CAPITAL ONE FINANCIAL CORPORATION
AND
BNY MIDWEST TRUST COMPANY,
AS FORWARD PURCHASE CONTRACT AGENT
FORWARD PURCHASE CONTRACT AGREEMENT
DATED AS OF APRIL 23, 2002
TABLE OF CONTENTS
PAGE
ARTICLE I. DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION...............................................1
Section 1.1 Definitions............................................................................1
Section 1.2 Compliance Certificates and Opinions..................................................14
Section 1.3 Form of Documents Delivered to Agent..................................................15
Section 1.4 Acts of Holders; Record Dates.........................................................15
Section 1.5 Notices...............................................................................16
Section 1.6 Notice to Holders; Waiver.............................................................17
Section 1.7 Effect of Headings and Table of Contents..............................................18
Section 1.8 Successors and Assigns................................................................18
Section 1.9 Separability Clause...................................................................18
Section 1.10 Benefits of Agreement.................................................................18
Section 1.11 Governing Law.........................................................................18
Section 1.12 Legal Holidays........................................................................18
Section 1.13 Counterparts..........................................................................19
Section 1.14 Inspection of Agreement...............................................................19
ARTICLE II. CERTIFICATE FORMS...................................................................................19
Section 2.1 Forms of Certificates Generally.......................................................19
Section 2.2 Form of Agent's Certificate of Authentication.........................................20
ARTICLE III. THE DECS...........................................................................................20
Section 3.1 Title and Terms; Denominations........................................................20
Section 3.2 Rights and Obligations Evidenced by the Certificates..................................20
Section 3.3 Execution, Authentication, Delivery and Dating........................................21
Section 3.4 Temporary Certificates................................................................22
Section 3.5 Registration; Registration of Transfer and Exchange...................................23
Section 3.6 Book-Entry Interests..................................................................24
Section 3.7 Notices To Holders....................................................................25
Section 3.8 Appointment of Successor Clearing Agency..............................................25
Section 3.9 Definitive Certificates...............................................................25
Section 3.10 Mutilated, Destroyed, Lost and Stolen Certificates....................................25
Section 3.11 Persons Deemed Owners.................................................................27
Section 3.12 Cancellation..........................................................................27
Section 3.13 Establishment of Stripped DECS........................................................28
Section 3.14 Reestablishment of Upper DECS.........................................................29
Section 3.15 Transfer of Collateral Upon Occurrence of Termination Event...........................31
Section 3.16 No Consent to Assumption..............................................................32
ARTICLE IV. THE NOTES...........................................................................................32
Section 4.1 Payment of Interest; Rights to Interest Payments Preserved; Notice....................32
Section 4.2 Notice and Voting.....................................................................33
Section 4.3 Tax Event Redemption..................................................................33
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ARTICLE V. THE FORWARD PURCHASE CONTRACTS; THE REMARKETING......................................................34
Section 5.1 Purchase of Shares of Common Stock....................................................34
Section 5.2 Payment of Purchase Price; Remarketing................................................36
Section 5.3 Issuance of Shares of Common Stock....................................................41
Section 5.4 Adjustment of Settlement Rate.........................................................41
Section 5.5 Notice of Adjustments and Certain Other Events........................................48
Section 5.6 Termination Event; Notice.............................................................49
Section 5.7 Early Settlement......................................................................50
Section 5.8 Early Settlement Upon Merger..........................................................51
Section 5.9 Accelerated Remarketing and Settlement................................................53
Section 5.10 Charges and Taxes.....................................................................56
Section 5.11 No Fractional Shares..................................................................56
Section 5.12 Tax Treatment.........................................................................56
ARTICLE VI. REMEDIES............................................................................................56
Section 6.1 Unconditional Right of Holders to Purchase Common Stock...............................56
Section 6.2 Restoration of Rights and Remedies....................................................57
Section 6.3 Rights and Remedies Cumulative........................................................57
Section 6.4 Delay or Omission Not Waiver..........................................................57
Section 6.5 Undertaking For Costs.................................................................57
Section 6.6 Waiver of Stay or Extension Laws......................................................58
ARTICLE VII. THE AGENT..........................................................................................58
Section 7.1 Certain Duties, Rights and Immunities.................................................58
Section 7.2 Notice of Default.....................................................................60
Section 7.3 Certain Rights of Agent...............................................................60
Section 7.4 Not Responsible For Recitals, Etc.....................................................61
Section 7.5 May Hold DECS and Other Dealings......................................................61
Section 7.6 Money Held In Custody.................................................................62
Section 7.7 Compensation and Reimbursement........................................................62
Section 7.8 Corporate Agent Required; Eligibility.................................................62
Section 7.9 Resignation and Removal; Appointment of Successor.....................................63
Section 7.10 Acceptance of Appointment By Successor................................................64
Section 7.11 Merger, Conversion, Consolidation or Succession to Business...........................65
Section 7.12 Preservation of Information; Communications to Holders................................65
Section 7.13 Failure to Act........................................................................65
Section 7.14 No Obligations of Agent...............................................................66
Section 7.15 Tax Compliance........................................................................66
ARTICLE VIII. SUPPLEMENTAL AGREEMENTS...........................................................................67
Section 8.1 Supplemental Agreements Without Consent of Holders....................................67
Section 8.2 Supplemental Agreements With Consent of Holders.......................................67
Section 8.3 Execution of Supplemental Agreements..................................................68
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Section 8.4 Effect of Supplemental Agreements.....................................................68
Section 8.5 Reference to Supplemental Agreements..................................................69
ARTICLE IX. CONSOLIDATION, MERGER, SALE OR CONVEYANCE...........................................................69
Section 9.1 Company May Consolidate, Etc., Only on Certain Terms..................................69
Section 9.2 Successor Substituted.................................................................69
ARTICLE X. COVENANTS............................................................................................70
Section 10.1 Performance Under Purchase Contracts..................................................70
Section 10.2 Maintenance of Office or Agency.......................................................70
Section 10.3 Company to Reserve Common Stock.......................................................71
Section 10.4 Covenants as to Common Stock..........................................................71
Section 10.5 Statements of Officer of the Company as to Default....................................71
Section 10.6 ERISA.................................................................................71
EXHIBITS
Exhibit A Form of Upper DECS Certificate
Exhibit B Form of Stripped DECS Certificate
Exhibit C Instruction from Forward Purchase Contract Agent to Collateral Agent
Exhibit D Instruction to Forward Purchase Contract Agent
Exhibit E Notice to Settle by Separate Cash
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FORWARD PURCHASE CONTRACT AGREEMENT, dated as of April 23, 2002, between
Capital One Financial Corporation, a Delaware corporation (the "Company"), and
BNY Midwest Trust Company, an Illinois trust company, acting as Forward Purchase
Contract Agent for the Holders of DECS from time to time (the "Agent").
RECITALS
The Company has duly authorized the execution and delivery of this
Agreement and the Certificates evidencing the DECS.
All things necessary to make the Forward Purchase Contracts, when the
Certificates are executed by the Company and authenticated, executed on behalf
of the Holders and delivered by the Agent, as provided in this Agreement, the
valid obligations of the Company, and to constitute this Agreement a valid
agreement of the Company, in accordance with its terms, have been done.
For and in consideration of the premises and the purchase of the DECS by
the Holders thereof, the Company and the Agent mutually agree as follows:
ARTICLE I.
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
Section 1.1 Definitions.
For all purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings
assigned to them in this Article and include the plural as well as the
singular, and nouns and pronouns of the masculine gender include the
feminine and neuter genders;
(b) all accounting terms not otherwise defined herein have
the meanings assigned to them in accordance with generally accepted
accounting principles in the United States;
(c) the words "herein," "hereof" and "hereunder" and other
words of similar import refer to this Agreement as a whole and not to
any particular Article, Section or other subdivision; and
(d) the following terms have the meanings given to them in
this Section 1.1(d):
"Accelerated Remarketing" has the meaning specified in Section 5.9 (a)
and 5.9(c)(ii).
"Accelerated Remarketing Date" means, collectively, the Initial Capital
Category Accelerated Remarketing Date and the Secondary Capital Category
Accelerated Remarketing Date.
"Accelerated Remarketing Value" means the value at the Accelerated
Remarketing Date or any Subsequent Remarketing Date, as the case may be, of (i)
U.S. Treasury securities that will pay, on or prior to the Scheduled Stock
Purchase Date, an amount of cash equal to the Stated Amount of such Notes that
are included in the Accelerated Remarketing, plus (ii) U.S. Treasury securities
that will pay, on or prior to each Payment Date in respect of the Notes falling
during the period from and including the Accelerated Remarketing Date (if such
remarketing is successful) or any Subsequent Remarketing Date, as the case may
be, through and including the Scheduled Stock Purchase Date, an amount of cash
equal to the aggregate interest payments scheduled to be payable on each such
Payment Date had the Accelerated Remarketing not occurred, assuming for that
purpose that the interest rate on the Notes is equal to the Coupon Rate, in each
case calculated based on the proviso to the definition of "Remarketing Value".
"Accelerated Settlement Rate" has the meaning specified in Section
5.9(c)(i).
"Accelerated Stock Purchase Date" has the meaning specified in Section
5.9(c)(i).
"Act" when used with respect to any Holder, has the meaning specified in
Section 1.4.
"Affiliate" has the same meaning as given to that term in Rule 405 under
the Securities Act or any successor rule thereunder.
"Agent" means the Person named as the "Agent" in the first paragraph of
this instrument until a successor Agent shall have become such pursuant to the
applicable provisions of this Agreement, and thereafter "Agent" shall mean such
Person.
"Agent-purchased Treasury Consideration" has the meaning specified in
Section 5.2(d).
"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(b).
"Applicable Ownership Interest" means, with respect to an Upper DECS and
the Treasury Securities in the Treasury Portfolio, (A) a 1/20, or 5.0%,
undivided beneficial ownership interest in a $1,000 principal or interest amount
of a principal or interest strip in a U.S. Treasury security included in such
Treasury Portfolio which matures on or prior to the Scheduled Stock Purchase
Date and (B) for each scheduled interest Payment Date on the Notes that occurs
after the Tax Event Redemption Date and on or before the Scheduled Stock
Purchase Date, a 5.0% undivided beneficial ownership interest in a $1,000
principal or interest amount of a principal or interest strip in a U.S. Treasury
security included in the Treasury Portfolio that matures on or prior to that
interest Payment Date or Dates.
"Applicants" has the meaning specified in Section 7.12(b).
"Bankruptcy Code" means Title 11 of the United States Code, or any other
law of the United States that from time to time provides a uniform system of
bankruptcy laws.
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"Beneficial Owner" means, with respect to a Book-Entry Interest, a
Person who is the beneficial owner of such Book-Entry Interest as reflected on
the books of the Clearing Agency or on the books of a Person maintaining an
account with such Clearing Agency (directly as a Clearing Agency Participant or
as an indirect participant, in each case in accordance with the rules of such
Clearing Agency).
"Board of Directors" means either the Board of Directors of the Company
or the committee of executive officers appointed by such Board or any other
committee of such Board duly authorized to act generally or in any particular
respect for such Board hereunder.
"Board Resolution" means (i) a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted by
the Board of Directors and to be in full force and effect on the date of such
certification, (ii) a copy of a unanimous written consent of the Board of
Directors or (iii) a certificate signed by the authorized officer or officers to
whom the Board of Directors has delegated its authority, and in each case,
delivered to the Agent.
"Book-Entry Interest" means a beneficial interest in a Global
Certificate, ownership and transfers of which shall be maintained and made
through book entries by a Clearing Agency as described in Section 3.6.
"Business Day" means any day other than a Saturday, Sunday or any other
day on which banking institutions and trust companies in Chicago, Illinois, the
State of New York or at a place of payment are authorized or required by law,
regulation or executive order to be closed.
"Capital One Bank" means Capital One Bank, a banking corporation
chartered under the laws of the Commonwealth of Virginia, or any successor
corporation.
"Capital Stock" means any and all shares, interests, rights to purchase,
warrants, options, participations or other equivalents of or interests in
(however designated, whether voting or non-voting) corporate stock or similar
interests in other types of entities.
"Cash Merger" has the meaning specified in Section 5.8(a).
"Cash Settlement" has the meaning specified in Section 5.2(a).
"Certificate" means an Upper DECS Certificate or a Stripped DECS
Certificate.
"Clearing Agency" means an organization registered as a "Clearing
Agency" pursuant to Section 17A of the Exchange Act that is acting as a
depositary for the DECS and in whose name, or in the name of a nominee of that
organization, shall be registered a Global Certificate and which shall undertake
to effect book-entry transfers and pledges of the DECS.
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time the Clearing
Agency effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.
"Closing Price" has the meaning specified in Section 5.1(b).
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"Code" means Internal Revenue Code of 1986, as amended, and the rules
and regulations promulgated thereunder.
"Collateral" has the meaning specified in Section 2.1(a) of the Pledge
Agreement.
"Collateral Agent" means BNY Midwest Trust Company, as Collateral Agent
under the Pledge Agreement until a successor Collateral Agent shall have become
such pursuant to the applicable provisions of the Pledge Agreement, and
thereafter "Collateral Agent" shall mean the Person who is then the Collateral
Agent thereunder.
"Collateral Substitution" has the meaning specified in Section 3.13(a).
"Common Stock" means the common stock, par value $0.01 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 provisions of this Agreement, and thereafter "Company" shall mean
such successor.
"Constituent Person" has the meaning specified in Section 5.4(b).
"Corporate Trust Office" means the office of the Agent at which, at any
particular time, its corporate trust business shall be principally administered,
which office at the date hereof is located at 2 North LaSalle Street, Suite
1020, Chicago, Illinois 60602, Attention: Corporate Trust Department.
"Coupon Rate" means the percentage rate per annum at which each Note
will bear interest initially.
"Current Market Price" has the meaning specified in Section 5.4(a)(8).
"Custodial Agent" means BNY Midwest Trust Company, as Custodial Agent
under the Pledge Agreement until a successor Custodial Agent shall have become
such pursuant to the applicable provisions of the Pledge Agreement, and
thereafter "Custodial Agent" shall mean the Person who is then the Custodial
Agent thereunder.
"DECS" means an Upper DECS or a Stripped DECS.
"Depositary" means, initially, DTC, until another Clearing Agency
becomes its successor, and thereafter "Depositary" shall mean such successor.
"DTC" means The Depository Trust Company, the initial Clearing Agency.
"Early Settlement" has the meaning specified in Section 5.7(a).
"Early Settlement Amount" has the meaning specified in Section 5.7(a).
"Early Settlement Date" has the meaning specified in Section 5.7(a).
"Early Settlement Rate" has the meaning specified in Section 5.7(b).
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"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"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.
"Expiration Date" has the meaning specified in Section 1.4(f).
"Expiration Time" has the meaning specified in Section 5.4(a)(6).
"Failed Remarketing" has the meaning specified in Sections 5.2(e) and
5.9 (b)(ii).
"Fair Market Value" with respect to securities distributed in a Spin-Off
means (a) in the case of any Spin-Off that is effected simultaneously with an
Initial Public Offering of such securities, the Initial Public Offering price of
those securities, and (b) in the case of any other Spin-Off, the average of the
Sale Prices of those securities over the first 10 Trading Days after the
effective date of such Spin-Off.
"Forward Purchase Contract," when used with respect to any DECS, means
the contract forming a part of such DECS and obligating the Company to sell and
the Holder of such DECS to purchase Common Stock on the terms and subject to the
conditions set forth in Article Five.
"Forward Purchase Contract Settlement Fund" has the meaning specified in
Section 5.3.
"Global Certificate" means a Certificate that evidences all or part of
the DECS and is registered in the name of a Depositary or a nominee thereof.
"Grace Period" has the meaning specified in Section 5.9(a).
"Holder" means the Person in whose name the DECS evidenced by an Upper
DECS Certificate or a Stripped DECS Certificate is registered in the Upper DECS
Register or the Stripped DECS Register, as the case may be.
"Indenture" means the Indenture, dated as of November 1, 1996, between
the Company and the Trustee as supplemented by any officers' certificate or
supplemental indenture.
"Initial Acceleration Event" has the meaning specified in Section
5.9(a).
"Initial Capital Category Accelerated Remarketing Date" has the meaning
specified in Section 5.9 (b)(i).
"Initial Public Offering," with respect to any Spin-Off, means the first
time securities of the same class or type as the securities being distributed in
the Spin-Off are bone fide offered to the public for cash.
"Issuer Order" or "Issuer Request" means a written order or request
signed in the name of the Company by the Chief Executive Officer, the Chief
Financial Officer, the President, any
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Vice-President, the Treasurer, any Assistant Treasurer, the Secretary or any
Assistant Secretary (or other officer performing similar functions) of the
Company and delivered to the Agent.
"Last Failed Accelerated Remarketing" has the meaning specified in
Section 5.9 (b)(ii) and 5.9 (c)(ii).
"Last Failed Remarketing" has the meaning specified in Section 5.2(e).
"Merger Early Settlement" has the meaning specified in Section 5.8(a).
"Merger Early Settlement Amount" has the meaning specified in Section
5.8(b).
"Merger Early Settlement Date" has the meaning specified in Section
5.8(a)(i).
"Non-electing Share" has the meaning specified in Section 5.4(b).
"Notes" means the series of senior debt securities of the Company
designated the 6.25% Senior Notes Due May 17, 2007, to be issued under the
Indenture.
"NYSE" has the meaning specified in Section 5.1(b).
"Office of the Agent in The City of New York" means an office where
Certificates may be presented or surrendered for acquisition of shares of Common
Stock, transfer or exchange, Notes may be presented for payment or surrendered
for transfer or exchange and where notices and demands to or upon the Company in
respect of DECS may be served, such office being located initially at 15 Broad
Street, New York, New York 10005, Attention: Corporation Trust Operations.
"Officer's Certificate" means a certificate signed by the Chief
Executive Officer, the Chief Financial Officer, the President, any
Vice-President, the Treasurer, any Assistant Treasurer, the Secretary or any
Assistant Secretary (or other officer performing similar functions) of the
Company and delivered to the Agent.
"Opinion of Counsel" means an opinion in writing signed by legal
counsel, who may be an employee of or counsel to the Company or an Affiliate of
the Company and who shall be reasonably acceptable to the Agent.
"Opt-out Treasury Consideration" has the meaning specified in Section
5.2(g).
"Outstanding DECS" means, as of the date of determination, all Upper
DECS or Stripped DECS evidenced by Certificates theretofore authenticated,
executed and delivered under this Agreement, except:
(i) If a Termination Event has occurred, (A)
Stripped DECS and (B) Upper DECS for which the related Note or
the appropriate Treasury Consideration or Applicable Ownership
Interest in the Treasury Portfolio, as the case may be, has been
theretofore deposited with the Agent in trust for the Holders of
such Upper DECS;
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(ii) Upper DECS and Stripped DECS evidenced by
Certificates theretofore cancelled by the Agent or delivered to
the Agent for cancellation or deemed cancelled pursuant to the
provisions of this Agreement; and
(iii) Upper DECS and Stripped DECS evidenced by
Certificates in exchange for or in lieu of which other
Certificates have been authenticated, executed on behalf of the
Holder and delivered pursuant to this Agreement, other than any
such Certificate in respect of which there shall have been
presented to the Agent proof satisfactory to it that such
Certificate is held by a bona fide purchaser in whose hands the
Upper DECS or Stripped DECS evidenced by such Certificate are
valid obligations of the Company;
provided, that in determining whether the Holders of the requisite number of the
Upper DECS or Stripped DECS have given any request, demand, authorization,
direction, notice, consent or waiver hereunder, Upper DECS or Stripped DECS
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 Upper DECS or Stripped DECS which a
Responsible Officer of the Agent actually knows to be so owned shall be so
disregarded. Upper DECS or Stripped DECS so owned which have been pledged in
good faith may be regarded as Outstanding DECS if the pledgee establishes to the
satisfaction of the Agent the pledgee's right so to act with respect to such
Upper DECS or Stripped DECS and that the pledgee is not the Company or any
Affiliate of the Company.
"Payment Date" means each February 17, May 17, August 17 and November
17, commencing August 17, 2002.
"Person" means any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Plan" means an employee benefit plan that is subject to Title I of
ERISA, a plan, individual retirement account or other arrangement that is
subject to Section 4975 of the Code or any similar law or any entity whose
underlying assets are considered to include "plan assets" of any such plan,
account or arrangement.
"Pledge" means the pledge under the Pledge Agreement of the Notes, the
Treasury Securities or the appropriate Treasury Consideration or Applicable
Ownership Interest in the Treasury Portfolio, in each case constituting a part
of the DECS, property, cash, securities, financial assets and security
entitlements of the Collateral Account (as defined in Section 1.1 of the Pledge
Agreement) and any proceeds of any of the foregoing.
"Pledge Agreement" means the Pledge Agreement, dated as of the date
hereof, by and among the Company, the Collateral Agent, the Custodial Agent, the
Securities Intermediary and the Agent, on its own behalf and as attorney-in-fact
for the Holders from time to time of the DECS.
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"Pledged Applicable Ownership Interest in the Treasury Portfolio" has
the meaning specified in Section 2.1(c) of the Pledge Agreement.
"Pledged Notes" has the meaning specified in Section 2.1(c) of the
Pledge Agreement.
"Pledged Treasury Consideration" has the meaning specified in Section
2.1(c) of the Pledge Agreement.
"Pledged Treasury Securities" has the meaning specified in Section
2.1(c) of the Pledge Agreement.
"Predecessor Certificate" means a Predecessor Upper DECS Certificate or
a Predecessor Stripped DECS Certificate.
"Predecessor Stripped DECS Certificate" of any particular Stripped DECS
Certificate means every previous Stripped DECS Certificate evidencing all or a
portion of the rights and obligations of the Company and the Holder under the
Stripped DECS evidenced thereby; and, for the purposes of this definition, any
Stripped DECS Certificate authenticated and delivered under Section 3.10 in
exchange for or in lieu of a mutilated, destroyed, lost or stolen Stripped DECS
Certificate shall be deemed to evidence the same rights and obligations of the
Company and the Holder as the mutilated, destroyed, lost or stolen Stripped DECS
Certificate.
"Predecessor Upper DECS Certificate" of any particular Upper DECS
Certificate means every previous Upper DECS Certificate evidencing all or a
portion of the rights and obligations of the Company and the Holder under the
Upper DECS evidenced thereby; and, for the purposes of this definition, any
Upper DECS Certificate authenticated and delivered under Section 3.10 in
exchange for or in lieu of a mutilated, destroyed, lost or stolen Upper DECS
Certificate shall be deemed to evidence the same rights and obligations of the
Company and the Holder as the mutilated, destroyed, lost or stolen Upper DECS
Certificate.
"Prompt Corrective Action Rules" has the meaning specified in Section
5.9(a).
"Purchase Price" has the meaning specified in Section 5.1(a).
"Purchased Shares" has the meaning specified in Section 5.4(a)(6).
"Quotation Agent" means Salomon Smith Barney Inc. or its successor or
any other primary U.S. government securities dealer in New York City selected by
the Company.
"Record Date" for the distribution payable on any Payment Date means, as
to any Global Certificate, the Business Day next preceding such Payment Date,
and as to any other Certificate, the 15th day preceding such Payment Date.
"Redemption Amount" means, in the case of a Tax Event Redemption
occurring prior to a successful remarketing of the Notes, for each Note the
product of (i) the Stated Amount of such Note and (ii) a fraction whose
numerator is the applicable Treasury Portfolio Purchase Price and whose
denominator is the aggregate principal amount of Notes outstanding on the Tax
Event Redemption Date, and in the case of a Tax Event Redemption occurring after
the earlier of a
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successful remarketing of the Notes or a Stock Purchase Date, for each Note the
Stated Amount of the Note.
"Redemption Price" means the redemption price per Note equal to the
Redemption Amount.
"Register" means the Upper DECS Register and the Stripped DECS Register,
as applicable.
"Registrar" means the Upper DECS Registrar and the Stripped DECS
Registrar, as applicable.
"Remarketing Agent" means Salomon Smith Barney Inc. or its successor
under the Remarketing Agreement.
"Remarketing Agreement" means the Remarketing Agreement dated April 23,
2002 by and among the Company, the Remarketing Agent and the Agent.
"Remarketing Date" means the third Business Day preceding February 17,
2005.
"Remarketing Fee" has the meaning specified in Section 5.2(b)(i).
"Remarketing Period" means the three Business Day period beginning on
the Remarketing Date, or in the event of an Accelerated Remarketing, the three
Business Day period beginning on the Accelerated Remarketing Date and each
subsequent three Business Day remarketing period as specified in Section
5.2(e)(i), 5.9(b) (ii) and 5.9(c)(ii).
"Remarketing Value" means
(1) the value at the Remarketing Date or any
Subsequent Remarketing Date, as the case may be, of U.S.
Treasury securities that will pay, on or prior to each Payment
Date falling on or prior to the Scheduled Stock Purchase Date,
an amount of cash equal to the aggregate interest payments that
are scheduled to be payable on each such Payment Date, on the
Notes which are included in Upper DECS and are participating in
the remarketing, or which are participating in the remarketing
pursuant to Section 4.5(d) of the Pledge Agreement, assuming for
that purpose that the interest rate on the Notes is equal to the
Coupon Rate, and
(2) the value at the Remarketing Date or any
Subsequent Remarketing Date, as the case may be, of U.S.
Treasury securities that will pay, on or prior to the Scheduled
Stock Purchase Date, an amount of cash equal to the Stated
Amount of such Notes which are included in Upper DECS and are
participating in the remarketing, or which are participating in
the remarketing pursuant to Section 4.5(d) of the Pledge
Agreement
provided that for purposes of clauses (1) and (2) above, the Remarketing
Value shall be calculated on the assumptions that (x) the U.S. Treasury
securities are
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highly liquid and mature on or within 35 days prior to the applicable
Payment Date or the Scheduled Stock Purchase Date, as determined in good
faith by the Remarketing Agent in a manner intended to minimize the cash
value of the U.S. Treasury securities, and (y) the U.S. Treasury
securities are valued based on the ask-side price of the U.S. Treasury
securities at a time between 9:00 a.m. and 11:00 a.m., New York City
time, selected by the Remarketing Agent, on the Remarketing Date or any
Subsequent Remarketing Date, as the case may be, as determined on a
third-day settlement basis by a reasonable and customary means selected
in good faith by the Remarketing Agent, plus accrued interest to that
date.
"Reorganization Event" has the meaning specified in Section 5.4(b).
"Reset Rate" has the meaning specified in Section 5.2(c).
"Responsible Officer" means, when used with respect to the Agent, any
officer within the corporate trust department of the Agent (or any successor of
the Agent), including any Vice-President, any assistant Vice-President, any
assistant secretary, any assistant treasurer, any trust officer, any senior
trust officer or any other officer of the Agent who customarily performs
functions similar to those performed by the Persons who at the time shall be
such officers, respectively, or to whom any corporate trust matter is referred
because of such Person's knowledge of and familiarity with the particular
subject and who, in each of the above cases, shall have direct responsibility
for the administration of this Agreement.
"Sale Price" of the Common Stock or any securities distributed in a
Spin-Off, as the case may be, on any Trading Day means the closing sale price
per share (or if no closing sale price is reported, the average of the bid and
asked prices or, if more than one in either case, the average of the average bid
and the average asked prices) on such Trading Day as reported in composite
transactions for the principal U.S. securities exchange on which the Common
Stock or such securities are traded or, if the Common Stock or such securities
are not listed on a U.S. national or regional securities exchange, as reported
by Nasdaq.
"Scheduled Stock Purchase Date" means May 17, 2005.
"Secondary Acceleration Event" has the meaning specified in Section
5.9(c)(i).
"Secondary Capital Category Accelerated Remarketing Date" has the
meaning specified in Section 5.9 (c)(ii).
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations thereunder.
"Securities Intermediary" means BNY Midwest Trust Company, in its
capacity as securities intermediary under the Pledge Agreement, together with
its successors in such capacity.
"Separate Notes" has the meaning specified in Section 1.1 of the Pledge
Agreement.
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"Settlement Date" means any Early Settlement Date or Merger Early
Settlement Date or any Stock Purchase Date.
"Settlement Rate" has the meaning specified in Section 5.1(a).
"Spin-Off" means a dividend or other distribution of shares of Capital
Stock of any class or series, or similar equity interests, of or relating to a
subsidiary or other business unit of the Company.
"Stated Amount" means, with respect to any one Note, Upper DECS or
Stripped DECS, $50.
"Stock Purchase Date" means the Scheduled Stock Purchase Date or the
Accelerated Stock Purchase Date, as applicable.
"Stripped DECS" means the collective rights and obligations of a holder
of a Stripped DECS Certificate in respect of a 1/20 undivided beneficial
interest in a Treasury Security, subject in each case to the Pledge thereof, and
the related Forward Purchase Contract.
"Stripped DECS Certificate" means a certificate evidencing the rights
and obligations of a Holder in respect of the number of Stripped DECS specified
on such certificate, substantially in the form of Exhibit B hereto.
"Stripped DECS Register" and "Stripped DECS Registrar" have the
respective meanings specified in Section 3.5(a).
"Subsequent Remarketing Date" means, provided there has been one or more
Failed Remarketings, the date on which the Remarketing Agent has consummated a
successful remarketing in accordance with Section 5.2 or Section 5.9 hereof,
such date to be no later than the Business Day immediately preceding the
relevant Stock Purchase Date.
"Supplemental Indenture" means a supplemental indenture dated as of
April 23, 2002, between the Company and BNY Midwest Trust Company, as successor
to Harris Trust and Savings Bank, as Trustee, to the indenture dated as of
November 1, 1996, between the Company and the Trustee.
"Tax Event" means the receipt by the Company of an opinion of nationally
recognized independent tax counsel experienced in such matters, which may be
Cleary, Gottlieb, Steen & Hamilton, to the effect that there is more than an
insubstantial risk that interest payable by the Company on the Notes would not
be deductible, in whole or in part, by the Company for United States federal
income tax purposes, as a result of (a) any amendment to, or change (including
any announced proposed change) in, the laws (or any regulations thereunder) of
the United States or any political subdivision or taxing authority thereof or
therein affecting taxation, (b) any amendment to or change in an official
interpretation or application of such laws or regulations by any legislative
body, court, governmental agency or regulatory authority or (c) any official
interpretation or pronouncement that provides for a position with respect to
such laws or regulations that differs from the generally accepted position on
April 17, 2002, which
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amendment, change or proposed change is effective or which interpretation or
pronouncement is announced on or after April 17, 2002.
"Tax Event Redemption" means, if a Tax Event shall occur and be
continuing, the redemption of the Notes, at the option of the Company, in whole
but not in part, on not less than 30 days' nor more than 60 days' written
notice.
"Tax Event Redemption Date" means the date upon which a Tax Event
Redemption is to occur.
"Tax Event Redemption Principal Amount" means in the case of a Tax Event
Redemption occurring prior to a successful remarketing of the Notes, for each
Note the product of the principal amount of the Note and a fraction whose
numerator is the Treasury Portfolio Purchase Price and whose denominator is the
aggregate Stated Amount of Notes outstanding on the Tax Event Redemption Date,
and in the case of a Tax Event Redemption Date occurring after the earlier of a
successful remarketing of the Notes or a Stock Purchase Date, the Stated Amount
of the Notes.
"Termination Date" means the date, if any, on which a Termination Event
occurs.
"Termination Event" means the occurrence of any of the following events,
at any time on or prior to a Stock Purchase Date:
(i) the entry by a court having competent
jurisdiction of:
(a) a decree or order for relief in respect
of the Company in an involuntary proceeding under any
applicable bankruptcy, insolvency, reorganization or
other similar law or a decree or order adjudging the
Company to be insolvent, or approving a petition seeking
reorganization, arrangement, adjustment or composition
of the Company and such decree or order shall remain
unstayed and in effect for a period of 60 consecutive
days; or
(b) a final and non-appealable order
appointing a custodian, receiver, liquidator, assignee,
trustee or other similar official of the Company or of
any substantial part of the property of the Company
ordering the winding up or liquidation of the affairs of
the Company; or
(ii) the commencement by the Company of a voluntary
proceeding under any applicable bankruptcy, insolvency,
reorganization or other similar law or of a voluntary proceeding
seeking to be adjudicated insolvent or the consent by the
Company to the entry of a decree or order for relief in an
involuntary proceeding under any applicable bankruptcy,
insolvency, reorganization or other similar law or to the
commencement of any insolvency proceedings against it, or the
filling by the Company of a petition or answer or consent
seeking organization or relief under any applicable law, or the
consent by the Company to the filing of such petition or to the
appointment of or taking possession by a custodian, receiver,
liquidator, assignee, trustee or similar official of the or any
substantial
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part of the property of the Company or the making by the Company
of an assignment for the benefit of creditors, or the taking of
corporate action by the Company or any in furtherance of any
such action.
"Threshold Appreciation Price" has the meaning specified in Section
5.1(a)(i).
"TIA" means the Trust Indenture Act of 1939, as amended, and the rules
and regulations promulgated thereunder.
"Trading Day" has the meaning specified in Section 5.1(c).
"Transaction Documents" has the meaning specified in Section 7.1(a).
"Treasury Consideration" means the Agent-purchased Treasury
Consideration or the Opt-out Treasury Consideration.
"Treasury Portfolio" means: (i) if a Tax Event Redemption occurs prior
to a successful remarketing of the Notes or a Stock Purchase Date, a portfolio
of principal or interest strips of U.S. Treasury Securities that mature on or
prior to the Scheduled Stock Purchase Date in an aggregate amount equal to the
aggregate principal amount of the Notes included in the Upper DECS on the Tax
Event Redemption Date and, with respect to each Payment Date on the Notes that
occurs after the Tax Event Redemption Date and on or before the Scheduled Stock
Purchase Date, interest or principal strips of U.S. Treasury Securities that
mature on or prior to such Payment Date in an aggregate amount equal to the
aggregate interest payment that would be due on the aggregate principal amount
of the Notes on such Payment Date if the interest rate of the Notes were not
reset on the applicable Remarketing Date, and (ii) solely for purposes of
determining the Treasury Portfolio Purchase Price in the case of a Tax Event
Redemption Date occurring prior to a successful remarketing of the Notes or a
Stock Purchase Date, a portfolio of U.S. Treasury Securities consisting of
principal or interest strips of U.S. Treasury Securities that mature on or prior
to the Scheduled Stock Purchase Date in an aggregate amount equal to the
aggregate principal amount of the Notes outstanding on the Tax Event Redemption
Date and with respect to each Payment Date on the Notes that occurs after the
Tax Event Redemption Date and on or before the Scheduled Stock Purchase Date,
interest or principal strips of U.S. Treasury Securities that mature on or prior
to such Payment Date in an aggregate amount equal to the aggregate interest
payment that would be due on the aggregate principal amount of the Notes
outstanding on the Tax Event Redemption Date.
"Treasury Portfolio Purchase Price" means the lowest aggregate price
quoted by a primary U.S. government securities dealer in New York City to the
Quotation Agent on the third Business Day immediately preceding the Tax Event
Redemption Date for the purchase of the Treasury Portfolio for settlement on the
Tax Event Redemption Date.
"Treasury Security" means a zero-coupon U.S. Treasury security (CUSIP
Number 912803AD5) maturing on May 15, 2005 that will pay $1,000 on such maturity
date.
"Trustee" means BNY Midwest Trust Company, as successor to Harris Trust
and Savings Bank, an Illinois trust company, as trustee under the Indenture, or
any successor thereto.
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"Underwriting Agreement" means the Underwriting Agreement relating to
the DECS dated April 17, 2002 among the Company and the underwriters named
therein.
"Upper DECS" means the collective rights and obligations of a Holder of
an Upper DECS Certificate in respect of a Note or the appropriate Treasury
Consideration or Applicable Ownership Interest in the Treasury Portfolio, as the
case may be, subject in each case to the Pledge thereof, and the related Forward
Purchase Contract.
"Upper DECS Certificate" means a certificate evidencing the rights and
obligations of a Holder in respect of the number of Upper DECS specified on such
certificate, substantially in the form of Exhibit A hereto.
"Upper DECS Register" and "Upper DECS Registrar" have the respective
meanings specified in Section 3.5(a).
"Vice-President" means any vice-president, whether or not designated by
a number or a word or words added before or after the title "vice-president."
Section 1.2 Compliance Certificates and Opinions.
Except as otherwise expressly provided by this Agreement, upon any
application or request by the Company to the Agent to take any action under any
provision of this Agreement, the Company shall furnish to the Agent an Officer's
Certificate stating that all conditions precedent, if any, provided for in this
Agreement relating to the proposed action have been complied with and, if
requested by the Agent, an Opinion of Counsel stating that, in the opinion of
such counsel, all such conditions precedent, if any, have been complied with,
except that in the case of any such application or request as to which the
furnishing of such documents is specifically required by any provision of this
Agreement relating to such particular application or request, no additional
certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a condition
or covenant provided for in this Agreement (other than the Officer's Certificate
provided for in Section 10.5) shall include:
(a) a statement that the individual signing such certificate
or opinion has read such covenant or condition and the definitions
herein relating thereto;
(b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(c) a statement that, in the opinion of such individual, he
or she has made such examination or investigation as is necessary to
enable such individual to express an informed opinion as to whether or
not such covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of such
individual, such condition or covenant has been complied with.
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Section 1.3 Form of Documents Delivered to Agent.
(a) In any case where several matters are required to be
certified by, or covered by an opinion of, any specified Person, it is
not necessary that all such matters be certified by, or covered by the
opinion of, only one such Person, or that they be so certified or
covered by only one document, but one such Person may certify or give an
opinion with respect to some matters and one or more other such Persons
as to other matters, and any such Person may certify or give an opinion
as to such matters in one or several documents.
(b) Any certificate or opinion of an officer of the Company
may be based, insofar as it relates to legal matters, upon a certificate
or opinion of, or representations by, counsel, unless such officer
knows, or in the exercise of reasonable care should know, that the
certificate or opinion or representations with respect to the matters
upon which his certificate or opinion is based are erroneous. Any such
certificate or Opinion of Counsel may be based, insofar as it relates to
factual matters, upon a certificate or opinion of, or representations
by, an officer or officers of the Company stating that the information
with respect to such factual matters is in the possession of the Company
unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to
such matters are erroneous.
Where any Person is required to make, give or execute two or more applications,
requests, consents, certificates, statements, opinions or other instruments
under this Agreement, they may, but need not, be consolidated and form one
instrument.
Section 1.4 Acts of Holders; Record Dates.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Agreement to be given
or taken by Holders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders in
person or by an agent of such Holders duly appointed in writing; and,
except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments are delivered to the Agent
and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient
for any purpose of this Agreement and (subject to Section 7.1)
conclusive in favor of the Agent and the Company, if made in the manner
provided in this Section.
(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved in any manner which the Agent
deems sufficient.
(c) The ownership of DECS shall be proved by the Upper DECS
Register or the Stripped DECS Register, as the case may be.
(d) Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Certificate shall bind
every future Holder of the same
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Certificate and the Holder of every Certificate 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 Certificate.
(e) The Company may set any day as a record date for the
purpose of determining the Holders of Outstanding DECS 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 DECS. If any record date is set
pursuant to this paragraph, the Holders of the Outstanding Upper DECS
and the Outstanding Stripped DECS, as the case may be, on such record
date, and no other Holders, shall be entitled to take the relevant
action with respect to the Upper DECS or the Stripped DECS, as the case
may be, whether or not such Holders remain Holders after such record
date; provided that no such action shall be effective hereunder unless
taken on or prior to the applicable Expiration Date by Holders of the
requisite number of Outstanding DECS 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 DECS 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 DECS in the manner
set forth in Section 1.6.
(f) With respect to any record date set pursuant to this
Section, the Company may designate any date as the "Expiration Date" and
from time to time may change the Expiration Date to any earlier or later
day; provided that no such change shall be effective unless notice of
the proposed new Expiration Date is given to the Agent in writing, and
to each Holder of DECS in the manner set forth in Section 1.6, on or
prior to the existing Expiration Date. If an Expiration Date is not
designated with respect to any record date set pursuant to this Section,
the Company shall be deemed to have initially designated the 180th day
after such record date as the Expiration Date with respect thereto,
subject to its right to change the Expiration Date as provided in this
paragraph. Notwithstanding the foregoing, no Expiration Date shall be
later than the 180th day after the applicable record date.
Section 1.5 Notices.
Any request, demand, authorization, direction, notice, consent, waiver
or Act of Holders or other document provided or permitted by this Agreement to
be made upon, given or furnished to, or filed with:
(a) the Agent by any Holder or by the Company shall be
sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if made, given, furnished or filed in writing and
personally delivered, mailed, first-class postage prepaid, telecopied
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or delivered by overnight air courier guaranteeing next day delivery, to
the Agent at BNY Midwest Trust Company, 2 North LaSalle Street, Suite
1020, Chicago, Illinois 60602, telecopy number: (312) 827-8542,
Attention: Corporate Trust Department, or at any other address furnished
in writing by the Agent to the Holders and the Company; or
(b) the Company by the Agent or by any Holder shall be
sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if made, given, furnished or filed in writing and
personally delivered, mailed, first-class postage prepaid, telecopied or
delivered by overnight air courier guaranteeing next day delivery, to
the Company at Capital One Financial Corporation, 2980 Fairview Park
Drive, Suite 1300, Falls Church, Virginia 22042-4525, telecopy number:
(703) 205-1094, Attention: Corporate Secretary, or at any other address
furnished in writing to the Agent and the Holders by the Company; or
(c) the Collateral Agent by the Agent, the Company or any
Holder shall be sufficient for every purpose hereunder (unless otherwise
herein expressly provided) if made, given, furnished or filed in writing
and personally delivered, mailed, first-class postage prepaid,
telecopied or delivered by overnight air courier guaranteeing next day
delivery, addressed to the Collateral Agent at BNY Midwest Trust
Company, 2 North LaSalle Street, Suite 1020, Chicago, Illinois 60602,
telecopy number: (312) 827-8542, Attention: Corporate Trust Department,
or at any other address furnished in writing by the Collateral Agent to
the Agent, the Company and the Holders; or
(d) the Trustee by the Company shall be sufficient for every
purpose hereunder (unless otherwise herein expressly provided) if made,
given, furnished or filed in writing and personally delivered, mailed,
first-class postage prepaid, telecopied or delivered by overnight air
courier guaranteeing next day delivery, addressed to the Trustee at BNY
Midwest Trust Company, 2 North LaSalle Street, Suite 1020, Chicago,
Illinois 60602, telecopy number: (312) 827-8542, Attention: Corporate
Trust Department, or at any other address furnished in writing by the
Trustee to the Company.
Section 1.6 Notice to Holders; Waiver.
(a) Where this Agreement provides for notice to Holders of
any event, such notice shall be sufficiently given (unless otherwise
herein expressly provided) if in writing and mailed, first-class postage
prepaid, to each Holder affected by such event, at its address as it
appears in the applicable Register, not later than the latest date, and
not earlier than the earliest date, prescribed for the giving of such
notice. In any case where notice to Holders is given by mail, neither
the failure to mail such notice nor any defect in any notice so mailed
to any particular Holder shall affect the sufficiency of such notice
with respect to other Holders. Where this Agreement provides for notice
in any manner, such notice may be waived in writing by the Person
entitled to receive such notice, either before or after the event, and
such waiver shall be the equivalent of such notice. Waivers of notice by
Holders shall be filed with the Agent, but such filing shall not be a
condition precedent to the validity of any action taken in reliance upon
such waiver.
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(b) In case by reason of the suspension of regular mail
service or by reason of any other cause it shall be impracticable to
give such notice by mail, then such notification as shall be made with
the approval of the Agent shall constitute a sufficient notification for
every purpose hereunder.
Section 1.7 Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
Section 1.8 Successors and Assigns.
All covenants and agreements in this Agreement by the Company shall bind
its successors and assigns, whether so expressed or not.
Section 1.9 Separability Clause.
In case any provision in this Agreement or in the DECS shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions hereof and thereof shall not in any way be affected or
impaired thereby.
Section 1.10 Benefits of Agreement.
Nothing in this Agreement or in the DECS, express or implied, shall give
to any Person, other than the parties hereto and their successors hereunder and,
to the extent provided hereby, the Holders, any benefits or any legal or
equitable right, remedy or claim under this Agreement. The Holders from time to
time shall be beneficiaries of this Agreement and shall be bound by all of the
terms and conditions hereof and of the DECS evidenced by their Certificates by
their acceptance of delivery of such Certificates.
Section 1.11 Governing Law.
This Agreement and the DECS shall be governed by and construed in
accordance with the laws of the State of New York, without regard to its
principles of conflicts of laws.
Section 1.12 Legal Holidays.
(a) In any case where any Payment Date shall not be a
Business Day, then (notwithstanding any other provision of this Agreement or the
Upper DECS Certificates) payments on the Notes shall not be made on such date,
but such payments shall be made on the next succeeding Business Day with the
same force and effect as if made on such Payment Date, provided that no interest
shall accrue or be payable by the Company for the period from and after any such
Payment Date, except that if such next succeeding Business Day is in the next
succeeding calendar year, such payment shall be made on the immediately
preceding Business Day with the same force and effect as if made on such Payment
Date.
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(b) In any case where a Stock Purchase Date shall not be a
Business Day, then (notwithstanding any other provision of this Agreement or the
Certificates), the Forward Purchase Contracts shall not be performed on such
date, but the Forward Purchase Contracts shall be performed on the immediately
following Business Day with the same force and effect as if performed on such
Stock Purchase Date.
Section 1.13 Counterparts.
This Agreement may be executed in any number of counterparts by the
parties hereto, each of which, when so executed and delivered, shall be deemed
an original, but all such counterparts shall together constitute one and the
same instrument.
Section 1.14 Inspection of Agreement.
A copy of this Agreement shall be available at all reasonable times
during normal business hours at the Corporate Trust Office for inspection by any
Holder.
ARTICLE II.
CERTIFICATE FORMS
Section 2.1 Forms of Certificates Generally.
(a) The Upper DECS Certificates (including the form of
Forward Purchase Contract forming part of the Upper DECS evidenced
thereby) shall be in substantially the form set forth in Exhibit A
hereto, with such letters, numbers or other marks of identification or
designation and such legends or endorsements printed, lithographed or
engraved thereon as may be required by the rules of any securities
exchange or quotation system on which the Upper DECS are listed or
quoted for trading or any depositary therefor, or as may, consistently
herewith, be determined by the officers of the Company executing such
Upper DECS Certificates, as evidenced by their execution of the Upper
DECS Certificates.
(b) The definitive Upper DECS Certificates shall be printed,
lithographed or engraved on steel engraved borders or may be produced in
any other manner, all as determined by the officers of the Company
executing such Upper DECS Certificates, consistent with the provisions
of this Agreement, as evidenced by their execution thereof.
(c) The Stripped DECS Certificates (including the form of
Forward Purchase Contracts forming part of the Stripped DECS evidenced
thereby) shall be in substantially the form set forth in Exhibit B
hereto, with such letters, numbers or other marks of identification or
designation and such legends or endorsements printed, lithographed or
engraved thereon as may be required by the rules of any securities
exchange or quotation system on which the Stripped DECS may be listed or
quoted for trading or any depositary therefor, or as may, consistently
herewith, be determined by the officers of the Company executing such
Stripped DECS Certificates, as evidenced by their execution of the
Stripped DECS Certificates.
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(d) The definitive Stripped DECS Certificates shall be
printed, lithographed or engraved on steel engraved borders or may be
produced in any other manner, all as determined by the officers of the
Company executing such Stripped DECS Certificates, consistent with the
provisions of this Agreement, as evidenced by their execution thereof.
(e) Every Global Certificate authenticated, executed on
behalf of the Holders and delivered hereunder shall bear a legend in
substantially the following form:
"THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
FORWARD PURCHASE CONTRACT AGREEMENT (AS HEREINAFTER DEFINED) AND IS REGISTERED
IN THE NAME OF THE CLEARING AGENCY OR A NOMINEE THEREOF. THIS CERTIFICATE MAY
NOT BE EXCHANGED IN WHOLE OR IN PART FOR A CERTIFICATE REGISTERED, AND NO
TRANSFER OF THIS CERTIFICATE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME
OF ANY PERSON OTHER THAN SUCH CLEARING AGENCY OR A NOMINEE THEREOF, EXCEPT IN
THE LIMITED CIRCUMSTANCES DESCRIBED IN THE FORWARD PURCHASE CONTRACT AGREEMENT."
Section 2.2 Form of Agent's Certificate of Authentication.
(a) The form of the Agent's certificate of authentication of
the Upper DECS shall be in substantially the form set forth on the form
of the Upper DECS Certificates.
(b) The form of the Agent's certificate of authentication of
the Stripped DECS shall be in substantially the form set forth on the
form of the Stripped DECS Certificates.
ARTICLE III.
THE DECS
Section 3.1 Title and Terms; Denominations.
(a) The aggregate number of Upper DECS and Stripped DECS, if
any, evidenced by Certificates authenticated, executed on behalf of the
Holders and delivered hereunder is limited to 13,000,000 (14,950,000 if
the Underwriters' (as defined in the Underwriting Agreement)
over-allotment option pursuant to the Underwriting Agreement is
exercised in full), except for Certificates authenticated, executed and
delivered upon registration of transfer of, in exchange for, or in lieu
of other Certificates pursuant to Section 3.4, 3.5, 3.10, 3.13, 3.14,
5.7, 5.8 or 8.5.
(b) The Certificates shall be issuable only in registered
form and only in denominations of a single DECS and any integral
multiple thereof.
Section 3.2 Rights and Obligations Evidenced by the Certificates.
(a) Each Upper DECS Certificate shall evidence the number of
Upper DECS specified therein, with each such Upper DECS representing the
ownership by the Holder thereof of a beneficial interest in a Note or
the appropriate Treasury Consideration or Applicable Ownership Interest
in the Treasury Portfolio, as the case may be, subject to
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the Pledge of such Note or such Treasury Consideration or Applicable
Ownership Interest in the Treasury Portfolio, as the case may be, by
such Holder pursuant to the Pledge Agreement, and the rights and
obligations of the Holder thereof and the Company under one Forward
Purchase Contract. The Agent as attorney-in-fact for, and on behalf of,
the Holder of each Upper DECS shall pledge, pursuant to the Pledge
Agreement, the Note or the appropriate Treasury Consideration or
Applicable Ownership Interest in the Treasury Portfolio, as the case may
be, forming a part of such Upper DECS, to the Collateral Agent and grant
to the Collateral Agent a security interest in the right, title, and
interest of such Holder in such Note or such Treasury Consideration or
Applicable Ownership Interest in the Treasury Portfolio, as the case may
be, for the benefit of the Company, to secure the obligation of the
Holder under each Forward Purchase Contract to purchase the Common Stock
of the Company. Prior to the purchase of shares of Common Stock under
each Forward Purchase Contract, such Forward Purchase Contracts shall
not entitle the Holders of Upper DECS Certificates to any of the rights
of a holder of shares of Common Stock, including, without limitation,
the right to vote or receive any dividends or other payments or to
consent or to receive notice as stockholders in respect of the meetings
of stockholders or for the election of directors of the Company or for
any other matter, or any other rights whatsoever as stockholders of the
Company.
(b) Each Stripped DECS Certificate shall evidence the number
of Stripped DECS specified therein, with each such Stripped DECS
representing the ownership by the Holder thereof of a 1/20 undivided
beneficial interest in a Treasury Security, subject to the Pledge of
such interest in such Treasury Security by such Holder pursuant to the
Pledge Agreement, and the rights and obligations of the Holder thereof
and the Company under one Forward Purchase Contract. The Agent as
attorney-in-fact for, and on behalf of, the Holder of each Stripped DECS
shall pledge, pursuant to the Pledge Agreement, the Treasury Security,
forming a part of such Stripped DECS, to the Collateral Agent and grant
to the Collateral Agent a security interest in the right, title and
interest of such Holder in such Treasury Security for the benefit of the
Company, to secure the obligation of the Holder under each Forward
Purchase Contract to purchase shares of Common Stock pursuant to this
Agreement and the related Forward Purchase Contract. Prior to the
purchase of shares of Common Stock under each Forward Purchase Contract,
such Forward Purchase Contracts shall not entitle the Holders of
Stripped DECS Certificates to any of the rights of a holder of shares of
Common Stock, including, without limitation, the right to vote or
receive any dividends or other payments or to consent or to receive
notice as stockholders in respect of the meetings of stockholders or for
the election of directors of the Company or for any other matter, or any
other rights whatsoever as stockholders of the Company.
Section 3.3 Execution, Authentication, Delivery and Dating.
(a) Subject to the provisions of Sections 3.13 and 3.14,
upon the execution and delivery of this Agreement, and at any time and
from time to time thereafter, the Company may deliver Certificates
executed by the Company to the Agent for authentication, execution on
behalf of the Holders and delivery, together with its Issuer Order for
authentication of such Certificates, and the Agent in accordance with
such
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Issuer Order shall authenticate, execute on behalf of the Holders and
deliver such Certificates.
(b) The Certificates shall be executed on behalf of the
Company by the Chief Executive Officer, the Chief Financial Officer, the
President, any Vice-President, the Treasurer, any Assistant Treasurer,
the Secretary or any Assistant Secretary (or other officer performing
similar functions) of the Company and delivered to the Agent. The
signature of any of these officers on the Certificates must be manual.
(c) Certificates bearing the manual signatures of
individuals who were at any time the proper officers of the Company
shall bind the Company, notwithstanding that such individuals or any of
them have ceased to hold such offices prior to the authentication and
delivery of such Certificates or did not hold such offices at the date
of such Certificates.
(d) No Forward Purchase Contract evidenced by a Certificate
shall be valid until such 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 Certificate has entered into the Forward Purchase Contracts
evidenced by such Certificate.
(e) Each Certificate shall be dated the date of its
authentication.
(f) No Certificate shall be entitled to any benefit under
this Agreement or be valid or obligatory for any purpose unless there
appears on such Certificate a certificate of authentication
substantially in the form provided for herein executed by an authorized
signatory of the Agent by manual signature, and such certificate upon
any Certificate shall be conclusive evidence, and the only evidence,
that such Certificate has been duly authenticated and delivered
hereunder.
Section 3.4 Temporary Certificates.
(a) Pending the preparation of definitive Certificates, the
Company shall execute and deliver to the Agent, and the Agent shall
authenticate, execute on behalf of the Holders, and deliver, in lieu of
such definitive Certificates, temporary Certificates which are in
substantially the form set forth in Exhibit A or Exhibit B hereto, as
the case may be, with such letters, numbers or other marks of
identification or designation and such legends or endorsements printed,
lithographed or engraved thereon as may be required by the rules of any
securities exchange on which the Upper DECS or Stripped DECS, as the
case may be, are listed, or as may, consistent herewith, be determined
by the officers of the Company executing such Certificates, as evidenced
by their execution of the Certificates.
(b) If temporary Certificates are issued, the Company will
cause definitive Certificates to be prepared without unreasonable delay.
After the preparation of definitive Certificates, the temporary
Certificates shall be exchangeable for definitive Certificates upon
surrender of the temporary Certificates at the Corporate Trust Office,
at the expense
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of the Company and without charge to the Holder. Upon surrender for
cancellation of any one or more temporary Certificates, the Company
shall execute and deliver to the Agent, and the Agent shall
authenticate, execute on behalf of the Holder, and deliver in exchange
therefor, one or more definitive Certificates of like tenor and
denominations and evidencing a like number of Upper DECS or Stripped
DECS, as the case may be, as the temporary Certificate or Certificates
so surrendered. Until so exchanged, the temporary Certificates shall in
all respects evidence the same benefits and the same obligations with
respect to the Upper DECS or Stripped DECS, as the case may be,
evidenced thereby as definitive Certificates.
Section 3.5 Registration; Registration of Transfer and Exchange.
(a) The Agent shall keep at the Corporate Trust Office a
register (the "Upper DECS Register") in which, subject to such
reasonable regulations as it may prescribe, the Agent shall provide for
the registration of Upper DECS Certificates and of transfers of Upper
DECS Certificates (the Agent, in such capacity, the "Upper DECS
Registrar") and a register (the "Stripped DECS Register") in which,
subject to such reasonable regulations as it may prescribe, the Agent
shall provide for the registration of the Stripped DECS Certificates and
transfers of Stripped DECS Certificates (the Agent, in such capacity,
the "Stripped DECS Registrar").
(b) Upon surrender for registration of transfer of any
Certificate at the Corporate Trust Office, the Company shall execute and
deliver to the Agent, and the Agent shall authenticate, execute on
behalf of the designated transferee or transferees, and deliver, in the
name of the designated transferee or transferees, one or more new
Certificates of like tenor and denominations, and evidencing a like
number of Upper DECS or Stripped DECS, as the case may be.
(c) At the option of the Holder, Certificates may be
exchanged for other Certificates, of like tenor and denominations and
evidencing a like number of Upper DECS or Stripped DECS, as the case may
be, upon surrender of the Certificates to be exchanged at the Corporate
Trust Office. Whenever any Certificates are so surrendered for exchange,
the Company shall execute and deliver to the Agent, and the Agent shall
authenticate, execute on behalf of the Holder, and deliver the
Certificates which the Holder making the exchange is entitled to
receive.
(d) All Certificates issued upon any registration of
transfer or exchange of a Certificate shall evidence the ownership of
the same number of Upper DECS or Stripped DECS, as the case may be, and
be entitled to the same benefits and subject to the same obligations,
under this Agreement as the Upper DECS or Stripped DECS, as the case may
be, evidenced by the Certificate surrendered upon such registration of
transfer or exchange.
(e) Every Certificate presented or surrendered for
registration of transfer or for exchange shall (if so required by the
Agent) be duly endorsed, or be accompanied by a written instrument of
transfer in form satisfactory to the Company and the Agent duly
executed, by the Holder thereof or its attorney duly authorized in
writing.
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(f) No service charge shall be made for any registration of
transfer or exchange of a Certificate, but the Company and the Agent may
require payment from the Holder of a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection with any
registration of transfer or exchange of Certificates, other than any
exchanges pursuant to Sections 3.4, 3.6, 3.9 and 8.5 not involving any
transfer.
(g) Notwithstanding the foregoing, the Company shall not be
obligated to execute and deliver to the Agent, and the Agent shall not
be obligated to authenticate, execute on behalf of the Holder and
deliver any Certificate presented or surrendered for registration of
transfer or for exchange on or after the Business Day immediately
preceding the earlier of a Stock Purchase Date or the Termination Date.
In lieu of delivery of a new Certificate, upon satisfaction of the
applicable conditions specified above in this Section and receipt of
appropriate registration or transfer instructions from such Holder, the
Agent shall,
(i) if a Stock Purchase Date has occurred, deliver
the shares of Common Stock issuable in respect of the Forward
Purchase Contracts forming a part of the DECS evidenced by such
Certificate,
(ii) in the case of Upper DECS, if a Termination
Event shall have occurred prior to a Stock Purchase Date,
transfer the Notes or the appropriate Treasury Consideration or
Applicable Ownership Interest in the Treasury Portfolio, as
applicable, relating to such Upper DECS, or
(iii) in the case of Stripped DECS, if a Termination
Event shall have occurred prior to a Stock Purchase Date,
transfer the Treasury Securities relating to such Stripped DECS,
in each case subject to the applicable conditions and in
accordance with the applicable provisions of Article V.
Section 3.6 Book-Entry Interests.
The Certificates, on original issuance will be issued in the form of one
or more fully registered Global Certificates, to be delivered to the Depositary
or its custodian by, or on behalf of, the Company. Such Global Certificate shall
initially be registered in the applicable Register in the name of Cede & Co.,
the nominee of the Depositary, and no Beneficial Owner will receive a definitive
Certificate representing such Beneficial Owner's interest in such Global
Certificate, except as provided in Section 3.9. The Agent shall enter into an
agreement with the Depositary if so requested by the Company. Unless and until
definitive, fully registered Certificates have been issued to Beneficial Owners
pursuant to Section 3.9:
(a) the provisions of this Section 3.6 shall be in full
force and effect;
(b) the Company shall be entitled to deal with the Clearing
Agency for all purposes of this Agreement (including receiving
approvals, votes or consents hereunder) as the Holder of the DECS and
the sole holder of the Global Certificate(s) and shall have no
obligation to the Beneficial Owners;
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(c) to the extent that the provisions of this Section 3.6
conflict with any other provisions of this Agreement, the provisions of
this Section 3.6 shall control; and
(d) the rights of the Beneficial Owners shall be exercised
only through the Clearing Agency and shall be limited to those
established by law and agreements between such Beneficial Owners and the
Clearing Agency and/or the Clearing Agency Participants. The Clearing
Agency will make book-entry transfers among Clearing Agency
Participants.
Section 3.7 Notices To Holders.
Whenever a notice or other communication to the Holders is required to
be given under this Agreement, the Company or the Company's agent shall give
such notices and communications to the Holders and, with respect to any DECS
registered in the name of a Clearing Agency or the nominee of a Clearing Agency,
the Company or the Company's agent shall, except as set forth herein, have no
obligations to the Beneficial Owners.
Section 3.8 Appointment of Successor Clearing Agency.
If any Clearing Agency elects to discontinue its services as securities
depositary with respect to the DECS or ceases to be eligible as a "clearing
agency" under the Exchange Act, the Company may, in its sole discretion, appoint
a successor Clearing Agency with respect to the DECS.
Section 3.9 Definitive Certificates.
If
(i) a Clearing Agency elects to discontinue its
services as securities depositary with respect to the DECS or
ceases to be eligible as a "clearing agency" under the Exchange
Act and a successor Clearing Agency is not appointed within 90
days after such discontinuance pursuant to Section 3.8,
(ii) the Company elects to terminate the book-entry
system through the Clearing Agency with respect to the DECS, or
(iii) there shall have occurred and be continuing a
default by the Company in respect of its obligations under one
or more Forward Purchase Contracts,
then upon surrender of the Global Certificates representing the Book-Entry
Interests with respect to the DECS by the Clearing Agency, accompanied by
registration instructions, the Company shall cause definitive Certificates to be
delivered to Clearing Agency Participants in accordance with the instructions of
the Clearing Agency. The Company and the Agent shall not be liable for any delay
in delivery of such instructions and may conclusively rely on and shall be
protected in relying on such instructions.
Section 3.10 Mutilated, Destroyed, Lost and Stolen Certificates.
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(a) If any mutilated Certificate is surrendered to the
Agent, the Company shall execute and deliver to the Agent, and the Agent
shall authenticate, execute on behalf of the Holder, and deliver in
exchange therefor, a new Certificate at the cost of the Holder,
evidencing the same number of Upper DECS or Stripped DECS, as the case
may be, and bearing a Certificate number not contemporaneously
outstanding.
(b) If there shall be delivered to the Company and the Agent
(i) evidence to their satisfaction of the destruction, loss or theft of
any Certificate, and (ii) such security or indemnity at the cost of the
Holder as may be required by them to hold each of them and any agent of
any of them harmless, then, in the absence of notice to the Company or
the Agent that such Certificate has been acquired by a bona fide
purchaser, the Company shall execute and deliver to the Agent, and the
Agent shall authenticate, execute on behalf of the Holder, and deliver
to the Holder, in lieu of any such destroyed, lost or stolen
Certificate, a new Certificate, evidencing the same number of Upper DECS
or Stripped DECS, as the case may be, and bearing a Certificate number
not contemporaneously outstanding.
(c) Notwithstanding the foregoing, the Company shall not be
obligated to execute and deliver to the Agent, and the Agent shall not
be obligated to authenticate, execute on behalf of the Holder, and
deliver to the Holder, a Certificate on or after the Business Day
immediately preceding the earlier of a Stock Purchase Date or the
Termination Date. In lieu of delivery of a new Certificate, upon
satisfaction of the applicable conditions specified above in this
Section and receipt of appropriate registration or transfer instructions
from such Holder, the Agent shall (i) if a Stock Purchase Date has
occurred, deliver the shares of Common Stock issuable in respect of the
Forward Purchase Contracts forming a part of the DECS evidenced by such
Certificate, or (ii) if a Termination Event shall have occurred prior to
a Stock Purchase Date, transfer the Notes, the appropriate Treasury
Consideration or Applicable Ownership Interest in the Treasury
Portfolio, or the Treasury Securities, as the case may be, evidenced
thereby, in each case subject to the applicable conditions and in
accordance with the applicable provisions of Article V.
(d) Upon the issuance of any new Certificate under this
Section, the Company and the Agent may require the payment by the Holder
of a sum sufficient to cover any tax or other governmental charge that
may be imposed in relation thereto and any other expenses (including the
fees and expenses of the Agent) connected therewith.
(e) Every new Certificate issued pursuant to this Section in
lieu of any destroyed, lost or stolen Certificate shall constitute an
original additional contractual obligation of the Company and of the
Holder in respect of the DECS evidenced thereby, whether or not the
destroyed, lost or stolen Certificate (and the DECS evidenced thereby)
shall be at any time enforceable by anyone, and shall be entitled to all
the benefits and be subject to all the obligations of this Agreement
equally and proportionately with any and all other Certificates
delivered hereunder.
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(f) The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with
respect to the replacement or payment of mutilated, destroyed, lost or
stolen Certificates.
Section 3.11 Persons Deemed Owners.
(a) Prior to due presentment of a Certificate for
registration of transfer, the Company and the Agent, and any agent of
the Company or the Agent, may treat the Person in whose name such
Certificate is registered as the owner of the DECS evidenced thereby,
for the purpose of receiving interest payments on the Notes, performance
of the Forward Purchase Contracts and for all other purposes whatsoever
(subject to Section 4.1(a)), whether or not any such payments shall be
overdue and notwithstanding any notice to the contrary, and neither the
Company nor the Agent, nor any agent of the Company or the Agent, shall
be affected by notice to the contrary.
(b) Notwithstanding the foregoing, with respect to any
Global Certificate, nothing herein shall prevent the Company, the Agent
or any agent of the Company or the Agent from giving effect to any
written certification, proxy or other authorization furnished by any
Clearing Agency (or its nominee), as a Holder, with respect to such
Global Certificate or impair, as between such Clearing Agency and owners
of beneficial interests in such Global Certificate, the operation of
customary practices governing the exercise of rights of such Clearing
Agency (or its nominee) as Holder of such Global Certificate. None of
the Company, the Agent, or any agent of the Company or the Agent will
have any responsibility or liability for any aspect of the records
relating to or payments made on account of beneficial ownership
interests in a Global Certificate or maintaining, supervising or
reviewing any records relating to such beneficial ownership interests.
Section 3.12 Cancellation.
(a) All Certificates surrendered (i) for delivery of shares
of Common Stock on or after any Settlement Date; (ii) upon the transfer
of Notes, the appropriate Treasury Consideration or Applicable Ownership
Interest in the Treasury Portfolio, or Treasury Securities, as the case
may be, after the occurrence of a Termination Event; or (iii) upon the
registration of a transfer or exchange of a DECS shall, if surrendered
to any Person other than the Agent, be delivered to the Agent and, if
not already cancelled, shall be promptly cancelled by it. The Company
may at any time deliver to the Agent for cancellation any Certificates
previously authenticated, executed and delivered hereunder which the
Company may have acquired in any manner whatsoever, and all Certificates
so delivered shall, upon Issuer Order, be promptly cancelled by the
Agent. No Certificates shall be authenticated, executed on behalf of the
Holder and delivered in lieu of or in exchange for any Certificates
cancelled as provided in this Section, except as expressly permitted by
this Agreement. All cancelled Certificates held by the Agent shall be
disposed of by the Agent in accordance with its customary procedures.
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(b) If the Company or any Affiliate of the Company shall
acquire any Certificate, such acquisition shall not operate as a
cancellation of such Certificate unless and until such Certificate is
cancelled or delivered to the Agent for cancellation.
Section 3.13 Establishment of Stripped DECS.
(a) A Holder may separate the Pledged Notes, Pledged
Treasury Consideration or Pledged Applicable Ownership Interest in the
Treasury Portfolio, as applicable, from the related Forward Purchase
Contracts in respect of the Upper DECS held by such Holder by
substituting for such Pledged Notes, Pledged Treasury Consideration or
Pledged Applicable Ownership Interest in the Treasury Portfolio, as the
case may be, Treasury Securities that will pay, on or before the
Scheduled Stock Purchase Date, an amount equal to the aggregate
principal amount of such Notes or the appropriate Treasury Consideration
or Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) in the Treasury Portfolio (a "Collateral
Substitution"), at any time from and after the date of this Agreement
and on or prior to the second Business Day immediately preceding a Stock
Purchase Date, by (i) depositing with the Collateral Agent Treasury
Securities having an aggregate principal amount equal to the aggregate
Stated Amount of such Upper DECS, and (ii) transferring the related
Upper DECS to the Agent accompanied by a notice to the Agent,
substantially in the form of Exhibit D hereto, stating that the Holder
has transferred the relevant amount of Treasury Securities to the
Collateral Agent and requesting that the Agent instruct the Collateral
Agent to release the Pledged Notes, Pledged Treasury Consideration or
Pledged Applicable Ownership Interest in the Treasury Portfolio, as the
case may be, underlying such Upper DECS, whereupon the Agent shall
promptly give such instruction to the Collateral Agent, substantially in
the form of Exhibit C hereto. Notwithstanding the foregoing, a Holder
may not separate the Pledged Notes, Pledged Treasury Consideration or
Pledged Applicable Ownership Interest in the Treasury Portfolio, as the
case may be, from the related Forward Purchase Contracts in respect of
the Upper DECS held by such Holder during the periods beginning on the
fourth Business Day prior to any Remarketing Period and ending on the
third Business Day after the end of such Remarketing Period. Upon
receipt of the Treasury Securities described in clause (i) above and the
instruction described in clause (ii) above, in accordance with the terms
of the Pledge Agreement, the Collateral Agent will release to the Agent,
on behalf of the Holder, such Pledged Notes, Pledged Treasury
Consideration or Pledged Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, from the Pledge, free and clear of the
Company's security interest therein, and upon receipt thereof the Agent
shall promptly:
(i) cancel the related Upper DECS;
(ii) transfer the Pledged Notes, Pledged Treasury
Consideration or Pledged Applicable Ownership Interest in the
Treasury Portfolio, as the case may be, to the Holder; and
(iii) authenticate, execute on behalf of such Holder
and deliver to such Holder a Stripped DECS Certificate executed
by the Company in accordance with
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Section 3.3 evidencing the same number of Forward Purchase
Contracts as were evidenced by the cancelled Upper DECS.
(b) Holders who elect to separate the Pledged Notes, Pledged
Treasury Consideration or Pledged Applicable Ownership Interest in the
Treasury Portfolio, as the case may be, from the related Forward
Purchase Contract and to substitute Treasury Securities for such Pledged
Notes, Pledged Treasury Consideration or Pledged Applicable Ownership
Interest in the Treasury Portfolio, as the case may be, shall be
responsible for any fees or expenses payable to the Collateral Agent for
its services as Collateral Agent in respect of the substitution, and the
Company shall not be responsible for any such fees or expenses.
(c) Holders may make Collateral Substitutions (i) if
Treasury Securities are being substituted for Pledged Notes, only in
integral multiples of 20 Upper DECS, or (ii) if the Collateral
Substitutions occur after the Remarketing Date or any Accelerated
Remarketing Date (in either case, if such remarketing is successful) or
any Subsequent Remarketing Date, or after a Tax Event Redemption, only
in integral multiples of Upper DECS such that the Treasury Securities to
be deposited and the Treasury Consideration or Applicable Ownership
Interest in the Treasury Portfolio to be released are in integral
multiples of $1,000.
(d) In the event a Holder making a Collateral Substitution
pursuant to this Section 3.13 fails to effect a book-entry transfer of
the Upper DECS or fails to deliver an Upper DECS Certificate to the
Agent after depositing Treasury Securities with the Collateral Agent,
the Pledged Notes or Pledged Treasury Consideration or Pledged
Applicable Ownership Interest in the Treasury Portfolio, as the case may
be, constituting a part of such Upper DECS, and any distributions on
such Pledged Notes or Pledged Treasury Consideration or Pledged
Applicable Ownership Interest in the Treasury Portfolio, as the case may
be, shall be held in the name of the Agent or its nominee in trust for
the benefit of such Holder, until such Upper DECS are so transferred or
the Upper DECS Certificate is so delivered, as the case may be, or, with
respect to an Upper DECS Certificate, such Holder provides evidence
satisfactory to the Company and the Agent that such Upper DECS
Certificate has been destroyed, lost or stolen, together with any
indemnity that may be required by the Agent and the Company.
(e) Except as described in this Section 3.13, for so long as
the Forward Purchase Contract underlying an Upper DECS remains in
effect, such Upper DECS shall not be separable into its constituent
parts, and the rights and obligations of the Holder of such Upper DECS
in respect of the Note or the appropriate Treasury Consideration or
Applicable Ownership Interest in the Treasury Portfolio, as the case may
be, and the Forward Purchase Contract comprising such Upper DECS may be
acquired, and may be transferred and exchanged, only as an Upper DECS.
Section 3.14 Reestablishment of Upper DECS.
(a) A Holder of Stripped DECS may reestablish Upper DECS at
any time from and after the date of this Agreement and on or prior to
the second Business Day
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immediately preceding a Stock Purchase Date, by (i) depositing with the
Collateral Agent the Notes or the appropriate Treasury Consideration or
Applicable Ownership Interest in the Treasury Portfolio (identified and
calculated by reference to the Treasury Consideration then comprising
Upper DECS), as the case may be, then comprising such number of Upper
DECS as is equal to such Stripped DECS and (ii) transferring such
Stripped DECS to the Agent accompanied by a notice to the Agent,
substantially in the form of Exhibit D hereto, stating that the Holder
has transferred the relevant amount of Notes or the appropriate Treasury
Consideration or Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, to the Collateral Agent and requesting
that the Agent instruct the Collateral Agent to release the Pledged
Treasury Securities underlying such Stripped DECS, whereupon the Agent
shall promptly give such instruction to the Collateral Agent,
substantially in the form of Exhibit C hereto. Notwithstanding the
foregoing, a Holder may not reestablish Upper DECS during the periods
beginning on the fourth Business Day prior to any Remarketing Period and
ending on the third business day after the end of such Remarketing
Period. Upon receipt of the Notes or the appropriate Treasury
Consideration or Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, described in clause (i) above and the
instruction described in clause (ii) above, in accordance with the terms
of the Pledge Agreement, the Collateral Agent will release to the Agent,
on behalf of the Holder, such Pledged Treasury Securities from the
Pledge, free and clear of the Company's security interest therein, and
upon receipt thereof the Agent shall promptly:
(i) cancel the related Stripped DECS;
(ii) transfer the Pledged Treasury Securities to the
Holder; and
(iii) authenticate, execute on behalf of such Holder
and deliver an Upper DECS Certificate executed by the Company in
accordance with Section 3.3 evidencing the same number of
Forward Purchase Contracts as were evidenced by the cancelled
Stripped DECS.
(b) Holders of Stripped DECS may reestablish Upper DECS (i)
only in integral multiples of 20 Stripped DECS for 20 Upper DECS or (ii)
if the reestablishment occurs after the Remarketing Date or an
Accelerated Remarketing Date (in either case, if such remarketing is
successful) or any Subsequent Remarketing Date, or after a Tax Event
Redemption, only in integral multiples of Stripped DECS such that the
Treasury Consideration to be deposited and the Treasury Securities to be
released are in integral multiples of $1,000.
(c) Except as provided in this Section 3.14, for so long as
the Forward Purchase Contract underlying a Stripped DECS remains in
effect, such Stripped DECS shall not be separable into its constituent
parts, and the rights and obligations of the Holder of such Stripped
DECS in respect of the Treasury Security and Forward Purchase Contract
comprising such Stripped DECS may be acquired, and may be transferred
and exchanged, only as a Stripped DECS.
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(d) Holders of Stripped DECS who reestablish Upper DECS
shall be responsible for any fees or expenses payable to the Collateral
Agent for its services as Collateral Agent in respect of the
substitution, and the Company shall not be responsible for any such fees
or expenses.
(e) In the event a Holder who reestablishes Upper DECS
pursuant to this Section 3.14 fails to effect a book-entry transfer of
the Stripped DECS or fails to deliver a Stripped DECS Certificate to the
Agent after depositing Pledged Notes, the Pledged Treasury Consideration
or Pledged Applicable Ownership Interest in the Treasury Portfolio, as
the case may be, with the Collateral Agent, the Treasury Securities
constituting a part of such Stripped DECS, and any distributions on such
Treasury Securities shall be held in the name of the Agent or its
nominee in trust for the benefit of such Holder, until such Stripped
DECS are so transferred or the Stripped DECS Certificate is so
delivered, as the case may be, or, with respect to a Stripped DECS
Certificate, such Holder provides evidence satisfactory to the Company
and the Agent that such Stripped DECS Certificate has been destroyed,
lost or stolen, together with any indemnity that may be required by the
Agent and the Company.
Section 3.15 Transfer of Collateral Upon Occurrence of Termination
Event.
Upon the occurrence of a Termination Event and the transfer to the Agent
of the Notes, the appropriate Treasury Consideration or Applicable Ownership
Interest in the Treasury Portfolio, or the Treasury Securities, as the case may
be, underlying the Upper DECS and the Stripped DECS pursuant to the terms of the
Pledge Agreement, the Agent shall request transfer instructions with respect to
such Notes or the appropriate Treasury Consideration or Applicable Ownership
Interest in the Treasury Portfolio, or Treasury Securities, as the case may be,
from each Holder by written request mailed to such Holder at its address as it
appears in the Upper DECS Register or the Stripped DECS Register, as the case
may be. Upon book-entry transfer of the Upper DECS or Stripped DECS or delivery
of an Upper DECS Certificate or Stripped DECS Certificate to the Agent with such
transfer instructions, the Agent shall transfer the Notes, the appropriate
Treasury Consideration or Applicable Ownership Interest in the Treasury
Portfolio, or Treasury Securities, as the case may be, underlying such Upper
DECS or Stripped DECS, as the case may be, to such Holder by book-entry
transfer, or other appropriate procedures, in accordance with such instructions.
In the event a Holder would be entitled to receive less than $1,000 principal
amount at maturity of any Treasury security, the Agent shall dispose of such
Treasury security for cash and deliver such cash to the Holder. In the event a
Holder of Upper DECS or Stripped DECS fails to effect such transfer or delivery,
the Notes, the appropriate Treasury Consideration or Applicable Ownership
Interest in the Treasury Portfolio or Treasury Securities, as the case may be,
underlying such Upper DECS or Stripped DECS, as the case may be, and any
distributions thereon, shall be held in the name of the Agent or its nominee in
trust for the benefit of such Holder, until (i) such Upper DECS or Stripped DECS
are transferred or the Upper DECS Certificate or Stripped DECS Certificate is
surrendered or such Holder provides satisfactory evidence that such Upper DECS
Certificate or Stripped DECS Certificate has been destroyed, lost or stolen,
together with any indemnity that may be required by the Agent and the Company;
and (ii) the expiration of the time period specified in the abandoned property
laws of the relevant State.
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Section 3.16 No Consent to Assumption.
Each Holder of a DECS, 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 Forward Purchase Contract by the Company,
any receiver, liquidator or person or entity performing similar functions or its
trustee in the event that the Company becomes the debtor under the Bankruptcy
Code or subject to other similar state or federal law providing for
reorganization or liquidation.
ARTICLE IV.
THE NOTES
Section 4.1 Payment of Interest; Rights to Interest Payments
Preserved; Notice.
(a) A payment on any Note, Treasury Consideration or
Applicable Ownership Interest in the Treasury Portfolio, as the case may
be, which is paid on any Payment Date other than a Payment Date with
respect to the Stated Amount due on Treasury Consideration or Applicable
Ownership Interest in the Treasury Portfolio shall, subject to receipt
thereof by the Agent from the Collateral Agent (if the Collateral Agent
is the registered owner thereof) as provided by the terms of the Pledge
Agreement, be paid to the Person in whose name the Upper DECS
Certificate (or one or more Predecessor Upper DECS Certificates) of
which such Note or the appropriate Treasury Consideration or Applicable
Ownership Interest in the Treasury Portfolio, as the case may be, is a
part is registered at the close of business on the Record Date for such
Payment Date.
(b) Each Upper DECS Certificate evidencing Notes delivered
under this Agreement upon registration of transfer of or in exchange for
or in lieu of any other Upper DECS Certificate shall carry the rights to
interest accrued and unpaid which were carried by the Notes and Treasury
Consideration or Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, underlying such other Upper DECS
Certificate.
(c) In the case of any Upper DECS with respect to which
Early Settlement of the underlying Forward Purchase Contract is effected
on an Early Settlement Date, Merger Early Settlement of the underlying
Forward Purchase Contract is effected on a Merger Early Settlement Date,
Cash Settlement is effected on the Business Day immediately preceding
the relevant Stock Purchase Date, or a Collateral Substitution is
effected, in each case on a date that is after any Record Date and on or
prior to the next succeeding Payment Date, payments on the Note or the
appropriate Treasury Consideration or Applicable Ownership Interest in
the Treasury Portfolio, as the case may be, underlying such Upper DECS
otherwise payable on such Payment Date shall be payable on such Payment
Date notwithstanding such Early Settlement, Merger Early Settlement,
Cash Settlement or Collateral Substitution, as the case may be, and such
payments shall, subject to receipt thereof by the Agent, be payable to
the Person in whose name the Upper DECS Certificate (or one or more
Predecessor Upper DECS Certificates) was registered at the close of
business on the Record Date. Except as otherwise expressly provided in
the immediately preceding sentence, in the case of any Upper DECS with
respect to which Early Settlement, Merger Early Settlement or Cash
Settlement of the
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underlying Forward Purchase Contract is effected, or with respect to
which a Collateral Substitution has been effected, payments on the
related Notes or payments on the appropriate Treasury Consideration or
Applicable Ownership Interest in the Treasury Portfolio, as the case may
be, that would otherwise be payable after the applicable Settlement Date
or after such Collateral Substitution, as the case may be, shall not be
payable hereunder to the Holder of such Upper DECS; provided, that to
the extent that such Holder continues to hold the Separate Notes that
formerly comprised a part of such Holder's Upper DECS, such Holder shall
be entitled to receive the payments on such Separate Notes.
Section 4.2 Notice and Voting.
Under the terms of the Pledge Agreement, the Agent will be entitled to
exercise the voting and any other consensual rights pertaining to the Pledged
Notes but only to the extent instructed by the Holders as described below. Upon
receipt of notice of any meeting at which holders of Notes are entitled to vote
or upon any solicitation of consents, waivers or proxies of holders of Notes,
the Agent shall, as soon as practicable thereafter, mail to the Holders of Upper
DECS a notice (a) containing such information as is contained in the notice or
solicitation, (b) stating that each Holder on the record date set by the Agent
therefor (which, to the extent possible, shall be the same date as the record
date for determining the holders of Notes entitled to vote) shall be entitled to
instruct the Agent as to the exercise of the voting rights pertaining to the
Pledged Notes underlying their Upper DECS and (c) stating the manner in which
such instructions may be given. Upon the written request of the Holders of Upper
DECS on such record date, the Agent shall endeavor insofar as practicable to
vote or cause to be voted, in accordance with the instructions set forth in such
requests, the maximum number of Pledged Notes as to which any particular voting
instructions are received. In the absence of specific instructions from the
Holder of an Upper DECS, the Agent shall abstain from voting the Pledged Note
underlying such Upper DECS. The Company hereby agrees, if applicable, to solicit
Holders of Upper DECS to timely instruct the Agent in order to enable the Agent
to vote such Pledged Notes.
Section 4.3 Tax Event Redemption.
Upon the occurrence of a Tax Event Redemption prior to the successful
remarketing of the Notes, the Company may elect to instruct in writing the
Collateral Agent to apply, and upon such written instruction, the Collateral
Agent shall apply, out of the aggregate Redemption Price for the Notes that are
components of Upper DECS, an amount equal to the aggregate Tax Event Redemption
Principal Amount for the Notes that are components of Upper DECS to purchase on
behalf of the Holders of Upper DECS the Treasury Portfolio and promptly remit
the remaining portion of such aggregate Redemption Price to the Agent for
payment to the Holders of such Upper DECS. The Treasury Portfolio will be
substituted for the Pledged Notes, and will be pledged to the Collateral Agent
in accordance with the terms of the Pledge Agreement to secure the obligation of
each Holder of an Upper DECS to purchase the Common Stock under the Forward
Purchase Contract constituting a part of such Upper DECS. Following the
occurrence of a Tax Event Redemption prior to a successful remarketing of the
Notes, the Holders of Upper DECS and the Collateral Agent shall have such
security interests, rights and obligations with respect to the Treasury
Portfolio as the Holder of Upper DECS and the Collateral Agent had in
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respect of the Notes, as the case may be, subject to the Pledge thereof as
provided in Articles II, III, IV, V and VI of the Pledge Agreement, and any
reference herein or in the Certificates to the Note shall be deemed to be a
reference to such Treasury Portfolio and any reference herein or in the
Certificates to interest on the Notes shall be deemed to be a reference to
corresponding distributions on the Treasury Portfolio. The Company may cause to
be made in any Upper DECS Certificates thereafter to be issued such change in
phraseology and form (but not in substance) as may be appropriate to reflect the
substitution of the Treasury Portfolio for Notes as collateral.
The Company shall cause notice of any Tax Event Redemption to be mailed,
at least 30 calendar days but not more than 60 calendar days before the relevant
Tax Event Redemption Date, to each Holder of Upper DECS including Notes to be
redeemed at its registered address.
Upon the occurrence of a Tax Event Redemption after the successful
remarketing of the Notes, the Redemption Price will be payable in cash to the
holders of the Notes.
ARTICLE V.
THE FORWARD PURCHASE CONTRACTS; THE REMARKETING
Section 5.1 Purchase of Shares of Common Stock.
(a) Each Forward Purchase Contract shall, unless an Early
Settlement has occurred in accordance with Section 5.7, or a Merger
Early Settlement has occurred in accordance with Section 5.8, obligate
the Holder of the related DECS to purchase, and the Company to sell, on
the relevant Stock Purchase Date at a price equal to $50 (the "Purchase
Price"), a number of newly issued shares of Common Stock equal to the
Settlement Rate unless, on or prior to the relevant Stock Purchase Date,
there shall have occurred a Termination Event with respect to the DECS
of which such Forward Purchase Contract is a part. The "Settlement Rate"
is equal to,
(i) if the Applicable Market Value (as defined
below) is greater than or equal to $78.61 (the "Threshold
Appreciation Price"), 0.6361 shares of Common Stock per Forward
Purchase Contract,
(ii) if the Applicable Market Value is less than the
Threshold Appreciation Price, but is greater than $63.91, the
number of shares of Common Stock per Forward Purchase Contract
equal to the Stated Amount of the related DECS divided by the
Applicable Market Value, and
(iii) if the Applicable Market Value is equal to or
less than $63.91, 0.7824 shares of Common Stock per Forward
Purchase Contract, in each case subject to adjustment as
provided in Section 5.4 (and in each case rounded upward or
downward to the nearest 1/10,000th of a share).
As provided in Section 5.11, no fractional shares of Common Stock will
be issued upon settlement of Forward Purchase Contracts.
Promptly after the calculation of the Settlement Rate and the Applicable
Market Value, the Company shall give the Agent notice thereof. All calculations
and determinations of the
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Settlement Rate and the Applicable Market Value shall be made by the Company or
its agents based on their good faith calculations, and the Agent shall have no
responsibility with respect thereto.
(b) The "Applicable Market Value" means the average of the
Closing Price per share of Common Stock on each of the 20 consecutive
Trading Days ending on the third Trading Day immediately preceding the
relevant Stock Purchase Date. The "Closing Price" of the Common Stock on
any date of determination means the closing sale price (or, if no
closing price is reported, the last reported sale price) of the Common
Stock on the New York Stock Exchange (the "NYSE") on such date or, if
the Common Stock is not listed for trading on the NYSE on any such date,
as reported in the composite transactions for the principal United
States securities exchange on which the Common Stock is so listed, or if
the Common Stock is not so listed on a United States national or
regional securities exchange, as reported by The Nasdaq Stock Market,
or, if the Common Stock is not so reported, the last quoted bid price
for the Common Stock in the over-the-counter market as reported by the
National Quotation Bureau or similar organization, or, if such bid price
is not available, the market value of the Common Stock on such date as
determined by a nationally recognized independent investment banking
firm retained for this purpose by the Company. A "Trading Day" means a
day on which the Common Stock (A) is not suspended from trading on any
national or regional securities exchange or association or
over-the-counter market at the close of business and (B) has traded at
least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for
the trading of the Common Stock.
(c) Each Holder of a DECS, by its acceptance thereof,
irrevocably authorizes the Agent to enter into and perform the related
Forward Purchase Contract on its behalf as its attorney-in-fact
(including the execution of Certificates on behalf of such Holder),
agrees to be bound by the terms and provisions thereof, covenants and
agrees to perform its obligations under such Forward Purchase Contracts,
and consents to the provisions hereof, irrevocably authorizes the Agent
as its attorney-in-fact to enter into and perform the Pledge Agreement
on its behalf as its attorney-in-fact, and consents to and agrees to be
bound by the Pledge of the Notes, the appropriate Treasury Consideration
or Applicable Ownership Interest in the Treasury Portfolio, or the
Treasury Securities pursuant to the Pledge Agreement; provided that upon
a Termination Event, the rights of the Holder of such DECS under the
Forward Purchase Contract may be enforced without regard to any other
rights or obligations. Each Holder of a DECS, by its acceptance thereof,
further covenants and agrees that, to the extent and in the manner
provided in Section 5.2, Section 5.9 and the Pledge Agreement, but
subject to the terms thereof, payments in respect of the Notes, the
appropriate Treasury Consideration or Applicable Ownership Interest in
the Treasury Portfolio, or the Treasury Securities, to be paid upon
settlement of such Holder's obligations to purchase Common Stock under
the Forward Purchase Contract, shall be paid on the relevant Stock
Purchase Date by the Collateral Agent to the Company in satisfaction of
such Holder's obligations under such Forward Purchase Contract and such
Holder shall acquire no right, title or interest in such payment.
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(d) Upon registration of transfer of a Certificate, the
transferee shall be bound (without the necessity of any other action on
the part of such transferee) under the terms of this Agreement, the
Forward Purchase Contracts underlying such Certificate and the Pledge
Agreement, and the transferor shall be released from the obligations
under this Agreement, the Forward Purchase Contracts underlying the
Certificates so transferred and the Pledge Agreement. The Company
covenants and agrees, and each Holder of a Certificate, by its
acceptance thereof, likewise covenants and agrees, to be bound by the
provisions of this paragraph.
Section 5.2 Payment of Purchase Price; Remarketing.
(a) Unless a Tax Event Redemption, successful remarketing,
Termination Event, Merger Early Settlement or Early Settlement has
occurred, each Holder of an Upper DECS may pay in cash ("Cash
Settlement") the Purchase Price for the shares of Common Stock to be
purchased pursuant to a Forward Purchase Contract if such Holder
notifies the Agent by use of a notice in substantially the form of
Exhibit E hereto of its intention to make a Cash Settlement. Such notice
shall be made on or prior to 5:00 p.m., New York City time, (x) on the
seventh Business Day immediately preceding the Scheduled Stock Purchase
Date or (y) if a Secondary Acceleration Event has occurred, on the fifth
Business Day immediately preceding the Accelerated Stock Purchase Date.
The Agent shall promptly notify the Collateral Agent of the receipt of
such a notice from a Holder intending to make a Cash Settlement.
(i) A Holder of an Upper DECS who has so notified
the Agent of its intention to make a Cash Settlement is required
to pay the Purchase Price to the Collateral Agent prior to 11:00
a.m., New York City time, on the fourth Business Day immediately
preceding the relevant Stock Purchase Date in lawful money of
the United States by certified or cashiers' check or wire
transfer, in each case payable to or upon the order of the
Company. Any cash received by the Collateral Agent will be paid
to the Company on the relevant Stock Purchase Date in settlement
of the Forward Purchase Contract in accordance with the terms of
this Agreement and the Pledge Agreement.
(ii) If a Holder of an Upper DECS fails to notify the
Agent of its intention to make a Cash Settlement in accordance
with this paragraph (a), the Holder shall be deemed to have
consented to the disposition of the Pledged Notes pursuant to
the remarketing as described in paragraph (b) below. If a Holder
of an Upper DECS does notify the Agent as provided in this
paragraph (a) of its intention to pay the Purchase Price in
cash, but fails to make such payment as required by paragraph
(a)(i) above, the Holder shall be deemed to have consented to
the disposition of the Pledged Notes pursuant to the remarketing
as described in paragraph 5.2(b) below.
(b) (i) The Company has engaged the Remarketing Agent to
sell the Notes of (A) Holders of Upper DECS, other than Holders that
have elected not to participate in the remarketing pursuant to the
procedures set forth in subsection (g) below, and (B) holders of
Separate Notes that have elected to participate in the remarketing
pursuant to the
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procedures set forth in Section 4.5(d) of the Pledge Agreement. On the
seventh Business Day prior to the Remarketing Date or Accelerated
Remarketing Date or the first day of any subsequent Remarketing Period
(or if a Secondary Acceleration Event has occurred, on the fifth
Business Day prior to the Accelerated Remarketing Date), the Agent shall
give Holders of Upper DECS and holders of Separate Notes notice of the
remarketing (the form of which notice to be provided by the Company) in
a daily newspaper in the English language of general circulation in The
City of New York, which is expected to be The Wall Street Journal,
including the specific U.S. Treasury security or securities (including
the CUSIP number and/or the principal terms of such Treasury security or
securities) described in subsection (g) below, that must be delivered by
Holders of Upper DECS that elect not to participate in the remarketing
pursuant to subsection (g) below, no later than 10:00 a.m., New York
City time, on the fourth Business Day preceding the Remarketing Date or
Accelerated Remarketing Date or the first day of any Subsequent
Remarketing Period, as applicable. The Agent shall notify, by 10:00
a.m., New York City time, on the third Business Day preceding the
Remarketing Date or Accelerated Remarketing Date or the first day of any
subsequent Remarketing Period, as applicable, the Remarketing Agent and
the Collateral Agent of the aggregate number of Notes of Upper DECS
Holders to be remarketed. On the third Business Day immediately
preceding the Remarketing Date or Accelerated Remarketing Date or the
first day of any subsequent Remarketing Period, as applicable, no later
than by 10:00 a.m. New York City time, pursuant to the terms of the
Pledge Agreement, the Custodial Agent will notify the Remarketing Agent
of the aggregate number of Separate Notes to be remarketed. On the third
Business Day immediately preceding the Remarketing Date or Accelerated
Remarketing Date or the first day of any subsequent Remarketing Period,
as applicable, the Collateral Agent and the Custodial Agent, pursuant to
the terms of the Pledge Agreement, will deliver for remarketing to the
Remarketing Agent all Notes to be remarketed.
(ii) Holders of Notes may make a contingent election
by notice to the Agent, substantially as set forth in the Note (an
"Opt-Out Notice"), on or prior to the third Business Day prior to a
Stock Purchase Date that in the event a Last Failed Remarketing or a
Last Failed Accelerated Remarketing occurs, such holders elect not to
sell their Notes to the Company pursuant to Section 206 of the
Supplemental Indenture.
(c) Upon receipt of such notice from the Agent and the
Custodial Agent and such Notes from the Collateral Agent and the
Custodial Agent, the Remarketing Agent will, on the Remarketing Date,
use its commercially reasonable best efforts to (i) establish a rate of
interest that, in the opinion of the Remarketing Agent, will, when
applied to the outstanding Notes (assuming, even if not true, that all
of the Notes are included in the remarketing), enable the then current
aggregate market value of the Notes to have a value equal to at least
100.5% of the Remarketing Value as of the Remarketing Date, the
Accelerated Remarketing Date or as of any Subsequent Remarketing Date,
as the case may be (the "Reset Rate") and (ii) sell such Notes on such
date at a price equal to 100.5% of the Remarketing Value.
(d) The Remarketing Agent will use the proceeds from a
successful remarketing to purchase the appropriate U.S. Treasury
securities (the "Agent-purchased
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Treasury Consideration") with the CUSIP numbers, if any, selected by the
Remarketing Agent, described in clauses (1) and (2) of the definition of
Remarketing Value related to the Notes of Holders of Upper DECS or that
were remarketed. On or prior to the third Business Day following the
Remarketing Date or Accelerated Remarketing Date (in either case, if
such remarketing is successful), or any Subsequent Remarketing Date the
Remarketing Agent shall deliver such Agent-purchased Treasury
Consideration to the Agent, which shall thereupon deliver such
Agent-purchased Treasury Consideration to the Collateral Agent. The
Collateral Agent, for the benefit of the Company, will thereupon apply
such Agent-purchased Treasury Consideration, in accordance with the
Pledge Agreement, to secure such Holders' obligations under the Forward
Purchase Contracts. The Remarketing Agent will deduct as a remarketing
fee an amount not exceeding 25 basis points (0.25%) of the total
proceeds from the remarketing (the "Remarketing Fee"). The Remarketing
Agent will remit (1) the portion of the proceeds from the remarketing
attributable to the Separate Notes to the Custodial Agent for the
benefit of the holders of Separate Notes that were remarketed and (2)
the remaining portion of the proceeds, less those proceeds used to
purchase the Agent-purchased Treasury Consideration, to the Agent for
payment to the Holders of the Upper DECS that were remarketed, all
determined on a pro rata basis, in each case, on or prior to the third
Business Day following such Remarketing Date or Accelerated Remarketing
Date, or Subsequent Remarketing Date. Holders whose Notes are so
remarketed will not otherwise be responsible for the payment of any
Remarketing Fee in connection therewith.
(e) (i) If, in spite of using its commercially reasonable
best efforts, the Remarketing Agent cannot remarket the Notes included
in the remarketing at a price equal to at least 100.5% of the
Remarketing Value, the Remarketing Agent will again attempt to remarket
the Notes included in the remarketing at a price equal to at least
100.5% of the Remarketing Value on each of the two immediately following
Business Days. If the Remarketing Agent cannot remarket the Notes
included in the remarketing at a price equal to at least 100.5% of the
Remarketing Value on either of those days, it will attempt to remarket
the Notes included in the remarketing at a price equal to at least
100.5% of the Remarketing Value on each of the three Business Days
immediately preceding the 17th day of each following month until, in
either case, the earlier to occur of either (A) a successful remarketing
or (B) the Scheduled Stock Purchase Date (each subsequent three Business
Day period, a "Remarketing Period"). If the Remarketing Agent cannot
remarket the Notes at a price equal to at least 100.5% of the
Remarketing Value during any such Remarketing Period, the remarketing in
each such period will be deemed to have failed (each, a "Failed
Remarketing"). If, in spite of using its commercially reasonable best
efforts, the Remarketing Agent fails to remarket the Notes underlying
the Upper DECS at a price equal to at least 100.5% of the Remarketing
Value in accordance with the terms of the Pledge Agreement by 4:00 p.m.,
New York City time, on the Business Day immediately preceding the
Scheduled Stock Purchase Date, a "Last Failed Remarketing" will be
deemed to have occurred.
(ii) Within three Business Days following the end of
a Remarketing Period which constituted a Failed Remarketing, the
Remarketing Agent shall return any Notes delivered to it to the
Collateral Agent, other than Notes deemed purchased by the
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Company pursuant to Section 206 of the Supplemental Indenture. Following
a Last Failed Remarketing or a Last Failed Accelerated Remarketing, the
Collateral Agent, for the benefit of the Company, may exercise its
rights as a secured party with respect to such Notes, including those
actions specified in subsection 5.2(f) below, with respect to Notes not
deemed purchased by the Company; provided, that if upon a Last Failed
Remarketing or Last Failed Accelerated Remarketing, the Collateral Agent
delivers any Notes to the Company in full satisfaction of the Holder's
obligation under the related Forward Purchase Contracts, any accumulated
and unpaid interest on such Notes will become payable by the Company to
the Agent for payment to the Holder of the Upper DECS to which such
Notes relate. Such payment will be made by the Company on or prior to
11:00 a.m., New York City time, on the relevant Stock Purchase Date in
lawful money of the United States by certified or cashier's check or
wire transfer in immediately available funds payable to or upon the
order of the Agent. Upon the occurrence of a Last Failed Remarketing or
a Last Failed Accelerated Remarketing, the Company will purchase on the
relevant Stock Purchase Date the Notes of all holders, except Notes for
which an Opt-Out Notice has been delivered to the Company in compliance
with Section 206 of the Supplemental Indenture for an amount equal to
the Stated Amount of the Note, plus an amount in cash equal to the value
of the Treasury securities described in subclause (ii) of the definition
of Accelerated Remarketing Value (assuming for this purpose that the
relevant Subsequent Remarketing Date is the Accelerated Stock Purchase
Date). The proceeds of the sale of Notes deemed to be submitted for sale
to the Company shall be paid (a) to the Collateral Agent on behalf of
such Holder to satisfy such Holder's obligation to pay the Purchase
Price under the related Forward Purchase Contract if such Notes are part
of an Upper DECS, with any remaining proceeds paid to the Agent for
payment to such Holder, and (b) to the Holder of such Notes if the Notes
are Separate Notes. The Company will publish notice by means of
Bloomberg and Reuters newswires of any Remarketing Period during which
no successful remarketing occurred, such notice to be published not
later than the fourth Business Day following the end of such Remarketing
Period. The Company will cause a notice of the Last Failed Remarketing
to be published on the fourth Business Day following the date of the
Last Failed Remarketing in a daily newspaper in the English language of
general circulation in The City of New York, which is expected to be The
Wall Street Journal.
(f) With respect to any Notes which constitute part of Upper
DECS which are subject to the Last Failed Remarketing or for which an
Opt-Out Notice was delivered but for which no cash payment was
delivered, the Collateral Agent for the benefit of the Company reserves
all of its rights as a secured party with respect thereto and, subject
to applicable law and Section 5.2 (j) below, may, among other things,
permit the Company to cause the Notes to be sold or to retain and cancel
such Notes, in either case, in full satisfaction of the Holders'
obligations under the Forward Purchase Contracts.
(g) A Holder of Upper DECS may elect not to participate in a
remarketing and retain the Notes underlying such Upper DECS by notifying
the Agent of such election and delivering the specific U.S. Treasury
security or securities (including the CUSIP number and/or the principal
terms of such security or securities) identified by the Agent that
constitute the U.S. Treasury securities described in clauses (1) and (2)
of the definition of Remarketing Value relating to the retained Notes
(as if only such Notes
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were being remarketed) (the "Opt-out Treasury Consideration") to the
Agent not later than 10:00 a.m. on the fourth Business Day prior to the
Remarketing Date or the Accelerated Remarketing Date, as applicable (or,
in the case of a Failed Remarketing, not later than 10:00 a.m. on the
fourth Business Day immediately prior to the subsequent Remarketing
Period). Upon receipt thereof by the Agent, the Agent shall deliver such
Opt-out Treasury Consideration to the Collateral Agent, which will, for
the benefit of the Company, thereupon apply such Opt-out Treasury
Consideration to secure such Holder's obligations under the Forward
Purchase Contracts. On the first Business Day immediately preceding the
Remarketing Date or the Accelerated Remarketing Date (or, in the case of
a Failed Remarketing, the subsequent Remarketing Period), the Collateral
Agent, pursuant to the terms of the Pledge Agreement, will deliver the
Pledged Notes of such Holder to the Agent. Within three Business Days
following any Remarketing Period, (A) if the remarketing was successful,
the Agent shall distribute such Notes to the Holders thereof, and (B) if
there was a Failed Remarketing, the Agent will deliver such Notes to the
Collateral Agent, which will, for the benefit of the Company, thereupon
apply such Notes to secure such Holders' obligations under the Forward
Purchase Contracts and return the Opt-out Treasury Consideration
delivered by such Holders to such Holders. A Holder that does not so
deliver the Opt-out Treasury Consideration pursuant to this clause (g)
shall be deemed to have elected to participate in the remarketing.
(h) Upon the maturity of the Pledged Treasury Securities
underlying the Stripped DECS and the Pledged Treasury Consideration or
Pledged Applicable Ownership Interest in the Treasury Portfolio, as the
case may be, underlying the Upper DECS, on the relevant Stock Purchase
Date, the Collateral Agent shall remit to the Company an amount equal to
the aggregate Purchase Price applicable to such DECS, as payment for the
Common Stock issuable upon settlement thereof without receiving any
instructions from the Holders of such DECS. In the event the payments in
respect of the Pledged Treasury Securities, Pledged Treasury
Consideration or Pledged Applicable Ownership Interest in the Treasury
Portfolio underlying a DECS are in excess of the Purchase Price under
the Forward Purchase Contract being settled thereby, the Collateral
Agent will distribute such excess to the Agent for the benefit of the
Holder of such DECS when received.
(i) Any distribution to Holders of excess funds and interest
described in Section 5.2(c) and (d) above shall be payable at the office
of the Agent in The City of New York maintained for that purpose or, at
the option of the Holder or the Holder of Separate Notes, as applicable,
by check mailed to the address of the Person entitled thereto at such
address as it appears on the relevant Register or by wire transfer to an
account specified by the Holder or the holder of Separate Notes, as
applicable.
(j) The obligations of each Holder to pay the Purchase Price
are non-recourse obligations and except to the extent paid by Cash
Settlement, Early Settlement or Merger Early Settlement, are payable
solely out of the proceeds of any Collateral pledged to secure the
obligations of the Holder, and in no event will any Holder be liable for
any deficiency between such proceeds and the Purchase Price.
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(k) Notwithstanding anything to the contrary herein, the
Company shall not be obligated to issue any Common Stock in respect of a
Forward Purchase Contract or deliver any certificates therefor to the
Holder of the related DECS unless the Company shall have received
payment in full for the shares of Common Stock to be purchased
thereunder by such Holder in the manner herein set forth.
(l) In the event of a successful remarketing, the interest
rate on all of the outstanding Notes (whether or not included in the
remarketing) shall be adjusted to the Reset Rate.
Section 5.3 Issuance of Shares of Common Stock.
Unless a Termination Event shall have occurred on or prior to the
relevant Stock Purchase Date or an Early Settlement or a Merger Early Settlement
shall have occurred with respect to all of the outstanding DECS, on the relevant
Stock Purchase Date, upon its receipt of payment for the shares of Common Stock
purchased by the Holders pursuant to the provisions of this Article and subject
to Section 5.4, the Company shall issue and deposit with the Agent, for the
benefit of the Holders of the Outstanding DECS, one or more certificates or
book-entry interests representing the newly issued shares of Common Stock
registered in the name of the Agent (or its nominee) as custodian for the
Holders (such certificates or book-entry interests for shares of Common Stock,
together with any dividends or distributions for which a record date and payment
date for such dividend or distribution has occurred after the relevant Stock
Purchase Date, being hereinafter referred to as the "Forward Purchase Contract
Settlement Fund") to which the Holders are entitled hereunder. Subject to the
foregoing, upon surrender of a Certificate to the Agent on or after the relevant
Stock Purchase Date, together with settlement instructions thereon duly
completed and executed, the Holder of such Certificate shall be entitled to
receive in exchange therefor a certificate or book-entry interest representing
that number of whole shares of Common Stock which such Holder is entitled to
receive pursuant to the provisions of this Article V (after taking into account
all DECS then held by such Holder) together with cash in lieu of fractional
shares as provided in Section 5.11 and any dividends or distributions with
respect to such shares constituting part of the Forward Purchase Contract
Settlement Fund, but without any interest thereon, and the Certificate so
surrendered shall forthwith be cancelled. Such shares shall be registered in the
name of the Holder or the Holder's designee as specified in the settlement
instructions provided by the Holder to the Agent. If any shares of Common Stock
issued in respect of a Forward Purchase Contract are to be registered to a
Person other than the Person in whose name the Certificate evidencing such
Forward Purchase Contract is registered, no such registration shall be made
unless the Person requesting such registration has paid any transfer and other
taxes required by reason of such registration in a name other than that of the
registered Holder of such Certificate or has established to the satisfaction of
the Company that such tax either has been paid or is not payable.
Section 5.4 Adjustment of Settlement Rate.
(a) Adjustments for Dividends, Distributions, Stock Splits,
Etc.
(1) Stock Dividends. In case the Company
shall pay or make a dividend or other distribution on
the Common Stock in Common Stock,
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the Settlement Rate, Early Settlement Rate or
Accelerated Settlement Rate, as applicable, as in effect
at the opening of business on the day following the date
fixed for the determination of stockholders entitled to
receive such dividend or other distribution shall be
increased by dividing such Settlement Rate, Early
Settlement Rate or Accelerated Settlement Rate by a
fraction of which the numerator shall be the number of
shares of Common Stock outstanding at the close of
business on the date fixed for such determination and
the denominator shall be the sum of such number of
shares and the total number of shares constituting such
dividend or other distribution, such increase to become
effective immediately after the opening of business on
the day following the date fixed for such determination.
For the purposes of this paragraph (1), the number of
shares of Common Stock at the time outstanding shall not
include shares held in the treasury of the Company but
shall include any shares issuable in respect of any
scrip certificates issued in lieu of fractions of shares
of Common Stock. The Company will not pay any dividend
or make any distribution on shares of Common Stock held
in the treasury of the Company.
(2) Stock Purchase Rights. 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 DECS upon settlement
of the Forward Purchase Contracts underlying such DECS)
entitling them to subscribe for or purchase shares of
Common Stock at a price per share less than the Current
Market Price per share of the Common Stock on the date
fixed for the determination of stockholders entitled to
receive such rights, options or warrants (other than
pursuant to a dividend reinvestment, share purchase or
similar plan), the Settlement Rate, Early Settlement
Rate or Accelerated Settlement Rate, as applicable, 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, Early Settlement Rate
or Accelerated Settlement Rate, as applicable, by a
fraction, the numerator of which shall be the number of
shares of Common Stock outstanding at the close of
business on the date fixed for such determination plus
the number of shares of Common Stock which the aggregate
of the offering price of the total number of shares of
Common Stock so offered for subscription or purchase
would purchase at such Current Market Price and the
denominator of which shall be the number of shares of
Common Stock outstanding at the close of business on the
date fixed for such determination plus the number of
shares of Common Stock so offered for subscription or
purchase, such increase to become effective immediately
after the opening of business on the day following the
date fixed for such determination. For the purposes of
this paragraph (2), the number of shares of Common Stock
at any time outstanding shall not include shares held in
the treasury of the Company but shall include any shares
issuable in respect of any scrip certificates issued in
lieu of fractions of shares of Common Stock. The Company
shall not issue any such rights, options or
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warrants in respect of shares of Common Stock held in
the treasury of the Company.
(3) Stock Splits; Reverse Splits. In case
outstanding shares of Common Stock shall be subdivided
or split into a greater number of shares of Common
Stock, the Settlement Rate, Early Settlement Rate or
Accelerated Settlement Rate, as applicable, 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 be
combined into a smaller number of shares of Common
Stock, the Settlement Rate, Early Settlement Rate or
Accelerated Settlement Rate, as applicable, in effect at
the opening of business on the day following the day
upon which such combination becomes effective shall be
proportionately reduced, such increase or reduction, as
the case may be, to become effective immediately after
the opening of business on the day following the day
upon which such subdivision, split or combination
becomes effective.
(4) Debt or Asset Distributions. (i) In case
the Company shall, by dividend or otherwise, distribute
to all holders of its Common Stock evidences of its
indebtedness 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,
shares of capital stock of any class or series, or
similar equity interests, of or relating to a subsidiary
or other business unit in the case of a Spin-Off
referred to in the next paragraph, or distribution
referred to in paragraph (1) of this Section), the
Settlement Rate, Early Settlement Rate or Accelerated
Settlement Rate, as applicable, shall be adjusted so
that the same shall equal the rate determined by
dividing the Settlement Rate, Early Settlement Rate or
Accelerated Settlement Rate, as applicable, in effect
immediately prior to the close of business on the date
fixed for the determination of stockholders entitled to
receive such distribution by a fraction, the numerator
of which shall be the Current Market Price per share of
the Common Stock on the date fixed for such
determination less the then fair market value (as
determined by the Board of Directors, whose
determination shall be conclusive and described in a
Board Resolution) of the portion of the assets or
evidences of indebtedness so distributed applicable to
one share of Common Stock and the denominator of which
shall be such Current Market Price per share of the
Common Stock, such adjustment to become effective
immediately prior to the opening of business on the day
following the date fixed for the determination of
stockholders entitled to receive such distribution. In
any case in which this paragraph (4) is applicable,
paragraph (2) of this Section shall not be applicable.
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(ii) In the case of a Spin-Off, the Settlement Rate,
Early Settlement Rate or Accelerated Settlement Rate, as applicable, in
effect immediately before the close of business on the record date fixed
for determination of stockholders entitled to receive that distribution
will be increased by multiplying the Settlement Rate, Early Settlement
Rate or Accelerated Settlement Rate, as applicable, by a fraction, the
numerator of which is the Current Market Price per share of the Common
Stock plus the Fair Market Value of the portion of those shares of
Capital Stock or similar equity interests so distributed applicable to
one share of Common Stock and the denominator of which is the Current
Market Price per share of the Common Stock. Any adjustment to the
Settlement Rate, Early Settlement Rate or Accelerated Settlement Rate
under this paragraph 4(ii) will occur at the earlier of (1) the tenth
Trading Day from, and including, the effective date of the Spin-Off and
(2) the date of the securities being offered in the Initial Public
Offering of the Spin-Off, if that Initial Public Offering is effected
simultaneously with the Spin-Off.
(1) Cash Distributions. 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 5.4(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 of the date of the
expiration of the tender or exchange offer referred to
below (as determined by the Board of Directors, whose
determination shall be conclusive and described in a
Board Resolution) of consideration payable in respect of
any tender or exchange offer by the Company or any of
its subsidiaries for all or any portion of the Common
Stock concluded within the 12 months preceding the date
of payment of the distribution described in clause (i)
above and in respect of which no adjustment pursuant to
this paragraph (5) or paragraph (6) 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, Early Settlement Rate or Accelerated
Settlement Rate, as applicable, shall be increased so
that the same shall equal the rate determined by
dividing the Settlement Rate, Early Settlement Rate or
Accelerated Settlement Rate, as applicable, in effect
immediately prior to the close of business on the date
fixed for determination of the stockholders entitled to
receive such distribution by a fraction (A) the
numerator of which shall be equal to the Current Market
Price per share of the Common Stock on the date fixed
for such determination less an amount equal to the
quotient of (x) the combined
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amount distributed or payable in the transactions
described in clauses (i), (ii) and (iii) above and (y)
the number of shares of Common Stock outstanding on such
date for determination and (B) the denominator of which
shall be equal to the Current Market Price per share of
the Common Stock on such date for determination.
(2) Tender Offers. In case (i) a tender or
exchange offer made by the Company or any subsidiary of
the Company for all or any portion of the Common Stock
shall expire and such tender or exchange offer (as
amended upon the expiration thereof) shall require the
payment to stockholders (based on the acceptance (up to
any maximum specified in the terms of the tender or
exchange offer) of Purchased Shares) of an aggregate
consideration having a fair market value (as determined
by the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution) that
combined together with (ii) the aggregate of the cash
plus the fair market value (as determined by the Board
of Directors, whose determination shall be conclusive
and described in a Board Resolution), as of the
expiration of such tender or exchange offer, of
consideration payable in respect of any other tender or
exchange offer, by the Company or any subsidiary of the
Company for all or any portion of the Common Stock
expiring within the 12 months preceding the expiration
of such tender or exchange offer and in respect of which
no adjustment pursuant to paragraph (5) of this Section
or this paragraph (6) has been made and (iii) the
aggregate amount of any distributions to all holders of
the Company's Common Stock made exclusively in cash
within the 12 months preceding the expiration of such
tender or exchange offer and in respect of which no
adjustment pursuant to paragraph (5) of this Section or
this paragraph (6) has been made, exceeds 15% of the
product of the Current Market Price per share of the
Common Stock as of the last time (the "Expiration Time")
tenders could have been made pursuant to such tender or
exchange offer (as it may be amended) times the number
of shares of Common Stock outstanding (including any
tendered shares) at 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, Early Settlement Rate or
Accelerated Settlement Rate, as applicable, shall be
adjusted so that the same shall equal the rate
determined by dividing the Settlement Rate, Early
Settlement Rate or Accelerated Settlement Rate, as
applicable, immediately prior to the close of business
on the date of the Expiration Time by a fraction (A) the
numerator of which shall be equal to (x) the product of
(I) the 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) at the Expiration Time less (y) the
amount of cash plus the fair market value (determined as
aforesaid) of the aggregate consideration payable to
stockholders based on the transactions described in
clauses (i), (ii) and (iii) above (assuming in the case
of clause (i) the acceptance, up to any maximum
specified in the terms of the tender
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or exchange offer, of Purchased Shares), and (B) the
denominator of which shall be equal to the product of
(x) the Current Market Price per share of the Common
Stock as of the Expiration Time and (y) the number of
shares of Common Stock outstanding (including any
tendered shares) as of the Expiration Time less the
number of all shares validly tendered and not withdrawn
as of the Expiration Time (the shares deemed so
accepted, up to any such maximum, being referred to as
the "Purchased Shares").
(3) Reclassification. The reclassification
of Common Stock into securities including securities
other than Common Stock (other than any reclassification
upon a Reorganization Event to which Section 5.4(b)
applies) shall be deemed to involve (i) a distribution
of such securities other than Common Stock to all
holders of Common Stock (and the effective date of such
reclassification shall be deemed to be "the date fixed
for the determination of stockholders entitled to
receive such distribution" and the "date fixed for such
determination" within the meaning of paragraph (4) of
this Section), and (ii) a subdivision, split or
combination, as the case may be, of the number of shares
of Common Stock outstanding immediately prior to such
reclassification into the number of shares of Common
Stock outstanding immediately thereafter (and the
effective date of such reclassification shall be deemed
to be "the day upon which such subdivision or split
becomes effective" or "the day upon which such
combination becomes effective," as the case may be, and
"the day upon which such subdivision, split or
combination becomes effective" within the meaning of
paragraph (3) of this Section).
(4) "Current Market Price". The "Current
Market Price" of the Common Stock means (a) on any day
the average of the Sales Prices for the 5 consecutive
Trading Days preceding the earlier of the day preceding
the day in question and the day before the "ex date"
with respect to the issuance or distribution requiring
computation, (b) in the case of any Spin-Off that is
effected simultaneously with an Initial Public Offering
of the securities being distributed in the Spin-Off, the
Sale Price of the Common Stock on the Trading Day on
which the Initial Public Offering price of the
securities being distributed in the Spin-Off is
determined, and (c) in the case of any other Spin-Off,
the average of the Sale Prices of the Common Stock over
the first 10 Trading Days after the effective date of
such Spin-Off. For purposes of this paragraph, the term
"ex date," when used with respect to any issuance or
distribution, shall mean the first date on which the
Common Stock trades regular way on the relevant exchange
or in the relevant market without the right to receive
such issuance or distribution.
(5) Calculation of Adjustments. All
adjustments to the Settlement Rate, Early Settlement
Rate or Accelerated Settlement Rate, as applicable,
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,
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Early Settlement Rate or Accelerated Settlement Rate, as
applicable, shall be required unless such adjustment
would require an increase or decrease of at least one
percent therein; provided, that any adjustments which by
reason of this subparagraph are not required to be made
shall be carried forward and taken into account in any
subsequent adjustment. If an adjustment is made to the
Settlement Rate, Early Settlement Rate or Accelerated
Settlement Rate, as applicable, pursuant to paragraph
(1), (2), (3), (4), (5), (6), (7) or (10) of this
Section 5.4(a), an adjustment shall also be made to the
Applicable Market Value solely to determine which of
clauses (i), (ii) or (iii) of the definition of
Settlement Rate, Early Settlement Rate or Accelerated
Settlement Rate, as applicable, in Section 5.1(a) will
apply on a Stock Purchase Date. Such adjustment shall be
made by multiplying the Applicable Market Value by a
fraction, the numerator of which shall be the Settlement
Rate, Early Settlement Rate or Accelerated Settlement
Rate, as applicable, immediately after such adjustment
pursuant to paragraph (1), (2), (3), (4), (5), (6), (7)
or (10) of this Section 5.4(a) and the denominator of
which shall be the Settlement Rate, Early Settlement
Rate or Accelerated Settlement Rate, as applicable,
immediately before such adjustment; provided, that if
such adjustment to the Settlement Rate, Early Settlement
Rate or Accelerated Settlement Rate, as applicable, is
required to be made pursuant to the occurrence of any of
the events contemplated by paragraph (1), (2), (3), (4),
(5), (7) or (10) of this Section 5.4(a) during the
period taken into consideration for determining the
Applicable Market Value, appropriate and customary
adjustments shall be made to the Settlement Rate, Early
Settlement Rate or Accelerated Settlement Rate, as
applicable.
(6) Increase of Settlement Rate. The Company
may make such increases in the Settlement Rate, Early
Settlement Rate or Accelerated Settlement Rate, as
applicable, in addition to those required by this
Section, as it considers to be advisable in order to
avoid or diminish any income tax to any holders of
shares of Common Stock resulting from any dividend or
distribution of stock or issuance of rights or warrants
to purchase or subscribe for stock or from any event
treated as such for income tax purposes or for any other
reasons.
(b) Adjustment for Consolidation, Merger or Other
Reorganization Event.
In the event of
(1) any consolidation or merger of the
Company with or into another Person (other than a merger
or consolidation in which the Company is the continuing
corporation and in which the Common Stock outstanding
immediately prior to the merger or consolidation is not
exchanged for cash, securities or other property of the
Company or another corporation),
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(2) any sale, transfer, lease or conveyance
to another Person of the property of the Company as an
entirety or substantially as an entirety,
(3) any statutory exchange of securities of
the Company with another Person (other than in
connection with a merger or acquisition), or
(4) any liquidation, dissolution or winding
up of the Company other than as a result of or after the
occurrence of a Termination Event (any such event, a
"Reorganization Event"),
each share of Common Stock covered by each Forward Purchase Contract forming a
part of a DECS immediately prior to such Reorganization Event shall, after such
Reorganization Event, be converted for purposes of the Forward Purchase Contract
into the kind and amount of securities, cash and other property receivable in
such Reorganization Event (without any interest thereon, and without any right
to dividends or distributions thereon which have a record date that is prior to
the relevant Stock Purchase Date) per share of Common Stock by a holder of
Common Stock that (i) is not a Person with which the Company consolidated or
into which the Company merged or which merged into the Company or to which such
sale or transfer was made, as the case may be (any such Person, a "Constituent
Person"), or an Affiliate of a Constituent Person to the extent such
Reorganization Event provides for different treatment of Common Stock held by
Affiliates of the Company and non-Affiliates, and (ii) failed to exercise his
rights of election, if any, as to the kind or amount of securities, cash and
other property receivable upon such Reorganization Event (provided that if the
kind or amount of securities, cash and other property receivable upon such
Reorganization Event is not the same for each share of Common Stock held
immediately prior to such Reorganization Event by other than a Constituent
Person or an Affiliate thereof and in respect of which such rights of election
shall not have been exercised ("Non-electing Share"), then for the purpose of
this Section the kind and amount of securities, cash and other property
receivable upon such Reorganization Event by each Non-electing Share shall be
deemed to be the kind and amount so receivable per share by a plurality of the
Non-electing Shares). On the relevant Stock Purchase Date, the Settlement Rate
then in effect will be applied to the value on the relevant Stock Purchase Date
of such securities, cash or other property. In the event of such a
Reorganization Event, the Person formed by such consolidation, merger or
exchange or the Person which acquires the assets of the Company or, in the event
of a liquidation or dissolution of the Company, the Company or a liquidating
trust created in connection therewith, shall execute and deliver to the Agent an
agreement supplemental hereto providing that the Holder of each Outstanding DECS
shall have the rights provided by this Section 5.4. 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 5.5 Notice of Adjustments and Certain Other Events.
(a) Whenever the Settlement Rate, Early Settlement Rate or
Accelerated Settlement Rate, as applicable, is adjusted as herein
provided, the Company shall:
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(i) forthwith compute the Settlement Rate, Early
Settlement Rate or Accelerated Settlement Rate, as applicable,
and the Applicable Market Value in accordance with Section 5.4
and prepare and transmit to the Agent an Officer's Certificate
setting forth the Settlement Rate and the Applicable Market
Value, the method of calculation thereof in reasonable detail,
and the facts requiring such adjustment and upon which such
adjustment is based; and
(ii) as soon as practicable following the occurrence
of an event that requires an adjustment to the Settlement Rate,
Early Settlement Rate or Accelerated Settlement Rate, as
applicable, pursuant to Section 5.4 (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 DECS
of the occurrence of such event and a statement in reasonable
detail setting forth the method by which the adjustment to the
Settlement Rate, Early Settlement Rate or Accelerated Settlement
Rate, as applicable, and the Applicable Market Value was
determined and setting forth the adjusted Settlement Rate, Early
Settlement Rate or Accelerated Settlement Rate, as applicable,
and the Applicable Market Value.
(b) The Agent shall not at any time be under any duty or
responsibility to any Holder of DECS to determine whether any facts
exist which may require any adjustment of the Settlement Rate, Early
Settlement Rate or Accelerated Settlement Rate, as applicable, and the
Applicable Market Value, or with respect to the nature or extent or
calculation of any such adjustment when made, or with respect to the
method employed in making the same. The Agent shall not be accountable
with respect to the validity or value (or the kind or amount) of any
shares of Common Stock, or of any securities or property, which may at
any time be issued or delivered with respect to any Forward 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
Forward Purchase Contract or to comply with any of the duties,
responsibilities or covenants of the Company contained in this Article.
Section 5.6 Termination Event; Notice.
The Forward Purchase Contracts and all obligations and rights of the
Company and the Holders thereunder, including the rights and obligations of
Holders to purchase Common Stock, shall immediately and automatically terminate,
without the necessity of any notice or action by any Holder, the Agent or the
Company, if, on or prior to a Stock Purchase Date, a Termination Event shall
have occurred. Upon and after the occurrence of a Termination Event, the Upper
DECS shall thereafter represent the right to receive the Notes or the
appropriate Treasury Consideration or Applicable Ownership Interest in the
Treasury Portfolio, as the case may be, forming a part of such Upper DECS, and
the Stripped DECS shall thereafter represent the right to receive the Treasury
Securities forming a part of such Stripped DECS, in each case in accordance with
the provisions of Section 4.3 of the Pledge Agreement. Upon the occurrence of a
Termination Event, the Company shall promptly but in no event later than two
Business Days thereafter give written notice to the Agent, the Collateral Agent
and to the Holders, at their addresses as they appear in the applicable
Register.
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Section 5.7 Early Settlement.
(a) Subject to and upon compliance with the provisions of
this Section 5.7, Forward Purchase Contracts underlying DECS having an
aggregate Stated Amount equal to $1,000 or an integral multiple thereof,
may, at the option of the Holder thereof, be settled early ("Early
Settlement") on or prior to 10:00 a.m. on the seventh Business Day
immediately preceding the Scheduled Stock Purchase Date (or, if earlier,
on the fifth Business Day immediately preceding the Accelerated Stock
Purchase Date). In order to exercise the right to effect Early
Settlement with respect to any Forward Purchase Contracts, the Holder of
the Certificate evidencing the related DECS shall deliver such
Certificate to the Agent at the Corporate Trust Office duly endorsed for
transfer to the Company or in blank with the form of Election to Settle
Early on the reverse thereof duly completed and accompanied by payment
payable to the Company in immediately available funds in an amount (the
"Early Settlement Amount") equal to the product of (i) the Stated Amount
of such DECS multiplied by (ii) the number of Forward Purchase Contracts
with respect to which the Holder has elected to effect Early Settlement;
provided that, at that time, if so required by the United States federal
securities laws, a registration statement is in effect and a prospectus
is available covering the shares of the Common Stock of the Company to
be delivered in respect of the Forward Purchase Contracts being settled.
No payment or adjustment shall be made upon Early Settlement of any
Forward Purchase Contract on account of any dividends on the Common
Stock issued upon such Early Settlement. If the foregoing requirements
are first satisfied with respect to Forward Purchase Contracts
underlying any DECS at or prior to 5:00 p.m., New York City time, on a
Business Day, such day shall be the "Early Settlement Date" with respect
to such DECS 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 DECS
shall be the next succeeding Business Day.
(b) Upon Early Settlement of any Forward Purchase Contract
by the Holder of the related DECS, the Company shall issue, and the
Holder shall be entitled to receive, 0.6361 shares of Common Stock on
account of such Forward Purchase Contract (the "Early Settlement Rate").
The Early Settlement Rate shall be adjusted in the same manner and at
the same time as the Settlement Rate is adjusted. As promptly as
practicable after Early Settlement of Forward Purchase Contracts in
accordance with the provisions of this Section 5.7, the Company shall
issue and shall deliver to the Agent at the Corporate Trust Office a
certificate or certificates or book entry interest 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
5.11.
(c) No later than the third Business Day after the
applicable Early Settlement Date the Company shall cause (i) the shares
of Common Stock issuable upon Early Settlement of Forward Purchase
Contracts to be issued and delivered, and (ii) the related Pledged Notes
or Pledged Treasury Consideration or Pledged Applicable Ownership
Interest in the Treasury Portfolio, in the case of Upper DECS, or the
related Pledged Treasury Securities, in the case of Stripped DECS, to be
released from the Pledge by the
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Collateral Agent and transferred, in each case, to the Agent for
delivery to the Holder thereof or the Holder's designee.
(d) Upon Early Settlement of any Forward Purchase Contracts,
and subject to receipt of shares of Common Stock from the Company and
the Pledged Notes, Pledged Treasury Consideration, Pledged Applicable
Ownership Interest in the Treasury Portfolio, or Pledged Treasury
Securities, as the case may be, from the Collateral Agent, as
applicable, the Agent shall, in accordance with the instructions
provided by the Holder thereof on the applicable form of Election to
Settle Early on the reverse of the Certificate evidencing the related
DECS, (i) transfer to the Holder the Pledged Notes, Pledged Treasury
Consideration, Pledged Applicable Ownership Interest in the Treasury
Portfolio, or Pledged Treasury Securities, as the case may be, forming a
part of such DECS, and (ii) deliver to the Holder a certificate or
certificates or book-entry interest 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 5.11.
(e) In the event that Early Settlement is effected with
respect to Forward Purchase Contracts underlying less than all the DECS
evidenced by a Certificate, upon such Early Settlement the Company shall
execute and the Agent shall authenticate, execute on behalf of the
Holder thereof and deliver to the Holder thereof, at the expense of the
Company, a Certificate evidencing the DECS as to which Early Settlement
was not effected.
Section 5.8 Early Settlement Upon Merger.
(a) In the event of a merger or consolidation of the Company
of the type described in clause (1) of Section 5.4(b) in which the
Common Stock outstanding immediately prior to such merger or
consolidation is exchanged for consideration consisting of at least 30%
cash or cash equivalents (any such event a "Cash Merger"), then the
Company (or the successor to the Company hereunder) shall be required to
offer the Holder of each DECS the right to settle the Forward Purchase
Contract underlying such DECS prior to a Stock Purchase Date ("Merger
Early Settlement") as provided herein. On or before the fifth Business
Day after the consummation of a Cash Merger, the Company or, at the
request and expense of the Company, the Agent, shall give all Holders
notice of the occurrence of the Cash Merger and of the right of Merger
Early Settlement arising as a result thereof. The Company shall also
deliver a copy of such notice to the Agent and the Collateral Agent.
Each such notice shall contain:
(i) the date, which shall be not less than 20 nor
more than 30 calendar days after the date of such notice, on
which the Merger Early Settlement will be effected (the "Merger
Early Settlement Date");
(ii) the date, which shall be on or one Business Day
prior to the Merger Early Settlement Date, by which the Merger
Early Settlement right must be exercised;
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(iii) the Settlement Rate in effect as a result of
such Cash Merger and the kind and amount of securities, cash and
other property receivable by the Holder upon settlement of each
Forward Purchase Contract pursuant to Section 5.4(b);
(iv) a statement to the effect that all or a portion
of the Purchase Price payable by the Holder to settle the
Forward Purchase Contract will be offset against the amount of
cash so receivable upon exercise of Merger Early Settlement, as
applicable; and
(v) the instructions a Holder must follow to
exercise the Merger Early Settlement right.
(b) To exercise a Merger Early Settlement right, a Holder
shall deliver to the Agent at the Corporate Trust Office on or before
5:00 p.m., New York City time on the date specified in the notice the
Certificate(s) evidencing the DECS with respect to which the Merger
Early Settlement right is being exercised duly endorsed for transfer to
the Company or in blank with the form of Election to Settle Early on the
reverse thereof duly completed and accompanied by payment payable to the
Company in immediately available funds in an amount equal to the Early
Settlement Amount less the amount of cash that otherwise would be
deliverable by the Company or its successor upon settlement of the
Forward Purchase Contract in lieu of Common Stock pursuant to Section
5.4(b) and as described in the notice to Holders (the "Merger Early
Settlement Amount").
(c) On the Merger Early Settlement Date, the Company shall
deliver or cause to be delivered (i) the net cash, securities and other
property to be received by such exercising Holder, equal to the
Settlement Rate as adjusted pursuant to Section 5.4, in respect of the
number of Forward Purchase Contracts for which such Merger Early
Settlement right was exercised, and (ii) the related Pledged Notes,
Pledged Treasury Consideration or Pledged Applicable Ownership Interest
in the Treasury Portfolio, in the case of Upper DECS, or Pledged
Treasury Securities, in the case of Stripped DECS, to be released from
the Pledge by the Collateral Agent and transferred, in each case, to the
Agent for delivery to the Holder thereof or its designee. In the event a
Merger Early Settlement right shall be exercised by a Holder in
accordance with the terms hereof, all references herein to the Stock
Purchase Date shall be deemed to refer to such Merger Early Settlement
Date.
(d) Upon Merger Early Settlement of any Forward Purchase
Contracts, and subject to receipt of such net cash, securities or other
property from the Company and the Pledged Notes, Pledged Treasury
Consideration, Pledged Applicable Ownership Interest in the Treasury
Portfolio or Pledged Treasury Securities, as the case may be, from the
Collateral Agent, as applicable, the Agent shall, in accordance with the
instructions provided by the Holder thereof on the applicable form of
Election to Settle Early on the reverse of the Certificate evidencing
the related DECS, (i) transfer to the Holder the Pledged Notes, Pledged
Treasury Consideration, Pledged Applicable Ownership Interest in the
Treasury Portfolio, or Pledged Treasury Securities, as the case may be,
forming a
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part of such DECS, and (ii) deliver to the Holder such net cash,
securities or other property issuable upon such Merger Early Settlement
together with payment in lieu of any fraction of a share, as provided in
Section 5.11.
(e) In the event that Merger Early Settlement is effected
with respect to Forward Purchase Contracts underlying less than all the
DECS evidenced by a Certificate, upon such Merger Early Settlement the
Company (or the successor to the Company hereunder) shall execute and
the Agent shall authenticate, execute on behalf of the Holder thereof
and deliver to the Holder thereof, at the expense of the Company, a
Certificate evidencing the DECS as to which Merger Early Settlement was
not effected.
Section 5.9 Accelerated Remarketing and Settlement.
(a) If, prior to the Scheduled Stock Purchase Date, Capital
One Bank is notified or is deemed to be notified in accordance with 12
C.F.R.Section 208.42 that it is in the capital category "adequately
capitalized" (as defined in 12 C.F.R.Section 208.43 or any comparable or
successor provision of the "prompt corrective action" rules adopted
pursuant to Section 38 of the Federal Deposit Insurance Act, as amended,
to which Capital One Bank may then be subject (the "Prompt Corrective
Action Rules")) (the "Initial Acceleration Event"), the Company shall
provide notice of such event to the Agent and the Remarketing Agent no
later than three Business Days following the Initial Acceleration Event.
Upon the receipt of such notice, the Remarketing Agent shall accelerate
the remarketing of the Notes (an "Accelerated Remarketing") pursuant to
the procedures set forth in (b) below; provided, however, that if such
Initial Acceleration Event is solely the result of a change in the then
applicable Prompt Corrective Action Rules, the Agent shall, if so
instructed by the Company, delay the remarketing of the Notes by 90 days
after such Initial Acceleration Event (the "Grace Period"). If, before
the expiration of the Grace Period, Capital One Bank is notified or is
deemed to be notified in accordance with 12 C.F.R. Section 208.42 or any
comparable provision of the Prompt Corrective Action Rules that it is in
the capital category "well capitalized" (as defined in Prompt Corrective
Action Rules), the Accelerated Remarketing shall be cancelled.
(b) (i) In an Accelerated Remarketing resulting from and
following an Initial Acceleration Event, the Remarketing Agent and the
Holders of Upper DECS and Separate Notes shall follow the applicable
notice provisions as described in Section 5.2(b). Upon receipt of notice
from the Agent and the Custodial Agent and such Notes from the
Collateral Agent and the Custodial Agent in accordance with Section
5.2(b), the Remarketing Agent will, no later than the fourteenth
Business Day following the Initial Acceleration Event or, if applicable,
on the Business Day immediately following the expiration of the Grace
Period (the "Initial Capital Category Accelerated Remarketing Date") use
its commercially reasonable best efforts to (i) establish a Reset Rate
that, in the opinion of the Remarketing Agent, will, when applied to the
Notes (assuming, even if not true, that all of the Notes are included in
the remarketing), enable the then current aggregate market value of the
Notes to have a value equal to at least 100.5% of the Accelerated
Remarketing Value as of the Initial Capital Category Accelerated
Remarketing Date or as of any Subsequent Remarketing Date, as the case
may be, and
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(ii) sell such Notes on such date at a price equal to 100.5% of the
Accelerated Remarketing Value.
(ii) If, in spite of using its commercially reasonable best
efforts, the Remarketing Agent cannot remarket the Notes included in the
Accelerated Remarketing on the Initial Capital Category Accelerated
Remarketing Date at a price equal to at least 100.5% of the Accelerated
Remarketing Value, the Remarketing Agent will again attempt to remarket
the Notes included in the Accelerated Remarketing at a price equal to at
least 100.5% of the Accelerated Remarketing Value on each of the two
immediately following Business Days. If the Remarketing Agent cannot
remarket the Notes included in the Accelerated Remarketing on either of
those days, it will attempt to remarket the Notes included in the
Accelerated Remarketing at a price equal to at least 100.5% of the
Accelerated Remarketing Value on each of the three Business Days
immediately preceding either (x) if the Initial Capital Category
Accelerated Remarketing Date occurs prior to May 17, 2004, each
subsequent Payment Date, or (y) if the Initial Capital Category
Accelerated Remarketing Date occurs on or after May 17, 2004, the 17th
day of each following month until, in either case, the earlier to occur
of either (A) a successful remarketing or (B) a Stock Purchase Date
(each such three Business Day period a "Remarketing Period"). If the
Remarketing Agent cannot remarket the Notes included in the Accelerated
Remarketing on any such date in a Remarketing Period at a price equal to
at least 100.5% of the Accelerated Remarketing Value, the Accelerated
Remarketing in each such period will be deemed to have failed (each, a
"Failed Remarketing"). If, in spite of using its commercially reasonable
best efforts, the Remarketing Agent fails to remarket the Notes
underlying the Upper DECS at a price equal to at least 100.5% of the
Accelerated Remarketing Value by 4:00 p.m., New York City time, on the
Business Day immediately preceding the relevant Stock Purchase Date, the
"Last Failed Accelerated Remarketing" will be deemed to have occurred.
(c) (i) If, prior to the Scheduled Stock Purchase Date,
Capital One Bank is notified or deemed to be notified in accordance with
12 C.F.R. 208.42 or any comparable provision of the Prompt Corrective
Action Rules that it is in the capital category "undercapitalized" or
lower for purposes of the Prompt Corrective Action Rules (the "Secondary
Acceleration Event"), the Company shall provide notice of such event to
the Agent and the Remarketing Agent no later than three Business Days
following such Secondary Acceleration Event. Upon the receipt of such
notice, the Agent will accelerate the remarketing of the Notes as
provided in paragraph (ii) below and the Stock Purchase Date shall
automatically be accelerated to the date that is twenty-three Business
Days after the occurrence of the Secondary Acceleration Event but no
later than May 17, 2005 (the "Accelerated Stock Purchase Date"). Each
Forward Purchase Contract shall then obligate the Holder of the related
DECS to purchase and the Company to sell, on the Accelerated Stock
Purchase Date at a price equal to $50, a number of newly issued shares
of Common Stock equal to an accelerated settlement rate based on the
Applicable Market Value (the "Accelerated Settlement Rate"), subject to
any adjustments made pursuant to Section 5.4.
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(ii) Upon the occurrence of a Secondary Acceleration Event,
if the Notes have not been remarketed prior to such Secondary
Acceleration Event, the Remarketing Agent will begin remarketing the
Notes as soon as practicable, but in no event later than seven Business
Days (an "Accelerated Remarketing") after such Secondary Acceleration
Event (such date as selected by the Remarketing Agent, the "Secondary
Capital Category Accelerated Remarketing Date"). In an Accelerated
Remarketing resulting from and following a Secondary Acceleration Event,
the Remarketing Agent and the Holders of Upper DECS and Separate Notes
shall follow the applicable notice provisions as described in Section
5.2(b). If, in spite of using its commercially reasonable best efforts,
the Remarketing Agent cannot remarket the Notes included in the
Accelerated Remarketing on the Secondary Capital Category Accelerated
Remarketing Date at a price equal to at least 100.5% of the Accelerated
Remarketing Value, the Remarketing Agent will again attempt to remarket
the Notes included in the Accelerated Remarketing at a price equal to at
least 100.5% of the Accelerated Remarketing Value on each of the two
immediately following Business Days. If the Remarketing Agent cannot
remarket the Notes included in such Accelerated Remarketing on either of
these dates, it will attempt to remarket the Notes included in the
Accelerated Remarketing at a price equal to at least 100.5% of the
Accelerated Remarketing Value on each of the three Business Days
immediately preceding the Accelerated Stock Purchase Date (each such
three Business Day Period, a "Remarketing Period"). If, in spite of
using its commercially reasonable best efforts, the Remarketing Agent
fails to remarket the Notes underlying the Upper DECS at a price equal
to at least 100.5% of the Accelerated Remarketing Value by 4:00 p.m.,
New York City time, on the Business Day immediately preceding the
Accelerated Stock Purchase Date, a Last Failed Accelerated Remarketing
will be deemed to have occurred.
(d) In the event of an Accelerated Remarketing pursuant to
this Section 5.9, the provisions of Sections 5.2 (f) through (l) shall
apply. In the event of a Last Failed Accelerated Remarketing, the
provisions of Section 5.2(e)(ii) shall apply.
(e) Notwithstanding any other provision of this Agreement,
on the Accelerated Stock Purchase Date, if such date occurs:
(i) the Collateral Agent shall transfer to the
Company the Pledged Treasury Securities underlying the Stripped
DECS and any Pledged Treasury Consideration or Pledged
Applicable Ownership Interest in the Treasury Portfolio, as the
case may be, underlying the Upper DECS, in the amount
corresponding to the U.S. Treasury Securities referred to in
clause (i) of the definition of "Accelerated Remarketing Value",
in full satisfaction of the obligation of the relevant Holders
to pay the Purchase Price applicable to the DECS, as payment for
the Common Stock issuable upon settlement thereof, regardless of
whether on such Accelerated Stock Purchase Date the value of the
applicable Treasury securities equals the Purchase Price payable
in respect of the DECS to which they are applied in full
settlement; and
(ii) if a successful remarketing of the Notes or a
Tax Event Redemption has previously occurred, the Collateral
Agent shall distribute to the
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Agent for the benefit of the applicable Holders of the Upper
DECS the remaining portion of the Pledged Treasury Consideration
or Pledged Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, underlying the Upper DECS, which
corresponds to the U.S. Treasury securities referred to in
clause (ii) of the definition of "Accelerated Remarketing
Value".
Section 5.10 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 Forward Purchase Contracts; provided, that the Company shall not be required
to pay any such tax or taxes which may be payable in respect of any exchange of
or substitution for a Certificate evidencing a DECS or any issuance of a share
of Common Stock in a name other than that of the registered Holder of a
Certificate surrendered in respect of the DECS 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 book-entry interest
in Common Stock or Certificates unless and until the Person or Persons
requesting the transfer or issuance thereof shall have paid to the Company the
amount of such tax or shall have established to the satisfaction of the Company
that such tax has been paid.
Section 5.11 No Fractional Shares.
No fractional shares or scrip representing fractional shares of Common
Stock shall be issued or delivered upon settlement on a Stock Purchase Date or
upon Early Settlement or Merger Early Settlement of any Forward Purchase
Contracts. If Certificates evidencing more than one Forward 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 Forward Purchase Contracts
evidenced by the Certificates so surrendered. Instead of any fractional share of
Common Stock which would otherwise be deliverable upon settlement of any Forward
Purchase Contracts on the applicable Settlement Date or upon Early Settlement or
Merger Early Settlement, the Company, through the Agent, shall make a cash
payment in respect of such fractional share in an amount equal to the value of
such fractional share times the Applicable Market Value. The Company shall
provide the Agent from time to time with sufficient funds to permit the Agent to
make all cash payments required by this Section 5.10 in a timely manner.
Section 5.12 Tax Treatment.
The Company covenants and agrees and each Holder, by purchasing the DECS
agrees, to (i) treat a Holder's acquisition of the DECS as the acquisition of
the Note and Forward Purchase Contract constituting the DECS and (ii) treat each
Holder as the owner for all tax purposes of the related Notes, Treasury
Consideration, Applicable Ownership Interest in the Treasury Portfolio or
Treasury Securities, as the case may be.
ARTICLE VI.
REMEDIES
Section 6.1 Unconditional Right of Holders to Purchase Common Stock.
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Subject to Section 5.6, the Holder of any DECS shall have the right,
which is absolute and unconditional, to purchase Common Stock pursuant to the
Forward Purchase Contract constituting a part of such DECS and to institute suit
for the enforcement of any such right to purchase Common Stock, and such right
shall not be impaired without the consent of such Holder.
Section 6.2 Restoration of Rights and Remedies.
If any Holder has instituted any proceeding to enforce any right or
remedy under this Agreement and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to such Holder, then
and in every such case, subject to any determination in such proceeding, the
Company and such Holder shall be restored severally and respectively to their
former positions hereunder and thereafter all rights and remedies of such Holder
shall continue as though no such proceeding had been instituted.
Section 6.3 Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Certificates in Section 3.10(f), no
right or remedy herein conferred upon or reserved to the Holders is intended to
be exclusive of any other right or remedy, and every right and remedy shall, to
the extent permitted by law, be cumulative and in addition to every other right
and remedy given hereunder or now or hereafter existing at law or in equity or
otherwise. The assertion or employment of any right or remedy hereunder, or
otherwise, shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.
Section 6.4 Delay or Omission Not Waiver.
No delay or omission of any Holder to exercise any right or remedy upon
a default shall impair any such right or remedy or constitute a waiver of any
such right. Every right and remedy given by this Article or by law to the
Holders may be exercised from time to time, and as often as may be deemed
expedient, by such Holders.
Section 6.5 Undertaking For Costs.
All parties to this Agreement agree, and each Holder of a DECS, by its
acceptance of such DECS shall be deemed to have agreed, that any court may in
its discretion require, in any suit for the enforcement of any right or remedy
under this Agreement, or in any suit against the Agent for any action taken,
suffered or omitted by it as Agent, the filing by any party litigant in such
suit of an undertaking to pay the costs of such suit, and that such court may in
its discretion assess reasonable costs, including reasonable attorneys' fees and
expenses, against any party litigant in such suit, having due regard to the
merits and good faith of the claims or defenses made by such party litigant;
provided that the provisions of this Section shall not apply to any suit
instituted by the Company, to any suit instituted by the Agent, to any suit
instituted by any Holder, or group of Holders, holding in the aggregate more
than 10% of the Outstanding DECS, or to any suit instituted by any Holder for
the enforcement of distributions on any Notes or any Forward Purchase Contract
on or after the respective Payment Date therefor in respect of any DECS held by
such Holder, or for enforcement of the right to purchase shares of Common Stock
under the Forward Purchase Contract constituting part of any DECS held by such
Holder.
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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 in 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, but will suffer and permit the execution of every power of the Agent and
the Holders as though no such law had been enacted.
ARTICLE VII.
THE AGENT
Section 7.1 Certain Duties, Rights and Immunities.
(a) The Agent shall act as agent and attorney-in-fact for
the Holders of the DECS hereunder with such powers as are specifically
vested in the Agent by the terms of this Agreement, the Pledge
Agreement, the Remarketing Agreement, the Notes and the DECS, and any
documents evidencing them or related thereto (the "Transaction
Documents"), together with such other powers as are reasonably
incidental thereto. The Agent:
(1) shall have no duties or responsibilities
except those expressly set forth in the Transaction
Documents and no implied covenants or obligations shall
be inferred from any Transaction Documents against the
Agent, nor shall the Agent be bound by the provisions of
any agreement by any party hereto beyond the specific
terms hereof;
(2) shall be entitled conclusively to rely
upon (x) any certification, order, judgment, opinion,
notice or other communication (including, without
limitation, any thereof by telephone or facsimile)
reasonably believed by it to be genuine and correct and
to have been signed or sent by or on behalf of the
proper Person or Persons (without being required to
determine the correctness of any fact stated therein),
(y) the truth of the statements and the correctness of
the opinions expressed therein and (z) advice and
statements of legal counsel and other experts selected
by the Agent;
(3) as to any matters not expressly provided
for by any Transaction Document, shall in all cases be
fully protected in acting, or in refraining from acting,
hereunder or thereunder in accordance with instructions
given by the Company or the Holders in accordance with
the Transaction Documents;
(4) shall not be responsible for any
recitals contained in any Transaction Document, or in
any certificate or other document referred to or
provided for in, or received by it under, any
Transaction Document or
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the DECS, or for the value, validity, effectiveness,
genuineness, enforceability or sufficiency of any
Transaction Document (other than as against the Agent)
or the DECS or any other document referred to or
provided for herein or therein or for any failure by the
Company, any Holder or any other Person (except the
Agent) to perform any of its obligations hereunder or
thereunder or for the perfection, priority or, except as
expressly required hereby, existence, validity,
perfection or maintenance of any security interest
created under the Pledge Agreement, or for the use or
application by the Company of the proceeds in respect of
the Forward Purchase Contracts;
(5) shall not be required to initiate or
conduct any litigation or collection proceedings
hereunder;
(6) shall not be responsible for any action
taken or omitted to be taken by it hereunder or under
any other document or instrument referred to or provided
for herein or in connection herewith or therewith,
except for its own gross negligence, bad faith or
willful misconduct; and
(7) shall not be required to advise any
party as to selling or retaining, or taking or
refraining from taking any action with respect to, the
DECS or other rights under any Transaction Document.
(b) No provision of any Transaction Document shall be
construed to relieve the Agent from liability for its own negligent
action, its own negligent failure to act, its own bad faith, or its own
willful misconduct, except that:
(1) this paragraph (b) shall not be
construed to limit the effect of paragraph (a) of this
Section;
(2) the Agent shall not be liable for any
error of judgment made in good faith by a Responsible
Officer, unless it shall be proved that the Agent was
grossly negligent in ascertaining the pertinent facts;
and
(3) in no event shall the Agent be required
to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its
duties hereunder.
(c) In no event shall the Agent or its officers, employees
or agents be liable for any special, indirect, individual, punitive or
consequential loss or damages, lost profits or loss of business, arising
in connection with any Transaction Document, whether or not the
likelihood of such loss or damage was known to the Agent, and regardless
of the form of action.
(d) Whether or not therein expressly so provided, every
provision of every Transaction Document relating to the conduct or
affecting the liability of or affording protection to the Agent shall be
subject to the provisions of this Section.
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(e) The Agent is authorized to execute and deliver the
Pledge Agreement and the Remarketing Agreement and any supplement
thereto in its capacity as Agent. The Agent shall be entitled to all of
the rights, privileges, immunities and indemnities contained in this
Agreement with respect to any duties of the Agent under, or actions
taken, omitted to be taken or suffered by the Agent pursuant to the
Pledge Agreement.
(f) The Agent shall have no liability whatsoever for the
action or inaction of any Clearing Agency or any book-entry system
thereof. In no event shall any Clearing Agency or any book-entry system
thereof be deemed an agent or subcustodian of the Agent.
(g) The Agent shall not be responsible or liable for any
failure or delay in the performance of its obligations under any
Transaction Document arising out of or caused, directly or indirectly,
by circumstances beyond its reasonable control, including, without
limitation, acts of God; acts of terrorism; earthquakes; fires; floods;
wars; civil or military disturbances; sabotage; epidemics; riots;
interruptions, loss or malfunctions of utilities, computer (hardware or
software) or communications service; accidents; labor disputes; acts of
civil or military authority; governmental actions; or inability to
obtain labor, material, equipment or transportation.
Section 7.2 Notice of Default.
Within 30 days after the occurrence of any default by the Company
hereunder of which a Responsible Officer of the Agent has actual knowledge, the
Agent shall transmit by mail to the Company and the Holders of DECS, as their
names and addresses appear in the Register, notice of such default hereunder,
unless such default shall have been cured or waived.
Section 7.3 Certain Rights of Agent.
Subject to the provisions of Section 7.1:
(a) the Agent may conclusively rely and shall be fully
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 Officer's Certificate, Issuer
Order or Issuer Request, and any resolution of the Board of Directors of
the Company may be sufficiently evidenced by a Board Resolution;
(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 Officer's Certificate of
the Company;
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(d) the Agent may consult with counsel of its selection and
the advice of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in reliance
thereon;
(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 execution, delivery and performance of the Forward
Purchase Contracts as it may see fit, and, if the Agent shall determine
to make such further inquiry or investigation, it shall be given a
reasonable opportunity to examine the books, records and premises of the
Company, personally or by agent or attorney;
(f) the Agent may execute any of the powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys or an Affiliate of the Agent and the Agent shall not be
responsible for any misconduct or negligence on the part of any agent or
attorney or an Affiliate appointed with due care by it hereunder;
(g) the rights, privileges, protections, immunities and
benefits given to the Agent, including, but not limited to, its right to
be indemnified, are extended to, and shall be enforceable by, the Agent
in each of its capacities hereunder, and to each Agent, custodian and
other person employed to act hereunder;
(h) the Agent shall not be charged with knowledge of any
default by the Company hereunder unless a Responsible Officer of the
Agent shall have received at the Corporate Trust Office of the Agent
written notice of such default; and
(i) the permissive right of the Agent to do things
enumerated in this Agreement shall not be construed as a duty.
Section 7.4 Not Responsible For Recitals, Etc.
The recitals contained herein and in the Certificates shall be taken as
the statements of the Company 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 DECS, 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 DECS or the Forward Purchase Contracts
and shall not be responsible for the perfection, priority or maintenance of any
security interests created or intended to be created under the Pledge Agreement.
Section 7.5 May Hold DECS and Other Dealings.
Any Registrar or any other agent of the Company, or the Agent and its
Affiliates, in their individual or any other capacity, may become the owner or
pledgee of DECS and may otherwise deal with the Company, the Collateral Agent or
any other Person with the same rights it would have if it were not Registrar or
such other agent, or the Agent. The Agent and its Affiliates may
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(without having to account therefor to the Company or any Holder of DECS or
holder of Separate Notes) accept deposits from, lend money to, make other
investments in and generally engage in any kind of banking, trust or other
business with the Company, any Holder of DECS and any holder of Separate Notes
(and any of their respective subsidiaries or Affiliates) as if it were not
acting as the Agent and the Agent and its Affiliates may accept fees and other
consideration from the Company, any Holder of DECS or any holder of Separate
Notes without having to account for the same to any such Person.
Section 7.6 Money Held In Custody.
Money held by the Agent in custody hereunder need not be segregated
from the Agent's other funds except to the extent required by law or provided
herein. The Agent shall be under no obligation to invest or pay interest on any
money received by it hereunder except as otherwise agreed in writing with the
Company.
Section 7.7 Compensation and Reimbursement.
The Company agrees:
(a) to pay to the Agent from time to time compensation for
all services rendered by it hereunder or under the Transaction Documents
as shall be agreed in writing between the Company and the Agent;
(b) to reimburse the Agent upon its request for all
reasonable expenses, disbursements and advances incurred or made by the
Agent in accordance with any provision of this Agreement or the
Transaction Documents (including the reasonable compensation and the
reasonable expenses and disbursements of its agents and counsel), except
any such expense, disbursement or advance as may be attributable to its
negligence, willful misconduct or bad faith; and
(c) to indemnify the Agent for, and to hold it harmless
against, any loss, liability or reasonable out-of-pocket expense
incurred without gross negligence, willful misconduct or bad faith on
its part, arising out of or in connection with the acceptance or
administration of its duties under the Transaction Documents, including
the costs and expenses (including reasonable fees and expenses of
counsel) of defending itself against any claim, whether asserted by the
Company, a Holder or any other Person, or liability in connection with
the exercise or performance of any of its powers or duties under the
Transaction Documents. The Agent shall promptly notify the Company of
any third party claim which may give rise to the indemnity hereunder and
give the Company the opportunity to participate in the defense of such
claim with counsel reasonably satisfactory to the indemnified party, and
no such claim shall be settled without the written consent of the
Company, which consent shall not be unreasonably withheld, provided that
any failure to give any such notice shall not affect the obligation of
the Company under this Section. The provisions of this Section 7.7 shall
survive the termination of this Agreement, the satisfaction or discharge
of the DECS and/ or the Separate Notes or the resignation or removal of
the Agent.
Section 7.8 Corporate Agent Required; Eligibility.
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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 $500,000,000,
subject to supervision or examination by federal or state authority and having
(or being a member of a bank holding company having) a Corporate Trust Office in
the Borough of Manhattan, the City of New York, if there be such a corporation,
qualified and eligible under this Article and willing to act on reasonable
terms. If such corporation publishes reports of condition at least annually,
pursuant to law or to the requirements of said supervising or examining
authority, then for the purposes of this Section, the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. If at
any time the Agent shall cease to be eligible in accordance with the provisions
of this Section, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article.
Section 7.9 Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Agent and no
appointment of a successor Agent pursuant to this Article shall become
effective until the acceptance of appointment by the successor Agent in
accordance with the applicable requirements of Section 7.10.
(b) The Agent may resign at any time by giving written
notice thereof to the Company 60 days prior to the effective date of
such resignation. If the instrument of acceptance by a successor Agent
required by Section 7.10 shall not have been delivered to the Agent
within 30 days after the giving of such notice of resignation, the
resigning Agent may petition, at the expense of the Company, any court
of competent jurisdiction for the appointment of a successor Agent.
(c) The Agent may be removed at any time by Act of the
Holders of a majority in number of the Outstanding DECS delivered a
written notice to the Agent and the Company. If the instrument of
acceptance by a successor Agent required by Section 7.10 shall not have
been delivered to the Agent within 30 days after the giving of such
notice of removal, the Agent to be removed may petition, at the expense
of the Company, any court of competent jurisdiction for the appointment
of a successor Agent.
(d) If at any time:
(1) the Agent has a "conflicting interest"
(as defined in Section 310(b) of the TIA) and fails to
eliminate the conflicting interest or resign pursuant to
Section 310(b) of the TIA upon written request therefor
by the Company or by any Holder who has been a bona fide
Holder of a DECS for at least six months, as if this
Agreement were an indenture qualified under the TIA, as
if the DECS were in default and as if such default had
not been cured or waived within the applicable period
under Section 310(b) of the TIA; or
(2) the Agent shall cease to be eligible
under Section 7.8 and
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shall fail to resign after written request therefor by
the Company or by any such Holder; or
(3) the Agent shall become incapable of
acting or shall be adjudged a bankrupt or insolvent or a
receiver of the Agent or of its property shall be
appointed or any public officer shall take charge or
control of the Agent or of its property or affairs for
the purpose of rehabilitation, conservation or
liquidation;
then, in any such case, (x) the Company by a Board Resolution may remove the
Agent, or (y) any Holder who has been a bona fide Holder of a DECS 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 DECS
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 as their
names and addresses appear in the applicable Register. Each notice shall
include the name of the successor Agent and the address of its Corporate
Trust Office.
Section 7.10 Acceptance of Appointment By Successor.
(a) In case of the appointment hereunder of a successor
Agent, every such successor Agent so appointed shall execute,
acknowledge and deliver to the Company and to the retiring Agent an
instrument accepting such appointment, and thereupon the resignation or
removal of the retiring Agent shall become effective and such successor
Agent, without any further act, deed or conveyance, shall become vested
with all the rights, powers, agencies, trusts 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, execute and deliver
an instrument transferring to such successor Agent all the rights,
powers, agencies, trusts and duties of the retiring Agent and duly
assign, transfer and deliver to such successor Agent all property and
money held by such retiring Agent hereunder.
(b) Upon request of any such successor Agent, the Company
shall execute any and all instruments for more fully and certainly
vesting in and confirming to such
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successor Agent all such rights, powers, agencies, trusts and duties
referred to in paragraph (a) of this Section.
(c) No successor Agent shall accept its appointment unless
at the time of such acceptance such successor Agent shall be qualified
and eligible under this Article.
Section 7.11 Merger, Conversion, Consolidation or Succession to
Business.
Any corporation into which the Agent may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Agent shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Agent, shall be the successor of the Agent hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Certificates shall have been
authenticated and executed on behalf of the Holders, but not delivered, by the
Agent then in office, any successor by merger, conversion or consolidation to
such Agent shall adopt such authentication and execution and deliver the
Certificates so authenticated and executed with the same effect as if such
successor Agent had itself authenticated and executed such DECS.
Section 7.12 Preservation of Information; Communications to Holders.
(a) The Agent shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders received by
the Agent in its capacity as Registrar.
(b) If three or more Holders (herein referred to as
"Applicants") apply in writing to the Agent, and furnish to the Agent
reasonable proof that each such applicant has owned a DECS 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
DECS and is accompanied by a copy of the form of proxy or other
communication which such Applicants propose to transmit, then the Agent
shall mail to all the Holders copies of the form of proxy or other
communication which is specified in such request, with reasonable
promptness after a tender to the Agent of the materials to be mailed and
of payment, or provision, in the absence of bad faith, satisfactory to
the Agent for the payment, of the reasonable expenses of such mailing.
Section 7.13 Failure to Act.
In the event of any ambiguity in the provisions of any Transaction
Document or any dispute between or conflicting claims by or among the parties
hereto or any other Person, the Agent shall be entitled, after prompt notice to
the Company and the Holders of DECS, at its sole option, to refuse to comply
with any and all such claims, demands or instructions so long as such dispute or
conflict shall continue, and the Agent shall not be or become liable in any way
to any of the parties hereto for its failure or refusal to comply with such
conflicting claims, demands or instructions. The Agent shall be entitled to
refuse to act until either (i) such conflicting or adverse claims or demands
shall have been finally determined by a court of competent jurisdiction or
settled by agreement between the conflicting parties as evidenced in a writing,
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reasonably satisfactory to the Agent, or (ii) the Agent shall have received
security or an indemnity reasonably satisfactory to the Agent sufficient to save
the Agent harmless from and against any and all loss, liability or reasonable
out-of-pocket expense which the Agent may incur by reason of its acting without
bad faith, willful misconduct or gross negligence. The Agent may in addition
elect to commence an interpleader action or seek other judicial relief or orders
as the Agent may deem necessary. Notwithstanding anything contained herein to
the contrary, the Agent shall not be required to take any action that is in its
opinion contrary to law or to the terms of any Transaction Document, or which
would in its opinion subject it or any of its officers, employees or directors
to liability.
Section 7.14 No Obligations of Agent.
Except to the extent otherwise provided in this Agreement, the Agent
assumes no obligation and shall not be subject to any liability under this
Agreement, the Pledge Agreement or any Forward Purchase Contract in respect of
the obligations of the Holder of any DECS thereunder. The Company agrees, and
each Holder of a Certificate, by such Holder's acceptance thereof, shall be
deemed to have agreed, that the Agent's execution of the Certificates on behalf
of the Holders shall be solely as agent and attorney-in-fact for the Holders,
and that the Agent shall have no obligation to perform such Forward Purchase
Contracts on behalf of the Holders, except to the extent expressly provided in
Article V. Anything contained in this Agreement to the contrary notwithstanding,
in no event shall the Agent or its officers, employees or agents be liable for
indirect, special, punitive, or consequential loss or damage of any kind
whatsoever, including, but not limited to, lost profits, whether or not the
likelihood of such loss or damage was known to the Agent and regardless of the
form of action.
Section 7.15 Tax Compliance.
(a) The Agent, on its own behalf and on behalf of the
Company, will comply with all applicable certification, information
reporting and withholding (including "backup" withholding) requirements
imposed on it as a paying agent by applicable tax laws, regulations or
administrative practice with respect to any payments made with respect
to the DECS. 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 reasonable written
direction timely received from the Company with respect to the
application of such requirements to particular payments to Holders or in
other particular circumstances, and may for purposes of this Agreement
rely on any such direction in accordance with Section 7.1(a)(2).
(c) The Agent shall maintain all appropriate records
documenting compliance with such requirements, and shall make such
records available, on written request, to the Company or its authorized
representative within a reasonable period of time after receipt of such
request.
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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:
(a) to evidence the succession of another Person to the
Company, and the assumption by any such successor of the covenants of
the Company herein and in the Certificates; or
(b) to add to the covenants of the Company for the benefit
of the Holders, or to surrender any right or power herein conferred upon
the Company; or
(c) to evidence and provide for the acceptance of
appointment hereunder by a successor Agent; or
(d) to make provision with respect to the rights of Holders
pursuant to the requirements of Section 5.4(b) or 5.8; or
(e) to cure any ambiguity, to correct or supplement any
provisions herein which may be inconsistent with any other provisions
herein, or to make any other provisions with respect to such matters or
questions arising under this Agreement, provided such action shall not
adversely affect the interests of the Holders; or
(f) to permit the substitution by Holders of designated
Company debt instruments for the Pledged Notes as Collateral under this
Agreement.
Section 8.2 Supplemental Agreements With Consent of Holders.
(a) With the consent of the Holders of not less than a
majority of the outstanding Forward Purchase Contracts voting together
as one class, by Act of said Holders delivered to the Company and the
Agent, the Company, when authorized by a Board Resolution, and the Agent
may enter into an agreement or agreements supplemental hereto, in form
satisfactory to the Company and the Agent, for the purpose of modifying
in any manner the terms of the Forward Purchase Contracts, or the
provisions of this Agreement or the rights of the Holders in respect of
the DECS; provided, that, except as contemplated herein, no such
supplemental agreement shall, without the consent of the Holder of each
Outstanding DECS adversely affected thereby:
(1) change any Payment Date;
(2) change the amount or the type of
Collateral required to be Pledged to secure a Holder's
Obligations under the Forward Purchase Contract unless
not adverse to Holders, impair the right of the Holder
of any Forward Purchase Contract to receive
distributions on the related
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Collateral (except as provided in Section 8.1(f) and
except for the rights of Holders of Upper DECS to
substitute the Treasury Securities for the Pledged
Notes, Pledged Treasury Consideration or Pledged
Applicable Ownership Interest in the Treasury Portfolio,
or the rights of holders of Stripped DECS to substitute
Notes or appropriate Treasury Consideration or
Applicable Ownership Interest in the Treasury Portfolio
for the Pledged Treasury Securities) or otherwise
adversely affect the Holder's rights in or to such
Collateral;
(3) impair the right to institute suit for
the enforcement of any Forward Purchase Contract;
(4) reduce the number of shares of Common
Stock to be purchased pursuant to any Forward Purchase
Contract, increase the price to purchase shares of
Common Stock upon settlement of any Forward Purchase
Contract, change the Stock Purchase Date or otherwise
materially adversely affect the Holder's rights under
any Forward Purchase Contract; or
(5) reduce the percentage of the outstanding
Forward Purchase Contracts the consent of whose Holders
is required for any such supplemental agreement;
provided, that if any amendment or proposal referred to above would adversely
affect only the Upper DECS or the Stripped DECS, then only the affected class of
Holder as of the record date for the Holders entitled to vote thereon will be
entitled to vote on such amendment or proposal, and such amendment or proposal
shall not be effective except with the consent of Holders of not less than a
majority or 100% of such class, as the case may be.
(b) It shall not be necessary for any Act of Holders under
this Section to approve the particular form of any proposed supplemental
agreement, but it shall be sufficient if such Act shall approve the
substance thereof.
Section 8.3 Execution of Supplemental Agreements.
In executing, or accepting the additional agencies created by, any
supplemental agreement permitted by this Article or the modifications thereby of
the agencies created by this Agreement, the Agent shall be provided and (subject
to Section 7.1) shall be fully protected in relying upon, an Opinion of Counsel
stating that the execution of such supplemental agreement is authorized or
permitted by this Agreement. The Agent may, but shall not be obligated to, enter
into any such supplemental agreement which affects the Agent's own rights,
duties or immunities under this Agreement or otherwise.
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
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this Agreement for all purposes; and every Holder of Certificates theretofore or
thereafter authenticated, executed on behalf of the Holders and delivered
hereunder shall be bound thereby.
Section 8.5 Reference to Supplemental Agreements.
Certificates authenticated, executed on behalf of the Holders and
delivered after the execution of any supplemental agreement pursuant to this
Article may, and shall if required by the Agent, bear a notation in form
approved by the Agent as to any matter provided for in such supplemental
agreement. If the Company shall so determine, new Certificates so modified as to
conform, in the opinion of the Agent and the Company, to any such supplemental
agreement may be prepared and executed by the Company and authenticated,
executed on behalf of the Holders and delivered by the Agent in exchange for
outstanding Certificates.
ARTICLE IX.
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
Section 9.1 Company May Consolidate, Etc., Only on Certain Terms.
The Company shall not consolidate with or merge into any other Person or
convey, transfer or lease its properties and assets substantially as an entirety
to any Person, unless:
(a) the Person formed by such consolidation or into which
the Company is merged or the Person which acquires by conveyance,
transfer or lease the properties and assets of the Company substantially
as an entirety shall be a corporation, partnership, limited liability
company or trust, shall be organized and validly existing under the laws
of the United States of America, any State thereof or the District of
Columbia and shall expressly assume every covenant of this Agreement,
the Forward Purchase Contracts, the Notes, the Remarketing Agreement and
the Pledge Agreement on the part of the Company to be performed or
observed by one or more supplemental agreements in form reasonably
satisfactory to the Agent and the Collateral Agent, executed and
delivered to the Agent and the Collateral Agent by such Person;
(b) immediately after giving effect to such transaction, no
default under this Agreement, the Forward Purchase Contracts, the
Remarketing Agreement or the Pledge Agreement shall have happened and be
continuing; and
(c) the Company has delivered to the Agent an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, conveyance, transfer or lease and such
supplemental agreement(s) comply with this Section 9.1 and that all
conditions precedent herein provided for relating to such transaction
have been complied with.
This Section 9.1 shall not apply to any merger or consolidation in which the
Company is the surviving corporation.
Section 9.2 Successor Substituted.
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(a) Upon any consolidation with or merger of the Company
into any other Person, or any conveyance, transfer or lease of the
properties and assets of the Company substantially as an entirety in
accordance with Section 9.1, the successor Person formed by such
consolidation or into which the Company is merged or to which such
conveyance, transfer or lease is made shall succeed to, and be
substituted for, and may exercise every right and power of, the Company
under this Agreement with the same effect as if such successor Person
had been named as the Company herein, and thereafter, except in the case
of a lease, the predecessor Person shall be relieved of all obligations
and covenants under this Agreement, the Forward Purchase Contracts, the
Notes, the DECS, the Remarketing Agreement and the Pledge Agreement.
(b) In case of any such consolidation, merger, sale,
assignment, transfer, lease or conveyance such change in phraseology and
form (but not in substance) may be made in the Certificates evidencing
DECS thereafter to be issued as may be appropriate.
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 DECS that it will duly and punctually perform its
obligations under the Forward Purchase Contracts in accordance with the terms of
the Forward Purchase Contracts and this Agreement. In the case of Early
Settlement pursuant to Section 5.7, if the United States federal securities laws
so require, the Company will use commercially reasonable efforts to (i) have in
effect a registration statement covering the shares of Common Stock to be
delivered in respect of the Forward Purchase Contracts being settled and (ii)
provide a prospectus in connection therewith, in each case that may be used in
connection with such Early Settlement.
Section 10.2 Maintenance of Office or Agency.
(a) The Company will maintain in the Borough of Manhattan,
The City of New York an office or agency where Certificates may be
presented or surrendered for acquisition of shares of Common Stock upon
settlement of the Forward Purchase Contracts on any Settlement Date and
for transfer of Collateral upon occurrence of a Termination Event, where
Certificates may be surrendered for registration of transfer or
exchange, for a Collateral Substitution or reestablishment of Upper DECS
and where notices and demands to or upon the Company in respect of the
DECS 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, Office of the Agent in The City of New York, and the
Company hereby appoints the Agent as its agent to receive all such
presentations, surrenders, notices and demands.
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(b) The Company may also from time to time designate one or
more other offices or agencies where Certificates may be presented or
surrendered for any or all such purposes and may from time to time
rescind such designations; provided, that no such designation or
rescission shall in any manner relieve the Company of its obligation to
maintain an office or agency in the Borough of Manhattan, The City of
New York for such purposes. The Company will give prompt written notice
to the Agent of any such designation or rescission and of any change in
the location of any such other office or agency. The Company hereby
designates as the place of payment for the DECS the Office of the Agent
in The City of New York and appoints the Agent at the Office of the
Agent in The City of New York as paying agent in such city.
Section 10.3 Company to Reserve Common Stock.
The Company shall at all times prior to the Stock Purchase Date reserve
and keep available, free from preemptive rights, out of its authorized but
unissued Common Stock the full number of shares of Common Stock issuable against
tender of payment in respect of all Forward Purchase Contracts constituting a
part of the DECS evidenced by outstanding Certificates.
Section 10.4 Covenants as to Common Stock.
The Company covenants that all shares of Common Stock which may be
issued against tender of payment in respect of any Forward Purchase Contract
constituting a part of the Outstanding DECS will, upon issuance, be duly
authorized, validly issued, fully paid and nonassessable.
Section 10.5 Statements of Officer of the Company as to Default.
The Company will deliver to the Agent, within 120 days after the end of
each fiscal year of the Company ending after the date hereof, an Officer's
Certificate, stating whether or not to the best knowledge of the signer thereof
the Company is in default in the performance and observance of any of the terms,
provisions and conditions hereof, and if the Company shall be in default,
specifying all such defaults and the nature and status thereof of which such
officer may have knowledge.
Section 10.6 ERISA.
Each Holder from time to time of the DECS which is a Plan hereby
represents that its acquisition of the DECS and the holding of the same
satisfies the applicable fiduciary requirements of ERISA and that it is entitled
to exemption relief from the prohibited transaction provisions of ERISA and the
Code in accordance with one or more prohibited transaction exemptions or
otherwise will not result in a nonexempt prohibited transaction.
[SIGNATURE PAGES FOLLOW]
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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.
CAPITAL ONE FINANCIAL CORPORATION
By:
---------------------------------------
Name:
Title:
BNY MIDWEST TRUST COMPANY
as Forward Purchase Contract Agent
By:
---------------------------------------
Name:
Title:
EXHIBIT A
FORM OF UPPER DECS CERTIFICATE
[FOR INCLUSION IN GLOBAL CERTIFICATES ONLY -- THIS CERTIFICATE IS A
GLOBAL CERTIFICATE WITHIN THE MEANING OF THE FORWARD PURCHASE CONTRACT AGREEMENT
(AS HEREINAFTER DEFINED) AND IS REGISTERED IN THE NAME OF THE CLEARING AGENCY OR
A NOMINEE THEREOF. THIS CERTIFICATE MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR
A CERTIFICATE REGISTERED, AND NO TRANSFER OF THIS CERTIFICATE IN WHOLE OR IN
PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH CLEARING
AGENCY OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN
THE FORWARD PURCHASE CONTRACT AGREEMENT.
Unless this Certificate is presented by an authorized representative of
The Depository Trust Company (55 Water Street, New York, New York) to the
Company or its agent for registration of transfer, exchange or payment, and any
Certificate issued is registered in the name of Cede & Co., or such other name
as requested by an authorized representative of The Depository Trust Company,
and any payment hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL since the registered owner
hereof, Cede & Co., has an interest herein.]
(Form of Face of Upper DECS Certificate)
No. CUSIP No.
-------------- ------------
Number of Upper DECS
------------
This Upper DECS Certificate certifies that [For inclusion in Global
Certificates only -- Cede & Co.] is the registered Holder of the number of Upper
DECS set forth above [For inclusion in Global Certificates only - or such other
number of Upper DECS reflected in the Schedule of Increases or Decreases in
Global Certificates attached hereto]. Each Upper DECS represents (i) either (a)
beneficial ownership by the Holder of one 6.25% Senior Note Due May 17, 2007
(the "Note") of Capital One Financial Corporation, a Delaware corporation (the
"Company") having a principal amount of $50, subject to the Pledge of such Note
by such Holder pursuant to the Pledge Agreement, or (b) if the Note has been
remarketed by the Remarketing Agent (or if the Holder has elected not to have
the Note remarketed by delivering the appropriate Treasury Consideration
specified by the Remarketing Agent), the appropriate Treasury Consideration,
subject to the Pledge of such Treasury Consideration by such Holder pursuant to
the Pledge Agreement, or (c) if a Tax Event Redemption has occurred, the
appropriate Applicable Ownership Interest in the Treasury Portfolio subject to
the Pledge of such Applicable Ownership Interest in the Treasury Portfolio
pursuant to the Pledge Agreement, and (ii) the rights and obligations of the
Holder under one Forward Purchase Contract with the Company. All capitalized
terms used herein which are defined in the Forward Purchase Contract Agreement
have the meaning set forth therein.
A-1
Pursuant to the Pledge Agreement, the Note or the appropriate Treasury
Consideration or Applicable Ownership Interest in the Treasury Portfolio, as the
case may be, constituting part of each Upper DECS evidenced hereby has been
pledged to the Collateral Agent, for the benefit of the Company, to secure the
obligations of the Holder under the Forward Purchase Contract comprising a part
of such Upper DECS.
The Pledge Agreement provides that all payments in respect of the
Pledged Notes, Pledged Treasury Consideration or Pledged Applicable Ownership
Interest in the Treasury Portfolio received by the Collateral Agent shall be
paid by the Collateral Agent by wire transfer in same day funds (i) in the case
of (A) quarterly cash distributions on Upper DECS which include Pledged Notes,
Pledged Treasury Consideration or Pledged Applicable Ownership Interest in the
Treasury Portfolio and (B) any payments in respect of the Notes, Treasury
Consideration or Applicable Ownership Interest in the Treasury Portfolio, as the
case may be, that have been released from the Pledge pursuant to the Pledge
Agreement, to the Agent to the account designated by the Agent, no later than
10:00 a.m., New York City time, on the Business Day such payment is received by
the Collateral Agent (provided that in the event such payment is received by the
Collateral Agent on a day that is not a Business Day or after 9:00 a.m., New
York City time, on a Business Day, then such payment shall be made no later than
9:30 a.m., New York City time, on the next succeeding Business Day) and (ii) in
the case of payments in respect of any Pledged Notes, Pledged Treasury
Consideration or Pledged Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, to be paid upon settlement of such Holder's
obligations to purchase Common Stock under the Forward Purchase Contract, to the
Company on the relevant Stock Purchase Date in accordance with the terms of the
Pledge Agreement, in full satisfaction of the respective obligations of the
Holders of the Upper DECS of which such Pledged Notes, Pledged Treasury
Consideration or Pledged Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, are a part under the Forward Purchase Contracts
forming a part of such Upper DECS. Quarterly distributions on Upper DECS which
include Pledged Notes, Pledged Treasury Consideration or Pledged Applicable
Ownership Interest in the Treasury Portfolio, as the case may be, which are
payable quarterly in arrears on February 17, May 17, August 17 and November 17
each year, commencing August 17, 2002 (a "Payment Date"), shall, subject to
receipt thereof by the Agent from the Collateral Agent (if the Collateral Agent
is the registered owner thereof), be paid to the Person in whose name this Upper
DECS Certificate (or a Predecessor Upper DECS Certificate) is registered at the
close of business on the Record Date for such Payment Date.
Each Forward Purchase Contract evidenced hereby obligates the Holder of
this Upper DECS Certificate to purchase, and the Company to sell, (A) on May 17,
2005 (the "Scheduled Stock Purchase Date"), at a price equal to $50 (the "Stated
Amount"), a number of newly issued shares of common stock, $0.01 par value per
share ("Common Stock"), of the Company, equal to the Settlement Rate unless on
or prior to the relevant Stock Purchase Date there shall have occurred a
Termination Event or (B) in the event a Secondary Acceleration Event (as defined
in the Forward Purchase Contract Agreement) occurs, on the date that is
twenty-three Business Days after the Secondary Acceleration Event, but no later
than May 17, 2005 (the "Accelerated Stock Purchase Date"), at a price equal to
the Stated Amount, a number of newly issued shares of Common Stock of the
Company equal to the Accelerated Settlement Rate, in either case unless on or
prior to the relevant Stock Purchase Date there shall have occurred a
Termination Event, Early Settlement or Merger Early Settlement with respect to
the Upper DECS of which
A-2
such Forward Purchase Contract is a part, all as provided in the Forward
Purchase Contract Agreement and more fully described on the reverse hereof. The
Purchase Price (as defined herein) for the shares of Common Stock purchased
pursuant to each Forward Purchase Contract evidenced hereby, if not paid
earlier, shall be paid on the relevant Stock Purchase Date by application of
payments received in respect of the Pledged Notes, Pledged Treasury
Consideration or Pledged Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, pledged to secure the obligations of the Holder
under such Forward Purchase Contract.
Payments on the Notes or the appropriate Treasury Consideration or
Applicable Ownership Interest in the Treasury Portfolio, as the case may be,
will be payable at the office of the Agent in The City of New York or, at the
option of the Company, by check mailed to the address of the Person entitled
thereto as such address appears on the Upper DECS Register or by wire transfer
to an account specified by such Person at least five Business Days prior to the
applicable Payment Date.
Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Agent by manual signature, this Upper DECS Certificate shall not be entitled to
any benefit under the Pledge Agreement or the Forward Purchase Contract
Agreement or be valid or obligatory for any purpose.
A-3
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
CAPITAL ONE FINANCIAL CORPORATION
By:
---------------------------------------
Name:
Title:
HOLDER SPECIFIED ABOVE (as to obligations
of such Holder under the Forward Purchase
Contracts evidenced hereby)
By: BNY MIDWEST TRUST COMPANY, not
individually but solely as
Attorney-in-Fact of such Holder
By:
---------------------------------------
Authorized Signatory
A-4
AGENT'S CERTIFICATE OF AUTHENTICATION
This is one of the Upper DECS Certificates referred to in the
within-mentioned Forward Purchase Contract Agreement.
BNY MIDWEST TRUST COMPANY,
as Forward Purchase Contract Agent
Dated: By:
--------------------- ---------------------------------------
Authorized Signatory
A-5
(Form of Reverse of Upper DECS Certificate)
Each Forward Purchase Contract evidenced hereby is governed by a Forward
Purchase Contract Agreement, dated as of April 23, 2002 (as may be supplemented
from time to time, the "Forward Purchase Contract Agreement"), between the
Company and BNY Midwest Trust Company, as Forward Purchase Contract Agent
(including its successors thereunder, herein called the "Agent"), to which
Forward 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 Upper DECS Certificates
are, and are to be, executed and delivered.
Each Forward Purchase Contract evidenced hereby obligates the Holder of
this Upper DECS Certificate to purchase, and the Company to sell, on the
relevant Stock Purchase Date at a price equal to $50 (the "Purchase Price"), a
number of shares of Common Stock of the Company equal to the Settlement Rate or
the Accelerated Settlement Rate, as applicable, unless, on or prior to the
relevant Stock Purchase Date, there shall have occurred a Termination Event or
an Early Settlement or Merger Early Settlement with respect to the DECS of which
such Forward Purchase Contract is a part. The "Settlement Rate" is equal to (a)
if the Applicable Market Value (as defined below) is greater than or equal to
$78.61 (the "Threshold Appreciation Price"), 0.6361 shares of Common Stock per
Forward Purchase Contract, (b) if the Applicable Market Value is less than the
Threshold Appreciation Price but is greater than $63.91, the number of shares of
Common Stock per Forward Purchase Contract equal to the Stated Amount of the
related Upper DECS divided by the Applicable Market Value and (c) if the
Applicable Market Value is less than or equal to $63.91, 0.7824 shares of Common
Stock per Forward Purchase Contract, in each case subject to adjustment as
provided in the Forward Purchase Contract Agreement. No fractional shares of
Common Stock will be issued upon settlement of Forward Purchase Contracts, as
provided in the Forward Purchase Contract Agreement.
The "Applicable Market Value" means the average of the Closing Price per
share of Common Stock on each of the 20 consecutive Trading Days ending on the
third Trading Day immediately preceding the relevant Stock Purchase Date.
The "Closing Price" of the Common Stock on any date of determination
means the closing sale price (or, if no closing price is reported, the last
reported sale price) of the Common Stock on the New York Stock Exchange (the
"NYSE") on such date or, if the Common Stock is not listed for trading on the
NYSE on any such date, as reported in the composite transactions for the
principal United States securities exchange on which the Common Stock is so
listed, or if the Common Stock is not so listed on a United States national or
regional securities exchange, as reported by The Nasdaq Stock Market, or, if the
Common Stock is not so reported, the last quoted bid price for the Common Stock
in the over-the-counter market as reported by the National Quotation Bureau or
similar organization, or, if such bid price is not available, the market value
of the Common Stock on such date as determined by a nationally recognized
independent investment banking firm retained for this purpose by the Company.
A "Trading Day" means a day on which the Common Stock (A) is not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market
A-6
at the close of business and (B) has traded at least once on the national or
regional securities exchange or association or over-the-counter market that is
the primary market for the trading of the Common Stock.
Each Forward Purchase Contract evidenced hereby may be settled prior to
the Stock Purchase Date through Early Settlement or Merger Early Settlement and
may be settled on the relevant Stock Purchase Date through Cash Settlement, all
in accordance with the terms of the Forward Purchase Contract Agreement.
In accordance with the terms of the Forward Purchase Contract Agreement,
the Holder of this Upper DECS Certificate shall pay the Purchase Price for the
shares of Common Stock purchased pursuant to each Forward Purchase Contract
evidenced hereby (i) by effecting a Cash Settlement, Early Settlement or Merger
Early Settlement, (ii) by application of payments received in respect of the
Pledged Treasury Consideration acquired from the proceeds of a remarketing of
the related Pledged Notes underlying the Upper DECS represented by this Upper
DECS Certificate, (iii) if the Holder has elected not to participate in the
remarketing, by application of payments received in respect of the Pledged
Treasury Consideration deposited by such Holder in respect of such Forward
Purchase Contract, or (iv) if a Tax Event Redemption has occurred prior to the
successful remarketing of the Notes, by application of payments received in
respect of the Pledged Applicable Ownership Interest in the Treasury Portfolio
purchased by the Collateral Agent on behalf of the Holder of this Upper DECS
Certificate. If, as provided in the Forward Purchase Contract Agreement, upon
the occurrence of a Last Failed Remarketing or a Last Failed Accelerated
Remarketing, the Collateral Agent, for the benefit of the Company, exercises its
rights as a secured creditor with respect to the Pledged Notes related to this
Upper DECS Certificate with respect to Notes the Holders of which have elected
to opt out of the sale to the Company pursuant to Section 206 of the
Supplemental Indenture, any accrued and unpaid interest on such Pledged Notes
will become payable by the Company to the Holder of this Upper DECS Certificate
in the manner provided for in the Forward Purchase Contract Agreement. In
addition, upon the occurrence of a Stock Purchase Date following a Last Failed
Remarketing or Last Failed Accelerated Remarketing, the Company is obligated to
repurchase the outstanding Notes and apply the net proceeds as set forth in the
Forward Purchase Contract Agreement, subject to certain opt-out rights referred
to therein.
The Company shall not be obligated to issue any shares of Common Stock
in respect of a Forward Purchase Contract or deliver any certificates or
book-entry interest therefor to the Holder unless it shall have received payment
in full of the aggregate Purchase Price for the shares of Common Stock to be
purchased thereunder in the manner herein set forth.
Under the terms of the Pledge Agreement, the Agent will be entitled to
exercise the voting and any other consensual rights pertaining to the Pledged
Notes, but only to the extent instructed by the Holders as described below. Upon
receipt of notice of any meeting at which holders of Notes are entitled to vote
or upon the solicitation of consents, waivers or proxies of holders of Notes,
the Agent shall, as soon as practicable thereafter, mail to the Holders of Upper
DECS a notice (a) containing such information as is contained in the notice or
solicitation, (b) stating that each such Holder on the record date set by the
Agent therefor (which, to the extent possible, shall be the same date as the
record date for determining the holders of Notes entitled to vote) shall be
entitled to instruct the Agent as to the exercise of the voting rights
pertaining to the
A-7
Pledged Notes constituting a part of such Holder's Upper DECS and (c) stating
the manner in which such instructions may be given. Upon the written request of
the Holders of Upper DECS on such record date, the Agent shall endeavor insofar
as practicable to vote or cause to be voted, in accordance with the instructions
set forth in such requests, the maximum number of Pledged Notes as to which any
particular voting instructions are received. In the absence of specific
instructions from the Holder of an Upper DECS, the Agent shall abstain from
voting the Pledged Note evidenced by such Upper DECS.
The Upper DECS Certificates are issuable only in registered form and
only in denominations of a single Upper DECS and any integral multiple thereof.
The transfer of any Upper DECS Certificate will be registered and Upper DECS
Certificates may be exchanged as provided in the Forward Purchase Contract
Agreement. The Upper DECS Registrar may require a Holder, among other things, to
furnish appropriate endorsements and transfer documents permitted by the Forward
Purchase Contract Agreement. No service charge shall be required for any such
registration of transfer or exchange, but the Company and the Agent may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith. The Holder of an Upper DECS may substitute for
the Pledged Notes, Pledged Treasury Consideration or Pledged Applicable
Ownership Interest in the Treasury Portfolio, as the case may be, securing its
obligations under the related Forward Purchase Contract Treasury Securities in
accordance with the terms of the Forward Purchase Contract Agreement and the
Pledge Agreement. From and after such Collateral Substitution, the DECS for
which such Pledged Treasury Securities secure the Holder's obligation under the
Forward Purchase Contract shall be referred to as a "Stripped DECS." A Holder
that elects to substitute a Treasury Security for Pledged Notes, Pledged
Treasury Consideration or Pledged Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, thereby creating Stripped DECS, shall be
responsible for any fees or expenses payable in connection therewith. Except as
provided in the Forward Purchase Contract Agreement, for so long as the Forward
Purchase Contract underlying an Upper DECS remains in effect, such Upper DECS
shall not be separable into its constituent parts, and the rights and
obligations of the Holder of such Upper DECS in respect of the Pledged Note,
Pledged Treasury Consideration or Pledged Applicable Ownership Interest in the
Treasury Portfolio, as the case may be, and Forward Purchase Contract
constituting such Upper DECS may be transferred and exchanged only as an Upper
DECS.
A Holder of Stripped DECS may reestablish Upper DECS by delivering to
the Collateral Agent Notes or the appropriate Treasury Consideration or
Applicable Ownership Interest in the Treasury Portfolio, as the case may be, in
exchange for the release of the Pledged Treasury Securities in accordance with
the terms of the Forward Purchase Contract Agreement and the Pledge Agreement.
The Forward Purchase Contracts and all obligations and rights of the
Company and the Holders thereunder, including, without limitation, the rights
and obligations of the Holders to purchase Common Stock, shall immediately and
automatically terminate, without the necessity of any notice or action by any
Holder, the Agent or the Company, if, on or prior to the Stock Purchase Date, a
Termination Event shall have occurred. Upon the occurrence of a Termination
Event, the Company shall promptly but in no event later than two Business Days
thereafter give written notice to the Agent, the Collateral Agent and to the
Holders, at their addresses as they appear in the Upper DECS Register. Upon and
after the occurrence of a Termination Event, the
A-8
Collateral Agent shall release the Pledged Notes, Pledged Treasury Consideration
or Pledged Applicable Ownership Interest in the Treasury Portfolio, as the case
may be, from the Pledge in accordance with the provisions of the Pledge
Agreement.
Upon registration of transfer of this Upper DECS 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
Forward Purchase Contract Agreement), by the terms of the Forward Purchase
Contract Agreement and the Forward Purchase Contracts evidenced hereby and the
transferor shall be released from the obligations under the Forward Purchase
Contracts evidenced by this Upper DECS Certificate. The Company covenants and
agrees, and the Holder, by its acceptance hereof, likewise covenants and agrees,
to be bound by the provisions of this paragraph.
The Holder of this Upper DECS Certificate, by its acceptance hereof,
authorizes the Agent to enter into and perform the related Forward Purchase
Contracts forming part of the Upper DECS evidenced hereby on its behalf as its
attorney-in-fact, expressly withholds any consent to the assumption (i.e.,
affirmance) of the Forward 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 of the Forward Purchase
Contracts, covenants and agrees to perform such Holder's obligations under such
Forward Purchase Contracts, consents to the provisions of the Forward Purchase
Contract Agreement, irrevocably authorizes the Agent to enter into and perform
the Pledge Agreement on such Holder's behalf as attorney-in-fact, and consents
to and agrees to be bound by the Pledge of the Notes or the appropriate Treasury
Consideration or Applicable Ownership Interest in the Treasury Portfolio, as the
case may be, underlying this Upper DECS Certificate pursuant to the Pledge
Agreement, provided, that upon a Termination Event, the rights of the Holder of
such DECS under the Forward Purchase Contract may be enforced without regard to
any other rights or obligations. The Holder further covenants and agrees, that,
to the extent and in the manner provided in the Forward Purchase Contract
Agreement and the Pledge Agreement, but subject to the terms thereof, payments
in respect of the Pledged Notes, Pledged Treasury Consideration or Pledged
Applicable Ownership Interest in the Treasury Portfolio, as the case may be, to
be paid upon settlement of such Holder's obligations to purchase Common Stock
under the Forward Purchase Contract, shall be paid on the Stock Purchase Date by
the Collateral Agent to the Company in satisfaction of such Holder's obligations
under such Forward Purchase Contract and such Holder shall acquire no right,
title or interest in such payments.
The Company and each Holder of any DECS, and each Beneficial Owner
thereof, by its acceptance thereof or of its interest therein, further agrees to
treat (i) the purchase of Upper DECS as the purchase of a unit consisting of the
Purchase Contract and the Note and (ii) itself as the owner of the related
Notes, Treasury Consideration, Applicable Ownership Interest in the Treasury
Portfolio or Treasury Securities, as the case may be.
Subject to certain exceptions, the provisions of the Forward Purchase
Contract Agreement may be amended with the consent of the Holders of a majority
of the Forward Purchase Contracts.
A-9
The Forward Purchase Contracts shall for all purposes be governed by,
and construed in accordance with, the laws of the State of New York, without
regard to its principles of conflicts of laws.
The Company, the Agent and any agent of the Company or the Agent may
treat the Person in whose name this Upper DECS Certificate is registered as the
owner of the Upper DECS evidenced hereby for the purpose of receiving quarterly
payments on the Notes, the Treasury Consideration or the Applicable Ownership
Interest in the Treasury Portfolio, as the case may be, performance of the
Forward Purchase Contracts and for all other purposes whatsoever (subject to the
Record Date provisions hereof), whether or not any payments in respect thereof
be overdue and notwithstanding any notice to the contrary, and neither the
Company, the Agent, nor any such agent shall be affected by notice to the
contrary.
The Forward 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 Forward Purchase Contract Agreement is available for
inspection by any Holder at the Corporate Trust Office.
A-10
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
UNIF GIFT MIN ACT - Custodian
(cust) (minor)
Under Uniform Gifts to Minors Act
(State)
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship
and not as tenants in common
Additional abbreviations may also be used though not in the above list.
A-11
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
(Please insert Social Security or Taxpayer I.D. or other Identifying
Number of Assignee)
(Please Print or Type Name and Address Including Postal Zip Code of
Assignee)
the within Upper DECS Certificate and all rights thereunder, hereby irrevocably
constituting and appointing ___________________________ attorney to transfer
said Upper DECS Certificate on the books of Capital One Financial Corporation
with full power of substitution in the premises.
Dated:
-------------------------
Signature:
-----------------------------
NOTICE: The signature to this assignment must correspond with the name
as it appears upon the face of the within Upper DECS Certificate in every
particular, without alteration or enlargement or any change whatsoever.
Signature Guarantee: .
---------------------------
A-12
SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate or book-entry interest
for shares of Common Stock deliverable upon settlement on or after a Stock
Purchase Date of the Forward Purchase Contracts underlying the number of Upper
DECS evidenced by this Upper DECS Certificate be registered in the name of, and
delivered, together with a check in payment for any fractional share, to the
undersigned at the address indicated below unless a different name and address
have been indicated below. If shares are to be registered in the name of a
Person other than the undersigned, the undersigned will pay any transfer tax
payable incident thereto.
Dated: Signature:
---------------------- -------------------------
Signature Guarantee:
---------------
(if assigned to another person)
If shares are to be registered REGISTERED HOLDER
in the name of and delivered to
a Person other than the Holder, Please print name and address of
please (i) print such Person's Registered Holder:
name and address and (ii)
provide a guarantee of your
signature:
Name Name
Address Address
Social Security or other Taxpayer
Identification Number, if any
A-13
ELECTION TO SETTLE EARLY
The undersigned Holder of this Upper DECS Certificate hereby irrevocably
exercises the option to effect Early Settlement in accordance with the terms of
the Forward Purchase Contract Agreement with respect to the Forward Purchase
Contracts underlying the number of Upper DECS evidenced by this Upper DECS
Certificate specified below. The option to effect Early Settlement may be
exercised only with respect to Forward Purchase Contracts underlying Upper DECS
with an aggregate Stated Amount equal to $1,000 or an integral multiple thereof.
The undersigned Holder directs that a certificate or book-entry interest 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 Upper DECS Certificate representing any Upper DECS evidenced
hereby as to which Early Settlement of the related Forward Purchase Contracts is
not effected, to the undersigned at the address indicated below unless a
different name and address have been indicated below. The Pledged Notes, Pledged
Treasury Consideration or Pledged Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, deliverable upon such Early Settlement will be
transferred in accordance with the transfer instructions set forth below. If
shares are to be registered in the name of a Person other than the undersigned,
the undersigned will pay any transfer tax payable incident thereto.
Dated: Signature:
---------------------- -------------------------
Signature Guarantee:
---------------
Number of DECS evidenced hereby as to which Early Settlement of the
related Forward Purchase Contracts is being elected:
If shares of Common Stock are to REGISTERED HOLDER
be registered in the name of and
delivered to and Pledged Notes, Please print name and address of
Pledged Treasury Consideration Registered Holder:
or Pledged Applicable Ownership
Interest in the Treasury
Portfolio, as the case may be,
are to be transferred to a
Person other than the Holder,
please print such Person's name
and address:
Name Name
Address Address
Social Security or other Taxpayer
Identification Number, if any
Transfer instructions for Pledged Notes, Pledged Treasury Consideration
or the Pledged Applicable Ownership Interest in the Treasury Portfolio, as the
case may be, transferable upon Early Settlement or a Termination Event:
A-14
(TO BE ATTACHED TO GLOBAL CERTIFICATES)
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The following increases or decreases in this Global Certificate have
been made:
Stated Amount of the
Amount of Decrease in Amount of Increase in Global Certificate
Stated Amount of the Stated Amount of the Following Such Decrease Signature of
Date Global Certificate Global Certificate or Increase Authorized Signatory
A-15
EXHIBIT B
FORM OF STRIPPED DECS CERTIFICATE
[FOR INCLUSION IN GLOBAL CERTIFICATES ONLY -- THIS CERTIFICATE IS A
GLOBAL CERTIFICATE WITHIN THE MEANING OF THE FORWARD PURCHASE CONTRACT AGREEMENT
(AS HEREINAFTER DEFINED) AND IS REGISTERED IN THE NAME OF A CLEARING AGENCY OR A
NOMINEE THEREOF. THIS CERTIFICATE MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A
CERTIFICATE REGISTERED, AND NO TRANSFER OF THIS CERTIFICATE IN WHOLE OR IN PART
MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH CLEARING AGENCY OR
A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE FORWARD
PURCHASE CONTRACT AGREEMENT.
Unless this Certificate is presented by an authorized representative of
The Depository Trust Company (55 Water Street, New York, New York) to the
Company or its agent for registration of transfer, exchange or payment, and any
Certificate issued is registered in the name of Cede & Co., or such other name
as requested by an authorized representative of The Depository Trust Company,
and any payment hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL since the registered owner
hereof, Cede & Co., has an interest herein.]
(Form of Face of Stripped DECS Certificate)
No. CUSIP No.
------------
Number of Stripped DECS
This Stripped DECS Certificate certifies that [For inclusion in Global
Certificates only -- Cede & Co.] is the registered Holder of the number of
Stripped DECS set forth above [For inclusion in Global Certificates only - or
such other number of Stripped DECS reflected in the Schedule of Increases or
Decreases in Global Certificate attached hereto]. Each Stripped DECS represents
(i) a 1/20 undivided beneficial ownership interest in a Treasury Security,
subject to the Pledge of such interest in such Treasury Security by such Holder
pursuant to the Pledge Agreement, and (ii) the rights and obligations of the
Holder under one Forward Purchase Contract with Capital One Financial
Corporation, a Delaware corporation (the "Company"). All capitalized terms used
herein which are defined in the Forward Purchase Contract Agreement have the
meaning set forth therein.
Pursuant to the Pledge Agreement, the Treasury Security constituting
part of each Stripped DECS evidenced hereby has been pledged to the Collateral
Agent, for the benefit of the Company, to secure the obligations of the Holder
under the Forward Purchase Contract comprising a part of such Stripped DECS.
Each Forward Purchase Contract evidenced hereby obligates the Holder of
this Stripped DECS Certificate to purchase, and the Company to sell, on the
relevant Stock Purchase Date, at a price equal to $50 (the "Stated Amount"), a
number of shares of common stock, $0.01 par value
B-1
per share ("Common Stock"), of the Company, equal to the Settlement Rate or the
Accelerated Settlement Rate, as applicable, unless on or prior to the relevant
Stock Purchase Date there shall have occurred a Termination Event or an Early
Settlement, Merger Early Settlement or Cash Settlement with respect to the
Stripped DECS of which such Forward Purchase Contract is a part, all as provided
in the Forward Purchase Contract Agreement and more fully described on the
reverse hereof. The Purchase Price for the shares of Common Stock purchased
pursuant to each Forward Purchase Contract evidenced hereby, if not paid
earlier, shall be paid on the relevant Stock Purchase Date by application of
payments received in respect of the Pledged Treasury Securities pledged to
secure the obligations under such Forward Purchase Contract in accordance with
the terms of the Pledge Agreement.
Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Agent by manual signature, this Stripped DECS Certificate shall not be entitled
to any benefit under the Pledge Agreement or the Forward Purchase Contract
Agreement or be valid or obligatory for any purpose.
B-2
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
CAPITAL ONE FINANCIAL CORPORATION
By:
---------------------------------------
Name:
Title:
HOLDER SPECIFIED ABOVE (as to obligations
of such Holder under the Forward Purchase
Contracts)
By: BNY MIDWEST TRUST COMPANY, not
individually but solely as
Attorney-in-Fact of such Holder
By:
---------------------------------------
Authorized Signatory
B-3
AGENT'S CERTIFICATE OF AUTHENTICATION
This is one of the Stripped DECS referred to in the within-mentioned
Forward Purchase Contract Agreement.
BNY MIDWEST TRUST COMPANY,
as Forward Purchase Contract Agent
Dated: By:
------------------------ ----------------------------------------
Authorized Signatory
B-4
(Reverse of Stripped DECS Certificate)
Each Forward Purchase Contract evidenced hereby is governed by a Forward
Purchase Contract Agreement, dated as of April 23, 2002 (as may be supplemented
from time to time, the "Forward Purchase Contract Agreement"), between the
Company and BNY Midwest Trust Company, as Forward Purchase Contract Agent
(including its successors thereunder, herein called the "Agent"), to which
Forward Purchase Contract Agreement and supplemental agreements thereto
reference is hereby made for a description of the respective rights, limitations
of rights, obligations, duties and immunities thereunder of the Agent, the
Company and the Holders and of the terms upon which the Stripped DECS
Certificates are, and are to be, executed and delivered.
Each Forward Purchase Contract evidenced hereby obligates the Holder of
this Stripped DECS Certificate to purchase, and the Company to sell, on the
relevant Stock Purchase Date at a price equal to $50 (the "Purchase Price"), a
number of shares of Common Stock of the Company equal to the Settlement Rate or
the Accelerated Settlement Rate, as applicable, unless, on or prior to the
relevant Stock Purchase Date, there shall have occurred a Termination Event or
an Early Settlement or Merger Early Settlement with respect to the DECS of which
such Forward Purchase Contract is a part. The "Settlement Rate" is equal to (a)
if the Applicable Market Value (as defined below) is greater than or equal to
$78.61 (the "Threshold Appreciation Price"), 0.6361 shares of Common Stock per
Forward Purchase Contract, (b) if the Applicable Market Value is less than the
Threshold Appreciation Price but is greater than $63.91, the number of shares of
Common Stock per Forward Purchase Contract equal to the Stated Amount of the
related DECS divided by the Applicable Market Value and (c) if the Applicable
Market Value is less than or equal $63.91, 0.7824 shares of Common Stock per
Forward Purchase Contract, in each case subject to adjustment as provided in the
Forward Purchase Contract Agreement. No fractional shares of Common Stock will
be issued upon settlement of Forward Purchase Contracts, as provided in the
Forward Purchase Contract Agreement.
The "Applicable Market Value" means the average of the Closing Price per
share of Common Stock on each of the 20 consecutive Trading Days ending on the
third Trading Day immediately preceding the relevant Stock Purchase Date.
The "Closing Price" of the Common Stock on any date of determination
means the closing sale price (or, if no closing price is reported, the last
reported sale price) of the Common Stock on the New York Stock Exchange (the
"NYSE") on such date or, if the Common Stock is not listed for trading on the
NYSE on any such date, as reported in the composite transactions for the
principal United States securities exchange on which the Common Stock is so
listed, or if the Common Stock is not so listed on a United States national or
regional securities exchange, as reported by The Nasdaq Stock Market, or, if the
Common Stock is not so reported, the last quoted bid price for the Common Stock
in the over-the-counter market as reported by the National Quotation Bureau or
similar organization, or, if such bid price is not available, the market value
of the Common Stock on such date as determined by a nationally recognized
independent investment banking firm retained for this purpose by the Company.
A "Trading Day" means a day on which the Common Stock (A) is not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market
B-5
at the close of business and (B) has traded at least once on the national or
regional securities exchange or association or over-the-counter market that is
the primary market for the trading of the Common Stock.
Each Forward Purchase Contract evidenced hereby may be settled prior to
the Stock Purchase Date through Early Settlement or Merger Early Settlement, and
may be settled on the relevant Stock Purchase Date through Cash Settlement, all
in accordance with the terms of the Forward Purchase Contract Agreement.
In accordance with the terms of the Forward Purchase Contract Agreement,
the Holder of this Stripped DECS Certificate shall pay the Purchase Price for
the shares of Common Stock purchased pursuant to each Forward Purchase Contract
evidenced hereby (i) by effecting an Early Settlement, Merger Early Settlement
or Cash Settlement or (ii) by application of payments received in respect of the
Pledged Treasury Securities underlying the Stripped DECS represented by this
Stripped DECS Certificate.
The Company shall not be obligated to issue any shares of Common Stock
in respect of a Forward Purchase Contract or deliver any certificates or
book-entry interest therefor to the Holder unless it shall have received payment
in full of the aggregate Purchase Price for the shares of Common Stock to be
purchased thereunder in the manner herein set forth.
The Stripped DECS Certificates are issuable only in registered form and
only in denominations of a single Stripped DECS and any integral multiple
thereof. The transfer of any Stripped DECS Certificate will be registered and
Stripped DECS Certificates may be exchanged as provided in the Forward Purchase
Contract Agreement. The Stripped DECS Registrar may require a Holder, among
other things, to furnish appropriate endorsements and transfer documents
permitted by the Forward Purchase Contract Agreement. No service charge shall be
required for any such registration of transfer or exchange, but the Company and
the Agent may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith. The Holder of a Stripped
DECS may substitute for the Pledged Treasury Securities securing its obligations
under the related Forward Purchase Contract Notes or the appropriate Treasury
Consideration or Applicable Ownership Interest in the Treasury Portfolio in
accordance with the terms of the Forward Purchase Contract Agreement and the
Pledge Agreement. From and after such substitution, the DECS for which such
Pledged Notes, Pledged Treasury Consideration or Pledged Applicable Ownership
Interest in the Treasury Portfolio secures the Holder's obligation under the
Forward Purchase Contract shall be referred to as an "Upper DECS." A Holder that
elects to substitute Notes or the appropriate Treasury Consideration or
Applicable Ownership Interest in the Treasury Portfolio, as the case may be, for
Pledged Treasury Securities, thereby reestablishing Upper DECS, shall be
responsible for any fees or expenses payable in connection therewith. Except as
provided in the Forward Purchase Contract Agreement, for so long as the Forward
Purchase Contract underlying a Stripped DECS remains in effect, such Stripped
DECS shall not be separable into its constituent parts, and the rights and
obligations of the Holder of such Stripped DECS in respect of the Pledged
Treasury Security and the Forward Purchase Contract constituting such Stripped
DECS may be transferred and exchanged only as a Stripped DECS.
B-6
The Forward Purchase Contracts and all obligations and rights of the
Company and the Holders thereunder, including, without limitation, the rights
and obligations of Holders to purchase Common Stock, shall immediately and
automatically terminate, without the necessity of any notice or action by any
Holder, the Agent or the Company, if, on or prior to the Stock Purchase Date, a
Termination Event shall have occurred. Upon the occurrence of a Termination
Event, the Company shall promptly but in no event later than two Business Days
thereafter give written notice to the Agent, the Collateral Agent and to the
Holders, at their addresses as they appear in the Stripped DECS Register. Upon
and after the occurrence of a Termination Event, the Collateral Agent shall
release the Pledged Treasury Securities from the Pledge in accordance with the
provisions of the Pledge Agreement.
Upon registration of transfer of this Stripped DECS 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
Forward Purchase Contract Agreement), by the terms of the Forward Purchase
Contract Agreement and the Forward Purchase Contracts evidenced hereby and the
transferor shall be released from the obligations under the Forward Purchase
Contracts evidenced by this Stripped DECS Certificate. The Company covenants and
agrees, and the Holder, by its acceptance hereof, likewise covenants and agrees,
to be bound by the provisions of this paragraph.
The Holder of this Stripped DECS Certificate, by its acceptance hereof,
authorizes the Agent to enter into and perform the related Forward Purchase
Contracts forming part of the Stripped DECS evidenced hereby on its behalf as
its attorney-in-fact, expressly withholds any consent to the assumption (i.e.,
affirmance) of the Forward 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 of the Forward Purchase
Contracts, covenants and agrees to perform such Holder's obligations under such
Forward Purchase Contracts, consents to the provisions of the Forward Purchase
Contract Agreement, irrevocably authorizes the Agent to enter into and perform
the Pledge Agreement on such Holder's behalf as attorney-in-fact, and consents
to and agrees to be bound by the Pledge of the Treasury Securities underlying
this Stripped DECS Certificate pursuant to the Pledge Agreement, provided, that
upon a Termination Event, the rights of the Holder of such DECS under the
Forward Purchase Contract may be enforced without regard to any other rights or
obligations. The Holder further covenants and agrees, that, to the extent and in
the manner provided in the Forward Purchase Contract Agreement and the Pledge
Agreement, but subject to the terms thereof, payments in respect of the Pledged
Treasury Securities, to be paid upon settlement of such Holder's obligations to
purchase Common Stock under the Forward Purchase Contract, shall be paid on the
Stock Purchase Date by the Collateral Agent to the Company in satisfaction of
such Holder's obligations under such Forward Purchase Contract and such Holder
shall acquire no right, title or interest in such payments.
The Company and each Holder of any DECS, and each Beneficial Owner
thereof, by its acceptance thereof or of its interest therein, further agrees to
treat (i) the purchase of a DECS as the purchase of a unit consisting of the
Purchase Contract and the Note and (ii) itself as the owner of the related
Notes, Treasury Consideration or Treasury Securities, as the case may be.
B-7
Subject to certain exceptions, the provisions of the Forward Purchase
Contract Agreement may be amended with the consent of the Holders of a majority
of the Forward Purchase Contracts.
The Forward Purchase Contracts shall for all purposes be governed by,
and construed in accordance with, the laws of the State of New York, without
regard to its principles of conflicts of laws.
The Company, the Agent and any agent of the Company or the Agent may
treat the Person in whose name this Stripped DECS Certificate is registered as
the owner of the Stripped DECS evidenced hereby for the purpose of performance
of the Forward Purchase Contracts and for all other purposes whatsoever (subject
to the Record Date provisions hereof), whether or not any payments in respect
thereof be overdue and notwithstanding any notice to the contrary, and neither
the Company, the Agent, such Affiliate, nor any such agent shall be affected by
notice to the contrary.
The Forward 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 Forward Purchase Contract Agreement is available for
inspection by any Holder at the Corporate Trust Office.
B-8
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
UNIF GIFT MIN ACT - Custodian
(cust) (minor)
Under Uniform Gifts to Minors Act
(State)
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and
not as tenants in common
Additional abbreviations may also be used though not in the above list.
B-9
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
(Please insert Social Security or Taxpayer I.D. or other Identifying
Number of Assignee)
(Please Print or Type Name and Address Including Postal Zip Code of
Assignee)
the within Stripped DECS Certificate and all rights thereunder, hereby
irrevocably constituting and appointing ____________________________ attorney to
transfer said Stripped DECS Certificate on the books of Capital One Financial
Corporation with full power of substitution in the premises.
Dated: Signature:
---------------------- --------------------------------
NOTICE: The signature to this assignment must
correspond with the name as it appears upon the
face of the within Stripped DECS Certificate in
every particular, without alteration or
enlargement or any change whatsoever.
Signature Guarantee:
---------------------------------------------------
B-10
SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate or book-entry interest
for shares of Common Stock deliverable upon settlement on or after the Stock
Purchase Date of the Forward Purchase Contracts underlying the number of
Stripped DECS evidenced by this Stripped DECS Certificate be registered in the
name of, and delivered, together with a check in payment for any fractional
share, to the undersigned at the address indicated below unless a different name
and address have been indicated below. If shares are to be registered in the
name of a Person other than the undersigned, the undersigned will pay any
transfer tax payable incident thereto.
Dated: Signature:
------------------- --------------------------------
Signature Guarantee:
-----------------------
(if assigned to another
person)
If shares are to be registered REGISTERED HOLDER
in the name of and delivered to
a Person other than the Holder, Please print name and address of
please (i) print such Person's Registered Holder:
name and address and (ii)
provide a guarantee of your
signature:
Name Name
Address Address
Social Security or other Taxpayer
Identification Number, if any
B-11
ELECTION TO SETTLE EARLY
The undersigned Holder of this Stripped DECS Certificate hereby
irrevocably exercises the option to effect Early Settlement in accordance with
the terms of the Forward Purchase Contract Agreement with respect to the Forward
Purchase Contracts underlying the number of Stripped DECS evidenced by this
Stripped DECS Certificate specified below. The option to effect Early Settlement
may be exercised only with respect to Forward Purchase Contracts underlying
Stripped DECS with an aggregate Stated Amount equal to $1,000 or an integral
multiple thereof. The undersigned Holder directs that a certificate or
book-entry interest for shares of Common Stock deliverable upon such Early
Settlement be registered in the name of, and delivered, together with a check in
payment for any fractional share and any Stripped DECS Certificate representing
any Stripped DECS evidenced hereby as to which Early Settlement of the related
Forward Purchase Contracts is not effected, to the undersigned at the address
indicated below unless a different name and address have been indicated below.
Pledged Treasury Securities deliverable upon such Early Settlement will be
transferred in accordance with the transfer instructions set forth below. If
shares are to be registered in the name of a Person other than the undersigned,
the undersigned will pay any transfer tax payable incident thereto.
Dated: Signature:
-------------------- --------------------------------
Signature Guarantee:
----------------------
Number of DECS evidenced hereby as to which Early Settlement of the
related Forward Purchase Contracts is being elected:
If shares of Common Stock are to REGISTERED HOLDER
be registered in the name of and
delivered to and Pledged Please print name and address of
Treasury Securities are to be Registered Holder:
transferred to a Person other
than the Holder, please print
such Person's name and address:
Name Name
Address Address
Social Security or other Taxpayer
Identification Number, if any
Transfer instructions for Pledged Treasury Securities transferable upon
Early Settlement or a Termination Event:
B-12
(TO BE ATTACHED TO GLOBAL CERTIFICATES)
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The following increases or decreases in this Global Certificate have
been made:
Stated Amount of the
Amount of Decrease in Amount of Increase in Global Certificate
Stated Amount of the Stated Amount of the Following Such Signature of
Date Global Certificate Global Certificate Decrease or Increase Authorized Signatory
B-13
EXHIBIT C
INSTRUCTION FROM FORWARD PURCHASE CONTRACT AGENT
TO COLLATERAL AGENT
BNY Midwest Trust Company
2 North LaSalle Street, Suite 1020
Chicago, Illinois 60602
Attention: Corporate Trust Department
Re: DECS of Capital One Financial Corporation (the "Company")
We hereby notify you in accordance with Section [4.1] [4.2] of the
Pledge Agreement, dated as of April 23, 2002, (the "Pledge Agreement") among the
Company, you, as Collateral Agent, Custodial Agent and Securities Intermediary
and us, as Forward Purchase Contract Agent and as attorney-in-fact for the
holders of [Upper DECS] [Stripped DECS] from time to time, that the Holder of
DECS listed below (the "Holder") has elected to substitute [$_____ aggregate
principal amount of Treasury Securities (CUSIP No.912803ADS)] [$_______
aggregate principal amount of Notes or $_____ aggregate principal amount of
Treasury Consideration (CUSIP No. _____) or the Applicable Ownership Interest in
the Treasury Portfolio, as the case may be,] in exchange for the related
[Pledged Notes, Pledged Treasury Consideration or the appropriate Pledged
Applicable Ownership Interest in the Treasury Portfolio, as the case may be,]
[Pledged Treasury Securities] held by you in accordance with the Pledge
Agreement and has delivered to us a notice stating that the Holder has
Transferred [Treasury Securities] [Notes, the Treasury Consideration or the
appropriate Applicable Ownership Interest in the Treasury Portfolio, as the case
may be,] to you, as Collateral Agent. We hereby instruct you, upon receipt of
such [Pledged Treasury Securities] [Pledged Notes, Pledged Treasury
Consideration or the appropriate Pledged Applicable Ownership Interest in the
Treasury Portfolio, as the case may be,], and upon the payment by such Holder of
any applicable fees, to release the [Notes, the Treasury Consideration or the
appropriate Applicable Ownership Interest in the Treasury Portfolio, as the case
may be,] [Treasury Securities] related to such [Upper DECS] [Stripped DECS] to
us in accordance with the Holder's instructions. Capitalized terms used herein
but not defined shall have the meaning set forth in the Pledge Agreement.
Date:
----------------------
BNY MIDWEST TRUST COMPANY,
AS FORWARD PURCHASE CONTRACT AGENT
By:
---------------------------------------
Name:
Title:
C-1
Please print name and address of Registered Holder electing to
substitute [Treasury Securities] [Notes, Treasury Consideration or the
appropriate Applicable Ownership Interest in the Treasury Portfolio] for the
[Pledged Notes, Pledged Treasury Consideration or the appropriate Pledged
Applicable Ownership Interest in the Treasury Portfolio] [Pledged Treasury
Securities]:
Name:
Social Security or other Taxpayer
Identification Number, if any:
Address:
C-2
EXHIBIT D
INSTRUCTION TO FORWARD PURCHASE CONTRACT AGENT
BNY Midwest Trust Company,
as Forward Purchase Contract Agent
2 North LaSalle Street, Suite 1020
Chicago, Illinois 60602
Attention: Corporate Trust Department
Telecopy: (312) 827-8542
Re: DECS of Capital One Financial Corporation (the "Company")
The undersigned Holder hereby notifies you that it has delivered to BNY
Midwest Trust Company, as Collateral Agent, Custodial Agent and Securities
Intermediary [$_______ aggregate principal amount of Treasury Securities (CUSIP
No. 912803ADS)] [$_______ aggregate principal amount of Notes or $_____
principal amount of Treasury Consideration (CUSIP No. ) or the appropriate
Applicable Ownership Interest in the Treasury Portfolio, as the case may be] in
exchange for the related [Pledged Notes, Pledged Treasury Consideration or the
appropriate Pledged Applicable Ownership Interest in the Treasury Portfolio, as
the case may be] [Pledged Treasury Securities] held by the Collateral Agent, in
accordance with Section [4.1] [4.2] of the Pledge Agreement, dated April 23,
2002 (the "Pledge Agreement"), among you, the Company and the Collateral Agent.
The undersigned Holder has paid the Collateral Agent all applicable fees
relating to such exchange. The undersigned Holder hereby instructs you to
instruct the Collateral Agent to release to you on behalf of the undersigned
Holder the [Pledged Notes, Pledged Treasury Consideration or the appropriate
Pledged Applicable Ownership Interest in the Treasury Portfolio, as the case may
be] [Pledged Treasury Securities] related to such [Upper DECS] [Stripped DECS].
Capitalized terms used herein but not defined shall have the meaning set forth
in the Pledge Agreement.
Date: Signature:
------------------- ---------------------------------
Signature Guarantee:
-----------------------
Please print name and address of Registered Holder:
Name:
Social Security or other Taxpayer Identification Number, if any:
Address:
D-1
EXHIBIT E
NOTICE TO SETTLE BY SEPARATE CASH
BNY Midwest Trust Company,
as Forward Purchase Contract Agent
2 North LaSalle Street, Suite 1020
Chicago, Illinois 60602
Attention: Corporate Trust Department
Telecopy: (312) 827-8542
Re: DECS of Capital One Financial Corporation (the "Company")
The undersigned Holder hereby irrevocably notifies you in accordance
with Section 5.3 of the Forward Purchase Contract Agreement dated as of April
23, 2002 among the Company and yourselves, as Forward Purchase Contract Agent
and as Attorney-in-Fact for the Holders of the Forward Purchase Contracts, that
such Holder has elected to pay to the Collateral Agent, on or prior to 11:00
a.m. New York City time, on the Business Day immediately preceding the Stock
Purchase Date, (in lawful money of the United States by [certified or cashiers
check or] wire transfer, in each case in immediately available funds),
$_________ as the Purchase Price for the shares of Common Stock issuable to such
Holder by the Company under the related Forward Purchase Contract on the Stock
Purchase Date. The undersigned Holder hereby instructs you to notify promptly
the Collateral Agent of the undersigned Holder's election to make such cash
settlement with respect to the Forward Purchase Contracts related to such
Holder's Upper DECS.
Dated:
------------------ -------------------------------------------
Signature
Signature Guarantee:
-----------------
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
Please print name and address of Registered Holder:
Social Security or other Taxpayer Identification Number, if any:
F-1