EX-4(k)
AMERICAN ELECTRIC POWER COMPANY, INC.
AND
[ ]
AS FORWARD PURCHASE CONTRACT AGENT
FORWARD PURCHASE CONTRACT AGREEMENT
DATED AS OF JUNE __, 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........................................13
Section 1.3 Form of Documents Delivered to Agent........................................14
Section 1.4 Acts of Holders; Record Dates...............................................14
Section 1.5 Notices.....................................................................15
Section 1.6 Notice to Holders; Waiver...................................................16
Section 1.7 Effect of Headings and Table of Contents....................................17
Section 1.8 Successors and Assigns......................................................17
Section 1.9 Separability Clause.........................................................17
Section 1.10 Benefits of Agreement.......................................................17
Section 1.11 Governing Law...............................................................17
Section 1.12 Legal Holidays..............................................................17
Section 1.13 Counterparts................................................................18
Section 1.14 Inspection of Agreement.....................................................18
ARTICLE II. CERTIFICATE FORMS.........................................................................18
Section 2.1 Forms of Certificates Generally.............................................18
Section 2.2 Form of Agent's Certificate of Authentication...............................19
ARTICLE III. THE EQUITY UNITS.........................................................................19
Section 3.1 Title and Terms; Denominations..............................................19
Section 3.2 Rights and Obligations Evidenced by the Certificates........................20
Section 3.3 Execution, Authentication, Delivery and Dating..............................21
Section 3.4 Temporary Certificates......................................................21
Section 3.5 Registration; Registration of Transfer and Exchange.........................22
Section 3.6 Book-Entry Interests........................................................23
Section 3.7 Notices To Holders..........................................................24
Section 3.8 Appointment of Successor Clearing Agency....................................24
Section 3.9 Definitive Certificates.....................................................24
Section 3.10 Mutilated, Destroyed, Lost and Stolen Certificates..........................25
Section 3.11 Persons Deemed Owners.......................................................26
Section 3.12 Cancellation................................................................26
Section 3.13 Establishment of Stripped Equity Units......................................27
Section 3.14 Reestablishment of Equity Units.............................................28
Section 3.15 Transfer of Collateral Upon Occurrence of Termination Event.................30
Section 3.16 No Consent to Assumption....................................................31
ARTICLE IV. THE NOTES.................................................................................31
Section 4.1 Payment of Interest; Rights to Interest Payments Preserved; Notice..........31
Section 4.2 Notice and Voting...........................................................32
Section 4.3 Tax Event Redemption........................................................32
i
TABLE OF CONTENTS
(continued)
PAGE
ARTICLE V. THE FORWARD PURCHASE CONTRACTS; THE REMARKETING............................................33
Section 5.1 Purchase of Shares of Common Stock..........................................33
Section 5.2 Payment of Purchase Price; Remarketing......................................35
Section 5.3 Issuance of Shares of Common Stock..........................................42
Section 5.4 Contract Adjustment Payments..................................................
Section 5.5 Deferral of Contract Adjustment Payments......................................
Section 5.6 Adjustment of Settlement Rate...............................................43
Section 5.7 Notice of Adjustments and Certain Other Events..............................49
Section 5.8 Termination Event; Notice...................................................50
Section 5.9 Early Settlement............................................................50
Section 5.10 Early Settlement Upon Merger................................................52
Section 5.11 Charges and Taxes...........................................................54
Section 5.12 No Fractional Shares........................................................54
Section 5.13 Tax Treatment...............................................................55
ARTICLE VI. REMEDIES..................................................................................55
Section 6.1 Unconditional Right of Holders to Purchase Common Stock.....................55
Section 6.2 Restoration of Rights and Remedies..........................................55
Section 6.3 Rights and Remedies Cumulative..............................................55
Section 6.4 Delay or Omission Not Waiver................................................56
Section 6.5 Undertaking For Costs.......................................................56
Section 6.6 Waiver of Stay or Extension Laws............................................56
ARTICLE VII. THE AGENT................................................................................56
Section 7.1 Certain Duties, Rights and Immunities.......................................56
Section 7.2 Notice of Default...........................................................59
Section 7.3 Certain Rights of Agent.....................................................59
Section 7.4 Not Responsible For Recitals, Etc...........................................60
Section 7.5 May Hold Equity Units and Stripped Equity Units and Other Dealings..........60
Section 7.6 Money Held In Custody.......................................................60
Section 7.7 Compensation and Reimbursement..............................................60
Section 7.8 Corporate Agent Required; Eligibility.......................................61
Section 7.9 Resignation and Removal; Appointment of Successor...........................62
Section 7.10 Acceptance of Appointment By Successor......................................63
Section 7.11 Merger, Conversion, Consolidation or Succession to Business.................63
Section 7.12 Preservation of Information; Communications to Holders......................64
Section 7.13 Failure to Act..............................................................64
Section 7.14 No Obligations of Agent.....................................................64
Section 7.15 Tax Compliance..............................................................65
ARTICLE VIII. SUPPLEMENTAL AGREEMENTS.................................................................65
Section 8.1 Supplemental Agreements Without Consent of Holders..........................65
Section 8.2 Supplemental Agreements With Consent of Holders.............................66
ii
TABLE OF CONTENTS
(continued)
PAGE
Section 8.3 Execution of Supplemental Agreements........................................67
Section 8.4 Effect of Supplemental Agreements...........................................67
Section 8.5 Reference to Supplemental Agreements........................................67
ARTICLE IX. CONSOLIDATION, MERGER, SALE OR CONVEYANCE.................................................68
Section 9.1 Company May Consolidate, Etc., Only on Certain Terms........................68
Section 9.2 Successor Substituted.......................................................68
ARTICLE X. COVENANTS..................................................................................69
Section 10.1 Performance Under Purchase Contracts........................................69
Section 10.2 Maintenance of Office or Agency.............................................69
Section 10.3 Company to Reserve Common Stock.............................................70
Section 10.4 Covenants as to Common Stock................................................70
Section 10.5 Statements of Officer of the Company as to Default..........................70
Section 10.6 ERISA.......................................................................70
EXHIBITS
Exhibit A.........Form of Equity Units Certificate
Exhibit B.........Form of Stripped Equity Units 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
iii
FORWARD PURCHASE CONTRACT AGREEMENT, dated as of June __, 2002, between
American Electric Power Company, Inc., a Delaware corporation (the "Company"),
and [ ], a [ ] company, acting as Forward Purchase Contract Agent for the
Holders of Equity Units and Stripped Equity Units from time to time (the
"Agent").
RECITALS
The Company has duly authorized the execution and delivery of this
Agreement and the Certificates evidencing the Equity Units and Stripped Equity
Units.
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 Equity
Units 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):
"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 5.4(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(c).
"Applicable Ownership Interest" means, with respect to an Equity Unit
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 [ ], 2005 and (B) for the
scheduled interest Payment Date on the Notes that occurs on the Stock Purchase
Date, in the case of a successful remarketing, or for each scheduled interest
Payment Date on the Notes that occurs after the Tax Event Redemption Date and on
or before the Stock Purchase Date, in the case of a Tax Event Redemption, 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.
"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 the State of New York
or at a place of payment are authorized or required by law, regulation or
executive order to be closed.
-2-
"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 5.10(a).
"Cash Settlement" has the meaning specified in Section 5.4(a).
"Certificate" means an Equity Units Certificate or a Stripped Equity
Units Certificate.
"Clearing Agency" means an organization registered as a "Clearing
Agency" pursuant to Section 17A of the Exchange Act that is acting as a
depositary for the Equity Units and Stripped Equity Units and in whose name, or
in the name of a nominee of that organization, shall be registered a Global
Certificate and which shall undertake to effect book-entry transfers and pledges
of the Equity Units and Stripped Equity Units.
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time the Clearing
Agency effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.
"Closing Price" has the meaning specified in Section 5.1(c).
"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 [ ], 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 $6.50 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 5.6(b).
"Contract Adjustment Payments" means, in the case of Equity Units and
Stripped Equity Units, the amount payable by the Company in respect of each
Forward Purchase Contract constituting a part of such Equity Units or Stripped
Equity Units, equal to [ ]% per year of the Stated Amount, in each case computed
on the basis of a 360-day year of twelve 30-day months, plus any Deferred
Contract Adjustment Payments accrued pursuant to Section 5.3.
-3-
"Corporate Trust Office" means the office of the Agent at which, at
any particular time, its corporate trust business shall be principally
administered, which office at the date hereof is located at [ ], 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 5.6(a)(8).
"Custodial Agent" means [ ], as Custodial Agent under the Pledge
Agreement until a successor Custodial Agent shall have become such pursuant to
the applicable provisions of the Pledge Agreement, and thereafter "Custodial
Agent" shall mean the Person who is then the Custodial Agent thereunder.
"Deferred Contract Adjustment Payments" has the meaning specified in
Section 5.3.
"Depositary" means, initially, DTC, until another Clearing Agency
becomes its successor, 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 5.9(a).
"Early Settlement Amount" has the meaning specified in Section 5.9(a).
"Early Settlement Date" has the meaning specified in Section 5.9(a).
"Early Settlement Rate" has the meaning specified in Section 5.9(b).
"Equity Units" means the collective rights and obligations of a Holder
of an Equity Units 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.
"Equity Units Certificate" means a certificate evidencing the rights
and obligations of a Holder in respect of the number of Equity Units specified
on such certificate, substantially in the form of Exhibit A hereto.
"Equity Units Register" and "Equity Units Registrar" have the
respective meanings specified in Section 3.5(a).
"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).
-4-
"Expiration Time" has the meaning specified in Section 5.6(a)(6).
"Failed Remarketing" has the meaning specified in Section 5.4(e).
"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 Equity
Units, means the contract forming a part of such Equity Unit and obligating the
Company to sell and the Holder of such Equity Unit 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 5.5.
"Global Certificate" means a Certificate that evidences all or part of
the Units and is registered in the name of a Depositary or a nominee thereof.
"Holder" means the Person in whose name the Units evidenced by an
Equity Units Certificate or a Stripped Equity Units Certificate is registered in
the Equity Units Register or the Stripped Equity Units Register, as the case may
be.
"Indenture" means the Indenture, dated as of May 1, 2001, between the
Company and the Trustee as supplemented by any officers' certificate or
supplemental indenture.
"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 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 Remarketing" has the meaning specified in Section
5.4(B)(II).
"Merger Early Settlement" has the meaning specified in Section 5.10.
"Merger Early Settlement Amount" has the meaning specified in Section
5.10.
"Merger Early Settlement Date" has the meaning specified in Section
5.10.
"Non-electing Share" has the meaning specified in Section 5.6(b).
"Notes" means the series of senior debt securities of the Company
designated the [ ]% Senior Notes Due [ ], 2007, to be issued under the
Indenture.
-5-
"NYSE" has the meaning specified in Section 5.1(c).
"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 Units may be served, such office being located initially at [ ],
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
5.4(g).
"Outstanding Units" means, as of the date of determination, all Equity
Units or Stripped Equity Units evidenced by Certificates theretofore
authenticated, executed and delivered under this Agreement, except:
(i) If a Termination Event has occurred, (A) Stripped Equity
Units and (B) Equity Units 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 Equity Units;
(ii) Equity Units and Stripped Equity Units evidenced by
Certificates theretofore cancelled by the Agent or delivered to
the Agent for cancellation or deemed cancelled pursuant to the
provisions of this Agreement; and
(iii) Equity Units and Stripped Equity Units evidenced by
Certificates in exchange for or in lieu of which other
Certificates have been authenticated, executed on behalf of the
Holder and delivered pursuant to this Agreement, other than any
such Certificate in respect of which there shall have been
presented to the Agent proof satisfactory to it that such
Certificate is held by a bona fide purchaser in whose hands the
Equity Units or Stripped Equity Units evidenced by such
Certificate are valid obligations of the Company;
provided, that in determining whether the Holders of the requisite number of the
Equity Units or Stripped Equity Units have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Equity Units or
Stripped Equity Units owned by the Company or any Affiliate of the Company shall
be disregarded and deemed not to be outstanding, except that, in determining
whether the Agent shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Equity Units or
Stripped Equity Units which a Responsible Officer of the Agent actually knows to
be so owned shall be so disregarded. Upper
-6-
Equity Units or Stripped Equity Units so owned which have been pledged in good
faith may be regarded as Outstanding Units if the pledgee establishes to the
satisfaction of the Agent the pledgee's right so to act with respect to such
Equity Units or Stripped Equity Units and that the pledgee is not the Company or
any Affiliate of the Company.
"Payment Date" means each [ ], [ ], [ ] and [ ], commencing [ ], 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 Equity Units or Stripped Equity Units, 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 Equity Units and Stripped Equity Units.
"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 Equity Units Certificate
or a Predecessor Stripped Equity Units Certificate.
"Predecessor Equity Units Certificate" of any particular Equity Units
Certificate means every previous Equity Units Certificate evidencing all or a
portion of the rights and obligations of the Company and the Holder under the
Equity Units evidenced thereby; and, for the purposes of this definition, any
Equity Units Certificate authenticated and delivered under Section 3.10 in
exchange for or in lieu of a mutilated, destroyed, lost or stolen Equity Units
Certificate shall be deemed to evidence the same rights and obligations of the
Company and the Holder as the mutilated, destroyed, lost or stolen Equity Units
Certificate.
-7-
"Predecessor Stripped Equity Units Certificate" of any particular
Stripped Equity Units Certificate means every previous Stripped Equity Units
Certificate evidencing all or a portion of the rights and obligations of the
Company and the Holder under the Stripped Equity Units evidenced thereby; and,
for the purposes of this definition, any Stripped Equity Units Certificate
authenticated and delivered under Section 3.10 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Stripped Equity Units Certificate shall be
deemed to evidence the same rights and obligations of the Company and the Holder
as the mutilated, destroyed, lost or stolen Stripped Equity Units Certificate.
"Purchase Price" has the meaning specified in Section 5.1(a).
"Purchased Shares" has the meaning specified in Section 5.6(a)(6).
"Quotation Agent" means [ ] 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 successful remarketing of the Notes or the 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 Equity Units Register and the Stripped Equity
Units Register, as applicable.
"Registrar" means the Equity Units Registrar and the Stripped Equity
Units Registrar, as applicable.
"Remarketing Agent" means [ ] or its successor under the Remarketing
Agreement.
"Remarketing Agreement" means the Remarketing Agreement dated [ ], 2002
by and among the Company, the Remarketing Agent and the Agent.
"Remarketing Date" means the third Business Day preceding [ ], 2005.
"Remarketing Fee" has the meaning specified in Section 5.4(b)(i).
-8-
"Remarketing Period" means the three Business Day period either: (i)
beginning on the Remarketing Date and ending after the two immediately following
Business Days; (ii) immediately preceding [ ], 2005; or (iii) immediately
preceding [ ], 2005.
"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 the
Stock Purchase Date, an amount of cash equal to the aggregate
interest payment that is scheduled to be payable on that Payment
Date, on the Notes which are included in Equity Units and are
participating in the remarketing and (b) the Separate Notes which
are to be remarketed pursuant to Section 4.5(d) of the Pledge
Agreement, assuming for that purpose that the interest rate on
the Notes is equal to the Coupon Rate, and
(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 Stock Purchase Date, an amount
of cash equal to the Stated Amount of (a) such Notes which are
included in Equity Units and are participating in the remarketing
and (b) the Separate Notes which are to be remarketed pursuant to
Section 4.5(d) of the Pledge Agreement
provided that for purposes of clauses (1) and (2) above, the
Remarketing Value shall be calculated on the assumptions that (x) the
U.S. Treasury securities are highly liquid and mature on or within 35
days prior to the Stock Purchase Date, as determined in good faith by
the Remarketing Agent in a manner intended to minimize the cash value
of the U.S. Treasury securities, and (y) the U.S. Treasury securities
are valued based on the ask-side price of the U.S. Treasury
securities at a time between 9:00 a.m. and 11:00 a.m., New York City
time, selected by the Remarketing Agent, on the Remarketing Date or
any Subsequent Remarketing Date, as the case may be, as determined on
a third-day settlement basis by a reasonable and customary means
selected in good faith by the Remarketing Agent, plus accrued
interest to that date.
"Reorganization Event" has the meaning specified in Section 5.6(b).
"Reset Rate" has the meaning specified in Section 5.4(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.
-9-
"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.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations thereunder.
"Securities Intermediary" means [ ], 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.
"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, Equity Unit or
Stripped Equity Unit, $50.
"Stock Purchase Date" means the [ ], 2005.
"Stripped Equity Units" means the collective rights and obligations of
a holder of a Stripped Equity Units 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 Equity Units Certificate" means a certificate evidencing the
rights and obligations of a Holder in respect of the number of Stripped Equity
Units specified on such certificate, substantially in the form of Exhibit B
hereto.
"Stripped Equity Units Register" and "Stripped Equity Units Registrar"
have the respective meanings specified in Section 3.5(a).
"Subsequent Remarketing Date" means, provided there has been one or
more Failed Remarketings, the date on which the Remarketing Agent has
consummated a successful remarketing in accordance with Section 5.4 hereof, such
date to be no later than the Business Day immediately preceding the Stock
Purchase Date.
-10-
"Supplemental Indenture" means a supplemental indenture dated as of
[ ], 2002, between the Company and The Bank of New York, as Trustee, to the
indenture dated as of May 1, 2001, 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 Xxxxxxx Xxxxxxx & Xxxxxxxx, 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 [
], 2002, which amendment, change or proposed change is effective or which
interpretation or pronouncement is announced on or after [ ], 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 the 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 the 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
-11-
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 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, a portfolio of principal or interest
strips of U.S. Treasury Securities that mature on or prior to the Stock Purchase
Date in an aggregate amount equal to the aggregate principal amount of the Notes
included in the Equity Units on the Tax Event Redemption Date and, with respect
to each scheduled interest Payment Date on the Notes that occurs after the Tax
Event Redemption Date and on or before the Stock Purchase Date, interest or
principal strips of U.S. Treasury Securities that mature on 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, 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 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 scheduled interest Payment Date on the
Notes that occurs after the Tax Event Redemption Date and on or before the Stock
Purchase Date, interest or principal strips of U.S. Treasury Securities that
mature on or prior to such interest Payment Date in an aggregate
-12-
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 ____________) maturing on [ ], 2005 that will pay $1,000 on such maturity
date.
"Trustee" means The Bank of New York, a New York banking corporation,
as trustee under the Indenture, or any successor thereto.
"Underwriting Agreement" means the Underwriting Agreement relating to
the Equity Units and Stripped Equity Units dated [ ], 2002 among the Company and
the underwriters named therein.
"Vice-President" means any vice-president, whether or not designated
by a number or a word or words added before or after the title "vice-president."
Section 1.2 COMPLIANCE CERTIFICATES AND OPINIONS.
Except as otherwise expressly provided by this Agreement, upon any
application or request by the Company to the Agent to take any action under any
provision of this Agreement, the Company shall furnish to the Agent an Officer's
Certificate stating that all conditions precedent, if any, provided for in this
Agreement relating to the proposed action have been complied with and, if
requested by the Agent, an Opinion of Counsel stating that, in the opinion of
such counsel, all such conditions precedent, if any, have been complied with,
except that in the case of any such application or request as to which the
furnishing of such documents is specifically required by any provision of this
Agreement relating to such particular application or request, no additional
certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Agreement (other than the Officer's
Certificate provided for in Section 10.5) shall include:
(a) a statement that the 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
-13-
(d) a statement as to whether, in the opinion of such
individual, such condition or covenant has been complied with.
Section 1.3 FORM OF DOCUMENTS DELIVERED TO AGENT.
(a) In any case where several matters are required to be
certified by, or covered by an opinion of, any specified Person, it is
not necessary that all such matters be 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 Equity Units or Stripped Equity Units
shall be proved by the Equity Units Register or the Stripped Equity
Units Register, as the case may be.
-14-
(d) Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Certificate shall
bind every future Holder of the same Certificate and the Holder of
every Certificate issued upon the registration of transfer thereof or
in exchange therefor or in lieu thereof in respect of anything done,
omitted or suffered to be done by the Agent or the Company in reliance
thereon, whether or not notation of such action is made upon such
Certificate.
(e) The Company may set any day as a record date for the
purpose of determining the Holders of Outstanding Units entitled to
give, make or take any request, demand, authorization, direction,
notice, consent, waiver or other action provided or permitted by this
Agreement to be given, made or taken by Holders of Equity Units and
Stripped Equity Units. If any record date is set pursuant to this
paragraph, the Holders of the Outstanding Equity Units on such record
date, and no other Holders, shall be entitled to take the relevant
action with respect to the Equity Units or the Stripped Equity Units,
as the case may be, whether or not such Holders remain Holders after
such record date; provided that no such action shall be effective
hereunder unless taken on or prior to the applicable Expiration Date by
Holders of the requisite number of Outstanding Units on such record
date. Nothing in this paragraph shall be construed to prevent the
Company from setting a new record date for any action for which a
record date has previously been set pursuant to this paragraph
(whereupon the record date previously set shall automatically and with
no action by any Person be cancelled and of no effect), and nothing in
this paragraph shall be construed to render ineffective any action
taken by Holders of the requisite number of Outstanding Units on the
date such action is taken. Promptly after any record date is set
pursuant to this paragraph, the Company, at its own expense, shall
cause notice of such record date, the proposed action by Holders and
the applicable Expiration Date to be given to the Agent in writing and
to each Holder of Equity Units and Stripped Equity Units 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 Equity Units and Stripped Equity Units
in the manner set forth in Section 1.6, on or prior to the existing
Expiration Date. If an Expiration Date is not designated with respect
to any record date set pursuant to this Section, the Company shall be
deemed to have initially designated the 180th day after such record
date as the Expiration Date with respect thereto, subject to its right
to change the Expiration Date as provided in this paragraph.
Notwithstanding the foregoing, no Expiration Date shall be later than
the 180th day after the applicable record date.
Section 1.5 NOTICES.
Any request, demand, authorization, direction, notice, consent, waiver
or Act of Holders or other document provided or permitted by this Agreement to
be made upon, given or furnished to, or filed with:
-15-
(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
or delivered by overnight air courier guaranteeing next day delivery,
to the Agent at [ ], telecopy number: [ ], 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 American Electric Power Company, Inc., 0 Xxxxxxxxx
Xxxxx, Xxxxxxxx, Xxxx 00000, telecopy number: [ ], Attention: [ ], 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 [ ], telecopy
number: [ ], 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 The
Bank of New York, [ ], telecopy number: [ ], 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.
(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
-16-
shall be made with the approval of the Agent shall constitute a
sufficient notification for every purpose hereunder.
Section 1.7 EFFECT OF HEADINGS AND TABLE OF CONTENTS.
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
Section 1.8 SUCCESSORS AND ASSIGNS.
All covenants and agreements in this Agreement by the Company shall
bind its successors and assigns, whether so expressed or not.
Section 1.9 SEPARABILITY CLAUSE.
In case any provision in this Agreement or in the Equity Units or
Stripped Equity Units shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions hereof and thereof shall
not in any way be affected or impaired thereby.
Section 1.10 BENEFITS OF AGREEMENT.
Nothing in this Agreement or in the Equity Units or Stripped Equity
Units, express or implied, shall give to any Person, other than the parties
hereto and their successors hereunder and, to the extent provided hereby, the
Holders, any benefits or any legal or equitable right, remedy or claim under
this Agreement. The Holders from time to time shall be beneficiaries of this
Agreement and shall be bound by all of the terms and conditions hereof and of
the Equity Units and Stripped Equity Units evidenced by their Certificates by
their acceptance of delivery of such Certificates.
Section 1.11 GOVERNING LAW.
This Agreement and the Equity Units and Stripped Equity Units shall be
governed by and construed in accordance with the laws of the State of New York,
without regard to its principles of conflicts of laws.
Section 1.12 LEGAL HOLIDAYS.
(a) In any case where any Payment Date shall not be a Business
Day, then (notwithstanding any other provision of this Agreement or the
Equity Units 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.
-17-
(b) If any date on which Contract Adjustment Payments are to
be made on the Forward Purchase Contracts is not a Business Day, then
payment of the Contract Adjustment Payments payable on that date will
be made on the next succeeding day which is a Business Day, and no
interest or additional payment will be paid in respect of the delay.
However, if that Business Day is in the next succeeding calendar year,
the payment will be made on the immediately preceding Business Day with
the same force and effect as if made on that Payment Date.
(c) In any case where the Stock Purchase Date shall not be a
Business Day, then (notwithstanding any other provision of this
Agreement or the Certificates), the 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 the Stock Purchase Date.
Section 1.13 COUNTERPARTS.
This Agreement may be executed in any number of counterparts by the
parties hereto, each of which, when so executed and delivered, shall be deemed
an original, but all such counterparts shall together constitute one and the
same instrument.
Section 1.14 INSPECTION OF AGREEMENT.
A copy of this Agreement shall be available at all reasonable times
during normal business hours at the Corporate Trust Office for inspection by any
Holder.
ARTICLE II.
CERTIFICATE FORMS
Section 2.1 FORMS OF CERTIFICATES GENERALLY.
(a) The Equity Units Certificates (including the form of
Forward Purchase Contract forming part of the Equity Units evidenced
thereby) shall be in substantially the form set forth in Exhibit A
hereto, with such letters, numbers or other marks of identification or
designation and such legends or endorsements printed, lithographed or
engraved thereon as may be required by the rules of any securities
exchange or quotation system on which the Equity Units are listed or
quoted for trading or any depositary therefor, or as may, consistently
herewith, be determined by the officers of the Company executing such
Equity Units Certificates, as evidenced by their execution of the
Equity Units Certificates.
(b) The definitive Equity Units Certificates shall be printed,
lithographed or engraved on steel engraved borders or may be produced
in any other manner, all as determined by the officers of the Company
executing such Equity Units Certificates, consistent with the
provisions of this Agreement, as evidenced by their execution thereof.
(c) The Stripped Equity Units Certificates (including the form
of Forward Purchase Contracts forming part of the Stripped Equity Units
evidenced thereby) shall be in substantially the form set forth in
Exhibit B hereto, with such letters, numbers or other
-18-
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 Equity Units 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 Equity Units
Certificates, as evidenced by their execution of the Stripped Equity
Units Certificates.
(d) The definitive Stripped Equity Units Certificates shall be
printed, lithographed or engraved on steel engraved borders or may be
produced in any other manner, all as determined by the officers of the
Company executing such Stripped Equity Units 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 Equity Units shall be in substantially the form set forth on the
form of the Equity Units Certificates.
(b) The form of the Agent's certificate of authentication of
the Stripped Equity Units shall be in substantially the form set forth
on the form of the Stripped Equity Units Certificates.
ARTICLE III.
THE EQUITY UNITS
Section 3.1 TITLE AND TERMS; DENOMINATIONS.
(a) The aggregate number of Equity Units and Stripped Equity
Units, if any, evidenced by Certificates authenticated, executed on
behalf of the Holders and delivered hereunder is limited to [ ] ([ ] 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,
5.9, 5.10 or 8.5.
-19-
(b) The Certificates shall be issuable only in registered form
and only in denominations of a single Unit and any integral multiple
thereof.
Section 3.2 RIGHTS AND OBLIGATIONS EVIDENCED BY THE CERTIFICATES.
(a) Each Equity Units Certificate shall evidence the number of
Equity Units specified therein, with each such Equity Units
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 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 Equity Unit
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
Equity Units, 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 Equity Units Certificates to any of the rights of a
holder of shares of Common Stock, including, without limitation, the
right to vote or receive any dividends or other payments or to consent
or to receive notice as stockholders in respect of the meetings of
stockholders or for the election of directors of the Company or for any
other matter, or any other rights whatsoever as stockholders of the
Company.
(b) Each Stripped Equity Units Certificate shall evidence the
number of Stripped Equity Units specified therein, with each such
Stripped Equity Units 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 Equity Units shall pledge, pursuant to the Pledge Agreement,
the Treasury Security, forming a part of such Stripped Equity Units, 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 Equity
Units Certificates to any of the rights of a holder of shares of Common
Stock, including, without limitation, the right to vote or receive any
dividends or other payments or to consent or to receive notice as
stockholders in respect of the meetings of stockholders or for the
election of directors of the Company or for any other matter, or any
other rights whatsoever as stockholders of the Company.
-20-
Section 3.3 EXECUTION, AUTHENTICATION, DELIVERY AND DATING.
(a) Subject to the provisions of Sections 3.13 and 3.14, upon
the execution and delivery of this Agreement, and at any time and from
time to time thereafter, the Company may deliver Certificates executed
by the Company to the Agent for authentication, execution on behalf of
the Holders and delivery, together with its Issuer Order for
authentication of such Certificates, and the Agent in accordance with
such Issuer Order shall authenticate, execute on behalf of the Holders
and deliver such Certificates.
(b) The Certificates shall be executed on behalf of the
Company by the 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 may
be manual or by facsimile.
(c) Certificates bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company
shall bind the Company, notwithstanding that such individuals or any of
them have ceased to hold such offices prior to the authentication and
delivery of such Certificates or did not hold such offices at the date
of such Certificates.
(d) No 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 Equity Units or Stripped Equity Units,
as the case may be, are listed, or as may, consistent herewith, be
determined by the officers of the Company executing such Certificates,
as evidenced by their execution of the Certificates.
-21-
(b) If temporary Certificates are issued, the Company will
cause definitive Certificates to be prepared without unreasonable
delay. After the preparation of definitive Certificates, the temporary
Certificates shall be exchangeable for definitive Certificates upon
surrender of the temporary Certificates at the Corporate Trust Office,
at the expense of the Company and without charge to the Holder. Upon
surrender for cancellation of any one or more temporary Certificates,
the Company shall execute and deliver to the Agent, and the Agent shall
authenticate, execute on behalf of the Holder, and deliver in exchange
therefor, one or more definitive Certificates of like tenor and
denominations and evidencing a like number of Equity Units or Stripped
Equity Units, as the case may be, as the temporary Certificate or
Certificates so surrendered. Until so exchanged, the temporary
Certificates shall in all respects evidence the same benefits and the
same obligations with respect to the Equity Units or Stripped Equity
Units, as the case may be, evidenced thereby as definitive
Certificates.
Section 3.5 REGISTRATION; REGISTRATION OF TRANSFER AND EXCHANGE.
(a) The Agent shall keep at the Corporate Trust Office a
register (the "Equity Units Register") in which, subject to such
reasonable regulations as it may prescribe, the Agent shall provide for
the registration of Equity Units Certificates and of transfers of
Equity Units Certificates (the Agent, in such capacity, the "Equity
Units Registrar") and a register (the "Equity Units Register") in
which, subject to such reasonable regulations as it may prescribe, the
Agent shall provide for the registration of the Equity Units
Certificates and transfers of Equity Units Certificates (the Agent, in
such capacity, the "Equity Units Registrar").
(b) Upon surrender for registration of transfer of any
Certificate at the Corporate Trust Office, the Company shall execute
and deliver to the Agent, and the Agent shall authenticate, execute on
behalf of the designated transferee or transferees, and deliver, in the
name of the designated transferee or transferees, one or more new
Certificates of like tenor and denominations, and evidencing a like
number of Equity Units or Stripped Equity Units, as the case may be.
(c) At the option of the Holder, Certificates may be exchanged
for other Certificates, of like tenor and denominations and evidencing
a like number of Equity Units or Stripped Equity Units, as the case may
be, upon surrender of the Certificates to be exchanged at the Corporate
Trust Office. Whenever any Certificates are so surrendered for
exchange, the Company shall execute and deliver to the Agent, and the
Agent shall authenticate, execute on behalf of the Holder, and deliver
the Certificates which the Holder making the exchange is entitled to
receive.
(d) All Certificates issued upon any registration of transfer
or exchange of a Certificate shall evidence the ownership of the same
number of Equity Units or Stripped Equity Units, as the case may be,
and be entitled to the same benefits and subject to the same
obligations, under this Agreement as the Equity Units or Stripped
Equity Units, as the case may be, evidenced by the Certificate
surrendered upon such registration of transfer or exchange.
-22-
(e) Every Certificate presented or surrendered for
registration of transfer or for exchange shall (if so required by the
Agent) be duly endorsed, or be accompanied by a written instrument of
transfer in form satisfactory to the Company and the Agent duly
executed, by the Holder thereof or its attorney duly authorized in
writing.
(f) No service charge shall be made for any registration of
transfer or exchange of a Certificate, but the Company and the Agent
may require payment from the Holder of a sum sufficient to cover any
tax or other governmental charge that may be imposed in connection with
any registration of transfer or exchange of Certificates, other than
any exchanges pursuant to Sections 3.4, 3.6, 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 the Stock Purchase Date or the Termination
Date. In lieu of delivery of a new Certificate, upon satisfaction of
the applicable conditions specified above in this Section and receipt
of appropriate registration or transfer instructions from such Holder,
the Agent shall,
(i) if the Stock Purchase Date has occurred, deliver the
shares of Common Stock issuable in respect of the Forward
Purchase Contracts forming a part of the Equity Units or
Stripped Equity Units, as the case may be, evidenced by such
Certificate,
(ii) in the case of Equity Units, if a Termination Event
shall have occurred prior to the Stock Purchase Date, transfer
the Notes or the appropriate Treasury Consideration or
Applicable Ownership Interest in the Treasury Portfolio, as
applicable, relating to such Equity Units, or
(iii) in the case of Stripped Equity Units, if a
Termination Event shall have occurred prior to the Stock
Purchase Date, transfer the Treasury Securities relating to
such Stripped Equity Units, in each case subject to the
applicable conditions and in accordance with the applicable
provisions of Article V.
Section 3.6 BOOK-ENTRY INTERESTS.
The Certificates, on original issuance will be issued in the form of
one or more fully registered Global Certificates, to be delivered to the
Depositary or its custodian by, or on behalf of, the Company. 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;
-23-
(b) the Company shall be entitled to deal with the Clearing
Agency for all purposes of this Agreement (including receiving
approvals, votes or consents hereunder) as the Holder of the Equity
Units and Stripped Equity Units and the sole holder of the Global
Certificate(s) and shall have no obligation to the Beneficial Owners;
(c) to the extent that the provisions of this Section 3.6
conflict with any other provisions of this Agreement, the provisions of
this Section 3.6 shall control; and
(d) the rights of the Beneficial Owners shall be exercised
only through the Clearing Agency and shall be limited to those
established by law and agreements between such Beneficial Owners and
the Clearing Agency and/or the Clearing Agency Participants. The
Clearing Agency will make book-entry transfers among Clearing Agency
Participants.
Section 3.7 NOTICES TO HOLDERS.
Whenever a notice or other communication to the Holders is required to
be given under this Agreement, the Company or the Company's agent shall give
such notices and communications to the Holders and, with respect to any Equity
Units or Stripped Equity Units registered in the name of a Clearing Agency or
the nominee of a Clearing Agency, the Company or the Company's agent shall,
except as set forth herein, have no obligations to the Beneficial Owners.
Section 3.8 APPOINTMENT OF SUCCESSOR CLEARING AGENCY.
If any Clearing Agency elects to discontinue its services as securities
depositary with respect to the Equity Units and Stripped Equity Units 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
Equity Units and Stripped Equity Units.
Section 3.9 DEFINITIVE CERTIFICATES.
If
(i) a Clearing Agency elects to discontinue its services
as securities depositary with respect to the Equity Units and
Stripped Equity Units 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 Equity
Units and Stripped Equity Units, 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 Equity Units and Stripped Equity Units by the
Clearing Agency, accompanied by registration instructions, the Company shall
cause definitive Certificates to be delivered to
-24-
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.
(a) If any mutilated Certificate is surrendered to the Agent,
the Company shall execute and deliver to the Agent, and the Agent shall
authenticate, execute on behalf of the Holder, and deliver in exchange
therefor, a new Certificate at the cost of the Holder, evidencing the
same number of Equity Units or Stripped Equity Units, as the case may
be, and bearing a Certificate number not contemporaneously outstanding.
(b) If there shall be delivered to the Company and the Agent
(i) evidence to their satisfaction of the destruction, loss or theft of
any Certificate, and (ii) such security or indemnity at the cost of the
Holder as may be required by them to hold each of them and any agent of
any of them harmless, then, in the absence of notice to the Company or
the Agent that such Certificate has been acquired by a bona fide
purchaser, the Company shall execute and deliver to the Agent, and the
Agent shall authenticate, execute on behalf of the Holder, and deliver
to the Holder, in lieu of any such destroyed, lost or stolen
Certificate, a new Certificate, evidencing the same number of Equity
Units or Stripped Equity Units, as the case may be, and bearing a
Certificate number not contemporaneously outstanding.
(c) Notwithstanding the foregoing, the Company shall not be
obligated to execute and deliver to the Agent, and the Agent shall not
be obligated to authenticate, execute on behalf of the Holder, and
deliver to the Holder, a Certificate on or after the Business Day
immediately preceding the earlier of the Stock Purchase Date or the
Termination Date. In lieu of delivery of a new Certificate, upon
satisfaction of the applicable conditions specified above in this
Section and receipt of appropriate registration or transfer
instructions from such Holder, the Agent shall (i) if the Stock
Purchase Date has occurred, deliver the shares of Common Stock issuable
in respect of the Forward Purchase Contracts forming a part of the
Equity Units or Stripped Equity Units evidenced by such Certificate, or
(ii) if a Termination Event shall have occurred prior to the Stock
Purchase Date, transfer the Notes, the appropriate 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 Equity Units or Stripped Equity Units, as the
case may be, evidenced thereby, whether or not the destroyed, lost or
stolen Certificate (and the Equity Units and Stripped Equity Units
evidenced thereby) shall be at any time
-25-
enforceable by anyone, and shall be entitled to all the benefits and be
subject to all the obligations of this Agreement equally and
proportionately with any and all other Certificates delivered
hereunder.
(f) The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with
respect to the replacement or payment of mutilated, destroyed, lost or
stolen Certificates.
Section 3.11 PERSONS DEEMED OWNERS.
(a) Prior to due presentment of a Certificate for registration
of transfer, the Company and the Agent, and any agent of the Company or
the Agent, may treat the Person in whose name such Certificate is
registered as the owner of the Equity Units or Stripped Equity Units,
as the case may be, evidenced thereby, for the purpose of receiving
interest payments on the Notes, receiving payment of Contract
Adjustment Payments, performance of the Forward Purchase Contracts and
for all other purposes whatsoever (subject to Section 4.1(a) and
5.2(a)), whether or not any such payments shall be overdue and
notwithstanding any notice to the contrary, and neither the Company nor
the Agent, nor any agent of the Company or the Agent, shall be affected
by notice to the contrary.
(b) Notwithstanding the foregoing, with respect to any Global
Certificate, nothing herein shall prevent the Company, the Agent or any
agent of the Company or the Agent from giving effect to any written
certification, proxy or other authorization furnished by any Clearing
Agency (or its nominee), as a Holder, with respect to such Global
Certificate or impair, as between such Clearing Agency and owners of
beneficial interests in such Global Certificate, the operation of
customary practices governing the exercise of rights of such Clearing
Agency (or its nominee) as Holder of such Global Certificate. None of
the Company, the Agent, or any agent of the Company or the Agent will
have any responsibility or liability for any aspect of the records
relating to or payments made on account of beneficial ownership
interests 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 Equity Units or Stripped
Equity Units, as the case may be, shall, if surrendered to any Person
other than the Agent, be delivered to the Agent and, if not already
cancelled, shall be promptly cancelled by it. The Company may at any
time deliver to the Agent for cancellation any Certificates previously
authenticated, executed and delivered hereunder which the Company may
have acquired in any manner whatsoever, and all Certificates so
delivered shall, upon Issuer Order, be promptly cancelled by the Agent.
No Certificates shall be authenticated, executed on behalf of the
Holder and delivered in lieu of or in exchange for any Certificates
cancelled as provided in this Section, except as expressly permitted by
this Agreement. All cancelled Certificates
-26-
held by the Agent shall be disposed of by the Agent in accordance with
its customary procedures.
(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 EQUITY UNITS.
(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 Equity Units 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 the 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 the 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 Equity Units, and
(ii) transferring the related Equity Units to the Agent accompanied by
a notice to the Agent, substantially in the form of Exhibit D hereto,
stating that the Holder has transferred the relevant amount of Treasury
Securities to the Collateral Agent and requesting that the Agent
instruct the Collateral Agent to release the Pledged Notes, Pledged
Treasury Consideration or Pledged Applicable Ownership Interest in the
Treasury Portfolio, as the case may be, underlying such Equity Units,
whereupon the Agent shall promptly give such instruction to the
Collateral Agent, substantially in the form of Exhibit C hereto.
Notwithstanding the foregoing, a Holder may not 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 Equity Units 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 Equity Units;
(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
-27-
(iii) authenticate, execute on behalf of such Holder and
deliver to such Holder a Stripped Equity Units 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 Equity Units.
(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 Equity Units, or (ii) if the Collateral Substitutions
occur after the Remarketing Date or any Subsequent Remarketing Date, or
after a Tax Event Redemption, as the case may be, only in integral
multiples of Equity Units 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 Equity Units or fails to deliver an Equity Units 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 Equity Units, 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 Equity Units are so
transferred or the Equity Units Certificate is so delivered, as the
case may be, or, with respect to an Equity Units Certificate, such
Holder provides evidence satisfactory to the Company and the Agent that
such Equity Units 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 Equity Units remains in
effect, such Equity Units shall not be separable into its constituent
parts, and the rights and obligations of the Holder of such Equity
Units 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 Equity Units
may be acquired, and may be transferred and exchanged, only as an
Equity Units.
Section 3.14 REESTABLISHMENT OF EQUITY UNITS.
-28-
(a) A Holder of Stripped Equity Units may reestablish Equity
Units at any time from and after the date of this Agreement and on or
prior to the second Business Day immediately preceding the 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 Equity Units), as the case
may be, then comprising such number of Equity Units as is equal to such
Stripped Equity Units and (ii) transferring such Stripped Equity Units
to the Agent accompanied by a notice to the Agent, substantially in the
form of Exhibit D hereto, stating that the Holder has transferred the
relevant amount of Notes 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 Equity Units, whereupon the Agent shall
promptly give such instruction to the Collateral Agent, substantially
in the form of Exhibit C hereto. Notwithstanding the foregoing, a
Holder may not reestablish Equity Units 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 Equity Units;
(ii) transfer the Pledged Treasury Securities to the
Holder; and
(iii) authenticate, execute on behalf of such Holder and
deliver an Equity Units 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 Equity Units.
(b) Holders of Stripped Equity Units may reestablish Equity
Units (i) only in integral multiples of 20 Stripped Equity Units for
20 Equity Units or (ii) if the reestablishment occurs after the
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 Equity Units 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 Equity Units
remains in effect, such Stripped Equity Units shall not be separable
into its constituent parts, and the rights and obligations of the
Holder of such Stripped Equity Units in respect of the Treasury
Security and Forward Purchase Contract comprising such Stripped Equity
Units may be acquired, and may be transferred and exchanged, only as a
Stripped Equity Units.
-29-
(d) Holders of Stripped Equity Units who reestablish Equity
Units shall be responsible for any fees or expenses payable to the
Collateral Agent for its services as Collateral Agent in respect of
the substitution, and the Company shall not be responsible for any
such fees or expenses.
(e) In the event a Holder who reestablishes Equity Units
pursuant to this Section 3.14 fails to effect a book-entry transfer of
the Stripped Equity Units or fails to deliver a Stripped Equity Units
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 Equity Units,
and any distributions on such Treasury Securities shall be held in the
name of the Agent or its nominee in trust for the benefit of such
Holder, until such Stripped Equity Units are so transferred or the
Stripped Equity Units Certificate is so delivered, as the case may be,
or, with respect to a Stripped Equity Units Certificate, such Holder
provides evidence satisfactory to the Company and the Agent that such
Stripped Equity Units 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 Equity Units and the Stripped Equity Units 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 Equity Units Register
or the Stripped Equity Units Register, as the case may be. Upon book-entry
transfer of the Equity Units or Stripped Equity Units or delivery of an Equity
Units Certificate or Stripped Equity Units 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 Equity
Units or Stripped Equity Units, 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 Equity Units or Stripped Equity Units 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 Equity Units or Stripped Equity Units, as the case may
be, and any distributions thereon, shall be held in the name of the Agent or its
nominee in trust for the benefit of such Holder, until (i) such Equity Units or
Stripped Equity Units are transferred or the Equity Units Certificate or
Stripped Equity Units Certificate is surrendered or such Holder provides
satisfactory evidence that such Equity Units Certificate or Stripped Equity
Units 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.
-30-
Section 3.16 NO CONSENT TO ASSUMPTION.
Each Holder of Equity Units or Stripped Equity Units, as the case may
be, by acceptance thereof, shall be deemed expressly to have withheld any
consent to the assumption under Section 365 of the Bankruptcy Code or otherwise,
of the 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
Equity Units Certificate (or one or more Predecessor Equity Units
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 Equity Units Certificate evidencing Notes delivered
under this Agreement upon registration of transfer of or in exchange
for or in lieu of any other Equity Units 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 Equity
Units Certificate.
(c) In the case of any Equity Units 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 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 Equity Units otherwise payable on such Payment
Date shall be payable on such Payment Date notwithstanding such Early
Settlement, Merger Early Settlement, Cash Settlement or Collateral
Substitution, as the case may be, and such payments shall, subject to
receipt thereof by the Agent, be payable to the Person in whose name
the Equity Units Certificate (or one or more Predecessor Equity Units
Certificates) was registered at the close of business on the Record
Date. Except as otherwise expressly provided in the immediately
preceding sentence, in the case of any Equity Units with respect to
which Early Settlement, Merger Early Settlement or Cash Settlement of
the underlying Forward Purchase Contract
-31-
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 Equity Units; provided, that to the extent that such
Holder continues to hold the Separate Notes that formerly comprised a
part of such Holder's Equity Units, 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
Equity Units a notice (a) containing such information as is contained in the
notice or solicitation, (b) stating that each Holder on the record date set by
the Agent therefor (which, to the extent possible, shall be the same date as the
record date for determining the holders of Notes entitled to vote) shall be
entitled to instruct the Agent as to the exercise of the voting rights
pertaining to the Pledged Notes underlying their Equity Units and (c) stating
the manner in which such instructions may be given. Upon the written request of
the Holders of Equity Units on such record date, the Agent shall endeavor
insofar as practicable to vote or cause to be voted, in accordance with the
instructions set forth in such requests, the maximum number of Pledged Notes as
to which any particular voting instructions are received. In the absence of
specific instructions from the Holder of an Equity Unit, the Agent shall abstain
from voting the Pledged Note underlying such Equity Units. The Company hereby
agrees, if applicable, to solicit Holders of Equity Units to timely instruct the
Agent in order to enable the Agent to vote such Pledged Notes.
Section 4.3 TAX EVENT REDEMPTION.
Upon the occurrence of a Tax Event Redemption prior to the 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 Equity Units, an amount equal to the aggregate Tax Event
Redemption Principal Amount for the Notes that are components of Equity Units to
purchase on behalf of the Holders of Equity Units the Treasury Portfolio and
promptly remit the remaining portion of such aggregate Redemption Price to the
Agent for payment to the Holders of such Equity Units. 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 Equity Units to purchase the Common Stock under
the Forward Purchase Contract constituting a part of such Equity Units.
Following the occurrence of a Tax Event Redemption prior to a successful
remarketing of the Notes, the Holders of Equity Units and the Collateral Agent
shall have such security interests, rights and obligations with respect to the
Treasury Portfolio as the Holder of Equity Units and the Collateral Agent had in
respect of the Notes, as the case may be, subject to the Pledge thereof as
provided in Articles II, III, IV, V and VI of the Pledge Agreement, and any
reference herein or in the Certificates to the Note shall be deemed to be a
reference to such Treasury Portfolio and any reference herein or in the
Certificates to interest on the Notes shall be
-32-
deemed to be a reference to corresponding distributions on the Treasury
Portfolio. The Company may cause to be made in any Equity Units 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 such
Tax Event Redemption Date, to each Holder of Equity Units 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 5.9, or a Merger
Early Settlement has occurred in accordance with Section 5.10, obligate
the Holder of the related Equity Units or Stripped Equity Units, as the
case may be, to purchase, and the Company to sell, on the 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 Stock Purchase Date, there shall have
occurred a Termination Event with respect to the Units 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 $[ ] (the "Threshold Appreciation
Price"), [ ] 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 $[ ], the
number of shares of Common Stock per Forward Purchase Contract
equal to the Stated Amount of the related Equity Units or
Stripped Equity Units, as the case may be, divided by the
Applicable Market Value, and
(iii) if the Applicable Market Value is equal to or less
than $[ ], [ ] shares of Common Stock per Forward Purchase
Contract, in each case subject to adjustment as provided in
Section 5.6 (and in each case rounded upward or downward to
the nearest 1/10,000th of a share).
As provided in Section 5.12, no fractional shares of Common Stock will
be issued upon settlement of 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 Settlement Rate and the Applicable Market
Value shall be made by the Company or its agents
-33-
based on their good faith calculations, and the Agent shall have no
responsibility with respect thereto.
(b) No fractional shares of Common Stock will be issued by the
Company with respect to the payment of Contract Adjustment Payments on
the Stock Purchase Date. In lieu of fractional shares otherwise
issuable with respect to such payment of Contract Adjustment Payments,
the Holder will be entitled to receive an amount of cash as provided in
Section 5.12.
(c) The "Applicable Market Value" means the average of the
Closing Price per share of Common Stock on each of the 20 consecutive
Trading Days ending on the third Trading Day immediately preceding the
Stock Purchase Date. The "Closing Price" of the Common Stock on any
date of determination means the closing sale price (or, if no closing
price is reported, the last reported sale price) of the Common Stock on
the New York Stock Exchange (the "NYSE") on such date or, if the Common
Stock is not listed for trading on the NYSE on any such date, as
reported in the composite transactions for the principal United States
securities exchange on which the Common Stock is so listed, or if the
Common Stock is not so listed on a United States national or regional
securities exchange, as reported by The Nasdaq Stock Market, or, if the
Common Stock is not so reported, the last quoted bid price for the
Common Stock in the over-the-counter market as reported by the National
Quotation Bureau or similar organization, or, if such bid price is not
available, the market value of the Common Stock on such date as
determined by a nationally recognized independent investment banking
firm retained for this purpose by the Company. A "Trading Day" means a
day on which the Common Stock (A) is not suspended from trading on any
national or regional securities exchange or association or
over-the-counter market at the close of business and (B) has traded at
least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for
the trading of the Common Stock.
(d) Each Holder of Equity Units or Stripped Equity Units, as
the case may be, 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 Equity Units or
Stripped Equity Units, as the case may be, under the Forward Purchase
Contract may be enforced without regard to any other rights or
obligations. Each Holder of Equity Units or Stripped Equity Units, as
the case may be, by its acceptance thereof, further covenants and
agrees that, to the extent and in the manner provided in Section 5.4
and the Pledge Agreement, but subject to the terms thereof, payments in
respect of the Notes, the appropriate 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
-34-
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 payment.
(e) Upon registration of transfer of a Certificate, the
transferee shall be bound (without the necessity of any other action on
the part of such transferee) under the terms of this Agreement, the
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 CONTRACT ADJUSTMENT PAYMENTS.
(a) Contract Adjustment Payments shall accrue on each Forward
Purchase Contract constituting a part of an Equity Unit or Stripped
Equity Unit at [ ]% per year of the Stated Amount of such Equity Units
or Equity Units, from [ ], 2002 through and including the Stock
Purchase Date, provided that no Contract Adjustment Payment shall
accrue after an Early Settlement or Merger Early Settlement. Subject to
Section 5.3 herein, the Company shall pay, on each Payment Date, the
Contract Adjustment Payments, if any, payable in respect of each
Forward Purchase Contract to the Person in whose name a Certificate (or
one or more Predecessor Certificates) is registered at the close of
business on the Record Date immediately preceding such Payment Date in
such coin or currency of the United States as at the time of payment
shall be legal tender for payments. The Contract Adjustment Payments,
if any, will be payable at the office in New York, New York, maintained
for that purpose or, at the option of the Company, by check mailed to
the address of the Person entitled thereto at such Person's address as
it appears on the Register or by wire transfer to the account
designated to the Agent by a prior written notice by such Person
delivered at least five Business Days prior to the applicable Payment
Date.
(b) Upon the occurrence of a Termination Event, the Company's
obligation to pay Contract Adjustment Payments (including any accrued
Deferred Contract Adjustment Payments), if any, shall cease.
(c) Each Certificate delivered under this Agreement upon
registration of transfer of or in exchange for or in lieu of (including
as a result of a Collateral Substitution or the re-establishment of an
Equity Unit) any other Certificate shall carry the rights to Contract
Adjustment Payments, if any, accrued and unpaid, and to accrue Contract
Adjustment Payments, if any, which were carried by the Forward Purchase
Contracts underlying such other Certificates.
(d) Subject to Sections 5.9 and 5.10, in the case of any
Equity Units or Stripped Equity Units, as the case may be, with respect
to which Early Settlement or Merger Early Settlement of the underlying
Forward Purchase Contract is effected on an Early Settlement Date or a
Merger Early Settlement Date, respectively, or in respect of which Cash
-35-
Settlement of the underlying Forward Purchase Contract is effected on
the Business Day immediately preceding the Stock Purchase Date, or with
respect to which a Collateral Substitution or an establishment or
re-establishment of an Equity Units pursuant to Section 3.14 is
effected, in each case on a date that is after any Record Date and on
or prior to the next succeeding Payment Date, Contract Adjustment
Payments on the Forward Purchase Contract underlying such Equity Units
or Stripped Equity Units, as the case may be, otherwise payable on such
Payment Date shall be payable on such Payment Date notwithstanding such
Cash Settlement, Early Settlement, Merger Early Settlement, Collateral
Substitution or establishment or re-establishment of Equity Units, and
such Contract Adjustment Payments shall be paid to the Person in whose
name the Certificate evidencing such Equity Units or Stripped Equity
Units (or one or more Predecessor Certificates) is registered at the
close of business on such Record Date. Except as otherwise expressly
provided in the immediately preceding sentence, in the case of any
Equity Units or Stripped Equity Units with respect to which Cash
Settlement, Early Settlement, Merger Early Settlement of the underlying
Forward Purchase Contract is effected on the Business Day immediately
preceding the Stock Purchase Date, an Early Settlement Date or Merger
Early Settlement Date, as the case may be, or with respect to which a
Collateral Substitution or an establishment or re-establishment of an
Equity Unit has been effected, Contract Adjustment Payments, if any,
that would otherwise be payable after the Early Settlement Date, or
Merger Early Settlement Date, Collateral Substitution or such
establishment or re-establishment with respect to such Forward Purchase
Contract shall not be payable.
Section 5.3 DEFERRAL OF CONTRACT ADJUSTMENT PAYMENTS.
(a) The Company shall have the right, at any time prior to the
Stock Purchase Date, to defer the payment of any or all of the Contract
Adjustment Payments otherwise payable on any Payment Date, but only if
the Company shall give the Holders and the Agent written notice of its
election to defer each such deferred Contract Adjustment Payment
(specifying the amount to be deferred) at least ten Business Days prior
to the earlier of (i) the next succeeding Payment Date or (ii) the date
the Company is required to give notice of the Record Date or Payment
Date with respect to payment of such Contract Adjustment Payments to
the NYSE or other applicable self-regulatory organization or to Holders
of the Equity Units and Stripped Equity Units, but in any event not
less than one Business Day prior to such Record Date. Any Contract
Adjustment Payments so deferred shall, to the extent permitted by law,
bear additional Contract Adjustment Payments thereon at the rate of [
]% per year (computed on the basis of a 360-day year of 12 30-day
months), compounding on each succeeding Payment Date, until paid in
full (such deferred installments of Contract Adjustment Payments, if
any, together with the additional Contract Adjustment Payments accrued
thereon, being referred to herein as the "Deferred Contract Adjustment
Payments"). Deferred Contract Adjustment Payments, if any, shall be due
on the next succeeding Payment Date except to the extent that payment
is deferred pursuant to this Section 5.3. No Contract Adjustment
Payments may be deferred to a date that is after the Stock Purchase
Date and no such deferral period may end other than on a Payment Date.
If the Forward Purchase Contracts are terminated upon the occurrence of
a Termination Event, the Holder's right to receive Contract Adjustment
Payments, if any, and Deferred Contract Adjustment Payments, will
terminate.
-36-
(b) In the event that the Company elects to defer the payment
of Contract Adjustment Payments on the Forward Purchase Contracts until
a Payment Date prior to the Stock Purchase Date, then all Deferred
Contract Adjustment Payments, if any, shall be payable to the
registered Holders as of the close of business on the Record Date
immediately preceding such Payment Date.
(c) In the event that the Company elects to defer the payment
of Contract Adjustment Payments on the Forward Purchase Contracts until
the Stock Purchase Date, each Holder will receive on the Stock Purchase
Date in lieu of a cash payment a number of shares of Common Stock (in
addition to a number of shares of Common Stock equal to the Settlement
Rate) equal to (A) the aggregate amount of Deferred Contract Adjustment
Payments payable to such Holder (net of any required tax withholding on
such Deferred Contract Adjustment Payment, which shall be remitted to
the appropriate taxing jurisdiction) divided by (B) the Applicable
Market Value.
(d) No fractional shares of Common Stock will be issued by the
Company with respect to the payment of Deferred Contract Adjustment
Payments on the Stock Purchase Date. In lieu of fractional shares
otherwise issuable with respect to such payment of Deferred Contract
Adjustment Payments, the Holder will be entitled to receive an amount
in cash as provided in Section 5.12.
(e) In the event the Company exercises its option to defer the
payment of Contract Adjustment Payments then, until the Deferred
Contract Adjustment Payments have been paid, the Company shall not
declare or pay dividends on, make distributions with respect to, or
redeem, purchase or acquire, or make a liquidation payment with respect
to, any of the Company's Common Stock other than:
(i) purchases, redemptions or acquisitions of shares of
Common Stock in connection with any employment contract,
benefit plan or other similar arrangement with or for the
benefit of employees, officers or directors or a stock
purchase or dividend reinvestment plan, or the satisfaction by
the Company of its obligations pursuant to any contract or
security outstanding on the date the Company exercises its
right to defer the Contract Adjustment Payments;
(ii) as a result of a reclassification of the Company's
Capital Stock or the exchange or conversion of one class or
series of the Company's Capital Stock for another class or
series of the Company's Capital Stock; the purchase of
fractional interests of the Common Stock pursuant to the
conversion or exchange provisions of such Common Stock or the
security being converted or exchanged;
(iii) dividends or distributions in any series of the
Company's Common Stock (or rights to acquire Common Stock) or
repurchases, acquisitions or redemptions of Common Stock in
connection with the issuance or exchange of the Common Stock
(or securities convertible into or exchangeable for shares of
the Company's Common Stock); or
-37-
(iv) redemptions, exchanges or repurchases of any rights
outstanding under a shareholder rights plan or the declaration
or payment thereunder of a dividend or distribution of or with
respect to rights in the future.
Section 5.4 PAYMENT OF PURCHASE PRICE; REMARKETING.
(a) Unless a Tax Event Redemption, successful remarketing,
Termination Event, Merger Early Settlement or Early Settlement has
occurred, each Holder of an Equity Unit 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, on
the tenth Business Day immediately preceding the Stock Purchase Date.
The Agent shall promptly notify the Collateral Agent of the receipt of
such a notice from a Holder intending to make a Cash Settlement.
(i) A Holder of an Equity Unit who has so notified the
Agent of its intention to make a Cash Settlement is required
to pay the Purchase Price to the Collateral Agent prior to
11:00 a.m., New York City time, on the seventh Business Day
immediately preceding the Stock Purchase Date in lawful money
of the United States by certified or cashiers' check or wire
transfer, in each case payable to or upon the order of the
Company. Any cash received by the Collateral Agent will be
paid to the Company on the Stock Purchase Date in settlement
of the Forward Purchase Contract in accordance with the terms
of this Agreement and the Pledge Agreement.
(ii) If a Holder of an Equity Unit 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 Equity Unit 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 5.4 (b) below.
(b) (i) The Company has engaged the Remarketing Agent to sell
the Notes of (A) Holders of Equity Units, 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 procedures set forth in Section 4.5(d) of the Pledge
Agreement. On the seventh Business Day prior to the Remarketing Date or
the first day of any subsequent Remarketing Period, the Agent shall
give Holders of Equity Units 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
-38-
of Equity Units 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
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 the first day of any
subsequent Remarketing Period, as applicable, the Remarketing Agent and
the Collateral Agent of the aggregate number of Notes of Equity Units
Holders to be remarketed. On the third Business Day immediately
preceding the 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 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.
(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
approximately 100.25% of the Remarketing Value as of the Remarketing
Date or as of any Subsequent Remarketing Date, as the case may be (the
"Reset Rate") and (ii) sell such Notes on such date at a price equal to
100.25% 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 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 Equity Units or that were remarketed. On or
prior to the third Business Day following the Remarketing Date 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 Equity
Units 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 Subsequent Remarketing Date. Holders whose Notes are so
remarketed will not otherwise be responsible for the payment of any
Remarketing Fee in connection therewith.
-39-
(e) (i) If, in spite of using its commercially reasonable best
efforts, the Remarketing Agent cannot establish the Reset Rate remarket
the Notes included in the remarketing at a price equal to approximately
100.25% of the Remarketing Value, the Remarketing Agent will again
attempt to establish the Reset Rate and remarket the Notes included in
the remarketing at a price equal to approximately 100.25% of the
Remarketing Value on each of the two immediately following Business
Days. If the Remarketing Agent cannot remarket the Notes included in
the remarketing at a price equal to approximately 100.25% of the
Remarketing Value on either of those days, it will attempt to establish
the Reset Rate and remarket the Notes included in the remarketing at a
price equal to approximately 100.25% of the Remarketing Value on each
of the three Business Days immediately preceding [ ]. If the
Remarketing Agent cannot establish the Reset Rate and remarket the
Notes included in the remarketing at a price equal to approximately
100.25% of the Remarketing Value either on any of the two Business Days
immediately following the Remarketing Date or on any of the three
Business Days immediately preceding [ ], the remarketing in each period
will be deemed to gave failed (each, a "Failed Remarketing"). If the
Remarketing Agent cannot establish the Reset Rate and remarket the
Notes included in the remarketing at a price equal to approximately
100.25% of the Remarketing Value on any of the three Business Days
immediately preceding [ ], the Remarketing Agent will further attempt
to establish the Reset Rate and remarket the Notes included in the
remarketing at a price equal to approximately 100.25% of the
Remarketing Value on each of the three Business Days immediately
preceding [ ]. If, in spite of using its commercially reasonable best
efforts, the Remarketing Agent fails to remarket the Notes underlying
the Equity Units at a price equal to approximately 100.25%, but not
less than 100%, of the Remarketing Value in accordance with the terms
of the Pledge Agreement by 4:00 p.m., New York City time, on the third
Business Day immediately preceding the Stock Purchase Date, a "Last
Failed Remarketing" will be deemed to have occurred.
(ii) Within three Business Days following the end of the
Last Failed Remarketing, the Remarketing Agent shall return
any Notes delivered to it to the Collateral Agent. 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 Section 5.4(f) below, and
the Holders of Equity Units, by their acceptance of the Equity
Units shall be deemed to have agreed to such exercise by the
Collateral Agent in such case; provided, that if upon the Last
Failed 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 Equity
Units 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 Stock Purchase Date in lawful money of the United States
by certified or cashier's check or wire transfer in
immediately available funds payable to or upon the order of
the Agent. The Company will 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.
-40-
(f) With respect to any Notes which constitute part of Equity Units which
are subject to the Last Failed Remarketing, the Collateral Agent for
the benefit of the Company reserves all of its rights as a secured
party with respect thereto and, subject to applicable law and Section
5.4 (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 and the Holders of the Equity Units, by their
acceptance of the Equity Units shall be deemed to have agreed to such
action by the Collateral Agent.
(g) A Holder of Equity Units may elect not to participate in
the remarketing and retain the Notes underlying such Equity Units 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 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, 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, 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 Equity Units and the Pledged Treasury
Consideration or Pledged Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, underlying the Equity Units, on the
Stock Purchase Date, the Collateral Agent shall remit to the Company an
amount equal to the aggregate Purchase Price applicable to such Units,
as payment for the Common Stock issuable upon settlement thereof
without receiving any instructions from the Holders of such Units. 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 Unit 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 Units when received.
-41-
(i) Any distribution to Holders of excess funds and
interest described in Section 5.4(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.
(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 Equity
Units or Stripped Equity Units, as the case may be, unless the
Company shall have received payment in full for the shares of
Common Stock to be purchased thereunder by such Holder in the
manner herein set forth.
(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 5.5 ISSUANCE OF SHARES OF COMMON STOCK.
Unless a Termination Event shall have occurred on or prior to the Stock
Purchase Date or an Early Settlement or a Merger Early Settlement shall have
occurred with respect to all of the outstanding Units, on the 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 Units, 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 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 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 Equity Units and Stripped
Equity Units then held by such Holder) together with cash in lieu of fractional
shares as provided in Section 5.12 and any dividends or distributions with
respect to such shares constituting part of the 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
-42-
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 5.6 ADJUSTMENT OF SETTLEMENT RATE.
(a) Adjustments for Dividends, Distributions, Stock Splits,
Etc.
(1) STOCK DIVIDENDS. In case the Company shall pay
or make a dividend or other distribution on the Common
Stock in Common Stock, the Settlement Rate or Early
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 or Early
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 Equity Units and Stripped Equity Units
upon settlement of the Forward Purchase Contracts
underlying such Equity Units and Stripped Equity Units)
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 or Early 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 or Early 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
-43-
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 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 or Early 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 or Early
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 or Early Settlement Rate, as applicable,
shall be adjusted so that the same shall equal the rate
determined by dividing the Settlement Rate or Early
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
-44-
shall be such Current Market Price per share of the
Common Stock, such adjustment to become effective
immediately prior to the opening of business on the day
following the date fixed for the determination of
stockholders entitled to receive such distribution. In
any case in which this paragraph (4) is applicable,
paragraph (2) of this Section shall not be applicable.
(ii) In the case of a Spin-Off, the Settlement Rate or
Early 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 or Early 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 or
Early 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
5.6(b) applies or as part of a distribution referred to
in paragraph (4) of this Section) in an aggregate amount
that, combined together with (ii) the aggregate amount of
any other distributions to all holders of its Common
Stock made exclusively in cash within the 12 months
preceding the date of payment of such distribution and in
respect of which no adjustment pursuant to this paragraph
(5) or paragraph (6) of this Section has been made and
(iii) the aggregate of any cash plus the fair market
value as 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 or Early
Settlement Rate, as applicable, shall be increased so
that the same shall equal the rate determined by dividing
the Settlement Rate or Early Settlement Rate, as
applicable, in effect immediately prior to the close of
business on the date fixed for determination of the
stockholders entitled
-45-
to receive such distribution by a fraction (A) the
numerator of which shall be equal to the Current Market
Price per share of the Common Stock on the date fixed for
such determination less an amount equal to the quotient
of (x) the combined amount distributed or payable in the
transactions described in clauses (i), (ii) and (iii)
above and (y) the number of shares of Common Stock
outstanding on such date for determination and (B) the
denominator of which shall be equal to the Current Market
Price per share of the Common Stock on such date for
determination.
(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 or Early Settlement Rate, as
applicable, shall be adjusted so that the same shall
equal the rate determined by dividing the Settlement Rate
or Early 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)
-46-
above (assuming in the case of clause (i) the acceptance,
up to any maximum specified in the terms of the tender or
exchange offer, of Purchased Shares), and (B) the
denominator of which shall be equal to the product of (x)
the Current Market Price per share of the Common Stock as
of the Expiration Time and (y) the number of shares of
Common Stock outstanding (including any tendered shares)
as of the Expiration Time less the number of all shares
validly tendered and not withdrawn as of the Expiration
Time (the shares deemed so accepted, up to any such
maximum, being referred to as the "Purchased Shares").
(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 5.6(b) applies)
shall be deemed to involve (i) a distribution of such
securities other than Common Stock to all holders of
Common Stock (and the effective date of such
reclassification shall be deemed to be "the date fixed
for the determination of stockholders entitled to receive
such distribution" and the "date fixed for such
determination" within the meaning of paragraph (4) of
this Section), and (ii) a subdivision, split or
combination, as the case may be, of the number of shares
of Common Stock outstanding immediately prior to such
reclassification into the number of shares of Common
Stock outstanding immediately thereafter (and the
effective date of such reclassification shall be deemed
to be "the day upon which such subdivision or split
becomes effective" or "the day upon which such
combination becomes effective," as the case may be, and
"the day upon which such subdivision, split or
combination becomes effective" within the meaning of
paragraph (3) of this Section).
(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 or Early 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
-47-
1/10,000th of a share to the next lower 1/10,000th of a
share). No adjustment in the Settlement Rate or Early
Settlement Rate, as applicable, shall be required unless
such adjustment would require
(6) 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 or Early Settlement Rate, as applicable, pursuant to
paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of
this Section 5.6(a), an adjustment shall also be made to
the Applicable Market Value solely to determine which of
clauses (i), (ii) or (iii) of the definition of
Settlement Rate or Early Settlement Rate, as applicable,
in Section 5.1(a) will apply on the Stock Purchase Date.
Such adjustment shall be made by multiplying the
Applicable Market Value by a fraction, the numerator of
which shall be the Settlement Rate or Early Settlement
Rate, as applicable, immediately after such adjustment
pursuant to paragraph (1), (2), (3), (4), (5), (6), (7)
or (10) of this Section 5.6(a) and the denominator of
which shall be the Settlement Rate or Early Settlement
Rate, as applicable, immediately before such adjustment;
provided, that if such adjustment to the Settlement Rate
or Early 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 5.6(a) during the period taken into
consideration for determining the Applicable Market
Value, appropriate and customary adjustments shall be
made to the Settlement Rate or Early Settlement Rate, as
applicable.
(7) INCREASE OF SETTLEMENT RATE. The Company may
make such increases in the Settlement Rate or Early
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),
(2) any sale, transfer, lease or conveyance to
another Person of the property of the Company as an
entirety or substantially as an entirety,
-48-
(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 Equity Units or Stripped Equity Units, as the case may be, 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 Stock
Purchase Date) per share of Common Stock by a holder of Common Stock that (i) is
not a Person with which the Company consolidated or into which the Company
merged or which merged into the Company or to which such sale or transfer was
made, as the case may be (any such Person, a "Constituent Person"), or an
Affiliate of a Constituent Person to the extent such Reorganization Event
provides for different treatment of Common Stock held by Affiliates of the
Company and non-Affiliates, and (ii) failed to exercise his rights of election,
if any, as to the kind or amount of securities, cash and other property
receivable upon such Reorganization Event (provided that if the kind or amount
of securities, cash and other property receivable upon such Reorganization Event
is not the same for each share of Common Stock held immediately prior to such
Reorganization Event by other than a Constituent Person or an Affiliate thereof
and in respect of which such rights of election shall not have been exercised
("Non-electing Share"), then for the purpose of this Section the kind and amount
of securities, cash and other property receivable upon such Reorganization Event
by each Non-electing Share shall be deemed to be the kind and amount so
receivable per share by a plurality of the Non-electing Shares). On the Stock
Purchase Date, the Settlement Rate then in effect will be applied to the value
on the Stock Purchase Date of such securities, cash or other property. In the
event of such a Reorganization Event, the Person formed by such consolidation,
merger or exchange or the Person which acquires the assets of the Company or, in
the event of a liquidation or dissolution of the Company, the Company or a
liquidating trust created in connection therewith, shall execute and deliver to
the Agent an agreement supplemental hereto providing that the Holder of each
Outstanding Units shall have the rights provided by this Section 5.6. Such
supplemental agreement shall provide for adjustments which, for events
subsequent to the effective date of such supplemental agreement, shall be as
nearly equivalent as may be practicable to the adjustments provided for in this
Section. The above provisions of this Section shall similarly apply to
successive Reorganization Events.
Section 5.7 NOTICE OF ADJUSTMENTS AND CERTAIN OTHER EVENTS.
(a) Whenever the Settlement Rate or Early Settlement Rate, as
applicable, is adjusted as herein provided, the Company shall:
(i) forthwith compute the Settlement Rate or Early
Settlement Rate, as applicable, and the Applicable Market
Value in accordance with Section 5.6 and prepare and transmit
to the Agent an Officer's Certificate setting forth the
Settlement Rate and the Applicable Market Value, the method of
calculation
-49-
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 or
Early Settlement Rate, as applicable, pursuant to Section 5.6
(or if the Company is not aware of such occurrence, as soon as
practicable after becoming so aware), provide a written notice
to the Holders of the Equity Units and Stripped Equity Units
of the occurrence of such event and a statement in reasonable
detail setting forth the method by which the adjustment to the
Settlement Rate or Early Settlement Rate, as applicable, and
the Applicable Market Value was determined and setting forth
the adjusted Settlement Rate or Early 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 Equity Units and Stripped Equity Units
to determine whether any facts exist which may require any adjustment
of the Settlement Rate or Early 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 5.8 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 the Stock Purchase Date, a Termination Event shall
have occurred. Upon and after the occurrence of a Termination Event, the Equity
Units 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 Equity Units, and
the Stripped Equity Units shall thereafter represent the right to receive the
Treasury Securities forming a part of such Stripped Equity Units, in each case
in accordance with the provisions of Section 4.3 of the Pledge Agreement. Upon
the occurrence of a Termination Event, the Company shall promptly but in no
event later than two Business Days thereafter give written notice to the Agent,
the Collateral Agent and to the Holders, at their addresses as they appear in
the applicable Register.
Section 5.9 EARLY SETTLEMENT.
(a) Subject to and upon compliance with the provisions of this
Section 5.7, Forward Purchase Contracts underlying Equity Units or
Stripped Equity Units having an
-50-
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 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 Equity Units or Stripped Equity Units, as the case may be,
shall deliver such Certificate to the Agent at the Corporate Trust
Office duly endorsed for transfer to the Company or in blank with the
form of Election to Settle Early on the reverse thereof duly completed
and accompanied by payment payable to the Company in immediately
available funds in an amount (the "Early Settlement Amount") equal to
(A) the product of (i) the Stated Amount of such Equity Units or
Stripped Equity Units, as the case may be, multiplied by (ii) the
number of Forward Purchase Contracts with respect to which the Holder
has elected to effect Early Settlement, plus (B) if such delivery is
made with respect to any Forward Purchase Contracts during the period
from the close of business on any Record Date next preceding any
Payment Date to the opening of business on such Payment Date, an amount
equal to the Contract Adjustment Payments, if any, payable on such
Payment Date with respect to such Forward Purchase Contracts; provided
that no payment shall be required pursuant to clause (B) of this
sentence if the Company shall have elected to defer the Contract
Adjustment Payments that would otherwise be payable on such Payment
Date and further 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. Except as provided in the immediately
preceding sentence and subject to Section 5.2(d), no payment or
adjustment shall be made upon Early Settlement of any Forward Purchase
Contract on any Contract Adjustment Payments accrued on such Forward
Purchase Contract or on account of any dividends on the Common Stock
issued upon such Early Settlement. If the foregoing requirements are
first satisfied with respect to Forward Purchase Contracts underlying
any Equity Units or Stripped Equity Units, as the case may be, at or
prior to 5:00 p.m., New York City time, on a Business Day, such day
shall be the "Early Settlement Date" with respect to such Equity Units
or Stripped Equity Units, as the case may be, and if such requirements
are first satisfied after 5:00 p.m., New York City time, on a Business
Day or on a day that is not a Business Day, the "Early Settlement Date"
with respect to such Equity Units or Stripped Equity Units, as the case
may be, shall be the next succeeding Business Day.
(b) Upon Early Settlement of any Forward Purchase Contract by
the Holder of the related Equity Units or Stripped Equity Units, as the
case may be, the Company shall issue, and the Holder shall be entitled
to receive, [ ] 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 5.9, 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 5.12.
-51-
(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 Equity Units, or the related Pledged
Treasury Securities, in the case of Stripped Equity Units, to be
released from the Pledge by the Collateral Agent and transferred, in
each case, to the Agent for delivery to the Holder thereof or the
Holder's designee.
(d) Upon Early Settlement of any 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
Equity Units or Stripped Equity Units, as the case may be,, (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 Equity Units or Stripped Equity Units, as the case may
be,, 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
Equity Units or Stripped Equity Units, as the case may be, 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 Equity Units or Stripped Equity Units, as
the case may be, as to which Early Settlement was not effected.
Section 5.10 EARLY SETTLEMENT UPON MERGER.
(a) In the event of a merger or consolidation of the Company
of the type described in clause (1) of Section 5.6(b) in which the
Common Stock outstanding immediately prior to such merger or
consolidation is exchanged for consideration consisting of at least 30%
cash or cash equivalents (any such event a "Cash Merger"), then the
Company (or the successor to the Company hereunder) shall be required
to offer the Holder of each Equity Units or Stripped Equity Units, as
the case may be, the right to settle the Forward Purchase Contract
underlying such Equity Units or Stripped Equity Units, as the case may
be, prior to the Stock Purchase Date ("Merger Early Settlement") as
provided herein. On or before the fifth Business Day 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:
-52-
(i) the date, which shall be not less than 20 nor more
than 30 calendar days after the date of such notice, on which
the Merger Early Settlement will be effected (the "Merger
Early Settlement Date");
(ii) the date, which shall be on or one Business Day
prior to the Merger Early Settlement Date, by which the Merger
Early Settlement right must be exercised;
(iii) the Settlement Rate in effect as a result of such
Cash Merger and the kind and amount of securities, cash and
other property receivable by the Holder upon settlement of
each Forward Purchase Contract pursuant to Section 5.6(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 Equity Units or Stripped Equity Units, as
the case may be, with respect to which the Merger Early Settlement
right is being exercised duly endorsed for transfer to the Company or
in blank with the form of Election to Settle Early on the reverse
thereof duly completed and accompanied by payment payable to the
Company in 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 5.6, 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 Equity Units, or Pledged
Treasury Securities, in the case of Stripped Equity Units, to be
released from the Pledge by the Collateral Agent and transferred, in
each case, to the Agent for delivery to the Holder thereof or 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
-53-
Treasury Portfolio or Pledged Treasury Securities, as the case may be,
from the Collateral Agent, as applicable, the Agent shall, in
accordance with the instructions provided by the Holder thereof on the
applicable form of Election to Settle Early on the reverse of the
Certificate evidencing the related Equity Units or Stripped Equity
Units, as the case may be,, (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 Equity Units or Stripped Equity
Units, as the case may be,, 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 5.12.
(e) In the event that Merger Early Settlement is effected with
respect to Forward Purchase Contracts underlying less than all the
Equity Units or Stripped Equity Units, as the case may be, evidenced by
a Certificate, upon such Merger Early Settlement the Company (or the
successor to the Company hereunder) shall execute and the Agent shall
authenticate, execute on behalf of the Holder thereof and deliver to
the Holder thereof, at the expense of the Company, a Certificate
evidencing the Equity Units or Stripped Equity Units, as the case may
be, as to which Merger Early Settlement was not effected.
Section 5.11 CHARGES AND TAXES.
The Company will pay all stock transfer and similar taxes attributable
to the initial issuance and delivery of the shares of Common Stock pursuant to
the Forward Purchase Contracts and in payment of any Deferred Contract
Adjustment Payments; provided, that the Company shall not be required to pay any
such tax or taxes which may be payable in respect of any exchange of or
substitution for a Certificate evidencing Equity Units or Stripped Equity Units
or any issuance of a share of Common Stock in a name other than that of the
registered Holder of a Certificate surrendered in respect of the Equity Units
and Stripped Equity Units evidenced thereby, other than in the name of the
Agent, as custodian for such Holder, and the Company shall not be required to
issue or deliver such share certificates or 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 5.12 NO FRACTIONAL SHARES.
No fractional shares or scrip representing fractional shares of Common
Stock shall be issued or delivered upon settlement on the Stock Purchase Date or
upon Early Settlement or Merger Early Settlement of any 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
-54-
Agent from time to time with sufficient funds to permit the Agent to make all
cash payments required by this Section 5.12 in a timely manner.
Section 5.13 TAX TREATMENT.
The Company covenants and agrees and each Holder, by purchasing the
Units agrees, to (i) treat a Holder's acquisition of the Units as the
acquisition of the Note and Forward Purchase Contract constituting the Units 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.
(a) The Holder of any Equity Units or Stripped Equity Units,
as the case may be shall have the right, which is absolute and
unconditional, subject to the right of the Company to defer payment
thereof pursuant to Section 5.3, and to the forfeiture of any Deferred
Contract Adjustment Payments upon Early Settlement pursuant to Section
5.9(a) or upon Merger Early Settlement pursuant to Section 5.10 or upon
the occurrence of a Termination Event, to receive payment of each
installment of the Contract Adjustment Payments, if any, with respect
to the Purchase Contract constituting a part of such Equity Units or
Stripped Equity Units, as the case may be, on the respective Payment
Date for such Equity Units or Stripped Equity Units, as the case may
be, and
(b) Subject to Section 5.6, the Holder of any Units shall have
the right, which is absolute and unconditional, to purchase Common
Stock pursuant to the Forward Purchase Contract constituting a part of
such Units 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
-55-
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 Equity Units or
Stripped Equity Units, as the case may be, by its acceptance of such Equity
Units or Stripped Equity Units, as the case may be, shall be deemed to have
agreed, that any court may in its discretion require, in any suit for the
enforcement of any right or remedy under this Agreement, or in any suit against
the Agent for any action taken, suffered or omitted by it as Agent, the filing
by any party litigant in such suit of an undertaking to pay the costs of such
suit, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys' fees 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 Units, 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 Equity Units or Stripped Equity Units, as the case
may be, 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
Equity Units or Stripped Equity Units, as the case may be, held by such Holder.
Section 6.6 WAIVER OF STAY OR EXTENSION LAWS.
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants 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 Equity Units and Stripped Equity Units hereunder with
such powers as are specifically vested in the Agent by the terms of
this Agreement, the Pledge Agreement, the Remarketing Agreement, the
Notes and the Equity Units and Stripped Equity Units, and any documents
-56-
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 the Equity Units or
Stripped Equity Units, or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of
any Transaction Document (other than as against the Agent) or
the Equity Units or Stripped Equity Units or any other
document referred to or provided for herein or therein or for
any failure by the Company, any Holder or any other Person
(except the Agent) to perform any of its obligations hereunder
or thereunder or for the perfection, priority or, except as
expressly required hereby, 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
-57-
(7) shall not be required to advise any party as to
selling or retaining, or taking or refraining from taking any
action with respect to, the Equity Units or Stripped Equity
Units or other rights under any Transaction Document.
(b) No provision of any Transaction Document shall be
construed to relieve the Agent from liability for its own negligent
action, its own negligent failure to act, its own bad faith, or its own
willful misconduct, except that:
(1) this paragraph (b) shall not be construed to limit
the effect of paragraph (a) of this Section;
(2) the Agent shall not be liable for any error of
judgment made in good faith by a Responsible Officer, unless
it shall be proved that the Agent was grossly negligent in
ascertaining the pertinent facts; and
(3) in no event shall the Agent be required to expend or
risk its own funds or otherwise incur any financial liability
in the performance of any of its duties hereunder.
(c) In no event shall the Agent or its officers, employees or
agents be liable for any special, indirect, individual, punitive or
consequential loss or damages, lost profits or loss of business,
arising in connection with any Transaction Document, whether or not the
likelihood of such loss or damage was known to the Agent, and
regardless of the form of action.
(d) Whether or not therein expressly so provided, every
provision of every Transaction Document relating to the conduct or
affecting the liability of or affording protection to the Agent shall
be subject to the provisions of this Section.
(e) The Agent is authorized to execute and deliver the Pledge
Agreement and the Remarketing Agreement and any supplement thereto in
its capacity as Agent. 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.
-58-
Section 7.2 NOTICE OF DEFAULT.
Within 30 days after the occurrence of any default by the Company
hereunder of which a Responsible Officer of the Agent has actual knowledge, the
Agent shall transmit by mail to the Company and the Holders of Equity Units and
Stripped Equity Units, as their names and addresses appear in the Register,
notice of such default hereunder, unless such default shall have been cured or
waived.
Section 7.3 CERTAIN RIGHTS OF AGENT.
Subject to the provisions of Section 7.1:
(a) 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;
(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;
-59-
(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 Equity Units or Stripped Equity Units, 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 Equity Units
or Stripped Equity Units 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 EQUITY UNITS AND STRIPPED EQUITY UNITS AND
OTHER DEALINGS.
Any Registrar or any other agent of the Company, or the Agent and its
Affiliates, in their individual or any other capacity, may become the owner or
pledgee of Equity Units or Stripped Equity Units, as the case may be, and may
otherwise deal with the Company, the Collateral Agent or any other Person with
the same rights it would have if it were not Registrar or such other agent, or
the Agent. The Agent and its Affiliates may (without having to account therefor
to the Company or any Holder of Equity Units or Stripped Equity Units 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 Equity Units or Stripped Equity Units and any holder of
Separate Notes (and any of their respective subsidiaries or Affiliates) as if it
were not acting as the Agent and the Agent and its Affiliates may accept fees
and other consideration from the Company, any Holder of Equity Units or Stripped
Equity Units or any holder of Separate Notes without having to account for the
same to any such Person.
Section 7.6 MONEY HELD IN CUSTODY.
Money held by the Agent in custody hereunder need not be segregated
from the Agent's other funds except to the extent required by law or provided
herein. The Agent shall be under no obligation to invest or pay interest on any
money received by it hereunder except as otherwise agreed in writing with the
Company.
Section 7.7 COMPENSATION AND REIMBURSEMENT.
The Company agrees:
-60-
(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 Equity Units or Stripped Equity Units
and/ or the Separate Notes or the resignation or removal of the Agent.
Section 7.8 CORPORATE AGENT REQUIRED; ELIGIBILITY.
There shall at all times be an Agent hereunder which shall be a
corporation organized and doing business under the laws of the United States of
America, any State thereof or the District of Columbia, authorized under such
laws to exercise corporate trust powers, having (or being a member of a bank
holding company having) a combined capital and surplus of at least $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.
-61-
Section 7.9 RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.
(a) No resignation or removal of the Agent and no appointment
of a successor Agent pursuant to this Article shall become effective
until the acceptance of appointment by the successor Agent in
accordance with the applicable requirements of Section 7.10.
(b) The Agent may resign at any time by giving written notice
thereof to the Company 60 days prior to the effective date of such
resignation. If the instrument of acceptance by a successor Agent
required by Section 7.10 shall not have been delivered to the Agent
within 30 days after the giving of such notice of resignation, the
resigning Agent may petition, at the expense of the Company, any court
of competent jurisdiction for the appointment of a successor Agent.
(c) The Agent may be removed at any time by Act of the Holders
of a majority in number of the Outstanding Units delivered 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 Unit for at least six months, as if this
Agreement were an indenture qualified under the TIA, as
if the Equity Units or Stripped Equity Units 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 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 Equity Units or
Stripped Equity Units 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
-62-
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 Equity Units or Stripped Equity Units 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 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
-63-
with the same effect as if such successor Agent had itself authenticated and
executed such Equity Units and Stripped Equity Units.
Section 7.12 PRESERVATION OF INFORMATION; COMMUNICATIONS TO
HOLDERS.
(a) The Agent shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders received by
the Agent in its capacity as Registrar.
(b) If three or more Holders (herein referred to as
"Applicants") apply in writing to the Agent, and furnish to the Agent
reasonable proof that each such applicant has owned Equity Units or
Stripped Equity Units, as the case may be, for a period of at least six
months preceding the date of such application, and such application
states that the Applicants desire to communicate with other Holders
with respect to their rights under this Agreement or under the Equity
Units or Stripped Equity Units, as the case may be, and is accompanied
by a copy of the form of proxy or other communication which such
Applicants propose to transmit, then the Agent shall mail to all the
Holders copies of the form of proxy or other communication which is
specified in such request, with reasonable promptness after a tender to
the Agent of the materials to be mailed and of payment, or provision,
in the absence of bad faith, satisfactory to the Agent for the payment,
of the reasonable expenses of such mailing.
Section 7.13 FAILURE TO ACT.
In the event of any ambiguity in the provisions of any Transaction
Document or any dispute between or conflicting claims by or among the parties
hereto or any other Person, the Agent shall be entitled, after prompt notice to
the Company and the Holders of Equity Units and Stripped Equity Units, at its
sole option, to refuse to comply with any and all such claims, demands or
instructions so long as such dispute or conflict shall continue, and the Agent
shall not be or become liable in any way to any of the parties hereto for its
failure or refusal to comply with such conflicting claims, demands or
instructions. The Agent shall be entitled to refuse to act until either (i) such
conflicting or adverse claims or demands shall have been finally determined by a
court of competent jurisdiction or settled by agreement between the conflicting
parties as evidenced in a writing, reasonably satisfactory to the Agent, or (ii)
the Agent shall have received security or an indemnity reasonably satisfactory
to the Agent sufficient to save the Agent harmless from and against any and all
loss, liability or reasonable out-of-pocket expense which the Agent may incur by
reason of its acting without bad faith, willful misconduct or gross negligence.
The Agent may in addition elect to commence an interpleader action or seek other
judicial relief or orders as the Agent may deem necessary. Notwithstanding
anything contained herein to the contrary, the Agent shall not be required to
take any action that is in its opinion contrary to law or to the terms of any
Transaction Document, or which would in its opinion subject it or any of its
officers, employees or directors to liability.
Section 7.14 NO OBLIGATIONS OF AGENT.
Except to the extent otherwise provided in this Agreement, the Agent
assumes no obligation and shall not be subject to any liability under this
Agreement, the Pledge Agreement or any Forward Purchase Contract in respect of
the obligations of the Holder of any Equity Units or
-64-
Stripped Equity Units thereunder. The Company agrees, and each Holder of a
Certificate, by such Holder's acceptance thereof, shall be deemed to have
agreed, that the Agent's execution of the Certificates on behalf of the Holders
shall be solely as agent and attorney-in-fact for the Holders, and that the
Agent shall have no obligation to perform such 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 Equity Units and Stripped Equity Units. 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.
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
-65-
(c) to evidence and provide for the acceptance of appointment
hereunder by a successor Agent; or
(d) to make provision with respect to the rights of Holders
pursuant to the requirements of Section 5.6(b) or 5.10; or
(e) to cure any ambiguity, to correct or supplement any
provisions herein which may be inconsistent with any other provisions
herein, or to make any other provisions with respect to such matters or
questions arising under this Agreement, provided such action shall not
adversely affect the interests of the Holders; 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 Equity Units and Stripped Equity Units; provided, that,
except as contemplated herein, no such supplemental agreement shall,
without the consent of the Holder of each Outstanding Units 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 Collateral
(except as provided in Section 8.1(f) and except for the
rights of Holders of Equity Units 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
Equity Units 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) reduce any Contract Adjustment Payments, if any, or
any Deferred Contract Adjustment Payment, or change any place
where, or the coin or currency in which, any Contract
Adjustment Payment is payable;
(4) impair the right to institute suit for the
enforcement of any Forward Purchase Contract, any Contract
Adjustment Payment, if any, or any Deferred Contract
Adjustment Payment, if any;
-66-
(5) impair the right to institute suit for the
enforcement of any Forward Purchase Contract;
(6) 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
(7) 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 Equity Units or the Stripped Equity Units, then only
the affected class of Holder as of the record date for the
Holders entitled to vote thereon will be entitled to vote on
such amendment or proposal, and such amendment or proposal
shall not be effective except with the consent of Holders of
not less than a majority or 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 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
-67-
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.
(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 Units, the Remarketing Agreement and the
Pledge Agreement.
-68-
(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 Units 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 Equity Units and Stripped Equity Units 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 payment of Contract Adjustment Payments,
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 Equity Units and where
notices and demands to or upon the Company in respect of the Equity
Units and Stripped Equity Units and this Agreement may be served. The
Company will give prompt written notice to the Agent of the location,
and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or
agency or shall fail to furnish the Agent with the address thereof,
such presentations, surrenders, notices and demands may be made or
served at the Corporate Trust Office, 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.
(b) The Company may also from time to time designate one or
more other offices or agencies where Certificates may be presented or
surrendered for any or all such purposes and may from time to time
rescind such designations; provided, that no such designation or
rescission shall in any manner relieve the Company of its obligation to
maintain an office or agency in the Borough of Manhattan, The City of
New York for such purposes. The Company will give prompt written notice
to the Agent of any such designation or rescission and of any change in
the location of any such other office or agency. The Company hereby
designates as the place of payment for the Equity Units and Stripped
Equity Units 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.
-69-
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 Equity Units and Stripped Equity Units evidenced by outstanding
Certificates.
Section 10.4 COVENANTS AS TO COMMON STOCK.
The Company covenants that all shares of Common Stock which may be
issued against tender of payment in respect of any Forward Purchase Contract
constituting a part of the Outstanding Units will, upon issuance, be duly
authorized, validly issued, fully paid and nonassessable.
Section 10.5 STATEMENTS OF OFFICER OF THE COMPANY AS TO DEFAULT.
The Company will deliver to the Agent, within 120 days after the end of
each fiscal year of the Company ending after the date hereof, an Officer's
Certificate, stating whether or not to the best knowledge of the signer thereof
the Company is in default in the performance and observance of any of the terms,
provisions and conditions hereof, and if the Company shall be in default,
specifying all such defaults and the nature and status thereof of which such
officer may have knowledge.
Section 10.6 ERISA.
Each Holder from time to time of the Equity Units or Stripped Equity
Units which is a Plan hereby represents that its acquisition of the Equity Units
or Stripped Equity Units 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]
-70-
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
AMERICAN ELECTRIC POWER COMPANY, INC.
By:
--------------------------------
Name:
Title:
[ ]
as Forward Purchase Contract Agent
By:
--------------------------------
Name:
Title:
EXHIBIT A
FORM OF EQUITY UNITS 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 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx) to the
Company or its agent for registration of transfer, exchange or payment, and any
Certificate issued is registered in the name of Cede & Co., or such other name
as requested by an authorized representative of The Depository Trust Company,
and any payment hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL since the registered owner
hereof, Cede & Co., has an interest herein.]
(Form of Face of Equity Units Certificate)
No. ______________ CUSIP No. ____________
Number of Equity Units____________
This Equity Units Certificate certifies that [For inclusion in Global
Certificates only -- Cede & Co.] is the registered Holder of the number of
Equity Units set forth above [For inclusion in Global Certificates only - or
such other number of Equity Units reflected in the Schedule of Increases or
Decreases in Global Certificates attached hereto]. Each Equity Unit represents
(i) either (a) beneficial ownership by the Holder of one [ ]% Senior Note Due [
], 2007 (the "Note") of American Electric Power Company, Inc., a New York
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.
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
A-1
each Equity Units 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 Equity Units.
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 Equity Units 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 Stock Purchase Date (as defined herein) in accordance with the
terms of the Pledge Agreement, in full satisfaction of the respective
obligations of the Holders of the Equity Units 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 Equity Units. Quarterly distributions on Equity
Units 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 [ ], [ ], [ ] and [ ] each year,
commencing [ ], 2002 (a "Payment Date"), shall, subject to receipt thereof by
the Agent from the Collateral Agent (if the Collateral Agent is the registered
owner thereof), be paid to the Person in whose name this Equity Units
Certificate (or a Predecessor Equity Units 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 Equity Units Certificate to purchase, and the Company to sell, on [ ], 2005
(the "Stock Purchase Date"), at a price equal to $50 (the "Stated Amount"), a
number of newly issued shares of common stock, $6.50 par value per share
("Common Stock"), of the Company, equal to the Settlement Rate unless on or
prior to the Stock Purchase Date there shall have occurred a Termination Event
or a Cash Settlement, Early Settlement or Merger Early Settlement with respect
to the Equity Units 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 (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 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
A-2
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 Equity Units Register or by wire transfer to an
account specified by such Person at least five Business Days prior to the
applicable Payment Date.
The Company shall pay on each Payment Date in respect of each Forward
Purchase Contract forming part of an Equity Unit evidenced hereby an amount (the
"Contract Adjustment Payment") equal to [ ]% per year of the Stated Amount,
computed on the basis of a 360-day year of twelve 30-day months, subject to
deferral at the option of the Company as provided in the Forward Purchase
Contract Agreement and more fully described on the reverse hereof (provided that
if any date on which a Contract Adjustment Payment is to be made on the Forward
Purchase Contracts is not a Business Day, then payment of such Contract
Adjustment Payment payable on such date will be made on the next succeeding day
which is a Business Day, and no interest or payment will be paid in respect of
such delay, except that if such next succeeding Business Day is in the next
succeeding calendar year, then such payment will be made on the immediately
preceding Business Day). Such Contract Adjustment Payments shall be payable to
the Person in whose name this Equity Units Certificate (or a Predecessor Equity
Units Certificate) is registered at the close of business on the Record Date for
such Payment Date.
Contract Adjustment Payments will be payable at the Office of the Agent
in The City of New York or, at the option of the Company, by check mailed to the
address of the Person entitled thereto as such address appears on the Equity
Units Register or by wire transfer to the account designated to the Agent by a
prior written notice by such Person delivered 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 Equity Units 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.
AMERICAN ELECTRIC POWER COMPANY, INC.
By:
--------------------------------
Name:
Title:
HOLDER SPECIFIED ABOVE (as to
obligations of such Holder under the
Forward Purchase Contracts evidenced
hereby)
By: [], not individually but solely
as Attorney-in-Fact of such Holder
By:
--------------------------------
Authorized Signatory
A-4
AGENT'S CERTIFICATE OF AUTHENTICATION
This is one of the Equity Units Certificates referred to in the
within-mentioned Forward Purchase Contract Agreement.
[ ],
as Forward Purchase Contract Agent
Dated: By:
---------------------------------- ---------------------------------
Authorized Signatory
A-5
(Form of Reverse of Equity Units Certificate)
Each Forward Purchase Contract evidenced hereby is governed by a
Forward Purchase Contract Agreement, dated as of June [ ], 2002 (as may be
supplemented from time to time, the "Forward Purchase Contract Agreement"),
between the Company and [ ], 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 Equity Units Certificates are, and are to be,
executed and delivered.
Each Forward Purchase Contract evidenced hereby obligates the Holder of
this Equity Units Certificate to purchase, and the Company to sell, on the 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, unless, on or prior
to the Stock Purchase Date, there shall have occurred a Termination Event or an
Early Settlement, Merger Early Settlement or Cash Settlement with respect to the
Units 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 $[ ] (the "Threshold Appreciation Price"), [ ] 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 $[ ], the number of
shares of Common Stock per Forward Purchase Contract equal to the Stated Amount
of the related Equity Units divided by the Applicable Market Value and (c) if
the Applicable Market Value is less than or equal to $[ ], [ ] 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 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
A-6
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 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 Equity Units 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 Equity Units represented
by this Equity Units 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
Equity Units Certificate. If, as provided in the Forward Purchase Contract
Agreement, upon the occurrence of the Last Failed 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 Equity Units
Certificate, any accrued and unpaid interest on such Pledged Notes will become
payable by the Company to the Holder of this Equity Units Certificate in the
manner provided for in the Forward Purchase Contract Agreement.
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
Equity Units a notice (a) containing such information as is contained in the
notice or solicitation, (b) stating that each such Holder on the record date set
by the Agent therefor (which, to the extent possible, shall be the same date as
the record date for determining the holders of Notes entitled to vote) shall be
entitled to instruct the Agent as to the exercise of the voting rights
pertaining to the Pledged Notes constituting a part of such Holder's Equity
Units and (c) stating the manner in which such instructions may be given. Upon
the written request of the Holders of Equity Units on such record date, the
Agent shall endeavor insofar as practicable to vote or cause to be voted, in
accordance with the instructions set forth in such requests, the maximum number
of Pledged Notes as to which any particular voting instructions are received. In
the absence of specific instructions from the Holder of an Equity Unit, the
Agent shall abstain from voting the Pledged Note evidenced by such Equity Units.
A-7
The Equity Units Certificates are issuable only in registered form and
only in denominations of a single Equity Unit and any integral multiple thereof.
The transfer of any Equity Units Certificate will be registered and Equity Units
Certificates may be exchanged as provided in the Forward Purchase Contract
Agreement. The Equity Units 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 Equity Units 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 Units for which such Pledged Treasury Securities secure the Holder's
obligation under the Forward Purchase Contract shall be referred to as a
"Stripped Equity Units." 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 Equity Units, 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
Equity Unit remains in effect, such Equity Units shall not be separable into its
constituent parts, and the rights and obligations of the Holder of such Equity
Units 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 Equity Units may be transferred and
exchanged only as an Equity Units.
A Holder of Stripped Equity Units may reestablish Equity Units 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.
Subject to the next succeeding paragraph, the Company shall pay on each
Payment Date, the Contract Adjustment Payments, if any, payable in respect of
each Forward Purchase Contract to the Person in whose name the Equity Units
Certificate evidencing such Forward Purchase Contract is registered at the close
of business on the Record Date for such Payment Date. Contract Adjustment
Payments, if any, will be payable at the office of the Agent in the City of New
York or, at the option of the Company, by check mailed to the address of the
Person entitled thereto at such address as it appears on the Equity Units
Register or by wire transfer to the account designated by such Person in writing
at least five Business Days prior to the applicable Payment Date.
The Company shall have the right, at any time prior to the Stock
Purchase Date, to defer the payment of any or all of the Contract Adjustment
Payments otherwise payable on any Payment Date, but only if the Company shall
give the Holders and the Agent written notice of its election to defer Contract
Adjustment Payments as provided in the Forward Purchase Contract Agreement. Any
Contract Adjustment Payments so deferred shall, to the extent permitted by law,
bear additional Contract Adjustment Payments thereon at the rate of [ ]% per
year (computed on the basis of a 360-day year of twelve 30-day months),
compounding on each succeeding Payment
A-8
Date, until paid in full (such deferred installments of Contract Adjustment
Payments, if any, together with the additional Contract Adjustment Payments, if
any, accrued thereon, are referred to herein as the "Deferred Contract
Adjustment Payments"). Deferred Contract Adjustment Payments, if any, shall be
due on the next succeeding Payment Date except to the extent that payment is
deferred pursuant to the Forward Purchase Contract Agreement. No Contract
Adjustment Payments may be deferred to a date that is after the Stock Purchase
Date and no such deferral period may end other than on a Payment Date.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments on the Forward Purchase Contracts until a Payment Date prior
to the Stock Purchase Date, then all Deferred Contract Adjustment Payments, if
any, shall be payable to the registered Holders as of the close of business on
the Record Date immediately preceding such Payment Date.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments on the Forward Purchase Contracts until the Stock Purchase
Date, the Holder of this Equity Units Certificate will receive on the Stock
Purchase Date, in lieu of a cash payment, a number of shares of Common Stock (in
addition to the number of shares of Common Stock equal to the Settlement Rate)
equal to (i) the aggregate amount of Deferred Contract Adjustment Payments
payable to the Holder of this Equity Units Certificate divided by (ii) the
Applicable Market Value.
In the event the Company exercises its option to defer the payment of
Contract Adjustment Payments, then, until the Deferred Contract Adjustment
Payments have been paid, the Company shall not declare or pay dividends on, make
distributions with respect to, or redeem, purchase or acquire, or make a
liquidation payment with respect to, any of its Common Stock other than (i)
purchases, redemptions or acquisitions of shares of Common Stock in connection
with any employment contract, benefit plan or other similar arrangement with or
for the benefit of employees, officers or directors or a stock purchase or
dividend reinvestment plan, or the satisfaction by the Company of its
obligations pursuant to any contract or security outstanding on the date the
Company exercises its rights to defer the Contract Adjustment Payments; (ii) as
a result of a reclassification of the Company's Capital Stock or the exchange or
conversion of one class or series of for another class or series of the
Company's Capital Stock; (iii) the purchase of fractional interests in shares of
any series of the Company's Common Stock pursuant to the conversion or exchange
provisions of such Common Stock or the security being converted or exchanged;
(iv) dividends or distributions in any series of the Company's Common Stock (or
rights to acquire Common Stock) or repurchases, acquisitions or redemptions of
Common Stock in connection with the issuance or exchange of any series of Common
Stock (or securities convertible into or exchangeable for shares of the
Company's Common Stock; or (v) redemptions, exchanges or repurchases of any
rights outstanding under a shareholder rights plan or the declaration or payment
thereunder of a dividend or distribution of or with respect to rights in the
future.
The 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 receive and the obligation of the Company to
pay Contract Adjustment Payments, if any, or any Deferred Contract Adjustment
Payments, and the rights of the Holders to purchase Common
A-9
Stock, shall immediately and automatically terminate, without the necessity of
any notice or action by any Holder, the Agent or the Company, if, on or prior to
the Stock Purchase Date, a Termination Event shall have occurred. Upon the
occurrence of a Termination Event, the Company shall promptly but in no event
later than two Business Days thereafter give written notice to the Agent, the
Collateral Agent and to the Holders, at their addresses as they appear in the
Equity Units Register. Upon and after the occurrence of a Termination Event, the
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 Equity Units 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 Equity Units Certificate. The Company covenants and
agrees, and the Holder, by its acceptance hereof, likewise covenants and agrees,
to be bound by the provisions of this paragraph.
The Holder of this Equity Units Certificate, by its acceptance hereof,
authorizes the Agent to enter into and perform the related Forward Purchase
Contracts forming part of the Equity Units 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 Equity Units Certificate pursuant to the Pledge
Agreement, provided, that upon a Termination Event, the rights of the Holder of
such Units 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 Equity Units or Stripped Equity
Units, and each Beneficial Owner thereof, by its acceptance thereof or of its
interest therein, further agrees to treat (i) the purchase of Equity Units as
the purchase of a unit consisting of the Forward 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.
A-10
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 Equity Units Certificate is registered as
the owner of the Equity Units 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, receiving
payments of Contract Adjustment Payments, if any, and any Deferred Contract
Adjustment Payments, 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-11
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
UNIF GIFT MIN ACT - Custodian
(cust) (minor)
Under Uniform Gifts to Minors Act
(State)
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship
and not as tenants in common
Additional abbreviations may also be used though not in the above list.
A-12
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
(Please insert Social Security or Taxpayer I.D. or other Identifying
Number of Assignee)
(Please Print or Type Name and Address Including Postal Zip Code of
Assignee)
the within Equity Units Certificate and all rights thereunder, hereby
irrevocably constituting and appointing ___________________________ attorney to
transfer said Equity Units Certificate on the books of American Electric Power
Company, Inc. with full power of substitution in the premises.
Dated: _________________________
Signature: _____________________________
NOTICE: The signature to this assignment must correspond with the name
as it appears upon the face of the within Equity Units Certificate in every
particular, without alteration or enlargement or any change whatsoever.
Signature Guarantee: ___________________________.
A-13
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
Equity Units evidenced by this Equity Units Certificate be registered in the
name of, and delivered, together with a check in payment for any fractional
share, to the undersigned at the address indicated below unless a different name
and address have been indicated below. If shares are to be registered in the
name of a Person other than the undersigned, the undersigned will pay any
transfer tax payable incident thereto.
Dated: Signature:
------------------------- -------------------------
Signature Guarantee: _______________
(if assigned to another person)
If shares are to be registered in the name of REGISTERED HOLDER and delivered to
a Person other than the Holder, please (i) print such Person's name Please print
name and address of and address and (ii) provide a guarantee of Registered
Holder: your signature:
Name Name
Address Address
Social Security or other Taxpayer
Identification Number, if any
A-14
ELECTION TO SETTLE EARLY
The undersigned Holder of this Equity Units 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 Equity Units evidenced by this
Equity Units Certificate specified below. The option to effect Early Settlement
may be exercised only with respect to Forward Purchase Contracts underlying
Equity Units 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 Equity Units Certificate representing
any Equity Units 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 Units evidenced hereby as to which Early Settlement of the
related Forward Purchase Contracts is being elected:
If shares of Common Stock are to be registered REGISTERED HOLDER
in the name of and delivered to and Pledged
Notes, Pledged Treasury Consideration or Please print name and address
Pledged Applicable Ownership Interest in the of Registered Holder:
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-15
(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-16
EXHIBIT B
FORM OF STRIPPED EQUITY UNITS 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 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx) to the
Company or its agent for registration of transfer, exchange or payment, and any
Certificate issued is registered in the name of Cede & Co., or such other name
as requested by an authorized representative of The Depository Trust Company,
and any payment hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL since the registered owner
hereof, Cede & Co., has an interest herein.]
(Form of Face of Stripped Equity Units Certificate)
No. CUSIP No. ____________
Number of Stripped Equity Units
This Stripped Equity Units Certificate certifies that [For inclusion in
Global Certificates only -- Cede & Co.] is the registered Holder of the number
of Stripped Equity Units set forth above [For inclusion in Global Certificates
only - or such other number of Stripped Equity Units reflected in the Schedule
of Increases or Decreases in Global Certificate attached hereto]. Each Stripped
Equity Units 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 American
Electric Power Company, Inc., a New York 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 Equity Units 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 Equity Units.
Each Forward Purchase Contract evidenced hereby obligates the Holder of
this Stripped Equity Units Certificate to purchase, and the Company to sell, on
the Stock Purchase Date, at a price equal to $50 (the "Stated Amount"), a number
of shares of common stock, $6.50 par value
B-1
per share ("Common Stock"), of the Company, equal to the Settlement Rate, unless
on or prior to the Stock Purchase Date there shall have occurred a Termination
Event or an Early Settlement, Merger Early Settlement or Cash Settlement with
respect to the Stripped Equity Units 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 (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 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.
The Company shall pay on each Payment Date in respect of each Forward
Purchase Contract forming part of a Stripped Equity Units evidenced hereby an
amount (the "Contract Adjustment Payments") equal to [ ]% per year of the Stated
Amount, computed on the basis of a 360-day year of 12 30-day months, subject to
deferral at the option of the Company as provided in the Forward Purchase
Contract Agreement and more fully described on the reverse hereof (provided that
if any date on which Contract Adjustment Payments are to be made on the Forward
Purchase Contracts is not a Business Day, then payment of the Contract
Adjustment Payments payable on that date will be made on the next succeeding day
which is a Business Day, and no interest or payment will be paid in respect of
the delay, except that if such next succeeding Business Day is in the next
succeeding calendar year, such payment will be made on the immediately preceding
Business Day). Such Contract Adjustment Payments shall be payable to the Person
in whose name this Stripped Equity Units Certificate (or a Predecessor Stripped
Equity Units Certificate) is registered at the close of business on the Record
Date for such Payment Date.
Contract Adjustment Payments, if any, will be payable at the Office of
the Agent in the City of New York or, at the option of the Company, by check
mailed to the address of the Person entitled thereto at such address as it
appears on the Stripped Equity Units Register or by wire transfer to the account
designated by such Person in writing 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 Stripped Equity Units 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.
AMERICAN ELECTRIC POWER COMPANY, INC.
By:
---------------------------------
Name:
Title:
HOLDER SPECIFIED ABOVE (as to obligations of such
Holder under the Forward Purchase Contracts)
By: [ ], not individually but solely as Attorney-in-Fact
of such Holder
By:
---------------------------------
Authorized Signatory
B-3
AGENT'S CERTIFICATE OF AUTHENTICATION
This is one of the Stripped Equity Units referred to in the
within-mentioned Forward Purchase Contract Agreement.
[ ],
as Forward Purchase Contract Agent
Dated: By:
----------------------------- ----------------------------------
Authorized Signatory
B-4
(Reverse of Stripped Equity Units Certificate)
Each Forward Purchase Contract evidenced hereby is governed by a
Forward Purchase Contract Agreement, dated as of June [ ], 2002 (as may be
supplemented from time to time, the "Forward Purchase Contract Agreement"),
between the Company and [ ], 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 Equity Units Certificates are, and are to
be, executed and delivered.
Each Forward Purchase Contract evidenced hereby obligates the Holder of
this Stripped Equity Units Certificate to purchase, and the Company to sell, on
the 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, unless,
on or prior to the Stock Purchase Date, there shall have occurred a Termination
Event or an Early Settlement or Merger Early Settlement with respect to the
Stripped Equity Units 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 $[ ] (the "Threshold Appreciation Price"), [
] 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
$[ ], the number of shares of Common Stock per Forward Purchase Contract equal
to the Stated Amount of the related Stripped Equity Units divided by the
Applicable Market Value and (c) if the Applicable Market Value is less than or
equal $[ ], [ ] 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 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
B-5
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 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 Equity Units 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 Equity
Units represented by this Stripped Equity Units 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 Equity Units Certificates are issuable only in registered
form and only in denominations of a single Stripped Equity Units and any
integral multiple thereof. The transfer of any Stripped Equity Units Certificate
will be registered and Stripped Equity Units Certificates may be exchanged as
provided in the Forward Purchase Contract Agreement. The Stripped Equity Units
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 Equity Units 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 Units 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 "Equity Unit." 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 Equity Units, 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 Equity Unit remains in effect, such Stripped Equity Units shall not be
separable into its constituent parts, and the rights and obligations of the
Holder of such Stripped Equity Units in respect of the Pledged Treasury Security
and the Forward Purchase Contract constituting such Stripped Equity Units may be
transferred and exchanged only as a Stripped Equity Unit.
Subject to the next succeeding paragraph, the Company shall pay on each
Payment Date, the Contract Adjustment Payments, if any, payable in respect of
each Forward Purchase Contract
B-6
to the Person in whose name the Stripped Equity Units Certificate evidencing
such Forward Purchase Contract is registered at the close of business on the
Record Date for such Payment Date. Contract Adjustment Payments, if any, will be
payable at the Office of the Agent in the City of New York or, at the option of
the Company, by check mailed to the address of the Person entitled thereto at
such address as it appears on the Stripped Equity Units Register or by wire
transfer to the account designated by such Person in writing at least five
Business Days prior to the applicable Payment Date.
The Company shall have the right, at any time prior to the Stock
Purchase Date, to defer the payment of any or all of the Contract Adjustment
Payments otherwise payable on any Payment Date, but only if the Company shall
give the Holders and the Agent written notice of its election to defer Contract
Adjustment Payments as provided in the Forward Purchase Contract Agreement. Any
Contract Adjustment Payments so deferred shall, to the extent permitted by law,
bear additional Contract Adjustment Payments thereon at the rate of [ ]% per
year (computed on the basis of a 360-day year of twelve 30-day months),
compounding on each succeeding Payment Date, until paid in full (such deferred
installments of Contract Adjustment Payments, if any, together with the
additional Contract Adjustment Payments, if any, accrued thereon, are referred
to herein as the "Deferred Contract Adjustment Payments"). Deferred Contract
Adjustment Payments, if any, shall be due on the next succeeding Payment Date
except to the extent that payment is deferred pursuant to the Forward Purchase
Contract Agreement. No Contract Adjustment Payments may be deferred to a date
that is after the Stock Purchase Date and no such deferral period may end other
than on a Payment Date.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments on the Forward Purchase Contracts until a Payment Date prior
to the Stock Purchase Date, then all Deferred Contract Adjustment Payments, if
any, shall be payable to the registered Holders as of the close of business on
the Record Date immediately preceding such Payment Date.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments on the Forward Purchase Contracts until the Stock Purchase
Date, the Holder of this Stripped Equity Units Certificate will receive on the
Stock Purchase Date, in lieu of a cash payment, a number of shares of Common
Stock (in addition to the number of shares of Common Stock equal to the
Settlement Rate) equal to (i) the aggregate amount of Deferred Contract
Adjustment Payments payable to the Holder of this Stripped Equity Units
Certificate divided by (ii) the Applicable Market Value.
In the event the Company exercises its option to defer the
payment of Contract Adjustment Payments, then, until the Deferred Contract
Adjustment Payments have been paid, the Company shall not declare or pay
dividends on, make distributions with respect to, or redeem, purchase or
acquire, or make a liquidation payment with respect to, any of its Common Stock
other than (i) purchases, redemptions or acquisitions of shares of Common Stock
in connection with any employment contract, benefit plan or other similar
arrangement with or for the benefit of employees, officers or directors or a
stock purchase or dividend reinvestment plan, or the satisfaction by the Company
of its obligations pursuant to any contract or security outstanding on the date
the Company exercises its rights to defer the Contract Adjustment Payments; (ii)
as a result of a reclassification of the Company's Capital Stock or the exchange
or conversion of one
B-7
class or series of the Company's Capital Stock for another class or series of
the Company's Capital Stock; (iii) the purchase of fractional interests in
shares of any series of the Company's Common Stock pursuant to the conversion or
exchange provisions of such Common Stock or the security being converted or
exchanged; (iv) dividends or distributions in any series of the Company's Common
Stock (or rights to acquire Common Stock) or repurchases, acquisitions or
redemptions of Common Stock in connection with the issuance or exchange of any
series of Common Stock (or securities convertible into or exchangeable for
shares of the Company's Common Stock; or (v) redemptions, exchanges or
repurchases of any rights outstanding under a shareholder rights plan or the
declaration or payment thereunder of a dividend or distribution of or with
respect to rights in the future.
The 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 receive and the obligation of the Company to pay
Contract Adjustment Payments, if any, or any Deferred Contract Adjustment
Payments, and the rights and obligations of Holders to purchase Common Stock,
shall immediately and automatically terminate, without the necessity of any
notice or action by any Holder, the Agent or the Company, if, on or prior to the
Stock Purchase Date, a Termination Event shall have occurred. Upon the
occurrence of a Termination Event, the Company shall promptly but in no event
later than two Business Days thereafter give written notice to the Agent, the
Collateral Agent and to the Holders, at their addresses as they appear in the
Stripped Equity Units Register. Upon and after the occurrence of a Termination
Event, the Collateral Agent shall release the Pledged Treasury Securities from
the Pledge in accordance with the provisions of the Pledge Agreement.
Upon registration of transfer of this Stripped Equity Units
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 Equity Units 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 Equity Units Certificate, by its acceptance
hereof, authorizes the Agent to enter into and perform the related Forward
Purchase Contracts forming part of the Stripped Equity Units 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 Equity Units Certificate pursuant
to the Pledge Agreement, provided, that upon a Termination Event, the rights of
the Holder of such Units 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
B-8
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 Equity Units or Stripped Equity
Units, and each Beneficial Owner thereof, by its acceptance thereof or of its
interest therein, further agrees to treat (i) the purchase of Equity Units 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.
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 Equity Units Certificate is
registered as the owner of the Stripped Equity Units evidenced hereby for the
purpose of receiving any Contract Adjustment Payments and any Deferred Contract
Adjustment Payments, 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.
B-9
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
UNIF GIFT MIN ACT - Custodian
(cust) (minor)
Under Uniform Gifts to Minors Act
(State)
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and
not as tenants in common
Additional abbreviations may also be used though not in the above list.
B-10
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
(Please insert Social Security or Taxpayer I.D. or other Identifying
Number of Assignee)
(Please Print or Type Name and Address Including Postal Zip Code of
Assignee)
the within Stripped Equity Units Certificate and all rights thereunder, hereby
irrevocably constituting and appointing ____________________________ attorney to
transfer said Stripped Equity Units Certificate on the books of American
Electric Power Company, Inc. with full power of substitution in the premises.
Dated: Signature:
----------------------- -------------------------
NOTICE: The signature to this assignment must
correspond with the name as it appears upon
the face of the within Stripped Equity Units
Certificate in every particular, without
alteration or enlargement or any change
whatsoever.
Signature Guarantee:
-----------------------------------------------------------
B-11
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 Equity Units evidenced by this Stripped Equity Units 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-12
ELECTION TO SETTLE EARLY
The undersigned Holder of this Stripped Equity Units 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 Equity Units evidenced by
this Stripped Equity Units Certificate specified below. The option to effect
Early Settlement may be exercised only with respect to Forward Purchase
Contracts underlying Stripped Equity Units 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 Equity Units
Certificate representing any Stripped Equity Units 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:
-------------------------------
(if assigned to another person)
Number of Stripped Equity Units 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-13
(TO BE ATTACHED TO GLOBAL CERTIFICATES)
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The following increases or decreases in this Global Certificate have
been made:
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-14
EXHIBIT C
INSTRUCTION FROM FORWARD PURCHASE CONTRACT AGENT
TO COLLATERAL AGENT
[ ]
[Address]
Attention: Corporate Trust Department
Re: EQUITY UNITS OF AMERICAN ELECTRIC POWER COMPANY, INC. (THE "COMPANY")
We hereby notify you in accordance with Section [4.1] [4.2] of the
Pledge Agreement, dated as of June [ ], 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 [Equity Units] [Stripped Equity Units] from time to time, that the
Holder of Equity Units and Stripped Equity Units listed below (the "Holder") has
elected to substitute [$_____ aggregate principal amount of Treasury Securities
(CUSIP No. _____________)] [$_______ 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 [Equity Units] [Stripped
Equity Units] to us in accordance with the Holder's instructions. Capitalized
terms used herein but not defined shall have the meaning set forth in the Pledge
Agreement.
Date:
------------------------------
[ ],
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
[ ],
as Forward Purchase Contract Agent
[Address]
Attention: Corporate Trust Department
Telecopy: [ ]
Re: EQUITY UNITS OF AMERICAN ELECTRIC POWER COMPANY, INC. (THE "COMPANY")
The undersigned Holder hereby notifies you that it has delivered to [ ], as
Collateral Agent, Custodial Agent and Securities Intermediary [$_______
aggregate principal amount of Treasury Securities (CUSIP No. ______________)]
[$_______ 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 June [ ], 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 [Equity Units] [Stripped Equity
Units]. 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
[ ],
as Forward Purchase Contract Agent
[Address]
Attention: Corporate Trust Department
Telecopy: [ ]
Re: EQUITY UNITS OF AMERICAN ELECTRIC POWER COMPANY, INC. (THE "COMPANY")
The undersigned Holder hereby irrevocably notifies you in accordance
with Section 5.4 of the Forward Purchase Contract Agreement dated as of June [
], 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 Equity Units.
Date: Signature:
---------------------------- ------------------------------
Signature Guarantee:--------------------
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
Please print name and address of Registered Holder:
Social Security or other Taxpayer Identification Number, if any:
F-1
