Draft of June 19, 1996
TYCO TOYS, INC.,
MIDLANTIC BANK N.A., As Depositary
AND
THE HOLDERS FROM TIME TO TIME OF
THE DEPOSITARY RECEIPTS DESCRIBED HEREIN
DEPOSIT AGREEMENT
FOR
SERIES C MANDATORILY CONVERTIBLE
REDEEMABLE PREFERRED STOCK
Dated as of ____________, 1996
TABLE OF CONTENTS
Page
ARTICLE I. Definitions................................................. 1
ARTICLE II. Book-Entry, Form of Receipts, Deposit of Stock, Execution
and Delivery, Transfer, Surrender and
Redemption of Receipts................................... 2
SECTION 2.01. Book-Entry Form; Form and Transfer of Receipts............. 2
SECTION 2.02. Deposit of Stock; Execution and Delivery of Receipts
in Respect Thereof......................................... 4
SECTION 2.03. Optional Redemption of Stock............................... 5
SECTION 2.04. Mandatory Conversion of Stock.............................. 6
SECTION 2.05. Conversion of Stock at the Option of the Holder............ 7
SECTION 2.06. Registration of Transfer of Receipts....................... 7
SECTION 2.07. Surrender of Receipts and Withdrawal of Stock.............. 7
SECTION 2.08. Limitations on Execution and Delivery, Transfer,
Surrender and Exchange of Receipts......................... 8
SECTION 2.09. Lost Receipts, etc......................................... 9
SECTION 2.10. Cancellation and Destruction of Surrendered Receipts....... 9
SECTION 2.11. Interchangeability of Book-Entry Receipts and Receipts
in Physical, Certificated Form............................ 9
ARTICLE III. Certain Obligations of Holders of Receipts and the Company..10
SECTION 3.01. Filing Proofs, Certificates and Other Information.......... 10
SECTION 3.02. Payment of Taxes or Other Governmental Charges............. 10
SECTION 3.03. Warranty as to Stock....................................... 10
SECTION 3.04. Warranty as to Receipts.................................... 10
ARTICLE IV. The Deposited Securities; Notices.......................... 11
SECTION 4.01. Cash Distributions......................................... 11
SECTION 4.02. Distributions Other than Cash, Rights, Preferences or
Privileges................................................. 11
SECTION 4.03. Subscription Rights, Preferences or Privileges............. 11
SECTION 4.04. Notice of Dividends, etc.; Fixing of Record Date for
Holders of Receipts........................................ 12
SECTION 4.05. Voting Rights.............................................. 13
SECTION 4.06. Changes Affecting Stock and Reclassifications,
Recapitalizations, etc..................................... 13
SECTION 4.07. Inspection of Reports...................................... 13
SECTION 4.08. Lists of Receipt Holders................................... 14
i
ARTICLE V. The Depositary, the Depositary's Agents, the Registrar and
the Company.............................................. 14
SECTION 5.01. Maintenance of Offices, Agencies and Transfer Books
by the Depositary; Registrar.............................. 14
SECTION 5.02. Prevention of or Delay in Performance by the
Depositary, the Depositary's Agents, the Registrar or the
Company................................................... 14
SECTION 5.03. Obligations of the Depositary, the Depositary's Agents,
the Registrar and the Company............................. 15
SECTION 5.04. Resignation and Removal of the Depositary;
Appointment of Successor Depositary....................... 16
SECTION 5.05. Corporate Notices and Reports............................. 17
SECTION 5.06. Indemnification by the Company............................ 17
SECTION 5.07. Charges and Expenses...................................... 17
ARTICLE VI. Amendment and Termination................................. 18
SECTION 6.01. Amendment................................................. 18
SECTION 6.02. Termination............................................... 18
ARTICLE VII. Miscellaneous............................................. 19
SECTION 7.01. Counterparts.............................................. 19
SECTION 7.02. Exclusive Benefit of Parties.............................. 19
SECTION 7.03. Invalidity of Provisions.................................. 19
SECTION 7.04. Notices................................................... 19
SECTION 7.05. Depositary's Agents....................................... 20
SECTION 7.06. Holders of Receipts Are Parties........................... 20
SECTION 7.07. Governing Law............................................. 20
SECTION 7.08. Inspection of Deposit Agreement........................... 20
SECTION 7.09. Headings.................................................. 20
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DEPOSIT AGREEMENT
DEPOSIT AGREEMENT dated as of __________, 1996, among Tyco Toys, Inc., a
Delaware corporation, Midlantic Bank N.A., a national banking association, and
the holders from time to time of the Receipts described herein.
WHEREAS, it is desired to provide, as hereinafter set forth in this
Deposit Agreement, for the deposit of shares of the Stock of the Company with
the Depositary for the purposes set forth in this Deposit Agreement and for
the issuance hereunder of Receipts evidencing Depositary Shares in respect of
the Stock so deposited; and
WHEREAS, the Receipts are to be substantially in the form of Exhibit A
annexed hereto, with appropriate insertions, modifications and omissions, as
hereinafter provided in this Deposit Agreement.
NOW, THEREFORE, in consideration of the premises, the parties hereto
agree as follows:
ARTICLE I.
Definitions
The following definitions shall for all purposes, unless otherwise
indicated, apply to the respective terms used in this Deposit Agreement. Terms
not otherwise defined herein shall be given the meaning assigned to such terms
in the Certificate.
"Certificate" shall mean the Certificate of Designations filed with the
Secretary of State of the State of Delaware establishing the Stock as a series
of preferred stock of the Company designated as "Series C Mandatorily
Convertible Redeemable Preferred Stock."
"Common Stock" shall mean the Company's Common Stock par value $0.01 per
share, or any security into which the Common Stock may be converted.
"Company" shall mean Tyco Toys, Inc., a Delaware corporation, and its
successors.
"Deposit Agreement" shall mean this Deposit Agreement, as amended or
supplemented from time to time.
"Depositary" shall mean Midlantic Bank N.A., and any successor as
Depositary hereunder.
"Depositary Shares" shall mean Depositary Shares, each representing
ownership of one-twentieth of the Stock deposited with the Depositary
hereunder under this Deposit Agreement, all as evidenced by a Receipt. Subject
to the terms of this Deposit Agreement, each owner of a Depositary Share is
entitled, proportionately, to all the rights, preferences and privileges of
the Stock represented by such Depositary Share, including the dividend,
voting, redemption, conversion and liquidation rights and subject,
proportionately, to all of the limitations of the Stock represented thereby,
contained in the Certificate, and to the benefits of all obligations of the
Company under the Certificate.
"Depositary's Agent" shall mean any agent appointed by the Depositary
pursuant to Section 7.05.
"Depositary's Office" shall mean the corporate trust office of the
Depositary in [ ], at which at any particular time its depositary receipt
business shall be administered.
"Mandatory Conversion Date" shall be ______________, 2000.
"Mandatory Conversion Rate" shall mean the conversion rate, as set forth
in Section III(A) of the Certificate, at which the Stock, and therefore the
Depositary Shares, will convert into Common Stock on the Mandatory Conversion
Date.
"Optional Rate" shall mean the conversion rate, as set forth in Section
III(B) of the Certificate, at which the Stock, and therefore the Depositary
Shares, will be subject to upon conversion, and may be subject to upon
redemption.
"Receipt" shall mean one of the Depositary Receipts issued hereunder by
the Depositary, whether in definitive or temporary form, evidencing interests
held in Depositary Shares in substantially the form set forth in Exhibit A
hereto. When the context requires, the term "Receipt" shall be deemed to
include the DTC Receipt (as defined in Section 2.01 hereof).
"Record Holder" as applied to a Receipt shall mean the person in whose
name a Receipt is registered on the books of the Depositary maintained for
such purpose.
"Redemption Date" shall have the meaning set forth in Section 2.03
hereof.
"Registrar" shall mean any bank or trust company which shall be appointed
to register ownership and transfers of Receipts as herein provided.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Stock" shall mean the Company's Series C Mandatorily Convertible
Redeemable Preferred Stock, par value $0.10 per share.
"Stockholder" shall mean holders of the Stock.
"Transaction" shall mean the occurrence of such an event, as set forth in
Section III(E) of the Certificate, which causes the consideration receivable
upon redemption or conversion of the Stock, and therefore the Depositary
Shares, to include securities, cash or other property in replacement of, or in
addition to Common Stock.
ARTICLE II.
Book-Entry, Form of Receipts, Deposit of Stock, Execution and Delivery,
Transfer, Surrender and Redemption of Receipts
SECTION 2.01. Book-Entry Form; Form and Transfer of Receipts. The Company
and the Depositary shall make application to The Depository Trust Company
("DTC") for acceptance of all or a portion of the Receipts for its book-entry
settlement system. The Company hereby appoints the Depositary acting through
any authorized officer thereof as its attorney-in-fact, with full power to
delegate, for purposes of executing any agreements, certifications or other
instruments or documents necessary or desirable in order to effect the
acceptance of such Receipts for DTC eligibility, including, but not limited
to, a letter of representations, in form satisfactory to the Company, the
Depositary and DTC. So long as the Receipts are eligible for book-entry
settlement with DTC, except as provided for in Section 2.11 of this Deposit
Agreement, or unless otherwise required by law, all Depositary Shares to be
traded on the New York Stock Exchange with book-entry settlement through DTC
shall be represented by a single receipt (the "DTC Receipt") which shall be
deposited with DTC (or its designee) evidencing all such Depositary Shares and
registered in the name of the nominee of DTC
2
(initially expected to be Cede & Co.). Midlantic Bank N.A. or such other
entity as is agreed to by DTC may hold the DTC Receipt as custodian for DTC.
During any period in which any Depositary Shares are evidenced by the DTC
Receipts except as expressly provided for in Section 2.11 of this Deposit
Agreement, no person acquiring Depositary Shares traded on the New York Stock
Exchange with book-entry settlement through DTC shall receive or be entitled
to receive physical delivery of the Receipts evidencing such Depositary
Shares. Ownership of beneficial interests in the DTC Receipt shall be shown
on, and the transfer of such ownership shall be effected through, records
maintained by (i) DTC or its nominee for such DTC Receipt, or (ii)
institutions that have accounts with DTC.
If DTC subsequently ceases to make its book-entry settlement system
available for the Receipts, the Company may instruct the Depositary regarding
making other arrangements for book-entry settlement. In the event that the
Receipts are not eligible for, or it is no longer necessary to have the
Receipts available in book-entry form, the Depositary shall provide written
instructions to DTC to deliver to the Depositary for cancellation the DTC
Receipt, and the Company shall instruct the Depositary to deliver to the
beneficial owners of the Depositary Shares previously evidenced by the DTC
Receipt definitive Receipts in physical form evidencing such Depositary
Shares. Such definitive Receipts shall be in the form annexed hereto as
Exhibit A with appropriate insertions, modifications and omissions, as
hereafter provided.
The beneficial owners of Depositary Shares shall, except as stated above
with respect to Depositary Shares in book-entry form represented by the DTC
Receipt, be entitled to receive Receipts in physical, certificated form as
herein provided.
The Receipts shall be typewritten, in the case of the DTC Receipt, and
otherwise shall, upon notice by the Company to the Depositary, be definitive
Receipts which shall be engraved or printed or lithographed on steel-engraved
borders and shall be substantially in the form set forth as Exhibit A annexed
to this Deposit Agreement, with appropriate insertions, modifications and
omissions, as hereinafter provided. The DTC Receipt shall bear such legend or
legends as may be required by DTC in order for it to accept the Depositary
Shares for its book-entry settlement system. Until such time as the Receipts
are so engraved or printed or lithographed in accordance with the preceding
sentence, the Depositary, upon the written order of the Company or any holder
of Stock, as the case may be, delivered in compliance with Section 2.02, shall
execute and deliver temporary Receipts which are printed, lithographed,
typewritten, mimeographed or otherwise substantially of the tenor of the
definitive Receipts in lieu of which they are issued and with such appropriate
insertions, omissions, substitutions and other variations as the persons
executing such Receipts may determine, as evidenced by their execution of such
Receipts. After the preparation of definitive Receipts, the temporary Receipts
shall be exchangeable for definitive Receipts upon surrender of the temporary
Receipts at the Depositary's Office, without charge to the holder. Upon
surrender for cancellation of any one or more temporary Receipts, the
Depositary shall execute and deliver in exchange therefor definitive Receipts
representing the same number of Depositary Shares as represented by the
surrendered temporary Receipt or Receipts. Such exchange shall be made at the
Depositary's expense and without any charge therefor to the holder of the
Receipts. Until so exchanged, the temporary Receipts shall in all respects be
entitled to the same benefits under this Deposit Agreement, and with respect
to the Stock, as definitive Receipts.
Receipts shall be executed by the Depositary by the manual signature of a
duly authorized officer of the Depositary; provided, that such signature may
be a facsimile if a Registrar for the Receipts (other than the Depositary)
shall have been appointed and such Receipts are countersigned by manual
signature of a duly authorized officer of the Registrar. No Receipt shall be
entitled to any benefits under this Deposit Agreement or be valid or
obligatory for any purpose unless it shall have been executed manually by a
duly authorized officer of the Depositary or, if a Registrar for the Receipts
(other than the Depositary) shall have been appointed, by manual or facsimile
signature of a duly authorized officer of the Depositary and countersigned
manually by a duly authorized officer of such Registrar. The Depositary shall
record on its books each Receipt so signed and delivered as hereinafter
provided.
Receipts shall be in denominations of any number of whole Depositary
Shares.
3
Receipts may be endorsed with or have incorporated in the text thereof
such legends or recitals or changes not inconsistent with the provisions of
this Deposit Agreement as may be required by the Depositary or required to
comply with any applicable law or any regulation or with the rules and
regulations of any securities exchange upon which the Stock, the Depositary
Shares or the Receipts may be listed or to conform with any usage with respect
thereto, or to indicate any special limitations or restrictions to which any
particular Receipts are subject.
Subject to any limitations set forth in a Receipt or in this Deposit
Agreement, title to Depositary Shares evidenced by a Receipt which is properly
endorsed or accompanied by a properly executed instrument of transfer, shall
be transferable by delivery with the same effect as in the case of a
negotiable instrument; provided, however, that until transfer of a Receipt
shall be registered on the books of the Depositary as provided in Section
2.04, the Depositary may, notwithstanding any notice to the contrary, treat
the record holder thereof at such time as the absolute owner thereof for the
purpose of determining the person entitled to distributions of dividends or
other distributions, the exchange of Depositary Shares for Stock, the right to
exchange Receipts pursuant to Section 2.11 or to any notice provided for in
this Deposit Agreement and for all other purposes.
SECTION 2.02. Deposit of Stock; Execution and Delivery of Receipts in
Respect Thereof. Subject to the terms and conditions of this Deposit
Agreement, the Company or any holder of Stock may from time to time deposit
shares of the Stock under this Deposit Agreement by delivery to the Depositary
of a certificate or certificates for the Stock to be deposited, properly
endorsed or accompanied, if required by law or the Depositary, by a duly
executed instrument of transfer or endorsement, in form satisfactory to the
Depositary, together with all such certifications as may be required by the
Depositary in accordance with the provisions of this Deposit Agreement, and
together with a written order of the Company or such holder, as the case may
be, directing the Depositary to execute and deliver to, or upon the written
order of, the person or persons stated in such order a Receipt or Receipts for
the number of Depositary Shares representing such deposited Stock.
Deposited Stock shall be held by the Depositary at the Depositary's
Office or at such other place or places as the Depositary shall determine.
Upon receipt by the Depositary of a certificate or certificates for Stock
deposited in accordance with the provisions of this Section, together with the
other documents required as above specified, and upon recordation of the Stock
on the books of the Company in the name of the Depositary or its nominee, the
Depositary, subject to the terms and conditions of this Deposit Agreement,
shall execute and deliver, to or upon the order of the Company or a holder of
Stock depositing shares of Stock in accordance with the first paragraph of
this Section, a Receipt or Receipts for the number of Depositary Shares
representing the Stock so deposited and registered in such name or names as
may be requested by the Company or such holder. The Depositary shall execute
and deliver such Receipt or Receipts at the Depositary's Office or such other
offices, if any, as the Depositary may designate. Delivery at other offices
shall be at the risk and expense of the person requesting such delivery. The
DTC Receipt shall provide that it shall evidence the aggregate amount of
Depositary Shares from time to time indicated in the records of the Depositary
and that the aggregate amount of Depositary Shares evidenced thereby may from
time to time be increased or decreased by making adjustments on such records
of the Depositary.
</R >
Other than in the case of splits, combinations or other reclassifications
affecting the Stock, or in the case of dividends or other distributions of
Stock, if any, there shall be deposited hereunder not more than [ ] shares of
Stock.
SECTION 2.03. Optional Redemption of Stock. Whenever the Company shall
elect to redeem shares of Stock in accordance with the provisions of the
Certificate, it shall (unless otherwise agreed to in writing with the
Depositary) give the Depositary not less than 30 days' notice of the proposed
date of such proposed redemption of Stock and the number of shares of Stock
held by the Depositary to be so redeemed. On the date of such redemption,
provided that the Company shall then have deposited with the Depositary the
number of shares of Common Stock and any cash
4
necessary to effect such redemption, the Depositary shall redeem the number of
Depositary Shares representing such Stock. The Depositary shall mail notice of
such redemption and the proposed simultaneous redemption of the number of
Depositary Shares representing the Stock to be redeemed, first class postage
prepaid, not less than 15 nor more than 60 days prior to the date fixed for
redemption of such Stock and Depositary Shares (the "Redemption Date"), to the
Record Holders on the record date for such redemption (determined pursuant to
Section 4.04 hereof) of the Receipts evidencing the Depositary Shares to be so
redeemed, at the addresses of such Record Holders as the same appear on the
records of the Depositary, but neither failure to mail any such notice to one
or more such Record Holders nor any defect in any notice shall affect the
sufficiency of the proceedings for redemption as to other Record Holders. Each
such notice shall state (i) that the Company has elected to redeem all or a
portion of the Stock represented by the Depositary Shares, (ii) the record
date for purposes of such redemption, (iii) the Redemption Date, (iv) that all
outstanding Depositary Shares are to be redeemed, or in the case of a
redemption of fewer than all outstanding Depositary Shares in connection with
a partial redemption of Stock pursuant to Section III(B) of the Certificate,
the number of such Depositary Shares held by such Record Holder to be
redeemed, (v) the number of shares of Common Stock, cash in lieu of fractional
shares and other consideration (in the event that a Transaction has occurred)
to be received for each Depositary Share held by such Record Holder (such
conversion amounts to be determined by the Company in accordance with the
Certificate), (vi) the place or places where Receipts evidencing Depositary
Shares are to be surrendered for shares of Common Stock, (vii) that dividends
in respect of the Stock represented by the Depositary Shares to be redeemed
will cease to accrue at the close of business on such Redemption Date; and
(viii) any other information required by applicable law and any other
procedures to be followed by such Record Holders to receive Common Stock for
their redeemed Depositary Shares. In case less than all the outstanding
Depositary Shares are to be redeemed, the Depositary Shares to be so redeemed
shall be selected by lot or pro rata (as nearly as may be) or in any other
equitable manner determined by the Depositary to be consistent with the method
determined by the Board of Directors, in its sole discretion, with respect to
the Stock.
The Depositary shall similarly mail notice of such redemption to the
Stockholders, if any, whose shares of Stock are designated by the Company for
redemption at their addresses as they appear on the records of the Depositary,
first class postage prepaid, not less than 15 and not more than 60 days prior
to the Redemption Date. Neither failure to mail any notice to any Stockholder
nor any defect in any notice shall affect the sufficiency of the proceedings
for redemption as to other Stockholders.
Notice having been mailed by the Depositary as aforesaid, from and after
the Redemption Date (unless the Company shall have failed to redeem the shares
of Stock to be redeemed by it as set forth in the Company's notice provided
for in the preceding paragraph) all dividends in respect of the shares of
Stock so called for redemption shall cease to accrue, the Depositary Shares
called for redemption shall be deemed no longer to be outstanding, and all
rights of the Record Holders of Receipts evidencing such Depositary Shares
(except the right to receive shares of Common Stock, cash in lieu of
fractional shares upon redemption, if applicable, or other consideration
resulting from the occurrence of a Transaction, if any) shall, to the extent
of such Depositary Shares, cease and terminate. Upon any surrender in
accordance with said notice of the Receipts evidencing any such Depositary
Shares (properly endorsed or assigned for transfer, if the Depositary shall so
require), each such Depositary Share shall be redeemed by the Depositary for
the number of Common Shares therefor specified in said notice, plus cash for
fractional shares, if any, represented by such Depositary Share. The foregoing
shall further be subject to the terms and conditions of the Certificate. If
less than all the Depositary Shares evidenced by a Receipt are called for
redemption, the Depositary will deliver to the Record Holder of such Receipt,
upon surrender of such Receipt, to the Depositary, a new Receipt evidencing
the Depositary Shares evidenced by such prior Receipt and not called for
redemption, together with certificates representing the shares of Common Stock
issuable upon redemption of the Depositary Shares called for redemption.
SECTION 2.04. Mandatory Conversion of Stock. On the Mandatory Conversion
Date, all outstanding shares of the Stock will automatically convert into
Common Stock at
5
the Mandatory Conversion Rate. Provided that the Company shall then have
deposited with the Depositary the number of shares of Common Stock, cash in
lieu of fractional shares, and other consideration (in the event that a
Transaction has occurred) necessary to effect such conversion, the Depositary
shall convert all outstanding Depositary Shares representing Stock into Common
Stock at the Mandatory Conversion Rate specified to the Depositary by the
Company.
From and after the Mandatory Conversion Date (unless the Company shall
have failed to deposit the shares of Common Stock, cash or other consideration
as required above), (i) all dividends in respect of the shares of Stock shall
cease to accrue, (ii) the Depositary Shares shall be deemed no longer to be
outstanding, (iii) all rights of the holders of Receipts evidencing such
Depositary Shares (except the right to receive the shares of Common Stock and
any other consideration then due) shall, to the extent of such Depositary
Shares, cease and terminate and (iv) upon surrender of the Receipts evidencing
any such Depositary Shares in accordance with such procedures and
documentation as the Depositary may require, such Depositary Shares shall be
converted by the Depositary into whole shares of Common Stock and any other
consideration therefor specified by the Company, plus all money and other
property, if any, represented by such Depositary Shares. The foregoing shall
further be subject to the terms and conditions of the Certificate.
SECTION 2.05. Conversion of Stock at the Option of the Holder. Upon the
Depositary's receipt from any Record Holder, at any time prior to the
Mandatory Conversion Date or until immediately before the close of business on
any redemption date with respect to such shares, of a written notice of such
Record Holders' election to convert any or all whole shares of the Stock
represented by such holders's Depositary Shares into Common Stock, along with
delivery to the Depositary of such holder's Receipt(s) evidencing such
Depositary Shares, cash payment of an amount equal to the Depositary Share's
portion of the dividends payable on the Stock (for conversions taking place
after the close of business on a record date for any declared dividend and
before the opening of business on the next succeeding dividend payment date,
as set forth in the Certificate), if applicable, and a proper assignment of
such Receipts(s) to the Company or in blank, provided that the Company shall
then have deposited with the Depositary the number of shares of Common Stock
and any money or other property necessary to effect such conversion, the
Depositary shall, promptly thereafter, (i) cancel such Receipt(s), (ii)
deliver to such Record Holder a certificate for the number of whole shares of
Common Stock into which such Stock is converted, pursuant to the Optional Rate
as calculated by the Company in accordance with the Certificate, (iii) deliver
to such holder all cash in lieu of fractional shares, if any, or other
consideration (in the event a Transaction has occurred) to be received for
each Depositary Share, (iv) if less than all of the Depositary Shares
evidenced by any Receipt are converted, deliver to such holder a new Receipt
or Receipts evidencing the quantity of Depositary Shares evidenced by such
prior Receipt but not converted and (v) cancel (or, if the Depositary is not
the transfer agent for Stock, deliver for cancellation) that number of shares
of Stock held by the Depositary which are represented by the aggregate of all
Depositary Shares so converted. Each such conversion of Depositary Shares
shall be deemed to have been effected immediately before the close of business
on the date on which the foregoing requirements as to delivery of notice of
conversion, Receipt(s), and assignment shall have been satisfied.
After the effective date of such conversion of any Depositary Shares, (i)
all dividends in respect of the shares of Stock represented by such Depositary
Shares shall cease to accrue, (ii) the Depositary Shares being so converted
shall be deemed no longer to be outstanding and (iii) all rights of the
holders of Receipts evidencing such Depositary Shares (except the right to
receive the shares of Common Stock and any money or other property to which
such holders were entitled upon such conversion) shall, to the extent of such
Depositary Shares, cease and terminate. No fractional shares of Stock may be
converted. The foregoing shall further be subject to the terms and conditions
of the Certificate.
SECTION 2.06. Registration of Transfer of Receipts. Subject to the terms
and conditions of this Deposit Agreement, the Depositary shall make transfers
on its books from time to time of Receipts upon any surrender thereof at the
Depositary's Office by the holder in person or by
6
such holder's duly authorized attorney, properly endorsed or accompanied by a
properly executed instrument of transfer, and duly stamped as may be required
by law. Thereupon the Depositary shall execute a new Receipt or Receipts
evidencing the same aggregate number of Depositary Shares as those evidenced
by the Receipt or Receipts surrendered and deliver such new Receipt or
Receipts to or upon the order of the person entitled thereto.
SECTION 2.07. Surrender of Receipts and Withdrawal of Stock. Any holder
of a Receipt or Receipts representing any number of whole shares of Stock (or
such holder's duly authorized attorney) may withdraw the Stock and all money
and other property, if any, represented thereby by surrendering such Receipt
or Receipts at the Depositary's Office or at such other offices as the
Depositary may designate for such withdrawals. If such holder's Depositary
Shares are being held by DTC or its nominee pursuant to Section 2.01, such
holder shall request, in accordance with Section 2.11, withdrawal from the
book-entry system of the number of Depositary Shares specified in the
preceding sentence. Thereafter, without unreasonable delay, the Depositary
shall deliver to such holder, or to the person or persons designated by such
holder as hereinafter provided, the number of whole shares of Stock and all
money and other property, if any, represented by the Receipt or Receipts so
surrendered for withdrawal, but holders of such whole shares of Stock will not
thereafter be entitled to receive Depositary Shares in exchange therefor. If a
Receipt delivered by the holder to the Depositary in connection with such
withdrawal shall evidence a number of Depositary Shares in excess of the
number of Depositary Shares representing the number of whole shares of Stock
to be so withdrawn, the Depositary shall at the same time, in addition to such
number of whole shares of Stock and such money and other property, if any, to
be so withdrawn, deliver to such holder, or (subject to Section 2.06) upon his
order, a new Receipt evidencing such excess number of Depositary Shares. In no
event will fractional shares of Stock (or cash in lieu thereof) be distributed
by the Depositary. Delivery of the Stock and money and other property being
withdrawn may be made by the delivery of such certificates, documents of title
and other instruments as the Depositary may deem appropriate, which, if
required by the Depositary, shall be properly endorsed or accompanied by
proper instruments of transfer.
Stock delivered pursuant to the preceding paragraph may be endorsed with
or have incorporated in the text thereof such legends or recitals or changes
not inconsistent with the provisions of this Deposit Agreement as may be
required by the Depositary or required to comply with any applicable law or
any regulation thereunder or with the rules and regulations of any securities
exchange upon which the Stock may be listed or to conform with any usage with
respect thereto, or to indicate any special limitations or restrictions to
which any particular shares of Stock are subject.
If the Stock and the money and other property being withdrawn are to be
delivered to a person or persons other than the Record Holder of the Receipt
or Receipts being surrendered for withdrawal of Stock, such holder shall
execute and deliver to the Depositary a written order so directing the
Depositary and the Depositary may require that the Receipt or Receipts
surrendered by such holder for withdrawal of such shares of Stock be properly
endorsed in blank or accompanied by a properly executed instrument of transfer
in blank.
Delivery of the Stock and the money and other property, if any,
represented by Receipts surrendered for withdrawal shall be made by the
Depositary at the Depositary's Office, except that, at the request, risk and
expense of the holder surrendering such Receipt or Receipts and for the
account of the holder thereof, such delivery may be made at such other place
as may be designated by such holder.
SECTION 2.08. Limitations on Execution and Delivery, Transfer, Surrender
and Exchange of Receipts. As a condition precedent to the execution and
delivery, registration of transfer, surrender or exchange of any Receipt, the
Depositary, any of the Depositary's Agents or the Company may require (i)
payment to it of a sum sufficient for the payment (or, in the event that the
Depositary or the Company shall have made such payment, the reimbursement to
it) of any charges or expenses payable by the holder of a Receipt pursuant to
Section 5.07 (or evidence reasonably satisfactory to the Company that such
charges and expenses have been paid), (ii) the production of evidence
satisfactory to it as to the identity and genuineness of any signature and
(iii) compliance with
7
such regulations, if any, as the Depositary or the Company may establish not
inconsistent with the provisions of this Deposit Agreement.
The deposit of Stock may be refused, the delivery of Receipts against
Stock may be suspended, the registration of transfer of Receipts may be
refused and the registration of transfer, surrender or exchange of outstanding
Receipts may be suspended (i) during any period when the register of
stockholders of the Company is closed or (ii) if any such action is deemed
necessary or advisable by the Depositary, any of the Depositary's Agents or
the Company at any time or from time to time because of any requirement of law
or of any government or governmental body or commission or under any provision
of the Deposit Agreement, or with the approval of the Company, for any other
reason.
Without limitation of the foregoing, the Depositary shall not accept for
deposit under this Deposit Agreement any Stock as to which it has actual
knowledge is required to be registered under the Securities Act, unless a
registration statement under the Securities Act is in effect as to such Stock;
provided, however, the Depositary shall have no affirmative duty to determine
whether any Stock is required to be registered under the Securities Act or
whether the effectiveness of any registration statement has been suspended.
SECTION 2.09. Lost Receipts, etc. In case any Receipt shall be mutilated,
destroyed, lost or stolen, the Depositary in its discretion may execute and
deliver a Receipt of like form and tenor in exchange and substitution for such
mutilated Receipt, or in lieu of and in substitution for such destroyed, lost
or stolen Receipt, upon (i) the filing by the holder thereof with the
Depositary of evidence satisfactory to the Depositary of such destruction or
loss or theft of such Receipt, of the authenticity thereof and of his or her
ownership thereof, (ii) the furnishing of the Depositary with reasonable
indemnification satisfactory to it, and (ii) the payment of a fee of two
percent (2%) of the value of the Depositary Shares represented by such
receipt, however, in no case shall such fee be in excess of $250.
SECTION 2.10. Cancellation and Destruction of Surrendered Receipts. All
Receipts surrendered to the Depositary or any Depositary's Agent shall be
cancelled by the Depositary. Except as prohibited by applicable law or
regulation, the Depositary is authorized to destroy all Receipts so cancelled.
Any Receipt evidenced in book-entry form shall be deemed cancelled when the
Depositary has caused the amount of Depositary Shares evidenced by the DTC
Receipt to be reduced in proportion to the number of Depositary Shares
evidenced by the surrendered Receipt.
SECTION 2.11. Interchangeability of Book-Entry Receipts and Receipts in
Physical, Certificated Form. Subject to the terms and conditions of this
Deposit Agreement, upon receipt by the Depositary of written instructions from
a DTC participant on behalf of any person having a beneficial interest in
Depositary Shares evidenced by the DTC Receipt for the purpose of directing
the Depositary to execute and deliver a Receipt in physical, certificated form
evidencing such Depositary Shares, the Depositary shall follow the customary
procedures established by DTC for the purpose of reducing the number of
Depositary Shares evidenced by the DTC Receipt and, following such reduction,
shall execute and deliver to or upon the order of the person or persons named
in such order a Receipt or Receipts registered in the name or names requested
by such person and evidencing in the aggregate the number of Depositary Shares
equal to the reduction in the number evidenced by the DTC Receipt. The
Depositary may require in such written instructions any certification or
representation as it shall deem necessary to comply with applicable law.
Subject to the terms and conditions of this Deposit Agreement, upon
receipt by the Depositary of a Receipt or Receipts in physical, certificated
form, duly endorsed or accompanied by appropriate instruments of transfer, in
form satisfactory to the Depositary, including any required certifications,
and together with written instructions directing the Depositary to adjust its
records to reflect an increase in the aggregate amount of Depositary Shares
evidenced by the DTC Receipt (including, without limitation, information
regarding the DTC participant account to be credited with such increase), and
upon payment of the fees and expenses of the Depositary, the Depositary shall
cancel
8
such Receipt or Receipts in physical, certificated form and shall follow the
customary procedures established by DTC for the purpose of reflecting such
increase in the number of Depositary Shares evidenced by the DTC Receipt.
ARTICLE III.
Certain Obligations of
Holders of Receipts and the Company
SECTION 3.01. Filing Proofs, Certificates and Other Information. Any
holder of a Receipt may be required from time to time to file such proof of
residence, or other matters or other information, to execute such certificates
and to make such representations and warranties as the Depositary or the
Company may reasonably deem necessary or proper. The Depositary or the Company
may withhold the delivery, or delay the registration of transfer, redemption
or exchange, of any Receipt or the withdrawal of the Stock represented by the
Depositary Shares evidenced by any Receipt or the distribution of any dividend
or other distribution or the sale of any rights or of the proceeds thereof
until such proof or other information is filed or such certificates are
executed or such representations and warranties are made.
SECTION 3.02. Payment of Taxes or Other Governmental Charges. Holders of
Receipts shall be obligated to make payments to the Depositary of certain
charges and expenses as provided in Section 5.07, or provide reasonably
satisfactory evidence to the Depositary that such charges and expenses have
been paid. Registration of transfer of any Receipt or any withdrawal of Stock
and all money or other property, if any, represented by the Depositary Shares
evidenced by such Receipt may be refused until any such payment due is made,
and any dividends, interest payments or other distributions may be withheld or
any part of or all the Stock or other property represented by the Depositary
Shares evidenced by such Receipt and not theretofore sold may be sold for the
account of the holder thereof (after attempting by reasonable means to notify
such holder prior to such sale), and such dividends, interest payments or
other distributions or the proceeds of any such sale may be applied to any
payment of such charges or expenses, the holder of such Receipt remaining
liable for any deficiency. The Depositary shall act as the withholding agent
for any payments, distributions and exchanges made with respect to the
Depositary Shares and Receipts, and the Stock, Common Stock or other
securities or assets represented thereby (collectively, the "Securities"). The
Depositary shall be responsible with respect to the Securities for the timely
(i) collection and deposit of any required withholding or backup withholding
tax, and (ii) filing of any information returns or other documents with
federal (and other applicable) taxing authorities. In the event the Depositary
is required to pay any such amounts, the Company shall reimburse the
Depositary for payment thereof upon the request of the Depositary and the
Depositary shall, upon the Company's request and as instructed by the Company,
pursue its rights against such holder at the Company's expense.
SECTION 3.03. Warranty as to Stock. The Company hereby represents and
warrants that the Stock, when issued, will be validly issued, fully paid and
nonassessable. Such representation and warranty shall survive the deposit of
the Stock and the issuance of the Receipts.
SECTION 3.04. Warranty as to Receipts. The Depositary hereby represents
and warrants that the Receipts, when issued, will be validly issued, fully
paid and nonassessable. Such representation and warranty shall survive the
deposit of the Stock and the issuance of the Receipts.
9
ARTICLE IV.
The Deposited Securities; Notices
SECTION 4.01. Cash Distributions. Whenever the Depositary shall receive
any cash dividend or other cash distribution on Stock, the Depositary shall,
subject to Sections 3.01 and 3.02, distribute to record holders of Receipts on
the record date fixed pursuant to Section 4.04 such amounts of such dividend
or distribution as are, as nearly as practicable, in proportion to the
respective numbers of Depositary Shares evidenced by the Receipts held by such
holders; provided, however, that in case the Company or the Depositary shall
be required to withhold and shall withhold from any cash dividend or other
cash distribution in respect of the Stock an amount on account of taxes, the
amount made available for distribution or distributed in respect of Depositary
Shares shall be reduced accordingly. The Depositary shall distribute or make
available for distribution, as the case may be, only such amount, however, as
can be distributed without attributing to any holder of Depositary Shares a
fraction of one cent, and any balance not so distributable shall be held by
the Depositary (without liability for interest thereon) and shall be added to
and be treated as part of the next sum received by the Depositary for
distribution to Record Holders then outstanding.
SECTION 4.02. Distributions Other than Cash, Rights, Preferences or
Privileges. Whenever the Depositary shall receive any distribution other than
cash, rights, preferences or privileges upon Stock, the Depositary shall,
subject to Sections 3.01 and 3.02, distribute to Record Holders on the record
date fixed pursuant to Section 4.04 such amounts of the securities or property
received by it as are, as nearly as practicable, in proportion to the
respective numbers of Depositary Shares evidenced by the Receipts held by such
holders, except that the Depositary may not distribute fractional shares of
Common Stock or of any security not issuable in fractional shares. If in the
opinion of the Company such distribution cannot be made proportionately among
such Record Holders, or if for any other reason (including any requirement
that the Company or the Depositary withhold an amount on account of taxes) the
Depositary deems, after consultation with the Company, such distribution not
to be feasible, the Depositary may, at the direction of the Company, adopt
such method as the Company deems equitable and practicable for the purpose of
effecting such distribution, including the sale (at public or private sale) of
the securities or property thus received, or any part thereof, at such place
or places and upon such terms as it may deem proper.
No fractional shares or Common Stock will be issued upon conversion or
redemption of Depositary Shares or upon payment of stock dividends or
distributions on the Stock; and, if such conversion, redemption, dividend or
distribution would otherwise result in a fractional share of Common Stock
being issued, the Depositary shall sell the total number of shares of Common
Stock that would have been represented by such fractional shares at public
sale at such place or places and upon such terms it deems proper. The net
proceeds of any such sale shall, subject to Sections 3.01 and 3.02, be
distributed or made available for distribution, as the case may be, by the
Depositary to Record Holders of Receipts as provided by Section 4.01 in the
case of a distribution received in cash. The amount distributed in the
foregoing cases will be reduced by any amount required to be withheld by the
Company or the Depositary on account of taxes or otherwise required pursuant
to law, regulation or court process.
SECTION 4.03. Subscription Rights, Preferences or Privileges. If the
Company shall at any time offer or cause to be offered to the persons in whose
names Stock is recorded on the books of the Company any rights, preferences or
privileges to subscribe for or to purchase any securities or any rights,
preferences or privileges of any other nature, such rights, preferences or
privileges shall in each such instance be made available by the Depositary to
the record holders of Receipts in such manner as the Company may determine,
either by the issue to such record holders of warrants representing such
rights, preferences or privileges or by such other method as may be approved
by the Company in its discretion with the reasonable approval of the
Depositary; provided, however, that (i) if at the time of issue or offer of
any such rights, preferences or privileges the Company determines that it is
not lawful or (after consultation with the Depositary) not feasible to make
such
10
rights, preferences or privileges available to holders of Receipts by the
issue of warrants or otherwise or (ii) if and to the extent so instructed by
holders of Receipts who do not desire to exercise such rights, preferences or
privileges, then the Company, in its discretion (with approval of the
Depositary; in any case where the Company has determined that it is not
feasible to make such rights, preferences or privileges available), may, if
applicable laws or the terms of such rights, preferences or privileges permit
such transfer, sell such rights, preferences or privileges at public or
private sale, at such place or places and upon such terms as it may deem
proper. The net proceeds of any such sale shall, subject to Sections 3.01 and
3.02, be distributed by the Depositary to the record holders of Receipts
entitled thereto as provided by Section 4.01 in the case of a distribution
received in cash. The Company shall not make any distribution of any such
rights, preferences or privileges unless the Company shall have provided an
opinion of counsel stating that such rights, preferences or privileges have
been registered under the Securities Act or that the offering and sale of such
rights, preferences or privileges are exempt from registration under the
Securities Act.
If registration under the Securities Act of the securities to which any
rights, preferences or privileges relate is required in order for holders of
Receipts to be offered or sold the securities to which such rights,
preferences or privileges relate, the Company agrees with the Depositary that
it will file promptly a registration statement pursuant to the Securities Act
with respect to such rights, preferences or privileges and securities and use
its commercially reasonable efforts and take all steps available to it to
cause such registration statement to become effective sufficiently in advance
of the expiration of such rights, preferences or privileges to enable such
holders to exercise such rights, preferences or privileges. In no event shall
the Depositary make available to the holders of Receipts any right, preference
or privilege to subscribe for or to purchase any securities unless and until
such registration statement shall have become effective, or unless the
offering and sale of such securities to such holders are exempt from
registration under the provisions of the Securities Act.
If any other action under the laws of any jurisdiction or any
governmental or administrative authorization, consent or permit is required in
order for such rights, preferences or privileges to be made available to
holders of Receipts, the Company agrees with the Depositary that the Company
will use its commercially reasonable efforts to take such action or obtain
such authorization, consent or permit sufficiently in advance of the
expiration of such rights, preferences or privileges to enable such holders to
exercise such rights, preferences or privileges.
SECTION 4.04. Notice of Dividends, etc.; Fixing of Record Date for
Holders of Receipts. Whenever (i) any cash dividend or other cash distribution
shall become payable, any distribution other than cash shall be made, or any
rights, warrants, preferences or privileges shall at any time be offered, with
respect to Stock, or (ii) the Depositary shall receive notice of any meeting
at which holders of Stock are entitled to vote or of which holders of Stock
are entitled to notice or any solicitation of consents in respect of the
Stock, or any call or conversion of any shares of Stock or at any time the
Depositary and the Company shall decide it is appropriate, the Depositary
shall in each such instance fix a record date (which shall be the same date as
the record date fixed by the Company with respect to the Stock) for the
determination of the holders of Receipts who shall be entitled to (a) receive
such dividend, distribution, rights, warrants, preferences or privileges or
the net proceeds of the sale thereof, (b) receive notice of, and give
instructions for the exercise of voting rights at, any such meeting or (c)
receive notice of any such call or conversion, subject to the provisions
hereof.
SECTION 4.05. Voting Rights. Upon receipt of notice of any meeting at
which the holders of Stock are entitled to vote or any solicitation of
consents in respect of Stock, the Depositary shall, as soon as practicable
thereafter, mail to the record holders of Receipts a notice which shall
contain (i) such information as is contained in such notice of meeting or
consent solicitation and (ii) a statement that the holders may, subject to any
applicable restrictions, instruct the Depositary as to the exercise of the
voting rights pertaining to the amount of Stock represented by their
respective Depositary Shares and a brief statement as to the manner in which
such instructions may be given. Upon the written request of a holder of a
Receipt on the relevant record date, the Depositary shall use its best efforts
to vote or cause to be voted or deliver a consent with respect to the amount
of Stock represented by the Depositary
11
Shares evidenced by such Receipt, in accordance with the instructions set
forth in such request. To the extent any such instructions request the voting
of a fraction of a share of Stock, the Depositary shall aggregate such
fraction with all other fractions resulting from requests with the same voting
instructions and shall vote the number of whole shares resulting from requests
with the same voting instructions and shall vote the number of whole shares
resulting from such aggregation in accordance with the instructions received
in such requests. The Company hereby agrees to take all reasonable action
which may be deemed necessary by the Depositary in order to enable the
Depositary to vote such Stock or cause such Stock to be voted. In the absence
of specific instructions from the holder of a Receipt, the Depositary will
abstain from voting to the extent of the Stock represented by the Depositary
Shares evidenced by such Receipt.
Holders of Receipts shall also be entitled to vote on certain amendments
to the Deposit Agreement pursuant to Section 6.01 hereof.
SECTION 4.06. Changes Affecting Stock and Reclassifications,
Recapitalizations, etc. Whenever a Transaction occurs the Company may in its
discretion, direct the Depositary to execute and deliver additional Receipts,
or may call for the surrender of all outstanding Receipts to be exchanged for
new Receipts specifically describing such new property into which the Stock
may be converted or redeemed for.
Whenever the Mandatory Conversion Rate and Optional Rate are adjusted by
the Company pursuant to Section II(D) of the Certificate, the Company shall
provide a certificate to the Depositary as required by Section III(F) of the
Certificate. Such certificate shall set forth such adjustments, the method of
calculation thereof and the facts requiring such adjustment and upon which
such adjustment is based. The Depositary shall promptly mail notice containing
the foregoing information to each Record Holder.
Whenever a Transaction occurs, the Company shall provide notice to the
Depositary containing the date on which such Transaction is expected to become
effective, and the date as of which it is expected that holders of Common
Stock of record shall be entitled to exchange their Common Stock for
securities or other property (including cash), if any, deliverable upon such
Transaction. The Depositary shall promptly mail notice containing the
foregoing information to each Record Holder.
SECTION 4.07. Inspection of Reports. The Depository shall make available
for inspection by holders of Receipts at the Depositary's Office, and at such
other places as it may from time to time deem advisable, any reports and
communications received from the Company which are received by the Depositary
as the holder of Stock unless at the time of or prior to receipt the Company
advises the Depositary that such reports or communications have not been
generally available to the stockholders.
SECTION 4.08. Lists of Receipt Holders. Promptly upon request from time
to time by the Company, the Depositary shall furnish to it a list, as of
recent date, of the names, addresses and holdings of Depositary Shares of all
persons in whose names Receipts are registered on the books of the Depositary.
ARTICLE V.
The Depositary, the Depositary's
Agents, the Registrar and the Company
SECTION 5.01. Maintenance of Offices, Agencies and Transfer Books by the
Depositary; Registrar. Upon execution of this Deposit Agreement, the
Depositary shall maintain at the Depositary's Office, facilities for the
execution and delivery, registration and registration of transfer, surrender
and exchange of Receipts, and at the offices of the Depositary's Agents, if
any, facilities for
12
the delivery, registration of transfer, surrender and exchange of Receipts,
all in accordance with the provisions of this Deposit Agreement.
The Depositary shall keep books at the Depositary's Office for the
registration and registration of transfer of Receipts, and to reflect
potential split-ups and combinations of Depositary Shares, which books at all
reasonable times shall be open for inspection by the Company.
The Depositary may close each such books only when the register of
stockholders of the Company is closed or as otherwise required by law.
The Depositary may, with the approval of the Company, appoint a Registrar
(which may be the Depositary) for registration of the Receipts or the
Depositary Shares evidenced thereby. If the Receipts or the Depositary Shares
evidenced thereby or the Stock represented by such Depositary Shares shall be
listed on the New York Stock Exchange, the Depositary will appoint a Registrar
(acceptable to the Company) for registration of such Receipts or Depositary
Shares in accordance with any requirements of such Exchange. Such Registrar
(which may be the Depositary if so permitted by the requirements of such
Exchange) may be removed and a substitute registrar appointed by the
Depositary upon the request or with the approval of the Company. If the
Receipts, such Depositary Shares or such Stock are listed on one or more other
stock exchanges, the Depositary will, at the request of the Company, arrange
such facilities for the delivery, registration, registration of transfer,
surrender and exchange of such Receipts, such Depositary Shares or such Stock
as may be required by law or applicable stock exchange regulation.
SECTION 5.02. Prevention of or Delay in Performance by the Depositary,
the Depositary's Agents, the Registrar or the Company. None of the Depositary,
any Depositary's Agent, any Registrar or the Company shall incur any liability
to any holder of any Receipt if by reason of any provision of any present or
future law, or regulation thereunder, of the United States of America or of
any other governmental authority or, in the case of the Depositary, the
Depositary's Agent or the Registrar, by reason of any provision, present or
future, of the Company's Restated Certificate of Incorporation, as amended
(including the Certificate) or by reason of any act of God or war or other
circumstance beyond the control of the relevant party, the Depositary, the
Depositary's Agent, the Registrar or the Company shall be prevented or
forbidden from, or subjected to any penalty on account of, doing or performing
any act or thing which the terms of this Deposit Agreement provide shall be
done or performed; nor shall the Depositary, any Depositary's Agent, any
Registrar or the Company incur any liability to any holder of a Receipt (i) by
reason of any nonperformance or delay, caused as aforesaid, in the performance
of any act or thing which the terms of this Deposit Agreement provide shall or
may be done or performed, or (ii) by reason of any exercise of, or failure to
exercise, any discretion provided for in this Deposit Agreement except, in the
case of any such exercise or failure to exercise discretion not caused as
aforesaid, if caused by the gross negligence or willful misconduct of the
party charged with such exercise or failure to exercise.
SECTION 5.03. Obligations of the Depositary, the Depositary's Agents, the
Registrar and the Company. None of the Depositary, any Depositary's Agent, any
Registrar or the Company assumes any obligation or shall be subject to any
liability under this Deposit Agreement to holders of Receipts other than for
its gross negligence or willful misconduct.
None of the Depositary, any Depositary's Agent, any Registrar or the
Company shall be under any obligation to appear in, prosecute or defend any
action, suit or other proceeding in respect of the Stock, the Common Stock,
the Depositary Shares or the Receipts which in its opinion may involve it in
expense or liability unless indemnity satisfactory to it against all expense
and liability be furnished as often as may be required.
None of the Depositary, any Depositary's Agent, any Registrar or the
Company shall be liable for any action or any failure to act by it in reliance
upon the written advice of legal counsel or accountants, or information from
any person presenting Stock for deposit, any holder of a Receipt or any
13
other person believed by it in good faith to be competent to give such
information. The Depositary, any Depositary's Agent, any Registrar and the
Company may each rely and shall each be protected in acting upon any written
notice, request, direction or other document believed by it to be genuine and
to have been signed or presented by the proper party or parties.
The Depositary shall not be responsible for any failure to carry out any
instruction to vote any of the shares of Stock or for the manner or effect of
any such vote made, as long as any such action or non-action is in good faith
or in accordance with the Depositary Agreement. The Depositary undertakes, and
any Registrar shall be required to undertake, to perform such duties and only
such duties as are specifically set forth in this Deposit Agreement, and no
implied covenants or obligations shall be read into this Deposit Agreement
against the Depositary or any Registrar. The Depositary will indemnify the
Company against any liability which may arise out of acts performed or omitted
by the Depositary or the Depositary's Agents due to its or their gross
negligence, wilful misconduct or bad faith. The Depositary, the Depositary's
Agents, and any Registrar may own and deal in any class of securities of the
Company and its affiliates and in Receipts. The Depositary may also act as
transfer agent or registrar of any of the securities of the Company and its
affiliates.
It is intended that neither the Depositary nor any Depositary's Agent
shall be deemed to be an "issuer" of the securities under the federal
securities laws or applicable state securities laws, it being expressly
understood and agreed that the Depositary and any Depositary's Agent are
acting only in a ministerial capacity as Depositary for the Stock.
The Depositary agrees to comply with all information reporting and
withholding requirements applicable to it under law or this Deposit Agreement
in its capacity as Depositary.
None of the Depositary (or its officers, directors, employees or agents),
any Depositary's Agent or the Registrar makes any representation or has any
responsibility as to the validity of the Registration Statement pursuant to
which the Depositary Shares are registered under the Securities Act, the
Stock, the Depositary Shares or the Receipts (except its countersignature
thereon), or any instruments referred to therein or herein, or as to the
correctness of any statement made therein or herein; provided, however, that
the Depositary is responsible for its representations in this Deposit
Agreement.
The Depositary assumes no responsibility for the correctness of the
description that appears in the Receipts, which can be taken as a statement of
the Company summarizing certain provisions of this Deposit Agreement.
Notwithstanding any other provision herein or in the Receipts, the Depositary
makes no warranties or representations as to the validity, genuineness or
sufficiency of any Stock at any time deposited with the Depositary hereunder
or of the Depositary Shares, as to the validity or sufficiency of this Deposit
Agreement, as to the value of the Depositary Shares or as to any right, title
or interest of the record holders of Receipts in and to the Depositary Shares,
except that the Depositary hereby represents and warrants as follows: (i) the
Depositary has been duly organized and is validly existing and in good
standing under the laws of the State of [New Jersey], with full power,
authority and legal right under such law to execute, deliver and carry out the
terms of this Deposit Agreement; (ii) this Deposit Agreement has been duly
authorized, executed and delivered by the Depositary; and (iii) this Deposit
Agreement constitutes a valid and binding obligation of the Depositary,
enforceable against the Depositary in accordance with its terms.
SECTION 5.04. Resignation and Removal of the Depositary; Appointment of
Successor Depositary. The Depositary may at any time resign as Depositary
hereunder by notice of its election so to do delivered to the Company, such
resignation to take effect upon the appointment of a successor Depositary and
its acceptance of such appointment as hereinafter provided.
The Depositary may at any time be removed by the Company by notice of
such removal delivered to the Depositary, such removal to take effect upon the
appointment of a successor Depositary and its acceptance of such appointment
as hereinafter provided.
14
In case at any time the Depositary acting hereunder shall resign or be
removed, the Company shall, within 60 days after the delivery of the notice of
resignation or removal, as the case may be, appoint a successor Depositary,
which shall be a bank or trust company having its principal office in the
United States of America and having a combined capital and surplus of at least
$50,000,000. If no successor Depositary shall have been so appointed and have
accepted appointment within 60 days after delivery of such notice, the
resigning or removed Depositary may petition any court of competent
jurisdiction for the appointment of a successor Depositary. Every successor
Depositary shall execute and deliver to its predecessor and to the Company an
instrument in writing accepting its appointment hereunder, and thereupon such
successor Depositary, without any further act or deed, shall become fully
vested with all the rights, powers, duties and obligations of its predecessor
and for all purposes shall be the Depositary under this Deposit Agreement, and
such predecessor, upon payment of all sums due it and on the written request
of the Company, shall execute and deliver an instrument transferring to such
successor all rights and powers of such predecessor hereunder, shall duly
assign, transfer and deliver all right, title and interest in the Stock and
any moneys or property held hereunder to such successor, and shall deliver to
such successor a list of the record holders of all outstanding Receipts. Any
successor Depositary shall promptly mail notice of its appointment to the
record holders of Receipts.
Any corporation into or with which the Depositary may be merged,
consolidated or converted shall be the successor of such Depositary without
the execution or filing of any document or any further act, and notice thereof
shall not be required hereunder. Such successor Depositary may authenticate
the Receipts in the name of the predecessor Depositary or in the name of the
successor Depositary.
SECTION 5.05. Corporate Notices and Reports. The Company agrees that it
will transmit to the record holders of Receipts, in each case at the addresses
furnished to it pursuant to Section 4.08, all notices and reports (including
without limitation financial statements) required by law, by the rules of any
national securities exchange upon which the Stock, the Depositary Shares or
the Receipts are listed or by the Company's Restated Certificate of
Incorporation, as amended (including the Certificate), to be furnished by the
Company to holders of Stock. Such transmission will be at the Company's
expense.
SECTION 5.06. Indemnification by the Company. The Company shall indemnify
the Depositary, any Depositary's Agent and any Registrar against, and hold
each of them harmless from, any loss, liability or expense (including
reasonable attorney fees and expenses) which may arise out of (a) acts
performed or omitted in connection with this Deposit Agreement and the
Receipts (i) by the Depositary, any Registrar or any of their respective
agents (including any Depositary's Agent), except for any liability arising
out of gross negligence, wilful misconduct or bad faith on the respective
parts of any such person or persons, or (ii) by the Company or any of its
agents, or (b) the offer, sale or registration of the Receipts, the Common
Stock or the Stock pursuant to the provisions hereof. The obligations of the
Company set forth in this Section 5.06 shall survive any succession of any
Depositary, Registrar or Depositary's Agent.
SECTION 5.07. Charges and Expenses. The Company shall pay all transfer
and other taxes and governmental charges arising solely from the existence of
the depositary arrangements. The Company shall pay all charges of the
Depositary in connection with the initial deposit of the Stock, the initial
issuance of the Depositary Shares and any redemption or conversion of the
Stock by the Company and all withdrawals of shares of the Stock by owners of
Depositary Shares. All other transfer and other taxes and governmental charges
shall be at the expense of holders of Depositary Shares. The Depositary may
refuse to effect any transfer of a Receipt or any withdrawal of Stock
evidenced thereby until all such taxes and charges with respect to such
Receipt or Stock are paid by the holder thereof. If a holder of Receipts
requests the Depositary to perform duties not required under this Deposit
Agreement, the Depositary shall notify the holder of the approximate cost of
the performance of such duties. If such duties are subsequently performed at
the request of such holder, such holder will be liable for such charges and
expenses. All other charges and expenses of the Depositary and any
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Depositary's Agent hereunder and of any Registrar (including, in each case,
fees and expenses of counsel) incident to the performance of their respective
obligations hereunder will be paid upon consultation and agreement between the
Depositary and the Company as to the amount and nature of such charges and
expenses.
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ARTICLE VI.
Amendment and Termination
SECTION 6.01. Amendment. The form of Receipt evidencing the Depositary
Shares and any provision of the Deposit Agreement may at any time be amended
by agreement between the Company and the Depositary; provided, however, that
no such amendment (other than any change in the fees of any Depositary,
Registrar or Transfer Agent, which shall go into effect not sooner than 90
days after notice thereof to the holders of the Receipts) which shall
materially and adversely alter the rights of the holders of Depositary Shares
(or, which relates to or affects rights to receive dividends or distributions,
or voting or redemption rights) will be effective unless such amendment has
been approved by the holders of at least two-thirds of the Depositary Shares
then outstanding. In no event may any amendment impair the right of any holder
of Receipts, subject to the conditions specified in the Deposit Agreement,
upon such surrender of the Receipts evidencing such Depositary Shares, to
receive Stock or upon conversion of the Stock represented by the Depositary
Receipts, to receive shares of Common Stock, and in each case any money or
other property represented thereby, except in order to comply with mandatory
provisions of applicable law.
SECTION 6.02. Termination. The Deposit Agreement may be terminated by the
Company or the Depositary only if (i) all outstanding Depositary Shares have
been redeemed or converted, (ii) there has been a final distribution in
respect of the Stock in connection with any liquidation, dissolution or
winding up of the Company and such distribution has been distributed to the
holders of Receipts or (iii) upon consent of holders of Receipts representing
not less than two-thirds of the Depositary Shares then outstanding.
Whenever the Deposit Agreement has been terminated pursuant to clause
(iii) of the preceding paragraph the Depositary will mail notice of such
termination to the record holders of all Receipts then outstanding at least 30
days prior to the date fixed in such notice for such termination. The
Depositary may likewise terminate the Deposit Agreement if at any time 90 days
shall have expired after the Depositary shall have delivered to the Company a
written notice of its election to resign and successor depositary shall not
have been appointed and accepted its appointment. If any Receipts remain
outstanding after the date of termination, the Depositary thereafter will
discontinue the transfer of Receipts, will suspend the distribution of
dividends to the holders thereof, and will not give any further notices (other
than notices of such termination) or perform any further acts under the
Deposit Agreement except as provided below and except that the Depositary will
continue to (i) collect dividends on the Stock and any distributions with
respect thereto and (ii) deliver the Stock together with such dividends and
distributions and the net proceeds of any sales of rights, preferences,
privileges or other property, without liability for interest thereon, in
exchange for Receipts surrendered. At any time after the expiration of two
years from the date of termination, the Depositary may sell the Stock then
held by it at public or private sales, at such place or places and upon such
terms as it deems proper and may thereafter hold the net proceeds of any such
sale, together with any money and other property then held by it, without
liability or interest thereon, for the pro rata benefit of the holders of
Receipts which have not been surrendered. Subject to applicable escheat laws,
any monies set aside by the Company in respect of any payment with respect to
the Stock represented by the Depositary Shares, or dividends thereon, and
unclaimed at the end of two years from the date upon which such payment is due
and payable shall revert to the general funds of the Company, after which time
the holders of such Depositary Shares shall look only to the general funds of
the Company for the payment thereof.
The Company does not intend to terminate the Deposit Agreement or to permit
the resignation of the Depositary without appointing a successor depositary.
In the event the Deposit Agreement is terminated, the Company will use all
reasonable efforts to have the Stock listed on the New York Stock Exchange.
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Upon the termination of this Deposit Agreement, the Company shall be
discharged from all obligations under this Deposit Agreement except for its
obligations to the Depositary, any Depositary's Agent and any Registrar under
Sections 5.06 and 5.07.
ARTICLE VII.
Miscellaneous
SECTION 7.01. Counterparts. This Deposit Agreement may be executed in any
number of counterparts, and by each of the parties hereto on separate
counterparts, each of which counterparts, when so executed and delivered,
shall be deemed an original, but all such counterparts taken together shall
constitute one and the same instrument.
SECTION 7.02. Exclusive Benefit of Parties. This Deposit Agreement is for
the exclusive benefit of the parties hereto, including the holders of the
Receipts, and their respective successors hereunder, and shall not be deemed
to give any legal or equitable right, remedy or claim to any other person
whatsoever.
SECTION 7.03. Invalidity of Provisions. In case any one or more of the
provisions contained in this Deposit Agreement or in the Receipts should be or
become invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein or
therein shall in no way be affected, prejudiced or disturbed thereby.
SECTION 7.04. Notices. Any and all notices to be given to the Company
hereunder or under the Receipts shall be in writing and shall be deemed to
have been duly given if personally delivered or sent by mail, overnight
courier or facsimile confirmed by letter, addressed to the Company at 6000
Midlantic Drive, Mount Laurel, New Jersey 08054, to the attention of R.
Michael Kennedy, Jr., Esq., facsimile number 609-273-2885, or at any other
address of which the Company shall have notified the Depositary in writing.
Any and all notices to be given to the Depositary hereunder or under the
Receipts shall be in writing and shall be deemed to have been duly given if
personally delivered or sent by mail, overnight courier or facsimile confirmed
by letter, addressed to the Depositary at the Depositary's Office at [ ],
facsimile number , or at any other address of which the Depositary shall have
notified the Company in writing.
Any and all notices to be given to any record holder of a Receipt
hereunder or under the Receipts shall be in writing and shall be deemed to
have been duly given if personally delivered or sent by mail, overnight
courier or facsimile confirmed by letter, addressed to such record holder at
the address of such record holder as it appears on the stock register of the
Company, or if such holder shall have filed with the Depositary or the Company
a written request that notices intended for such holder be mailed to some
other address, at the address designated in such request.
Delivery of a notice sent by mail, by telegram, telex or facsimile shall
be deemed to be effected at the time when a duly addressed letter containing
the same (or a confirmation thereof in the case of a telegram or telex
message) is deposited, postage prepaid, in a post office letter box. The
Depositary or the Company may, however, act upon any telegram, telex or
facsimile message received by it from the other or from any holder of a
Receipt, notwithstanding that such telegram, telex or facsimile message shall
not subsequently be confirmed by letter or as aforesaid.
SECTION 7.05. Depositary's Agents. The Depositary may from time to time
appoint Depositary's Agents to act in any respect for the Depositary for the
purposes of this Deposit Agreement and may at any time appoint additional
Depositary's Agents and vary or terminate the appointment of such Depositary's
Agents. The Depositary will notify the Company of any such action.
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SECTION 7.06. Holders of Receipts Are Parties. The holders of Receipts
from time to time shall be parties to this Deposit Agreement and shall be
bound by and entitled to the benefits of all of the terms and conditions
hereof and of the Receipts by acceptance of delivery thereof.
SECTION 7.07. Governing Law. This Deposit Agreement and the Receipts and
all rights hereunder and thereunder and provisions hereof and thereof shall be
governed by, and construed in accordance with, the laws of the State of New
York without giving effect to principles of conflict of laws.
SECTION 7.08. Inspection of Deposit Agreement. Copies of this Deposit
Agreement shall be filed with the Depositary and the Depositary's Agents and
shall be open to inspection during business hours at the Depositary's Office
and the respective offices of the Depositary's Agents, if any, by any holder
of a Receipt.
SECTION 7.09. Headings. The headings of articles and sections in this
Deposit Agreement and in the form of Receipt set forth in Exhibit A hereto
have been inserted for convenience only and are not to be regarded as a part
of this Deposit Agreement or the Receipts or to have any bearing upon the
meaning or interpretation of any provision contained herein or in the
Receipts.
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IN WITNESS WHEREOF, the Company and the Depositary have duly executed
this Deposit Agreement as of the day and year first above set forth, and all
holders of Receipts shall become parties hereto by and upon acceptance by them
of delivery of Receipts issued in accordance with the terms hereof.
TYCO TOYS, INC.
By:_____________________________
Name:____________________________
Title:____________________________
MIDLANTIC BANK N.A., as Depositary
By:_____________________________
Name:____________________________
Title:____________________________
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