time, and the
rules and regulations promulgated thereunder.
"Excess Treasury Notes" has the meaning specified in Section 4.2.
"Expiration Date" has the meaning specified in Section 1.4.
"Expiration Time" has the meaning specified in Section 5.6(a)(6).
"Final Settlement Date" means __________, 1999.
"Final Settlement Fund" has the meaning specified in Section 5.5.
"Global Security Certificate" means a Security Certificate that evidences
all or part of the Securities and is registered in the name of a Depositary or
a nominee thereof.
"Holder," when used with respect to a Security Certificate (or a
Security), means a Person in whose name the Security evidenced by such
Security Certificate (or the Security Certificate evidencing such Security) is
registered in the Security Register, subject to Section 3.7.
"Issuer Order" or "Issuer Request" means a written order or request
signed in the name of the Company by its Chairman of the Board, any Vice
Chairman, its President or a Vice President and by its Treasurer, an Assistant
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Treasurer, its Secretary or an Assistant Secretary, and delivered to the Agent.
"NYSE" has the meaning specified in Section 5.1.
"Officers' Certificate" means a certificate signed by the Chairman of the
Board, any Vice Chairman of the Board, the President or any Vice President and
by the Treasurer, an Assistant Treasurer, 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 and who shall be reasonably
acceptable to the Agent.
"Outstanding Securities" means, as of the date of determination, all
Securities evidenced by then Outstanding Security Certificates, except:
(i) If a Termination Event has occurred, Securities for which the
underlying Treasury Notes have been theretofore deposited with the Agent
in trust for the Holders of such Securities; and
(ii) On and after the applicable Early Settlement Date, Securities
as to which the Holder has elected to effect Early Termination of the
related Purchase Contracts;
provided, however, that in determining whether the Holders of the requisite
number of Securities have given any request, demand, authorization, direction,
notice, consent or waiver hereunder, Securities 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 Securities which the Agent knows to be so owned shall be so
disregarded. Securities so owned which have been pledged in good faith may be
regarded as outstanding if the pledgee establishes to the satisfaction of the
Agent the pledgee's right so to act with respect to such Securities and that
the pledgee is not the Company or any Affiliate of the Company.
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"Outstanding Security Certificates" means, as of the date of
determination, all Security Certificates theretofore authenticated, executed
and delivered under this Agreement, except:
(i) Security Certificates theretofore cancelled by the Agent or
delivered to the Agent for cancellation; and
(ii) Security Certificates in exchange for or in lieu of which
other Security Certificates have been authenticated, executed on behalf
of the Holder and delivered pursuant to this Agreement, other than any
such Security Certificate in respect of which there shall have been
presented to the Agent proof satisfactory to it that such Security
Certificate is held by a bona fide purchaser in whose hands the
Securities evidenced by such Security Certificate are valid obligations
of the Company.
"Payment Date" means each __________ and __________, commencing _________,
1997.
"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 Treasury Notes
constituting a part of the Securities.
"Pledge Agreement" means the Pledge Agreement, dated as of the date
hereof, among the Company, the Collateral Agent and the Agent, on its own
behalf and as attorney-in-fact for the Holders from time to time of the
Securities.
"Predecessor Security Certificate" of any particular Security Certificate
means every previous Security Certificate evidencing all or a portion of the
rights and obligations of the Holder under the Securities evidenced thereby;
and, for the purposes of this definition, any Security Certificate
authenticated and delivered under Section 3.6 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security Certificate shall be
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deemed to evidence the same rights and obligations of the Holder as the
mutilated, destroyed, lost or stolen Security Certificate.
"Purchase Contract," when used with respect to any Security, means the
contract obligating the Company to sell and the Holder of such Security to
purchase Common Stock on the terms and subject to the conditions set forth in
Article Five hereof.
"Purchased Shares" has the meaning specified in Section 5.6(a)(6).
"Record Date" for the interest and Yield Enhancement Payments payable on
any Payment Date means [, as to any Global Security Certificate,] the Business
Day next preceding such Payment Date, and as to any other Security
Certificate, the 15th day of the month preceding such Payment Date.
"Reorgainization Event" has the meaning specified in Section 5.6(b).
"Responsible Officer," when used with respect to the Agent, means any
officer of the Agent assigned by the Agent to administer its corporate trust
matters.
"Security" means the collective rights and obligations of a Holder of a
Security Certificate in respect of Treasury Notes with a principal amount
equal to the Stated Amount, subject to the Pledge thereof, and a Purchase
Contract.
"Security Certificate" means a certificate evidencing the rights and
obligations of a Holder in respect of the number of Securities specified on
such certificate.
"Security Register" and "Security Registrar" have the respective meanings
specified in Section 3.5.
"Settlement Rate" has the meaning specified in Section 5.1.
"Stated Amount" means $______.
"Termination Date" means the date, if any, on which a Termination Event
occurs.
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"Termination Event" means the occurrence of any of the following events:
(i) at any time on or prior to the Final Settlement Date, a judgment, decree or
order by a court having jurisdiction in the premises shall have been entered
granting relief under the Bankruptcy Code, 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 Final Settlement Date, such
decree or order shall have continued undischarged and unstayed for a period of
60 days; or (ii) a judgment, decree or order of a court having jurisdiction in
the premises 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 Final Settlement 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 Final Settlement Date the Company shall file a petition
for relief under the Bankruptcy Code, 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 United States Bankruptcy Code
or any other similar applicable 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.
"TIA" means the Trust Indenture Act of 1939, as amended, or any successor
statute.
"Trading Day" has the meaning specified in Section 5.1.
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"Treasury Notes" means _____% United States Treasury Notes due __________,
1999.
"Underwriting Agreement" means the Underwriting Agreement dated ________,
1997 between the Company and , as
representatives of the several
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."
"Yield Enhancement Payment" means the fee payable by the Company in
respect of each Purchase Contract, equal to ____% per annum of the Stated
Amount, accruing from __________, 1997, computed on the basis of the actual
number of days elapsed in a year of 365 or 366 days, as the case may be,
plus any Deferred Yield Enhancement Payments accrued pursuant to Section 5.3,
except that on the initial Payment Date the Yield Enhancement Payment shall be
reduced by an amount equal to accrued interest to __________, 1997, on the
Treasury Note constituting a part of a Security.
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
Officers' Certificate stating that all conditions precedent, if any, provided
for in this Agreement relating to the proposed action have been complied with
and 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 shall include:
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(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(2) 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;
(3) a statement that, in the opinion of each such individual, he
has made such examination or investigation as is necessary to enable him
to express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
Section 1.3. Form of Documents Delivered to Agent.
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 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.
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,
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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 by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer
authorized by law to take acknowledgments of deeds, certifying that the
individual signing such instrument or writing acknowledged to him the execution
thereof. Where such execution is by a signer acting in a capacity other than
his individual capacity, such certificate or affidavit shall also constitute
sufficient proof of his authority. The fact and date of the execution of any
such instrument or writing, or the authority of the Person executing the same,
may also be proved in any other manner which the Agent deems sufficient.
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(c) The ownership of Securities shall be proved by the Security Register.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Security shall bind every future
Holder of the same Security and the Holder of every Security Certificate
evidencing such Security issued upon the registration of transfer 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 Security Certificate.
(e) The Company may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities 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 Securities. If any record date is set pursuant to this paragraph,
the Holders of Outstanding Securities on such record date, and no other
Holders, shall be entitled to take the relevant action, 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 Securities 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 Securities 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 Securities in the manner set forth in Section 1.6.
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 Expira-
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tion 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 Securities 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, etc., to Agent and the Company.
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,
(1) 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 or filed in writing and personally delivered
or mailed, first-class postage prepaid, to the Agent at ________________,
Attention:______________________, or at any other address previously
furnished in writing by the Agent to the Holders and the Company, or
(2) 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
or mailed, first-class postage prepaid, to the Company at________________,
Attention: ____________________, or at any other
address previously furnished in writing to the Agent by the Company.
Section 1.6. Notice to Holders; Waiver.
Where this Agreement provides for notice to Holders of any event, such
notice shall be sufficiently given
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(unless otherwise herein expressly provided) if in writing and mailed,
first-class postage prepaid, to each Holder affected by such event, at his
address as it appears in the Security 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.
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 Securities 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.
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Nothing in this Agreement or in the Securities, express or implied, shall
give to any Person, other than the parties hereto and their successors
hereunder and 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 Securities evidenced by their Security
Certificates by their acceptance of delivery thereof.
Section 1.11. Governing Law.
This Agreement and the Securities shall be governed by and construed in
accordance with the laws of the State of New York.
Section 1.12. Legal Holidays.
In any case where any Payment Date, any Early Settlement Date or the Final
Settlement Date shall not be a Business Day, then (notwithstanding any other
provision of this Agreement or of the Securities) payment in respect of
interest on Treasury Notes or Yield Enhancement Payments shall not be made,
Purchase Contracts shall not be performed and Early Settlement shall not be
effected on such date, but such payments shall be made, or the Purchase
Contracts shall be performed or Early Settlement effected, as applicable, on
the next succeeding Business Day with the same force and effect as if made on
such Payment Date, Early Settlement Date or Final Settlement Date, as the case
may be; provided, that no interest shall accrue or be payable by the Company or
any Holder for the period from and after any such Payment Date, Early
Settlement Date or Final Settlement Date, as the case may be.
Section 1.13. Counterparts.
This Agreement may be executed in any number of counterparts, each of
which, when so executed, shall be deemed an original, but all such counterparts
shall together constitute one and the same instrument.
Section 1.14. Inspection of Agreement.
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A copy of this Agreement shall be available at all reasonable times at the
Corporate Trust Office for inspection by any Holder.
ARTICLE II
Security Certificate Forms
Section 2.1. Forms of Security Certificates Generally.
The Security Certificates (including the form of Purchase Contracts
forming part of the Securities 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 on which the Securities are listed or Depositary therefor,
or as may, consistently herewith, be determined by the officers of the Company
executing such Security Certificates, as evidenced by their execution of the
Security Certificates.
The definitive Security 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 the Security
Certificates, consistent with the provisions of this Agreement, as evidenced by
their execution thereof.
Every Global Security Certificate authenticated, executed on behalf of the
Holders and delivered hereunder shall bear a legend in substantially the
following form:
THIS SECURITY CERTIFICATE IS A GLOBAL SECURITY CERTIFICATE WITHIN
THE
MEANING OF THE PURCHASE CONTRACT AGREEMENT HEREINAFTER
REFERRED TO AND
IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF.
THIS
SECURITY CERTIFICATE MAY NOT BE EXCHANGED IN WHOLE OR IN PART
FOR A
SECURITY CERTIFICATE REGISTERED, AND NO TRANSFER OF THIS SECURITY
CERTIFICATE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF
ANY
PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE THEREOF, EXCEPT
IN THE LIMITED CIRCUM-
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STANCES DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT.
Section 2.2. Form of Agent's Certificate of Authentication.
The form of the Agent's certificate of authentication of the Securities
shall be in substantially the form set forth on the form of the Security
Certificates.
ARTICLE III
The Securities
Section 3.1. Title and Terms; Denominations.
The aggregate number of Securities evidenced by Security Certificates
authenticated, executed on behalf of the Holders and delivered hereunder is
limited to __________ (subject to increase up to a maximum of __________ to the
extent the over-allotment option of the underwriters under the Purchase
Agreement is exercised), except for Security Certificates authenticated,
executed and delivered upon registration of transfer of, in exchange for, or in
lieu of, other Security Certificates pursuant to Section 3.4, 3.5, 3.6, 5.9 or
8.5.
The Security Certificates shall be issuable only in registered form and
only in denominations of a single Security and any integral multiple thereof.
Section 3.2. Rights and Obligations Evidenced by the Security Certificates.
Each Security Certificate shall evidence the number of Securities
specified therein, with each such Security representing the ownership by the
Holder thereof of Treasury Notes with a principal amount equal to the Stated
Amount, subject to the Pledge of such Treasury Notes by such Holder pursuant to
the Pledge Agreement, and the rights and obligations of the Holder under one
Purchase Contract. Pursuant to the Pledge Agreement, dated as of the date
hereof, the Agent as attorney-in-fact for, and on behalf of, the Holder shall
pledge the Treasury Notes to the Collateral Agent and grant to the Collateral
Agent a security interest in the right, title,
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and interest of such Holders in the Treasury Notes, for the benefit of the
Company, to secure the obligation of the Holders under the Purchase Contracts
to purchase the Common Stock of the Company. Prior to the purchase, if any, of
shares of Common Stock under the Purchase Contracts, the Securities shall not
entitle the Holders 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, except to the extent otherwise expressly provided in this Agreement.
Section 3.3. Execution, Authentication, Delivery and Dating.
Upon the execution and delivery of this Agreement, and at any time and
from time to time thereafter, the Company may deliver Security 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 Security Certificates, and the Agent in accordance with such Issuer Order
shall authenticate, execute on behalf of the Holder and deliver such Security
Certificates.
The Security Certificates shall be executed on behalf of the Company by
its Chairman of the Board, its Vice Chairman of the Board, its President or one
of its Vice Presidents, under its corporate seal reproduced thereon attested by
its Secretary or one of its Assistant Secretaries. The signature of any of
these officers on the Security Certificates may be manual or facsimile.
Security 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 Security
Certificates or did not hold such offices at the date of such Security
Certificates.
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No Purchase Contract underlying a Security evidenced by a Security
Certificate shall be valid until such Security Certificate has been executed on
behalf of the Holder by the manual signature of an authorized signatory of
the Agent, as such Holder's attorney-in-fact. Such signature by an authorized
signatory of the Agent shall be conclusive evidence that the Holder of such
Security Certificate has entered into the Purchase Contracts underlying the
Securities evidenced by such Security Certificate.
Each Security Certificate shall be dated the date of its authentication.
No Security Certificate shall be entitled to any benefit under this
Agreement or be valid or obligatory for any purpose unless there appears on
such Security Certificate a certificate of authentication substantially in the
form provided for herein executed by an authorized signatory of the Agent by
manual signature, and such certificate upon any Security Certificate shall be
conclusive evidence, and the only evidence, that such Security Certificate has
been duly authenticated and delivered hereunder.
Section 3.4. Temporary Security Certificates.
Pending the preparation of definitive Security 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
Security Certificates, temporary Security Certificates which are 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 on which the Securities are listed, or as
may, consistently herewith, be determined by the officers of the Company
executing such Security Certificates, as evidenced by their execution of the
Security Certificates.
If temporary Security Certificates are issued, the Company will cause
definitive Security Certificates to be prepared without unreasonable delay.
After the preparation of definitive Security Certificates, the temporary
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Security Certificates shall be exchangeable for definitive Security
Certificates upon surrender of the temporary Security 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 Security
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 Security Certificates of authorized
denominations and evidencing a like number of Securities as the temporary
Security Certificate or Security Certificates so surrendered. Until so
exchanged, the temporary Security Certificates shall in all respects evidence
the same benefits and the same obligations with respect to the Securities
evidenced thereby as definitive Security Certificates.
Section 3.5. Registration; Registration of Transfer and Exchange.
The Agent shall keep at the Corporate Trust Office a register (the
register maintained in such office being herein referred to as the "Security
Register") in which, subject to such reasonable regulations as it may
prescribe, the Agent shall provide for the registration of Security
Certificates and of transfers of Security Certificates (the Agent, in such
capacity, the "Security Registrar").
Upon surrender for registration of transfer of any Security 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 Security Certificates of any
authorized denominations and evidencing a like number of Securities.
At the option of the Holder, Security Certificates may be exchanged for
other Security Certificates, of any authorized denominations and evidencing a
like number of Securities, upon surrender of the Security Certificates to be
exchanged at the Corporate Trust Office. Whenever any Security 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 Security Certifi-
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cates which the Holder making the exchange is entitled to receive.
All Security Certificates issued upon any registration of transfer or
exchange of a Security Certificate shall evidence the ownership of the same
number of Securities and be entitled to the same benefits and subject to the
same obligations, under this Agreement as the Securities evidenced by the
Security Certificate surrendered upon such registration of transfer or
exchange.
Every Security 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 his attorney
duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of a Security 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 Security Certificates, other than any exchanges
pursuant to Sections 3.6 and 8.5 not involving any transfer.
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 Security
Certificate presented or surrendered for registration of transfer or for
exchange on or after the Final Settlement Date or the Termination Date. In lieu
of delivery of a new Security 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 Final Settlement Date has occurred, deliver the shares of Common Stock
issuable in respect of the Purchase Contracts forming a part of the Securities
evidenced by such Security Certificate, or (ii) if a Termination Event shall
have occurred prior to the Final Settlement Date, transfer the principal amount
of the Treasury Notes evidenced thereby, in each case subject to the applicable
conditions and in
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accordance with the applicable provisions of Article Five hereof.
The provisions of Clauses (1), (2), (3) and (4) below shall apply only to
Global Security Certificates:
(1) Each Global Security Certificate authenticated and executed on
behalf of the Holders under this Agreement shall be registered in the
name of the Depositary designated for such Global Security Certificate
or a nominee thereof and delivered to such Depositary or a nominee
thereof or custodian therefor, and each such Global Security Certificate
shall constitute a single Security Certificate for all purposes of this
Agreement.
(2) Notwithstanding any other provision in this Agreement, no
Global Security Certificate may be exchanged in whole or in part for
Security Certificates registered, and no transfer of a Global Security
Certificate in whole or in part may be registered, in the name of any
Person other than the Depositary for such Global Security Certificate or
a nominee thereof unless (A) such Depositary (i) has notified the
Company that it is unwilling or unable to continue as Depositary for
such Global Security Certificate or (ii) has ceased to be a clearing
agency registered under the Exchange Act or (B) there shall have
occurred and be continuing a default by the Company in respect to its
obligations under one or more Purchase Contracts.
(3) Subject to Clause (2) above, any exchange of a Global Security
Certificate for other Security Certificates may be made in whole or in
part, and all Security Certificates issued in exchange for a Global
Security Certificate or any portion thereof shall be registered in such
names as the Depositary for such Global Security Certificate shall
direct.
(4) Every Security Certificate authenticated and delivered upon
registration of transfer of, or in exchange for or in lieu of, a Global
Security Certificate or any portion thereof, whether pursuant to this
Section, Section 3.4, 3.6, 5.9 or 8.5 or otherwise, shall be
authenticated, executed on behalf of the Holders and delivered in the
form of,
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and shall be, a Global Security Certificate, unless such Security
Certificate is registered in the name of a Person other than the
Depositary for such Global Security Certificate or a nominee thereof.
Section 3.6. Mutilated, Destroyed, Lost and Stolen Security Certificates.
If any mutilated Security 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 Security Certificate, evidencing the same number of Securities
and bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company and the Agent (i) evidence to
their satisfaction of the destruction, loss or theft of any Security
Certificate, and (ii) such security or indemnity as may be required by them to
save 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 Security 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 Security
Certificate, a new Security Certificate, evidencing the same number of
Securities and bearing a number not contemporaneously outstanding.
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
Security Certificate on or after the Final Settlement Date or the Termination
Date. In lieu of delivery of a new Security 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 Final Settlement Date has occurred, deliver the shares of
Common Stock issuable in respect of the Purchase Contracts forming a part of
the Securities evidenced by such Security Certificate, or (ii) if a Termination
Event shall have occurred prior to the Final Settlement Date, transfer the
principal amount of the Treasury Notes evidenced thereby, in
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each case subject to the applicable conditions and in accordance with the
applicable provisions of Article Five hereof.
Upon the issuance of any new Security 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.
Every new Security Certificate issued pursuant to this Section in lieu of
any destroyed, lost or stolen Security Certificate shall constitute an original
additional contractual obligation of the Company and of the Holder, whether or
not the destroyed, lost or stolen Security Certificate 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 Security Certificates delivered hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
settlement of mutilated, destroyed, lost or stolen Security Certificates.
Section 3.7. Persons Deemed Owners.
Prior to due presentment of a Security 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 Security Certificate is registered as
the owner of the Securities evidenced thereby, for the purpose of receiving
payments of interest on the Treasury Notes, receiving payments of Yield
Enhancement Payments, performance of the Purchase Contracts and for all other
purposes whatsoever, whether or not the payment of interest on the Treasury
Notes or any Yield Enhancement Payment payable in respect of the Purchase
Contracts constituting a part of the Securities evidenced thereby 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.
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Notwithstanding the foregoing, with respect to any Global Security
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 Depositary (or its nominee), as a
Holder, with respect to such Global Security Certificate or impair, as between
such Depositary and owners of beneficial interests in such Global Security
Certificate, the operation of customary practices governing the exercise of
rights of such Depositary (or its nominee) as Holder of such Global Security
Certificate.
Section 3.8. Cancellation.
All Security Certificates surrendered for delivery of shares of Common
Stock on or after the Final Settlement Date, transfer of Treasury Notes after
the occurrence of a Termination Event or pursuant to an Early Settlement or
registration of transfer or exchange 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 Security Certificates previously authenticated, executed
and delivered hereunder which the Company may have acquired in any manner
whatsoever, and all Security Certificates so delivered shall, upon Issuer
Order, be promptly cancelled by the Agent. No Security Certificates shall be
authenticated, executed on behalf of the Holder and delivered in lieu of or in
exchange for any Security Certificates cancelled as provided in this Section,
except as expressly permitted by this Agreement. All cancelled Security
Certificates held by the Agent shall be disposed of as directed by Issuer
Order.
If the Company or any Affiliate of the Company shall acquire any Security
Certificate, such acquisition shall not operate as a cancellation of such
Security Certificate unless and until such Security Certificate is delivered to
the Agent cancelled or for cancellation.
Section 3.9. Securities Not Separable.
Notwithstanding anything contained herein or in the Security Certificates
to the contrary, for so long as the Purchase Contract comprising a portion of
a Security re-
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mains in effect, such Security shall not be separable into its constituent
parts, for purposes of transfer or exchange of such Security, and the rights
and obligations of the Holder of such Security in respect of the Treasury Notes
and Purchase Contracts comprising such Security may be acquired, and may be
transferred and exchanged, only as a Security. Other than a Security
Certificate evidencing a Security, no Holder of a Security, or any transferee
thereof, shall be entitled to receive a certificate evidencing the ownership of
Treasury Notes or the rights and obligations of the Holder and the Company
under a Purchase Contract for so long as the Purchase Contract underlying the
Security remains in effect.
Section 3.10. No Consent To Assumption
Each Holder of a Security, 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 or
its trustee in the event that the Company becomes the debtor under the
Bankruptcy Code.
ARTICLE IV
The Treasury Notes
Section 4.1. Payment of Interest; Interest Rights Preserved.
Interest on any Treasury Note which is paid on any Payment Date shall,
subject to receipt thereof by the Agent from the Collateral Agent as provided
by the terms of the Pledge Agreement, be paid to the Person in whose name the
Security Certificate (or one or more Predecessor Security Certificates) of
which such Treasury Note is a part is registered at the close of business on
the Record Date next preceding such Payment Date.
Each Security Certificate evidencing Treasury Notes delivered under this
Agreement upon registration of transfer of or in exchange for or in lieu of any
other Security Certificate shall carry the rights to interest accrued and
unpaid, and to accrue, which were carried by
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the Treasury Notes underlying such other Security Certificate.
In the case of any Security with respect to which Early Settlement of the
underlying Purchase Contract is effected on an Early Settlement Date after any
Record Date and on or prior to the next succeeding Payment Date, interest on
the Treasury Notes underlying such Security otherwise payable on such Payment
Date shall be payable on such Payment Date notwithstanding such Early
Settlement, and such interest shall, subject to receipt thereof by the Agent,
be paid to the Person in whose name the Security Certificate (or one or more
Predecessor Security Certificates) is 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 Security with respect to which Early
Settlement of the underlying Purchase Contract is effected on an Early
Settlement Date, interest on the related Treasury Notes that would otherwise be
payable after the Early Settlement Date shall not be payable hereunder to the
Holder of such Security.
Section 4.2. Transfer of Treasury Notes Upon Occurrence of Termination Event.
Upon the occurrence of a Termination Event and the transfer to the Agent
of the Treasury Notes underlying such Securities pursuant to the terms of the
Pledge Agreement, the Agent shall request transfer instructions with respect to
such Treasury Notes from each Holder of Securities by written request mailed to
such Holder at his address as it appears in the Security Register, in respect
of the Treasury Notes underlying the Security Certificate held by such Holder.
Upon surrender to the Agent of a Security Certificate with such transfer
instructions in proper form for transfer of the Treasury Notes by Federal
Reserve Bank-Wire or other appropriate procedure, the Agent shall transfer the
Treasury Notes evidenced by such Security Certificate to such Holder in
accordance with such instructions. If a Security Certificate is not duly
surrendered to the Agent with appropriate transfer instructions, the Agent
shall hold the Treasury Notes evidenced by such Security Certificate as
custodian for the Holder of such Security Certificate.
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Treasury Notes shall be transferred only in denominations of $1,000 and
integral multiples thereof. As promptly as practicable following the occurrence
of a Termination Event, the Agent shall determine the excess of (i) the
aggregate principal amount of Treasury Notes underlying the Outstanding
Securities over (ii) the aggregate principal amount of Treasury Notes in
denominations of $1,000 and integral multiples thereof transferrable to Holders
of record on the date of such Termination Event (such excess being herein
referred to as the "Excess Treasury Notes"). As soon as practicable after
transfer to the Agent of the Treasury Notes underlying the Outstanding
Securities as provided in the Pledge Agreement, the Agent shall sell the Excess
Treasury Notes to or through one or more U.S. Government securities dealers at
then prevailing prices. The Agent shall deduct from the proceeds of such sales
all commissions and other out-of-pocket transaction costs incurred in
connection with such sales of Excess Treasury Notes and, until the net proceeds
of such sale or sales have been distributed to Holders of the Securities, the
Agent shall hold such proceeds as custodian for the Holders of Securities. Such
proceeds shall be held by the Agent uninvested without liability to any Person
for interest or other compensation thereon. Each Holder shall be entitled to
receive a portion, if any, of such net proceeds in lieu of Treasury Notes with
a principal amount of less than $1,000 determined by multiplying the aggregate
amount of such net proceeds by a fraction, the numerator of which is the
fraction of $1,000 in principal amount of Treasury Notes to which such Holder
would otherwise be entitled (after taking into account all Securities then held
by such Holder) and the denominator of which is the aggregate principal amount
of Excess Treasury Notes.
ARTICLE V
The Purchase Contracts
Section 5.1 Purchase of Shares of Common Stock.
Each Purchase Contract shall obligate the Holder of the related Security
to purchase, and the Company to sell, on the Final Settlement Date at a price
equal to the Stated Amount, a number of shares of Common Stock
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37
equal to the Settlement Rate, unless, on or prior to the Final Settlement Date,
there shall have occurred a Termination Event or an Early Settlement with
respect to the Security 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 $_____ (the "Threshold Appreciation Price"), _____ of a
share of Common Stock per Purchase Contract, (b) if the Applicable Market
Value is less than or equal to the Threshold Appreciation Price but is greater
than the Stated Amount, a fractional share of Common Stock per Purchase
Contract equal to the Stated Amount divided by the Applicable Market Value
(rounded upward or downward to the nearest 1/10,000th of a share) and (c) if
the Applicable Market Value is less than or equal to the Stated Amount, one
share of Common Stock per Purchase Contract, in each case subject to adjustment
as provided in Section 5.6. As provided in Section 5.10, no fractional shares
of Common Stock will be issued upon settlement of Purchase Contracts.
The "Applicable Market Value" means the average of the Closing Prices per
share of Common Stock on each of the twenty consecutive Trading Days ending on
the second Trading Day immediately preceding the Final Settlement 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
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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 Holder of a Security Certificate evidencing Securities, by his
acceptance thereof, authorizes the Agent to enter into and perform
the related Purchase Contracts on his behalf as his attorney-in-fact, agrees to
be bound by the terms and provisions thereof, covenants and agrees to perform
his obligations under such Purchase Contracts, consents to the provisions
hereof, irrevocably authorizes the Agent as his attorney-in-fact to enter into
and perform the Pledge Agreement on his behalf as his attorney-in-fact, and
consents to and agrees to be bound by the Pledge of the Treasury Notes
underlying such Security Certificate pursuant to the Pledge Agreement; provided
that upon an Event of Termination the rights of the Holder of such Security
under the Purchase Contract may be enforced without regard to any other rights
or obligations. Each Holder of a Security, by his 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 principal of the Treasury Notes on the Final Settlement Date shall
be paid 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.
Upon registration of transfer of a Security Certificate evidencing
Purchase Contracts, 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 evidenced thereby and the Pledge Agreement
and the transferor shall be released from the obligations under the Purchase
Contracts evidenced by the Security Certificates so transferred. The Company
covenants and agrees, and each Holder of a Security Certificate, by his
acceptance thereof, likewise covenants and agrees, to be bound by the
provisions of this paragraph.
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Section 5.2. Yield Enhancement Payments.
Subject to Section 5.3, the Company shall pay, on each Payment Date, the
Yield Enhancement Payments payable in respect of each Purchase Contract to the
Person in whose name the Security Certificate (or one or more Predecessor
Security Certificates) evidencing such Purchase Contract is registered at the
close of business on the Record Date next preceding such Payment Date. The
Yield Enhancement Payment will be payable at the office of the Agent in The
City of New York maintained for that purpose 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 Security Register.
Each Security Certificate delivered under this Agreement upon registration
of transfer of or in exchange for or in lieu of any other Security Certificate
shall carry the rights to Yield Enhancement Payments accrued and unpaid, and to
accrue, which were carried by the Purchase Contracts evidenced by such other
Security Certificate.
[In the case of any Security with respect to which Early Settlement of the
underlying Purchase Contract is effected on an Early Settlement Date after any
Record Date and on or prior to the next succeeding Payment Date, Yield
Enhancement Payments otherwise payable on such Payment Date shall be payable on
such Payment Date notwithstanding such Early Settlement, and such Yield
Enhancement Payments shall be paid to the Person in whose name the Security
Certificate evidencing such Security (or one or more Predecessor Security
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 Security with respect to which Early Settlement of the
underlying Purchase Contract is effected on an Early Settlement Date, Yield
Enhancement Payments that would otherwise be payable after the Early Settlement
Date with respect to the Purchase Contract underlying such Security shall not
be payable.]
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The Company's obligations with respect to Yield Enhancement Payments are
subordinate and junior in right of payment to all liabilities of the Company
and pari passu with the most senior preferred stock issued from time to time,
if any, by the Company.
Section 5.3. Deferral of Payment Dates For Yield Enhancement Payment.
The Company shall have the right, at any time prior to the Final
Settlement Date, to defer the payment of any or all of the Yield Enhancement
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 such
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 Yield Enhancement Payment to the New York Stock
Exchange or other applicable self-regulatory organization or to Holders of the
Securities, but in any event not less than two Business Days prior to such
Record Date. Any Yield Enhancement Payments so deferred shall bear additional
Yield Enhancement Payments thereon at the rate of_____% per annum (computed on
the basis of the actual number of days elapsed in a year of 365 or 366 days, as
the case may be), compounding on each succeeding Payment Date, until paid in
full (such deferred installments of Yield Enhancement Payments together with
the additional Yield Enhancement Payments accrued thereon, are referred to
herein as the "Deferred Yield Enhancement Payments"). Deferred Yield
Enhancement Payments shall be due on the next succeeding Payment Date except to
the extent that payment is deferred pursuant to this Section. No Yield
Enhancement Payments may be deferred to a date that is after the Final
Settlement Date or, with respect to any particular Purchase Contract, Early
Settlement thereof.
In the event that the Company elects to defer the payment of Yield
Enhancement Payments on the Purchase Contracts until the Final Settlement Date,
each holder will receive on the Final Settlement 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 (x) the aggregate amount
of
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Deferred Yield Enhancement Payments payable to a Holder divided by (y) the
Applicable Market Value.
No fractional shares of Common Stock will be issued by the Company with
respect to the payment of Deferred Yield Enhancement Payments on the Final
Settlement Date. In lieu of fractional shares otherwise issuable with respect
to such payment of Deferred Yield Enhancement Payments, the Holder will be
entitled to receive an amount in cash as provided in Section 5.10.
In the event the Company exercises its option to defer the payment of
Yield Enhancement Payments, then (a) the Company shall not 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 capital
stock (other than (i) purchase or acquisitions of shares of Common Stock in
connection with the satisfaction by the Company of its obligations under any
employee benefit plans or the satisfaction by the Company of its obligations
pursuant to any contract or security requiring the Company to purchase shares
of Common Stock, (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 or (iii) the purchase of fractional interests in shares of the Company's
capital stock pursuant to the conversion or exchange provisions of such capital
stock or the security being converted or exchanged) or make any guarantee
payments with respect to the foregoing), (b) the Company shall not make any
payment of interest, principal or premium, if any, on or repay, repurchase or
redeem any debt securities (including guarantees) issued by the Company that
rank pari passu with or junior to such Yield Enhancement Payments and (c) the
Company shall not make any guarantee payments with respect to the foregoing.
Section 5.4. Payment of Purchase Price.
The purchase price for the shares of Common Stock purchased pursuant to a
Purchase Contract, shall be paid by application of payments received by the
Company on the Final Settlement Date from the Collateral Agent pursuant to the
Pledge Agreement in respect of the principal of the Treasury Notes Pledged to
secure the obliga-
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tions. of the relevant Holder under such Purchase Contract. Such
application shall satisfy in full the obligations under such Purchase Contract
of the Holder of the Security of which such Purchase Contract is a part. 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.
Section 5.5. Issuance of Shares of Common Stock.
Unless a Termination Event shall have occurred on or prior to the Final
Settlement Date, on the Final Settlement Date, upon its receipt of payment in
full of the purchase price for the shares of Common Stock purchased by the
Holders pursuant to the foregoing provisions of this Article, and in payment
of Deferred Yield Enhancement Payments, if any, owed by the Company to the
Holders and subject to Section 5.6(b), the Company shall issue and deposit with
the Agent, for the benefit of the Holders of the Outstanding Securities,
one or more certificates representing the 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 with respect thereto, being hereinafter referred to as the "Final
Settlement Fund") to which the Holders are entitled hereunder. Subject to the
foregoing, upon surrender of a Security Certificate to the Agent on or after
the Final Settlement Date, together with settlement instructions thereon duly
completed and executed, the Holder of such Security 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 Five (after taking into account all
Securities then held by such Holder) together with cash in lieu of fractional
shares as provided in Section 5.10 and any dividends or distributions with
respect to such shares constituting part of the Final Settlement Fund, but
without any interest thereon, and the Security 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 on
the Security Certificate. If any shares
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of Common Stock issued in respect of a Purchase Contract and in
payment of any Deferred Yield Enhancement Payments are to be registered to a
Person other than the Person in whose name the Security 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 the Security Certificate evidencing such Purchase Contract
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) In case the Company shall pay or make a dividend or other distribution
on any class of Common Stock of the Company in Common Stock, the Settlement
Rate 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 any time outstanding
shall not include shares held in the treasury of the Company but shall include
shares issuable in respect of 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.
(2) In case the Company shall issue rights, options or warrants to all
holders of its Common Stock (not being available on an equivalent basis to
Holders of the Securities upon settlement of the Purchase Contracts underlying
such Securities) entitling them, for a period expir-
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44
ing within 45 days after the record date for the determination of stockholders
entitled to receive such rights, options or warrants, 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 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 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
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
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 shares issuable in
respect of scrip certificates issued in lieu of fractions of shares of Common
Stock. The Company shall not issue any such rights, options or warrants in
respect of shares of Common Stock held in the treasury of the Company.
(3) 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
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the day following the day upon which such subdivision, split or combination
becomes effective.
(4) In case the Company shall, by dividend or otherwise, distribute to all
holders of its Common Stock evidences of its indebtedness or assets (including
securities, but excluding any rights or warrants referred to in paragraph (2)
of this Section, any dividend or distribution paid exclusively in cash and any
dividend or distribution referred to in paragraph (1) of this Section), 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 of which the numerator
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 assets or
evidences of indebtedness so distributed applicable to one share of Common
Stock and the denominator shall all 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.
(5) In case the Company shall, (I) 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) 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 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
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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) 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 (i) 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 (ii) the denominator of which
shall be equal to the Current Market Price per share of the Common Stock on
such date for determination.
(6) 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
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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 (i) the numerator of which shall be equal to (A)
the product of (I) the 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 (B) 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 (ii) the denominator of which shall
be equal to the product of (A) the Current Market Price per share of the Common
Stock as of the Expiration Time and (B) 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) 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 (a) a distribution of such securities other than Common Stock to all
holders of Common Stock (and the
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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 (b) 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) The "Current Market Price" per share of Common Stock on any day means
the average of the daily Closing Prices for the 5 consecutive Trading Days
selected by the Company commencing not more than 20 Trading Days before, and
ending not later than, the earlier of the day in question and the day before
the "ex date" with respect to the issuance or distribution requiring such
computation. 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.
(9) 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, however,
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 (a), (b) or (c) of the definition of Settlement Rate
in Section 5.1 will apply on the Final Settlement Date. Such adjustment shall
be made by multiplying the Applicable
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Market Value by a fraction of which the numerator 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 shall be
the Settlement Rate immediately before such adjustment.
(10) 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 (i) 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), (ii) any
sale, transfer, lease or conveyance to another Person of the property of the
Company as an entirety or substantially as an entirety, (iii) any statutory
exchange of securities of the Company with another Person (other than in
connection with a merger or acquisition) or (iv) any liquidation, dissolution
or winding up of the Company other than as a result of or after the occurrence
of a Termination Event (any such event, a "Reorganization Event"), the
Settlement Rate will be adjusted to provide that each Holder of Securities will
receive on the Final Settlement Date with respect to each Purchase Contract
forming a part thereof, the kind and amount of securities, cash and other
property receivable upon such Reorganization Event by a Holder of the number of
shares of Common Stock issuable on account of each Purchase Contract if the
Final Settlement Date had occurred immediately prior to such Reorganization
Event, assuming such Holder of Common Stock 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
("Constituent Person"), or an Affiliate of a constituent Person, and failed to
exercise his rights of election, if any, as to
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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). 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 Holders of each
Outstanding Security 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 adjusted Settlement Rate in accordance
with Section 5.6 and prepare and transmit to the Agent an Officers'
Certificate setting forth the Settlement Rate, the method of
calculation thereof in reasonable detail, and the facts requiring such
adjustment and upon which such adjustment is based; and
(ii) within 10 Business Days following the occurrence of an event
that permits or requires an
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adjustment to the Settlement Rate pursuant to Section 5.6 (or if the
Company is not aware of such occurrence, as soon as practicable after
becoming so aware), provide a written notice to the Holders of the
Securities of the occurrence of such event and a statement in reasonable
detail setting forth the method by which the adjustment to the
Settlement Rate was determined and setting forth the adjusted
Settlement Rate.
(b) The Agent shall not at any time be under any duty or responsibility
to any holder of Securities to determine whether any facts exist which may
require any adjustment of the Settlement Rate, 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 the 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 any Yield
Enhancement Payment, 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 Final Settlement Date, a Termination Event shall have
occurred. Upon and after the occurrence of a Termination Event, the Securities
shall thereafter represent the right to receive the Treasury Notes forming a
part of such Securities in accordance with the provisions of Section 4.2 and
the Pledge Agreement. Upon the occurrence of a Termination Event, the Company
shall promptly but in no event after two business days thereafter give written
notice to the Agent, the Collateral Agent and to
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the Holders, at their addresses as they appear in the Security Register.
Each Holder of Securities, by acceptance hereof, 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.
Section 5.9. Early Settlement.
(a) Subject to and upon compliance with the provisions of this Section
5.9 at the option of the Holder thereof, any Purchase Contracts underlying
Securities having an aggregate Stated Amount equal to $______ or an integral
multiple thereof may be settled early ("Early Settlement") as provided herein.
In order to exercise the right to effect Early Settlement with respect to any
Purchase Contracts, the Holder of the Security Certificate evidencing such
Purchase Contracts shall deliver such Security 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 in the form of a certified or cashier's check
payable to the order of the Company in immediately available funds in an amount
(the "Early Settlement Amount") equal to (i) the product of (A) the Stated
Amount times (B) the number of Purchase Contracts with respect to which the
Holder has elected to effect Early Settlement [plus (ii) 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 sum of (x) the Yield
Enhancement Payments payable on such Payment Date with respect to such Purchase
Contracts plus (y) the interest on the related Treasury Notes payable on such
Payment Date. Except as provided in the immediately preceding sentence and
subject to the second to last paragraph of Section 5.2, no payment or
adjustment shall be made upon Early Settlement of any Purchase Contract on
account of any Yield Enhancement Payments accrued 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 Securities at or prior to 5:00 p.m., New York
City
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time, on a Business Day, such day shall be the "Early Settlement
Date" with respect to such Securities 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
Securities shall be the next succeeding Business Day.
(b) Upon Early Settlement of Purchase Contracts by a Holder of the related
Securities, the Company shall issue, and the Holder shall be entitled to
receive, a number of shares of Common Stock on account of each Purchase
Contract as to which Early Settlement is effected equal to the Early Settlement
Rate; provided, however, that upon the Early Settlement of the Purchase
Contracts, the Holder of such related Securities will forfeit the right to
receive any Deferred Yield Enhancement Payments. The Early Settlement Rate
shall initially be equal to _____ and 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 Settlement together with
payment in lieu of any fraction of a share, as provided in Section 5.10.
(c) The Company shall cause the shares of Common Stock issuable, and
Treasury Notes deliverable, upon Early Settlement of Purchase Contracts to be
issued and delivered, in the case of such shares of Common Stock, and released
from the Pledge by the Collateral Agent and transferred, in the case of such
Treasury Notes, to the Agent, for delivery to the Holder thereof or its
designee, no later than the third Business Day after the applicable Early
Settlement Date.
(d) Upon Early Settlement of any Purchase Contracts, and subject to
receipt thereof from the Company or 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 Security Certificate evidencing the related Securities, (i) transfer the
Treasury Notes forming a part of such Securities and (ii)
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deliver 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 5.10.
(e) In the event that Early Settlement is effected with respect to
Purchase Contracts underlying less than all the Securities evidenced by a
Security Certificate, upon such Early Settlement the Company shall execute and
the Agent shall authenticate, countersign and deliver to the Holder thereof,
at the expense of the Company, a Security Certificate evidencing the
Securities as to which Early Settlement was not effected.
Section 5.10. No Fractional Shares.
No fractional shares or scrip representing fractional shares of Common
Stock shall be issued or delivered upon settlement on the Final Settlement Date
or upon Early Settlement of any Purchase Contracts or with respect to the
payment of Deferred Yield Enhancement Payments, if any, on the Final Settlement
Date. If Security 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 Security Certificates so surrendered. Instead of any fractional share of
Common Stock which would otherwise be deliverable upon settlement of any
Purchase Contracts on the Final Settlement Date or upon Early Settlement or
with respect to the payment of any Deferred Yield Enhancement Payments, the
Company, through the Agent, shall make a cash payment in respect of such
fractional interest in an amount equal to the value of such fractional shares
at the Closing Price per share on the Trading Day immediately preceding the
Final Settlement Date or the related Early Settlement Date, respectively. 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 5.10 in a
timely manner.
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Section 5.1.1. 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 Yield Enhancement Payments;
provided, however, 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 Security Certificate evidencing a Purchase Contract or any issuance of a
share of Common Stock in a name other than that of the registered Holder of a
Security Certificate surrendered in respect of the Purchase Contracts 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 Security Certificates unless or 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.
ARTICLE VI
Remedies
Section 6.1. Unconditional Right of Holders to Receive Yield Enhancement
Payment.
The Holder of any Security shall have the right, which is absolute and
unconditional (subject to the right of the Company to defer payment thereof
pursuant to Section 5.3 and subject to the forfeiture of any Deferred Yield
Enhancement Payments upon Early Settlement pursuant to Section 5.9(b)), to
receive payment of each installment of the Yield Enhancement Payment with
respect to the Purchase Contract constituting a part of such Security on the
respective Payment Date for such Security and to purchase Common Stock pursuant
to such Purchase Contract and, in each such case, to institute suit for the
enforcement of any such payment and right to purchase Common Stock, and such
rights shall not be impaired without the consent of such Holder.
Section 6.2. Restoration of Rights and Remedies.
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If any Holder of Securities 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 of mutilated,
destroyed, lost or stolen Security Certificates in the last paragraph of
Section 3.6, no right or remedy herein conferred upon or reserved to the
Holders of Securities 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 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 any Security by
his acceptance of the Security Certificate evidencing such Security 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
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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 of Securities, or group of Holders, holding in the aggregate more than
10% of the Outstanding Securities, or to any suit instituted by any Holder for
the enforcement of the payment of the interest on any Treasury Note or the
Yield Enhancement Payment on any Purchase Contract on or after the respective
Payment Date therefor constituting a part of the Securities held by such
Holder, or for enforcement of the right to purchase shares of Common Stock
under the Purchase Contracts constituting a part of the Securities 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) hereby expressly waives all benefit or advantage of any such
law and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Agent or the Holders, 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 and Responsibilities.
(a) (1) The Agent undertakes to perform, with respect to the
Securities, such duties and only such duties as are specifically set
forth in this Agreement and the Pledge Agreement, and no implied
cove-
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nants or obligations shall be read into this Agreement against the
Agent; and
(2) in the absence of bad faith or negligence on its part, the
Agent may, with respect to the Securities, conclusively rely, as to the
truth of the statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the Agent and
conforming to the requirements of this Agreement, but in the case of any
certificates or opinions which by any provision hereof are specifically
required to be furnished to the Agent, the Agent shall be under a duty
to examine the same to determine whether or not they conform to the
requirements of this Agreement.
(b) No provision of this Agreement shall be construed to relieve the
Agent from liability for its own negligent action, its own negligent failure to
act, or its own wilful misconduct, except that
(1) this Subsection shall not be construed to limit the effect of
Subsection (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 negligent in ascertaining the pertinent facts; and
(3) no provision of this Agreement shall require the Agent to
expend or risk its own funds or otherwise incur any financial liability
in the performance of any of its duties hereunder, or in the exercise of
any of its rights or powers, if adequate indemnity is not provided to
it.
(c) Whether or not therein expressly so provided, every provision of
this Agreement relating to the conduct or affecting the liability of or
affording protection to the Agent shall be subject to the provisions of this
Section.
Section 7.2. Notice of Default.
Within 30 days after the occurrence of any default by the Company
hereunder, of which a Responsible Officer
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of the Agent has actual knowledge, the Agent shall transmit by mail to all
Holders of Securities, as their names and addresses appear in the Security
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) the Agent may rely and shall be protected in acting or refraining from
acting upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document believed by it to be
genuine and to have been signed or presented by the proper party or parties;
(b) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by an Officers' 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;
(c) 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 Officers' Certificate of the Company;
(d) the Agent may consult with counsel and the written 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;
(e) 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 issuance of the
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Securities and 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 entitled to examine the
books, records and promises of the Company, personally or by agent or attorney;
and
(f) the Agent may execute any of its powers hereunder or perform any
duties hereunder either directly or by or through agents or attorneys or an
Affiliate 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 or Issuance of Securities.
The recitals contained herein and in the Security Certificates shall be
taken as the statements of the Company and the Agent assumes no responsibility
for their accuracy. The Agent makes no representations as to the validity or
sufficiency of either this Agreement or of the Securities, or of the Pledge
Agreement or the Pledge. The Agent shall not be accountable for the use or
application by the Company of the proceeds in respect of the Purchase
Contracts.
Section 7.5. May Hold Securities.
Any Security 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 Securities 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 Security Registrar or such other agent, or the Agent.
Section 7.6. Money Held in Custody.
Money held by the Agent in custody hereunder need not be segregated from
the other funds except to the extent required by law. 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.
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The Company agrees:
(1) to pay to the Agent from time to time reasonable compensation
for all services rendered by it hereunder;
(2) except as otherwise expressly provided herein, 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 (including the reasonable compensation and the
expenses and disbursements of its agents and counsel), except any such
expense, disbursement or advance as may be attributable to its
negligence or bad faith; and
(3) to indemnify the Agent and any predecessor Agent for, and to
hold each of them harmless against, any loss, liability or expense
incurred without negligence or bad faith on its part, arising out of or
in connection with the acceptance or administration of its duties
hereunder, including the costs and expenses of defending itself against
any claim or liability in connection with the exercise or performance of
any of its powers or duties hereunder.
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 in the Borough of Manhattan, The City of New York
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
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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 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 Securities delivered to the Agent and the
Company.
(d) if at any time
(1) the Agent fails to comply with Section 310(b) of the TIA, as if
the Agent were an indenture 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 a Security 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
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for the purpose of rehabilitation, conservation or liquidation,
then, in any such case, (i) the Company by a Board Resolution may remove the
Agent, or (ii) any Holder who has been a bona fide Holder of a Security 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 a Security 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) The 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 of Securities as their names and
addresses appear in the Security 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 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,
exe-
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cute and deliver an instrument transferring to such successor Agent all the
rights, powers and trusts of the retiring Agent and shall 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 Security 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 may adopt such authentication and execution and deliver the Security
Certificates so authenticated and executed with the same effect as if such
successor Agent had itself authenticated and executed such Securities.
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 Security Registrar.
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(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 a Security 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 Securities and is accompanied by a
copy of the form of proxy or other communication which such applicants propose
to transmit, then the Agent shall, within five Business Days after the receipt
of such application, afford such applicants access to the information preserved
at the time by the Agent in accordance with Section 7.12(a).
(c) Every Holder of Securities, by receiving and holding the Security
Certificates evidencing the same, agrees with the Company and the Agent that
none of the Company, the Agent nor any agent of any of them shall be held
accountable by reason of the disclosure of any such information as to the names
and addresses of the Holders in accordance with Section 7.12(b), regardless of
the source from which such information was derived.
Section 7.13. No Obligations of Agent.
Except to the extent otherwise provided in this Agreement, the Agent
assumes no obligations 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 Security thereunder. The Company agrees, and
each Holder of a Security Certificate, by his acceptance thereof, shall be
deemed to have agreed, that the Agent's execution of the Security 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 Five hereof.
Section 7.14. 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 by applicable
tax laws, regulations or administrative practice with
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respect to (i) any payments made with respect to the Securities or (ii) the
issuance, delivery, holding, transfer, redemption or exercise of rights under
the Securities. Such compliance shall include, without limitation, the
preparation and timely filing of required returns and the timely payment of all
amounts required to be withheld to the appropriate taxing authority or its
designated agent.
(b) The Agent shall comply with any direction 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) hereof.
(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 to 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 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:
(1) 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 Security Certificates; or
(2) 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
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(3) to evidence and provide for the acceptance of appointment
hereunder by a successor Agent; or
(4) to make provision with respect to the rights of Holders
pursuant to the requirements of Section 5.6(b); or
(5) except as provided for in Section 5.6, 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.
With the consent of the Holders of not less than 66 2/3% of the
Outstanding Securities, 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 for the purpose of
modifying in any manner the terms of the Securities, or the provisions of this
Agreement or the rights of the Holders in respect of the Securities; provided,
however, that no such supplemental agreement shall, without the consent of the
Holder of each Outstanding Security affected thereby,
(1) change any Payment Date;
(2) change the amount or type of Treasury Notes underlying a
Security, impair the right of the Holder of any Security to receive
interest payments on the underlying Treasury Notes or otherwise
adversely affect the Holder's rights in or to such Treasury Notes;
(3) reduce any Yield Enhancement Payment or any Deferred Yield
Enhancement Payment, or change any place where, or the coin or currency
in which, any Yield Enhancement Payment is payable;
(4) impair the right to institute suit for the enforcement of any
Purchase Contract;
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(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
Final Settlement Date or otherwise adversely affect the Holder's rights
under any Purchase Contract; or
(6) reduce the percentage of the Outstanding Securities the consent
of whose Holders is required for any such supplemental agreement.
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 entitled to
receive and (subject to Section 7.1) shall be fully protected in relying upon,
an Opinion of Counsel stating that the execution of such supplemental 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.
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 Security Certificates theretofore or thereafter authenticated,
executed on behalf of the Holders and delivered hereunder shall be bound
thereby.
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Section 8.5. Reference to Supplemental Agreements.
Security 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 Security 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 Security 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 merge or consolidate with any other
Person or 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, 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, this Agreement and the Pledge Agreement by one or
more supplemental agreements in form 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
Securities or under the Pledge Agreement.
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Section 9.2. Rights and Duties fo Successor Corporation.
In case of any such consolidation, merger, sale, assignment, transfer,
lease or conveyance and upon any such assumption by the successor corporation
in accordance with Section 9.1, such successor corporation shall succeed to and
be substituted for the Company with the same effect as if it had been named
herein as the Company. Such successor corporation thereupon may cause to be
signed, and may issue either in its own name or in the name of CMS Energy
Corporation, any or all of the Security Certificates evidencing
Securities 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 Security
Certificates which previously shall have been signed and delivered by the
officers of the Company to the Agent for authentication and execution, and any
Security Certificate evidencing Securities which such successor corporation
thereafter shall cause to be signed and delivered to the Agent for that
purpose. All the Security Certificates so issued shall in all respects have the
same legal rank and benefit under this Agreement as the Security Certificates
theretofore or thereafter issued in accordance with the terms of this Agreement
as though all of such Security Certificates had been issued at the date of the
execution hereof.
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 Security Certificates evidencing Securities thereafter to be
issued as may be appropriate.
Section 9.3. Opinion of Counsel 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
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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 Securities 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.
The Company will maintain in the Borough of Manhattan, The City of New
York an office or agency where Security Certificates may be presented or
surrendered for acquisition of shares of Common Stock upon settlement or Early
Settlement and for transfer of Treasury Notes upon occurrence of a Termination
Event, where Security Certificates may be surrendered for registration of
transfer or exchange and where notices and demands to or upon the Company in
respect of the Securities 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.
The Company may also from time to time designate one or more other offices
or agencies where Security Certificates may be presented or surrendered for any
or all such purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any
manner relieve the Company of its obligation to maintain an office or agency in
the Borough of Manhattan, The City of New York for such purposes. The
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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
Securities 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 Final Settlement Date reserve
and keep available, free from preemptive rights, out of its authorized but
unissued Common Stock the full number of shares of Common Stock issuable (x)
against tender of payment in respect of all Purchase Contracts constituting a
part of the Securities evidenced by Outstanding Security Certificates and (y)
in payment of Deferred Yield Enhancement Payments, if any, owed by the Company
to the Holders.
Section 10.4. Convenants 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 Securities and in payment of any Deferred Yield
Enhancement Payments will, upon issuance, be duly authorized, validly issued,
fully paid and nonassessable.
Section 10.5. Statements of Officers 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 Officers'
Certificate, stating whether or not to the best knowledge of the signers
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 they may have knowledge.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
CMS ENERGY CORPORATION
Attested by
By:
--------------------- ------------------------
__________________________________
Attested by
By:
--------------------- ------------------------
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EXHIBIT A
CMS ENERGY CORPORATION
____% PREFERRED REDEEMABLE INCREASED
DIVIDEND EQUITY SECURITIES
(STATED AMOUNT $______ PER SECURITY)
No. Securities
This Security Certificate certifies that ____________ is the registered
Holder of the number of Securities set forth above. Each Security represents
(i) ownership by the Holder of ____% United States Treasury Notes due
__________, 1999 ("Treasury Notes") with a principal amount equal to the Stated
Amount, subject to the Pledge of such Treasury Notes by such Holder pursuant to
the Pledge Agreement, and (ii) the rights and obligations of the Holder under
one Purchase Contract with CMS Energy Corporation, a Michigan corporation (the
"Company"). [The Treasury Notes represented by this Security Certificate were
acquired by the Underwriters on behalf of the Company with the proceeds of the
offering of this Security Certificate and are being conveyed to the Holder of
this Certificate and pledged pursuant to the Pledge Agreement simultaneously
therewith.]
Pursuant to the Pledge Agreement, the Treasury Notes constituting part of
each Security evidenced hereby have been pledged to the Collateral Agent to
secure the obligations of the Holder under the Purchase Contract constituting
part of such Security.
The Pledge Agreement provides that all payments of principal of, or
interest on, any Treasury Notes constituting part of the Securities received by
the Collateral Agent shall be paid by the Collateral Agent by wire transfer in
same day funds no later than 1:00 p.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 1:00 p.m., New York City time, on a Business Day, then
such payment
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shall be made no later than 10:00 a.m., New York City time, on the next
succeeding Business Day) (i) in the case of (A) interest payments and (B) any
principal payments with respect to any Treasury Notes that have been released
from the Pledge pursuant to the Pledge Agreement, to the Agent to the account
designated by it for such purpose and (ii) in the case of principal payments on
any Pledged Treasury Notes (as defined in the Pledge Agreement), at the
direction of the Agent on behalf of the Holders, to the Company, in full
satisfaction of the respective obligations of the Holders of the Securities of
which such Pledged Treasury Securities are a part under the Purchase Contracts
forming a part of such Securities. Interest on any Treasury Note forming part
of a Security evidenced hereby which is paid on any or __________ , commencing
, 1997 (a "Payment Date"), shall, subject to receipt thereof by the Agent from
the Collateral Agent, be paid to the Person in whose name this Security
Certificate (or a Predecessor Security Certificate) is registered at the close
of business on the Record Date next preceding such Payment Date.
Each Purchase Contract evidenced hereby obligates the Holder of this
Security Certificate to purchase, and the Company to sell, on __________, 1999
(the "Final Settlement Date"), at a price equal to $______ (the "Stated
Amount"), a number of shares of Common Stock, par value $.01 per share ("Common
Stock"), of the Company, equal to the Settlement Rate, unless on or prior to
the Final Settlement Date there shall have occurred a Termination Event or
Early Settlement with respect to the Security 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 for the shares of Common
Stock purchased pursuant to each Purchase Contract evidenced hereby, if not
paid earlier, shall be paid on the Final Settlement Date by application of
payment received in respect of the principal of the Treasury Notes pledged to
secure the obligations under such Purchase Contract of the Holder of the
Security of which such Purchase Contract is a part.
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The Company shall pay, on each Payment Date, in respect of each
Purchase Contract forming part of a Security evidenced hereby an amount (the
"Yield Enhancement Payment") equal to ____% per annum of the Stated Amount,
from __________, 1997, computed on the basis of the actual number of days
elapsed in a year of 365 or 366 days, as the case may be, subject to deferral
at the option of the Company as provided in the Purchase Contract Agreement and
more fully described on the reverse hereof; except that on the initial Payment
Date the Yield Enhancement Payment shall be reduced by an amount equal to
accrued interest to __________, 1997, on the Treasury Note constituting a part
of this Security. Such Yield Enhancement Payment shall be payable to the Person
in whose name this Security Certificate (or a Predecessor Security Certificate)
is registered at the close of business on the Record Date next preceding such
Payment Date.
Interest on the Treasury Notes and the Yield Enhancement Payment 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 Security Register.
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 Security 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.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
CMS ENERGY CORPORATION
By:-------------------
Attest:
---------------------
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HOLDER SPECIFIED ABOVE (as to obligations of
such Holder under the Purchase Contracts evidenced
hereby)
By:__________________________________, not individually but solely
as Attorney-in-Fact of such Holder
By:_________________________________
Dated:
This is one of the Security Certificates referred to in the within
mentioned Purchase Contract Agreement.
as Agent
By:
___________________
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(Form of Reverse of Security Certificate]
Each Purchase Contract evidenced hereby is governed by a Purchase Contract
Agreement, dated as of __________, 1996 (the "Purchase Contract Agreement"),
between the Company and , as Purchase
Contract Agent (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 Security Certificates are, and are to be, executed
and delivered.
Each Purchase Contract evidenced hereby obligates the Holder of this
Security Certificate to purchase, and the Company to sell, on the Final
Settlement Date at a price equal to the Stated Amount, a number of shares of
Common Stock of the Company equal to the Settlement Rate, unless, on or prior
to the Final Settlement Date, there shall have occurred a Termination Event or
an Early Settlement with respect to the Security 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 $_____ (the "Threshold
Appreciation Price"), _____ of a share of Common Stock per Purchase Contract,
(b) if the Applicable Market Value is less than or equal to the Threshold
Appreciation Price but is greater than the Stated Amount, a fractional share of
Common Stock per Purchase Contract equal to the Stated Amount divided by the
Applicable Market Value and (c) if the Applicable Market Amount is less than or
equal to the Stated Amount, one share of Common Stock per Purchase Contract, in
each case subject to adjustment as provided in the Purchase Contract. 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 Prices
per share of Common Stock on each of the twenty consecutive Trading Days ending
on the second Trading Day immediately preceding the Final Settlement 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)
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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.
The purchase price for the shares of Common Stock purchased pursuant to
each Purchase Contract shall be paid by application of payments received by the
Company on the Final Settlement Date from the Collateral Agent at the direction
of the Agent on behalf of the Holders pursuant to the Pledge Agreement in
respect of the principal of the Treasury Notes pledged to secure the
obligations of the relevant Holder under such Purchase Contract.
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.
Subject to the next succeeding paragraph, the Company shall pay, on each
Payment Date, the Yield Enhancement Payment payable in respect of each Purchase
Contract to the Person in whose name the Security Certificate evidencing such
Purchase Contract is registered at the close of business on the Record Date
next preceding such Payment Date. Yield Enhancement Payments will be payable at
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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 Security Register.
The Company shall have the right, at any time prior to the Final
Settlement Date, to defer the payment of any or all of the Yield Enhancement
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 such
payment (specifying the amount to be deferred) as provided in the Purchase
Contract Agreement. Any Yield Enhancement Payments so deferred shall bear
additional Yield Enhancement Payments thereon at the rate of ____% per annum
(computed on the basis of the actual number of days elapsed in a year of 365 or
366 days, as the case may be), compounding on each succeeding Payment Date,
until paid in full (such deferred installments of Yield Enhancement Payments
together with the additional Yield Enhancement Payments accrued thereon, are
referred to herein as the "Deferred Yield Enhancement Payments"). Deferred
Yield Enhancement Payments shall be due on the next succeeding Payment Date
except to the extent that payment is deferred pursuant to the Purchase Contract
Agreement. No Yield Enhancement Payments may be deferred to a date that is
after the Final Settlement Date.
In the event that the Company elects to defer the payment of Yield
Enhancement Payments on the Purchase Contracts until the Final Settlement Date,
the Holder of this Security Certificate will receive on the Final Settlement
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 (x) the aggregate amount of Deferred Yield Enhancement Payments
payable to the Holder of the Security Certificate of Securities divided by (y)
the Applicable Market Value. No fractional shares of Common Stock will be
issued with respect to the payment of Deferred Yield Enhancement Payments on
the Final Settlement Date, as provided in the Purchase Contract Agreement.
In the event the Company exercises its option to defer the payment of
Yield Enhancement Payments, then (a) the Company shall not declare or pay
dividends on, make distributions with respect to, or redeem, purchase or
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acquire, or make a liquidation payment with respect to, any of its capital
stock (other than (i) purchase or acquisitions of shares of Common Stock in
connection with the satisfaction by the Company of its obligations under any
employee benefit plans or the satisfaction by the Company of its obligations
pursuant to any contract or security requiring the Company to purchase shares
of Common Stock, (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 or (iii) the purchase of fractional interests in shares of the Company's
capital stock pursuant to the conversion or exchange provisions of such capital
stock or the security being converted or exchanged) or make any guarantee
payments with respect to the foregoing), (b) the Company shall not make any
payment of interest, principal or premium, if any, on or repay, repurchase or
redeem any debt securities (including guarantees) issued by the Company that
rank pari passu with or junior to such Yield Enhancement Payments and (c) the
Company shall not make any guarantee payments with respect to the foregoing.
The Purchase Contracts and the 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 any Yield
Enhancement Payment or any Deferred Yield Enhancement Payments, 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 Final
Settlement Date, a Termination Event shall have occurred. Upon the occurrence
of a Termination Event, the Company shall promptly but in no event after 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 Security Register.
Upon and after the occurrence of a Termination Event, the Collateral Agent
shall release the Treasury Notes from the Pledge in accordance with the
provisions of the Pledge Agreement. The Securities shall thereafter represent
the right to receive the Treasury Notes forming a part of such Securities in
accordance with the provisions of the Purchase Contract Agreement and the
Pledge Agreement.
Subject to and upon compliance with the provisions of the Purchase
Contract Agreement at the option of the
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Holder thereof, Purchase Contracts underlying Securities having an aggregate
Stated Amount equal to $______ or an integral multiple thereof may be settled
early ("Early Settlement") as provided in the Purchase Contract Agreement. In
order to exercise the right to effect Early Settlement with respect to any
Purchase Contracts evidenced by this Security Certificate, the Holder of this
Security Certificate shall deliver this Security 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 set forth below duly completed
and accompanied by payment in the form of a certified or cashier's check
payable to the order of the Company in immediately available funds in an amount
(the "Early Settlement Amount") equal to (i) the product of (A) the Stated
Amount times (B) the number of Purchase Contracts with respect to which the
Holder has elected to effect Early Settlement, plus (ii) 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 sum of (x) the Yield
Enhancement Payments payable on such Payment Date with respect to such Purchase
Contracts plus (y) the interest with respect to the related Treasury Notes
payable on such Payment Date. Upon Early Settlement of Purchase Contracts by a
Holder of the related Securities, the Treasury Notes underlying such Securities
shall be released from the Pledge as provided in the Pledge Agreement and the
Holder shall be entitled to receive, a number of shares of Common Stock on
account of each Purchase Contract forming part of a Security as to which Early
Settlement is effected equal to the Early Settlement Rate; provided however,
that upon the Early Settlement of the Purchase Contracts, the Holder thereof
will forfeit the right to receive any Deferred Yield Enhancement Payments on
such Purchase Contracts. The Early Settlement Rate shall initially be equal to
_____ and shall be adjusted in the same manner and at the same time as the
Settlement Rate is adjusted as provided in the Purchase Contract Agreement.
The Security Certificates are issuable only in registered form and only in
denominations of a single Security and any integral multiple thereof. The
transfer
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of any Security Certificate will be registered and Security
Certificates may be exchanged as provided in the Purchase Contract Agreement.
The Security 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. For so long as the Purchase Contract
underlying a Security remains in effect, such Security shall not be separable
into its constituent parts, and the rights and obligations of the Holder of
such Security in respect of the Treasury Notes and Purchase Contract
constituting such Security may be transferred and exchanged only as a Security.
Upon registration of transfer of this Security 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 Security
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 Security Certificate, by his acceptance hereof,
authorizes the Agent to enter into and perform the related Purchase Contracts
forming part of the Securities 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 his 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 his behalf as his attorney-in-fact,
and consents to the Pledge of the Treasury Notes underlying this Security
Certificate pursuant to the Pledge Agreement. The Holder
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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 principal of the Treasury Notes on the
Final Settlement Date shall be paid 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.
Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of at least 66 2/3% of
the Outstanding Securities.
All terms used herein which are defined in the Purchase Contract Agreement
have the meanings set forth therein.
The Purchase Contracts shall for all purposes be governed by, and
construed in accordance with, the laws of the State of New York.
The Company, the Agent and its Affiliates and any agent of the Company or
the Agent may treat the Person in whose name this Security Certificate is
registered as the owner of the Securities evidenced hereby for the purpose of
receiving payments of interest on the Treasury Notes, receiving payments of
Yield Enhancement Payments and any Deferred Yield Enhancement Payments,
performance of the Purchase Contracts and for all other purposes whatsoever,
whether or not any payments in respect thereof be overdue and notwithstanding
any notice to the contrary, and neither the Company, the Agent 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.
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SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for shares of Common
Stock deliverable upon settlement on or after the Final Settlement Date of the
Purchase Contracts underlying the number of Securities evidenced by this
Security 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
If shares are to be registered
in the name of and delivered to REGISTERED HOLDER
a Person other than the Holder,
please print such Person's name
and address:
Please print name and address
of Registered Holder:
------------------------- -----------------------------
Name Name
------------------------- -----------------------------
Address Address
------------------------- -----------------------------
Social Security or other
Taxpayer Identification -----------------------------
Number, if any
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ELECTION TO SETTLE EARLY
The undersigned Holder of this Security 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 Securities evidenced by this Security Certificate
specified below. The option to effect Early Settlement may be exercised only
with respect to Purchase Contracts underlying Securities with an aggregate
Stated Amount equal to $_______ 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
Security Certificate representing any Securities 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. Treasury 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
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Number of Securities evidenced hereby as to which Early Settlement of the
related Purchase Contracts is being elected:
If shares are to be registered
in the name of and delivered to REGISTERED HOLDER
a Person other than the Holder,
please print such Person's name
and address:
Please print name and address
of Registered Holder:
------------------------- -----------------------------
Name Name
------------------------- -----------------------------
Address Address
------------------------- -----------------------------
Social Security or other
Taxpayer Identification -----------------------------
Number, if any
---------------------
Transfer Instructions for Treasury Notes Transferable Upon Early Settlement or
a Termination Event:
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