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Exhibit 4.4
K N ENERGY, INC.
AND
U.S. BANK TRUST NATIONAL ASSOCIATION,
AS PURCHASE CONTRACT AGENT
PURCHASE CONTRACT AGREEMENT
DATED AS OF NOVEMBER 25, 1998
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TABLE OF CONTENTS
PAGE
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.01. Definitions..................................................................... 1
SECTION 1.02. Compliance Certificates and Opinions............................................ 9
SECTION 1.03. Form of Documents Delivered to Agent............................................ 10
SECTION 1.04. Acts of Holders; Record Dates................................................... 10
SECTION 1.05. Notices, Etc., to Agent and the Company......................................... 12
SECTION 1.06. Notice to Holders; Waiver....................................................... 13
SECTION 1.07. Effect of Headings and Table of Contents........................................ 13
SECTION 1.08. Successors and Assigns.......................................................... 13
SECTION 1.09. Separability Clause............................................................. 13
SECTION 1.10. Benefits of Agreement........................................................... 13
SECTION 1.11. Governing Law................................................................... 14
SECTION 1.12. Legal Holidays.................................................................. 14
SECTION 1.13. Counterparts.................................................................... 14
SECTION 1.14. Inspection of Agreement......................................................... 14
SECTION 1.15. Appointment of Financial Institution as Agent for the
Company............................................................................... 14
ARTICLE 2
SECURITY CERTIFICATE FORMS
SECTION 2.01. Forms of Security Certificates Generally........................................ 15
SECTION 2.02. Form of Agent's Certificate of Authentication................................... 17
ARTICLE 3
THE SECURITIES
SECTION 3.01. Title and Terms; Denominations.................................................. 17
SECTION 3.02. Rights and Obligations Evidenced by the Security
Certificates.......................................................................... 18
SECTION 3.03. Execution, Authentication, Delivery and Dating.................................. 18
SECTION 3.04. Temporary Security Certificates................................................. 19
SECTION 3.05. Registration; Registration of Transfer and Exchange............................. 20
SECTION 3.06. Mutilated, Destroyed, Lost and Stolen Security Certificates..................... 22
SECTION 3.07. Persons Deemed Owners........................................................... 23
SECTION 3.08. Cancellation.................................................................... 24
SECTION 3.09. Securities Not Separable........................................................ 24
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PAGE
SECTION 3.10. No Consent to Assumption........................................................ 24
ARTICLE 4
THE TREASURY SECURITIES
SECTION 4.01. Payment of Interest; Interest Rights Preserved.................................. 25
SECTION 4.02. Transfer of Treasury Securities Upon Occurrence of
Termination Event..................................................................... 26
SECTION 4.03. Substitution of Collateral...................................................... 27
ARTICLE 5
THE PURCHASE CONTRACTS
SECTION 5.01. Purchase of Shares of Common Stock.............................................. 28
SECTION 5.02. Contract Fees................................................................... 30
SECTION 5.03. Deferral of Payment Dates for Contract Fees..................................... 31
SECTION 5.04. Payment of Purchase Price....................................................... 33
SECTION 5.05. Issuance of Shares of Common Stock.............................................. 33
SECTION 5.06. Adjustment of Settlement Rate................................................... 34
SECTION 5.07. Notice of Adjustments and Certain Other Events.................................. 41
SECTION 5.08. Termination Event; Notice....................................................... 41
SECTION 5.09. Early Settlement................................................................ 42
SECTION 5.10. No Fractional Shares............................................................ 43
SECTION 5.11. Charges and Taxes............................................................... 44
ARTICLE 6
REMEDIES
SECTION 6.01. Unconditional Right of Holders to Receive Contract Fees
and Purchase Common Stock............................................................. 44
SECTION 6.02. Restoration of Rights and Remedies.............................................. 45
SECTION 6.03. Rights and Remedies Cumulative.................................................. 45
SECTION 6.04. Delay or Omission Not Waiver.................................................... 45
SECTION 6.05. Undertaking for Costs........................................................... 45
SECTION 6.06. Waiver of Stay or Extension Laws................................................ 46
ARTICLE 7
THE AGENT
SECTION 7.01. Certain Duties and Responsibilities............................................. 46
SECTION 7.02. Notice of Default............................................................... 47
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PAGE
SECTION 7.03. Certain Rights of Agent......................................................... 47
SECTION 7.04. Not Responsible for Recitals or Issuance of Securities.......................... 48
SECTION 7.05. May Hold Securities............................................................. 48
SECTION 7.06. Money Held in Custody........................................................... 49
SECTION 7.07. Compensation and Reimbursement.................................................. 49
SECTION 7.08. Corporate Agent Required; Eligibility........................................... 49
SECTION 7.09. Resignation and Removal; Appointment of Successor............................... 50
SECTION 7.10. Acceptance of Appointment by Successor.......................................... 51
SECTION 7.11. Merger, Conversion, Consolidation or Succession to
Business.............................................................................. 52
SECTION 7.12. Preservation of Information; Communications to Holders.......................... 52
SECTION 7.13. No Obligations of Agent......................................................... 52
SECTION 7.14. Tax Compliance.................................................................. 53
ARTICLE 8
SUPPLEMENTAL AGREEMENTS
SECTION 8.01. Supplemental Agreements Without Consent of Holders.............................. 53
SECTION 8.02. Supplemental Agreements with Consent of Holders................................. 54
SECTION 8.03. Execution of Supplemental Agreements............................................ 55
SECTION 8.04. Effect of Supplemental Agreements............................................... 55
SECTION 8.05. Reference to Supplemental Agreements............................................ 56
ARTICLE 9
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
SECTION 9.01. Covenant Not to Merge, Consolidate, Sell or Convey
Property Except Under Certain Conditions.............................................. 56
SECTION 9.02. Rights and Duties of Successor Corporation...................................... 56
SECTION 9.03. Opinion of Counsel to Agent..................................................... 57
ARTICLE 10
COVENANTS
SECTION 10.01. Performance under Purchase Contracts........................................... 57
SECTION 10.02. Maintenance of Office or Agency................................................ 58
SECTION 10.03. Company to Reserve Common Stock................................................ 58
SECTION 10.04. Covenant as to Common Stock.................................................... 58
SECTION 10.05. Statement of Officers of the Company as to Default............................. 59
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PURCHASE CONTRACT AGREEMENT, dated as of November 25, 1998, between K N
Energy, Inc., a Kansas corporation (the "COMPANY"), and U.S. Bank Trust National
Association, acting as purchase contract agent for the Holders (as defined
below) from time to time (the "AGENT").
RECITALS
The Company has duly authorized the execution and delivery of this
Agreement and the Security Certificates evidencing the Securities.
All things necessary to make the Company's obligations under the
Securities, when the Security Certificates are executed by the Company and
authenticated, executed on behalf of the Holders and delivered by the Agent, as
in this Agreement provided, the valid obligations of the Company, enforceable in
accordance with their terms, and to constitute these presents a valid agreement
of the Company, enforceable in accordance with its terms, have been done.
W I T N E S S E T H:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually agreed as follows:
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.01. Definitions. For all purposes of this Agreement, except
as otherwise expressly provided or unless the context otherwise requires:
(i) 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
(ii) 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.
"ACT" when used with respect to any Holder, has the meaning specified
in Section 1.04.
"AFFILIATE" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control
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with such specified Person. For the purposes of this definition, "control" when
used with respect to any specified Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"AGENT" means the Person named as the "Agent" in the first paragraph of
this instrument until a successor Agent shall have become such pursuant to the
applicable provisions of this Agreement, and thereafter "Agent" shall mean the
Person who is then the Agent hereunder.
"AGREEMENT" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more agreements
supplemental hereto entered into pursuant to the applicable provisions hereof.
"APPLICABLE MARKET VALUE" has the meaning specified in Section 5.01.
"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 Depositary, or on the books of a Person maintaining an account
with such Depositary (directly as a Depositary Participant or as an indirect
participant, in each case in accordance with the rules of such Depositary).
"BOARD OF DIRECTORS" means the board of directors of the Company or a
duly authorized committee of that board.
"BOARD RESOLUTION" means one or more resolutions of the Board of
Directors, a copy of which has been certified by the Secretary or an Assistant
Secretary of the Company to have been duly adopted by the Board of Directors and
to be in full force and effect on the date of such certification and delivered
to the Agent.
"BOOK ENTRY INTEREST" means a beneficial interest in a Global Security
Certificate registered in the name of a Depositary or a nominee thereof,
ownership and transfers of which shall be maintained and made through book
entries by such Depositary as described in Section 2.01.
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"BUSINESS DAY" means any day that is not a Saturday, a Sunday or a day
on which the NYSE or banking institutions or trust companies in The City of New
York are authorized or obligated by law or executive order to be closed.
"CLOSING PRICE" has the meaning specified in Section 5.01.
"COLLATERAL AGENT" means The Chase Manhattan Trust Company, National
Association, 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 4.03(a).
"COLLATERAL SUBSTITUTION DATE " has the meaning specified in Section
4.03(a).
"COMMON STOCK" means the common stock, par value $5.00 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 5.06(b).
"CONTRACT FEES" means the fees payable by the Company on each Payment
Date in respect of each Purchase Contract as provided in the Purchase Contract.
"CORPORATE TRUST OFFICE" means the principal corporate trust office of
the Agent at which, at any particular time, its corporate trust business shall
be administered, which office at the date hereof is located at One Illinois
Center, Suite 3000, 000 Xxxx Xxxxxx Xxxxx, Xxxxxxx, Xxxxxxxx 00000 Attention:
Corporate Trust Services Division, except that for purposes of Section 10.02,
such term shall mean the office or agency of the Agent in the Borough of
Manhattan, the City of New York, which office at the date hereof is located at
000 Xxxx Xxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx Xxxx 00000.
"COUPON SECURITY" means the collective rights and obligations of a
Holder of a Security Certificate in respect of Coupon Treasury Securities with a
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principal amount equal to the Stated Amount, subject to the Pledge thereof, and
a Purchase Contract.
"COUPON TREASURY SECURITIES" means Treasury Notes and security
entitlements in respect thereof.
"CURRENT MARKET PRICE" has the meaning specified in Section
5.06(a)(ix).
"DEFERRED CONTRACT FEES" has the meaning specified in Section 5.03.
"DEPOSITARY" means a clearing agency registered under the Exchange Act
that is designated to act as Depositary for the Securities as contemplated by
Section 2.01.
"DEPOSITARY PARTICIPANT" means a broker, dealer, bank, other financial
institution or other Person for whom from time to time the Depositary effects
book entry transfers and pledges of securities deposited with the Depositary.
"EARLY SETTLEMENT" has the meaning specified in Section 5.09(a).
"EARLY SETTLEMENT AMOUNT" has the meaning specified in Section
5.09(a).
"EARLY SETTLEMENT DATE" has the meaning specified in Section 5.09(a).
"EARLY SETTLEMENT RATE" has the meaning specified in Section 5.09(b).
"EVENT CONSIDERATION" has the meaning specified in Section 5.06(b).
"EXCHANGE ACT" means the Securities Exchange Act of 1934 and any
statute successor thereto, in each case as amended from time to time, and the
rules and regulations promulgated thereunder.
"EXCESS COUPON TREASURY SECURITIES" and "EXCESS ZERO-COUPON TREASURY
SECURITIES" have the respective meanings specified in Section 4.02.
"EXPIRATION DATE" has the meaning specified in Section 1.04.
"EXPIRATION TIME" has the meaning specified in Section 5.06(a)(vi).
"FINAL SETTLEMENT DATE" means November 30, 2001.
"FINAL SETTLEMENT FUND" has the meaning specified in Section 5.05.
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"GLOBAL SECURITY CERTIFICATE" means a Security Certificate that
evidences all or part of the Securities and is registered in the name of a
Depositary or a nominee thereof.
"HOLDER" when used with respect to a Security Certificate (or a
Security) means a Person in whose name the Security evidenced by such Security
Certificate (or the Security Certificate evidencing such Security) is registered
in the Security Register, subject to Section 3.07.
"ISSUER ORDER" or "ISSUER REQUEST" means a written order or request
signed in the name of the Company by its Chairman of the Board, any Vice
Chairman, its President or a Vice President and by its Treasurer, an Assistant
Treasurer, its Secretary or an Assistant Secretary, and delivered to the Agent.
"MARKETABLE COMMON STOCK" has the meaning specified in Section
5.06(b).
"NYSE" means The New York Stock Exchange, Inc.
"OFFICERS' CERTIFICATE" means a certificate signed by the Chairman of
the Board, any Vice Chairman of the Board, the President or any Vice President
and by the Treasurer, an Assistant Treasurer, the Secretary or an Assistant
Secretary of the Company and delivered to the Agent.
"OPINION OF COUNSEL" means an opinion in writing signed by legal
counsel, who may be an employee of or counsel to the Company and who shall be
reasonably acceptable to the Agent.
"OUTSTANDING SECURITIES" means, as of the date of determination, all
Securities evidenced by then Outstanding Security Certificates, except:
(i) if a Termination Event has occurred, Securities for which (A) the
underlying Treasury Notes or Treasury Strips, as the case may be, have
been theretofore deposited with the Agent or (B) security entitlements
in respect of the underlying Treasury Notes or Treasury Strips, as the
case may be, have been credited to a securities account of the Agent,
in either case in trust for the Holders of such Securities; and
(ii) on and after the applicable Early Settlement Date, Securities as
to which the Holder has elected to effect Early Termination of the
related Purchase Contracts;
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provided, however, that in determining whether the Holders of the requisite
number of Securities have given any request, demand, authorization, direction,
notice, consent or waiver hereunder, Securities owned by, or in respect of which
security entitlements are owned by, the Company or any Affiliate of the Company
shall be disregarded and deemed not to be outstanding, except that, in
determining whether the Agent shall be protected in relying upon any such
request, demand, authorization, direction, notice, consent or waiver, only
Securities that the Agent knows to be so owned, or in respect of which the Agent
knows security entitlements to be so held, shall be so disregarded. Securities
so owned, or security entitlements in respect thereof that are so owned, that
have been pledged in good faith may be regarded as outstanding if the pledgee
establishes to the satisfaction of the Agent the pledgee's right so to act with
respect to such Securities or security entitlements and that the pledgee is not
the Company or any Affiliate of the Company.
"OUTSTANDING SECURITY CERTIFICATES" means, as of the date of
determination, all Security Certificates theretofore authenticated, executed and
delivered under this Agreement, except:
(i) Security Certificates theretofore canceled by the Agent or
delivered to the Agent for cancellation; and
(ii) Security Certificates in exchange for or in lieu of which other
Security Certificates have been authenticated, executed on behalf of
the Holder and delivered pursuant to this Agreement, other than any
such Security Certificate in respect of which there shall have been
presented to the Agent proof satisfactory to it that such Security
Certificate is held by a protected purchaser in whose hands the
Securities evidenced by such Security Certificate are valid obligations
of the Company.
"PAYMENT DATE" means each May 31 and November 30, commencing May 31,
1999.
"PERSON" means any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"PLEDGE" means the pledge under the Pledge Agreement of the Treasury
Securities constituting a part of the Securities.
"PLEDGE AGREEMENT" means the Pledge Agreement, dated as of the date
hereof, among the Company, the Collateral Agent and the Agent on its own behalf
and as attorney-in-fact for the Holders from time to time of the Securities.
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"PREDECESSOR SECURITY CERTIFICATE" of any particular Security
Certificate means every previous Security Certificate evidencing all or a
portion of the rights and obligations of the Holder under the Securities
evidenced thereby; and, for the purposes of this definition, any Security
Certificate authenticated and delivered under Section 3.06 in exchange for or in
lieu of a mutilated, destroyed, lost or stolen Security Certificate shall be
deemed to evidence the same rights and obligations of the Holder as the
mutilated, destroyed, lost or stolen Security Certificate.
"PURCHASE CONTRACT" when used with respect to any Security, means the
contract obligating the Company to sell and the Holder of such Security to
purchase Common Stock on the terms and subject to the conditions set forth in
Article 5 hereof.
"PURCHASED SHARES" has the meaning specified in Section 5.06(a)(vi).
"RECORD DATE" for the interest and Contract Fees payable on any Payment
Date means, as to any Securities evidenced by a Global Security Certificate, the
Business Day immediately preceding such Payment Date and, as to any Securities
evidenced by any other Security Certificate, 15 days prior to such Payment Date.
"REORGANIZATION EVENT" has the meaning specified in Section 5.06(b).
"RESPONSIBLE OFFICER" when used with respect to the Agent, means any
officer of the Agent assigned by the Agent to administer its corporate trust
matters.
"RIGHTS" has the meaning specified in Section 5.06(a)(vii).
"SECURITIES" means Coupon Securities or Zero-Coupon Securities.
"SECURITY CERTIFICATE" means a certificate evidencing the rights and
obligations of a Holder in respect of the number of Securities specified on such
certificate.
"SECURITY REGISTER" and "SECURITY REGISTRAR" have the respective
meanings specified in Section 3.05.
"SETTLEMENT RATE" has the meaning specified in Section 5.01.
"STATED AMOUNT" means $43.
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"TERMINATION DATE" means the date, if any, on which a Termination
Event occurs.
"TERMINATION EVENT" means the occurrence of any of the following
events: (i) at any time on or prior to the Final Settlement Date, a judgment,
decree or order by a court having jurisdiction in the premises shall have been
entered granting relief under the Bankruptcy Code, adjudicating the Company to
be insolvent, or approving as properly filed a petition seeking reorganization
or liquidation of the Company under the Bankruptcy Code or any other similar
applicable Federal or State law, and, unless such judgment, decree or order
shall have been entered within 60 days prior to the Final Settlement Date, such
decree or order shall have continued undischarged and unstayed for a period of
60 days; or (ii) a judgment, decree or order of a court having jurisdiction in
the premises for the appointment of a receiver or liquidator or trustee or
assignee in bankruptcy or insolvency of the Company or of its property, or for
the winding up or liquidation of its affairs, shall have been entered, and,
unless such judgment, decree or order shall have been entered within 60 days
prior to the Final Settlement Date, such judgment, decree or order shall have
continued undischarged and unstayed for a period of 60 days, or (iii) at any
time on or prior to the Final Settlement Date the Company shall file a petition
for relief under the Bankruptcy Code, or shall consent to the filing of a
bankruptcy proceeding against it, or shall file a petition or answer or consent
seeking reorganization or liquidation under the Bankruptcy Code or any other
similar applicable Federal or State law, or shall consent to the filing of any
such petition, or shall consent to the appointment of a receiver or liquidator
or trustee or assignee in bankruptcy or insolvency of it or of any substantial
part of its property, or shall make an assignment for the benefit of creditors,
or shall admit in writing its inability to pay its debts generally as they
become due.
"THRESHOLD APPRECIATION PRICE" has the meaning specified in Section
5.01.
"TIA" means the Trust Indenture Act of 1939, as amended, or any
successor statute.
"TRADING DAY" has the meaning specified in Section 5.01.
"TREASURY NOTES" means 5.875% United States Treasury Notes due November
30, 2001 (CUSIP No. 0000000X0) that are held through the Treasury/Reserve
Automated Debt Entry System.
"TREASURY SECURITIES" means Coupon Treasury Securities or Zero-
Coupon Treasury Securities.
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"TREASURY STRIPS" means zero-coupon United States Treasury Strips due
November 15, 2001 (CUSIP No. 000000XX0) that are held through the
Treasury/Reserve Automated Debt Entry System.
"UNDERWRITERS" means the several Underwriters named in the
Underwriting Agreement.
"UNDERWRITING AGREEMENT" means the Underwriting Agreement dated
November 19, 1998 between the Company and Xxxxxx Xxxxxxx & Co. Incorporated,
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated, Xxxxxxx, Sachs & Co., Xxxxxx
Xxxxxxx & Co., Inc., Xxxxxxx Xxxxx Barney Inc., Xxxxxxxxx & Company, Inc. and
NationsBanc Xxxxxxxxxx Securities LLC, as representatives of the several
Underwriters named therein, and relating to the Securities.
"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."
"ZERO-COUPON SECURITY" means the collective rights and obligations of a
Holder of a Security Certificate in respect of Zero-Coupon Treasury Securities
with a principal amount equal to the Stated Amount, subject to the Pledge
thereof, and a Purchase Contract.
"ZERO-COUPON TREASURY SECURITIES" means Treasury Strips and security
entitlements in respect thereof.
SECTION 1.02. Compliance Certificates and Opinions. Except as otherwise
expressly provided by this Agreement, upon any application or request by the
Company to the Agent to take any action under any provision of this Agreement,
the Company shall furnish to the Agent an Officers' Certificate stating that all
conditions precedent, if any, provided for in this Agreement relating to the
proposed action have been complied with and an Opinion of Counsel stating that,
in the opinion of such counsel, all such conditions precedent, if any, have been
complied with, except that in the case of any such application or request as to
which the furnishing of such documents is specifically required by any provision
of this Agreement relating to such particular application or request, no
additional certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Agreement shall include:
(a) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein relating
thereto;
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(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 each such individual, such
individual has made such examination or investigation as is necessary to enable
such individual to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
SECTION 1.03. Form of Documents Delivered to Agent. In any case where
several matters are required to be certified by, or covered by an opinion of,
any specified Person, it is not necessary that all such matters be certified by,
or covered by the opinion of, only one such Person, or that they be so certified
or covered by only one document, but one such Person may certify or give an
opinion with respect to some matters and one or more other such Persons as to
other matters, and any such Person may certify or give an opinion as to such
matters in one or several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which such officer's 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
representation 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 1.04. 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
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person or by an agent duly appointed in writing; and, except as herein otherwise
expressly provided, such action shall become effective when such instrument or
instruments are delivered to the Agent and, where it is hereby expressly
required, to the Company. Such instrument or instruments (and the action
embodied therein and evidenced thereby) are herein sometimes referred to as the
"ACT" of the Holders signing such instrument or instruments. Proof of execution
of any such instrument or of a writing appointing any such agent shall be
sufficient for any purpose of this Agreement and (subject to Section 7.01)
conclusive in favor of the Agent and the Company, if made in the manner provided
in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to such notary public or other officer
the execution thereof. Where such execution is by a signer acting in a capacity
other than such signer's individual capacity, such certificate or affidavit
shall also constitute sufficient proof of such signer's authority. The fact and
date of the execution of any such instrument or writing, or the authority of the
Person executing the same, may also be proved in any other manner that the Agent
deems sufficient.
(c) The ownership of Securities shall be proved by the Security
Register.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Security shall bind every future Holder
of the same Security and the Holder of every Security Certificate evidencing
such Security issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof in respect of anything done, omitted or suffered to
be done by the Agent or the Company in reliance thereon, whether or not notation
of such action is made upon such Security Certificate.
(e) The Company may set any date as a record date for the purpose of
determining the Holders of Outstanding Securities entitled to give, make or take
any request, demand, authorization, direction, notice, consent, waiver or other
action provided or permitted by this Agreement to be given, made or taken by
Holders. If any record date is set pursuant to this paragraph, the Holders of
Outstanding Securities on such record date, and no other Holders, shall be
entitled to take the relevant action, whether or not such Holders remain Holders
after such record date; provided that no such action shall be effective
hereunder unless taken on or prior to the applicable Expiration Date by Holders
of the requisite number of Outstanding Securities on such record date. Nothing
in this paragraph shall be construed to prevent the Company from setting a new
record date for any action
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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 canceled and of no effect), and nothing in this paragraph shall
be construed to render ineffective any action taken by Holders of the requisite
number of Outstanding Securities on the date such action is taken. Promptly
after any record date is set pursuant to this paragraph, the Company, at its own
expense, shall cause notice of such record date, the proposed action by Holders
and the applicable Expiration Date to be given to the Agent in writing and to
each Holder in the manner set forth in Section 1.06.
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 in the manner set forth in
Section 1.06, 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 1.05. Notices, Etc., to Agent and the Company. Any request,
demand, authorization, direction, notice, consent, waiver or Act of Holders or
other document provided or permitted by this Agreement to be made upon, given or
furnished to, or filed with,
(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 or mailed,
first-class postage prepaid or by guaranteed overnight courier, to the Agent at
One Illinois Center, Suite 3000, 000 Xxxx Xxxxxx Xxxxx, Xxxxxxx, Xxxxxxxx 00000,
Attention: Corporate Trust Services Division, or at any other address previously
furnished for such purpose 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 or mailed,
first-class postage prepaid or by guaranteed overnight courier, to the Company
at 000 Xxx Xxxxxx Xxxxxx, Xxxxxxxx, Xxxxxxxx 00000-0000, Attention: Treasurer,
or at any other address previously furnished for such purpose in writing to the
Agent by the Company.
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SECTION 1.06. Notice to Holders; Waiver. 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 such
Holder's address as it appears in the Security Register, not later than the
latest date, and not earlier than the earliest date, prescribed for the giving
of such notice. In any case where notice to Holders is given by mail, neither
the failure to mail such notice nor any defect in any notice so mailed to any
particular Holder shall affect the sufficiency of such notice with respect to
other Holders. Where this Agreement provides for notice in any manner, such
notice may be waived in writing by the Person entitled to receive such notice,
either before or after the event, and such waiver shall be the equivalent of
such notice. Waivers of notice by Holders shall be filed with the Agent, but
such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made with the approval of the Agent shall
constitute a sufficient notification for every purpose hereunder.
SECTION 1.07. 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 1.08. 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 1.09. Separability Clause. In case any provision in this
Agreement or in the Securities shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions hereof and
thereof shall not in any way be affected or impaired thereby.
SECTION 1.10. Benefits of Agreement. Except as set forth below, nothing
in this Agreement or in the Securities, express or implied, shall give to any
Person, other than the parties hereto and their successors hereunder and the
Holders, any benefits or any legal or equitable right, remedy or claim under
this Agreement. The Holders from time to time shall be beneficiaries of this
Agreement and shall be bound by all of the terms and conditions hereof and of
the Securities evidenced by their Security Certificates by their acceptance of
delivery thereof. The Underwriters shall be third-party beneficiaries of Section
4.01, and
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shall have the same rights to enforce Section 4.01 as if the Underwriters were
parties hereto.
SECTION 1.11. Governing Law. This Agreement and the Securities shall
be governed by and construed in accordance with the laws of the State of New
York.
SECTION 1.12. Legal Holidays. In any case where any Payment Date, any
Early Settlement Date or the Final Settlement Date shall not be a Business Day,
then (notwithstanding any other provision of this Agreement or of the
Securities) payment in respect of interest on Treasury Notes, Contract Fees or
Deferred Contract Fees shall not be made, Purchase Contracts shall not be
performed and Early Settlement shall not be effected on such date, but such
payments shall be made, Purchase Contracts performed or Early Settlement
effected, as applicable, on the next succeeding Business Day with the same force
and effect as if made on such Payment Date, Early Settlement Date or Final
Settlement Date, as the case may be; provided, that no interest shall accrue or
be payable by the Company or any Holder for the period from and after any such
Payment Date, Early Settlement Date or Final Settlement Date, as the case may
be.
SECTION 1.13. Counterparts. This Agreement may be executed in any
number of counterparts, each of which, when so executed, shall be deemed an
original, but all such counterparts shall together constitute one and the same
instrument.
SECTION 1.14. Inspection of Agreement. A copy of this Agreement shall
be available at all reasonable times at the Corporate Trust Office for
inspection by any Holder.
SECTION 1.15. Appointment of Financial Institution as Agent for the
Company. The Company may appoint a financial institution (which may be the
Collateral Agent) to act as its agent in performing its obligations, and in
accepting and enforcing performance of the obligations of the Agent and the
Holders, under this Agreement and the Purchase Contracts, by giving notice of
such appointment in the manner provided in Section 1.05 hereof. Any such
appointment shall not relieve the Company in any way from its obligations
hereunder.
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ARTICLE 2
SECURITY CERTIFICATE FORMS
SECTION 2.01. Forms of Security Certificates Generally. The Security
Certificates (including the form of Purchase Contracts forming part of the
Securities evidenced thereby) shall be in substantially the form set forth in
Exhibit A hereto (in the case of Security Certificates evidencing Coupon
Securities) or Exhibit B hereto (in the case of Security Certificates evidencing
Zero-Coupon Securities), with such letters, numbers or other marks of
identification or designation and such legends or endorsements printed,
lithographed or engraved thereon as may be required by the rules of any
securities exchange on which the Securities are listed or Depositary therefor,
or as may, consistently herewith, be determined by the officers of the Company
executing such Security Certificates, as evidenced by their execution of the
Security Certificates.
The definitive Security Certificates (if any) shall be printed,
lithographed or engraved on steel engraved borders or may be produced in any
other manner, all as determined by the officers of the Company executing the
Security Certificates, consistent with the provisions of this Agreement, as
evidenced by their execution thereof.
Every Global Security Certificate authenticated, executed on behalf of
the Holders and delivered hereunder shall bear a legend in substantially the
following form:
THIS SECURITY CERTIFICATE IS A GLOBAL SECURITY CERTIFICATE WITHIN THE
MEANING OF THE PURCHASE CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND IS
REGISTERED IN THE NAME OF THE DEPOSITORY TRUST COMPANY ("DTC") OR A NOMINEE OF
DTC. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A
PERSON OTHER THAN DTC OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED
IN THE PURCHASE CONTRACT AGREEMENT AND NO TRANSFER OF THIS SECURITY (OTHER THAN
A TRANSFER OF THIS SECURITY AS A WHOLE BY DTC TO A NOMINEE OF DTC OR BY A
NOMINEE OF DTC TO DTC OR ANOTHER NOMINEE OF DTC) MAY BE REGISTERED EXCEPT IN
LIMITED CIRCUMSTANCES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC, TO ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO.
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OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
The Securities will be initially issued in the form of one or more
fully registered Global Security Certificates, to be delivered to the Depositary
or its custodian by or on behalf of the Company. The Company hereby designates
The Depository Trust Company as the initial Depositary. Such Global Security
Certificates shall initially be registered in the Security Register in the name
of Cede & Co., the nominee of the Depositary, and no Holder will receive a
definitive Security Certificate representing such Holder's interests in such
Global Security Certificates, except as provided in this Section 2.01.
Unless and until definitive, fully registered Security Certificates
have been issued to a Holder pursuant to the provisions of this Section 2.01:
(a) the provisions of this Section 2.01 shall be in full force and
effect;
(b) the Company and the Agent shall be entitled to deal with the
Depositary for all purposes of this Agreement (including the payment of any
amounts on the Global Security Certificates and receiving approvals, votes or
consents hereunder) as the Holder and the sole owner of the Global Security
Certificates;
(c) to the extent that the provisions of this Section 2.01 conflict
with any other provisions of this Agreement or the Purchase Contracts, the
provisions of this Section 2.01 shall control; and
(d) the rights of the Beneficial Owners shall be exercised only
through the Depositary and shall be limited to those established by law and
agreements between such Beneficial Owners and the Depositary and/or the
Depositary Participants. The Depositary will make book entry transfers among the
Depositary Participants and receive and transmit payments of amounts on the
Global Security Certificates to such Depositary Participants.
Whenever a notice or other communication to the Holders is required to
be given under this Agreement, unless and until definitive Security Certificates
shall have been issued, the Company and the Agent shall give all such notices
and communications, specified herein to be given to Holders, to the Depositary
and,
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with respect to any Security Certificate registered in the name of the
Depositary or the nominee of the Depositary, the Company and the Agent shall
have no notice obligations to Beneficial Owners.
If the Depositary elects to discontinue its services as securities
depositary with respect to the Securities, the Company may, in its sole
discretion, appoint a successor Depositary with respect to the Securities.
If (i) the Depositary elects to discontinue its services as securities
depositary with respect to the Securities and a successor Depositary is not
appointed within 90 days after such discontinuance or (ii) the Company elects
after consultation with the Agent to terminate the book entry system through the
Depositary with respect to the Securities, then (x) definitive Security
Certificates shall be prepared by the Agent on behalf of the Company with
respect to such Securities and (y) upon surrender of the Global Security
Certificates by the Depositary, accompanied by registration instructions, the
Agent shall cause definitive Security Certificates to be delivered to Holders in
accordance with the instructions of the Depositary. Each definitive Security
Certificate so delivered shall evidence Securities of the same tenor (Coupon
Securities or Zero-Coupon Securities) as the Global Security Certificate so
surrendered in respect thereof.
Neither the Agent nor the Company shall be liable for any delay in
delivery of such instructions and each of them may conclusively rely on and
shall be protected in relying on, such instructions.
SECTION 2.02. Form of Agent's Certificate of Authentication. The
Agent's certificate of authentication of the Securities shall be in
substantially the form set forth on the form of the Security Certificates.
ARTICLE 3
THE SECURITIES
SECTION 3.01. Title and Terms; Denominations. The aggregate number of
Securities evidenced by Security Certificates authenticated, executed on behalf
of the Holders and delivered hereunder is limited to 9,310,000 (subject to
increase up to a maximum of 1,396,000 to the extent the over-allotment option of
the Underwriters granted in the Underwriting Agreement is exercised), except for
Security Certificates authenticated, executed and delivered upon registration of
transfer of, in exchange for, or in lieu of, other Security Certificates
pursuant to Section 3.04, 3.05, 3.06, 5.09 or 8.05.
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The Security Certificates shall be issuable only in registered form and
only in denominations of a single Security and any integral multiple thereof.
SECTION 3.02. Rights and Obligations Evidenced by the Security
Certificates. Each Security Certificate shall evidence the number and tenor
(Coupon Securities or Zero-Coupon Securities) of Securities specified therein,
with each such Security representing the ownership by the Holder thereof of
Treasury Securities with a principal amount equal to the Stated Amount, subject
to the Pledge of such Treasury Securities by such Holder pursuant to the Pledge
Agreement, and the rights and obligations of the Holder under one Purchase
Contract. The Agent is hereby authorized by each Holder to act as
attorney-in-fact for and on behalf of such Holder to pledge, pursuant to the
Pledge Agreement, the Treasury Securities to the Collateral Agent and grant to
the Collateral Agent a security interest in the right, title and interest of
such Holders in the Treasury Securities, for the benefit of the Company, to
secure the obligation of the Holders under the Purchase Contracts to purchase
the Common Stock of the Company. Prior to the purchase, if any, of shares of
Common Stock under the Purchase Contracts, the Securities shall not entitle the
Holders to any of the rights of a holder of shares of Common Stock, including,
without limitation, the right to vote or receive any dividends or other payments
or to consent or to receive notice as stockholders in respect of the meetings of
stockholders or for the election of directors of the Company or for any other
matter, or any other rights whatsoever as stockholders of the Company, except to
the extent otherwise expressly provided in this Agreement.
SECTION 3.03. Execution, Authentication, Delivery and Dating. Upon the
execution and delivery of this Agreement, and at any time from time to time
thereafter, the Company may deliver Security Certificates executed by the
Company to the Agent for authentication, execution on behalf of the Holders and
delivery, together with its Issuer Order for authentication of such Security
Certificates, and the Agent in accordance with such Issuer Order shall
authenticate, execute on behalf of the Holder and deliver such Security
Certificates.
The Security Certificates shall be executed on behalf of the Company by
its Chairman of the Board, its Vice Chairman of the Board, its President or one
of its Vice Presidents, under its corporate seal reproduced thereon attested by
its Secretary or one of its Assistant Secretaries. The signature of any of these
officers on the Security Certificates may be manual or facsimile.
Security Certificates bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company shall bind
the Company, notwithstanding that such individuals or any of them have ceased to
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hold such offices prior to the authentication and delivery of such Security
Certificates or did not hold such offices at the date of such Security
Certificates.
No Purchase Contract underlying a Security evidenced by a Security
Certificate shall be valid until such Security Certificate has been executed on
behalf of the Holder by the manual signature of an authorized signatory of the
Agent, as such Holder's attorney-in-fact. Such signature by an authorized
signatory of the Agent shall be conclusive evidence that the Holder of such
Security Certificate has entered into the Purchase Contracts underlying the
Securities evidenced by such Security Certificate.
Each Security Certificate shall be dated the date of its
authentication.
No Security Certificate shall be entitled to any benefit under this
Agreement or be valid or obligatory for any purpose unless there appears on such
Security Certificate a certificate of authentication substantially in the form
provided for herein executed by an authorized signatory of the Agent by manual
signature, and such certificate upon any Security Certificate shall be
conclusive evidence, and the only evidence, that such Security Certificate has
been duly authenticated and delivered hereunder.
SECTION 3.04. Temporary Security Certificates. Pending the preparation
of definitive Security Certificates, the Company may execute and deliver to the
Agent, and the Agent shall authenticate, execute on behalf of the Holders, and
deliver, in lieu of such definitive Security Certificates, temporary Security
Certificates that are in substantially the form set forth in Exhibit A hereto,
with such letters, numbers or other marks of identification or designation and
such legends or endorsements printed, lithographed or engraved thereon as may be
required by the rules of any securities exchange on which the Securities are
listed, or as may, consistently herewith, be determined by the officers of the
Company executing such Security Certificates, as evidenced by their execution of
the Security Certificates.
If temporary Security Certificates are issued, the Company shall cause
definitive Security Certificates to be prepared without unreasonable delay.
After the preparation of definitive Security Certificates, the temporary
Security Certificates shall be exchangeable for definitive Security Certificates
upon surrender of the temporary Security Certificates at the Corporate Trust
Office, at the expense of the Company and without charge to the Holder. Upon
surrender for cancellation of any one or more temporary Security Certificates,
the Company shall execute and deliver to the Agent, and the Agent shall
authenticate, execute on behalf of the Holder, and deliver in exchange therefor,
one or more definitive Security Certificates of authorized denominations and
evidencing a like number of
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Securities as the temporary Security Certificate or Security Certificates so
surrendered. Each definitive Security Certificate so delivered shall evidence
Securities of the same tenor (Coupon Securities or Zero-Coupon Securities) as
the temporary Security Certificate so surrendered in exchange therefor. Until so
exchanged, the temporary Security Certificates shall in all respects evidence
the same benefits and the same obligations with respect to the Securities
evidenced thereby as definitive Security Certificates.
SECTION 3.05. Registration; Registration of Transfer and Exchange. The
Agent shall keep at the Corporate Trust Office a register (the register
maintained in such office being herein referred to as the "SECURITY REGISTER")
in which, subject to such reasonable regulations as it may prescribe, the Agent
shall provide for the registration of Security Certificates and of transfers of
Security Certificates (the Agent, in such capacity, the "SECURITY REGISTRAR").
The Security Register shall record separately the registration and transfer of
Security Certificates evidencing Coupon Securities and Zero-Coupon Securities.
Upon surrender for registration of transfer of any Security Certificate
at the Corporate Trust Office, the Company shall execute and deliver to the
Agent, and the Agent shall authenticate, execute on behalf of the designated
transferee or transferees, and deliver, in the name of the designated transferee
or transferees, one or more new Security Certificates of any authorized
denominations and evidencing a like number of Securities of the same tenor
(Coupon Securities or Zero-Coupon Securities).
At the option of the Holder, Security Certificates may be exchanged for
other Security Certificates, of any authorized denominations and evidencing a
like number of Securities of the same tenor (Coupon Securities or Zero-Coupon
Securities), upon surrender of the Security Certificates to be exchanged at the
Corporate Trust Office. Whenever any Security Certificates are so surrendered
for exchange, the Company shall execute and deliver to the Agent, and the Agent
shall authenticate, execute on behalf of the Holder, and deliver the Security
Certificates that the Holder making the exchange is entitled to receive.
All Security Certificates issued upon any registration of transfer or
exchange of a Security Certificate shall evidence the ownership of the same
number of Securities of the same tenor (Coupon Securities or Zero-Coupon
Securities) and be entitled to the same benefits and be subject to the same
obligations, under this Agreement as the Securities evidenced by the Security
Certificate surrendered upon such registration of transfer or exchange.
Every Security Certificate presented or surrendered for registration of
transfer or for exchange shall (if so required by the Agent) be duly endorsed,
or be
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accompanied by a written instrument of transfer in form satisfactory to the
Company and the Agent duly executed, by the Holder thereof or such Holder's
attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of a Security Certificate, but the Company and the Agent may require
payment from the Holder of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any registration of
transfer or exchange of Security Certificates, other than any exchanges pursuant
to Sections 3.04, 3.06, 5.09 and 8.05 not involving any transfer.
Notwithstanding the foregoing, the Company shall not be obligated to
execute and deliver to the Agent, and the Agent shall not be obligated to
authenticate, execute on behalf of the Holder and deliver any Security
Certificate presented or surrendered for registration of transfer or for
exchange on or after the Final Settlement Date or the Termination Date. In lieu
of delivery of a new Security Certificate, upon satisfaction of the applicable
conditions specified above in this Section and receipt of appropriate
registration or transfer instructions from such Holder, the Agent shall (i) if
the Final Settlement Date has occurred, deliver the shares of Common Stock
issuable in respect of the Purchase Contracts forming a part of the Securities
evidenced by such Security Certificate, or (ii) if a Termination Event shall
have occurred prior to the Final Settlement Date, transfer the principal amount
of the Treasury Securities evidenced thereby, in each case subject to the
applicable conditions and in accordance with the applicable provisions of
Article 5 hereof.
The provisions of paragraphs (a), (b), (c) and (d) below shall apply
only to Global Security Certificates:
(a) Each Global Security Certificate authenticated and executed on
behalf of the Holders under this Agreement shall be registered in the name of
Cede & Co., as the nominee of the Depositary as set forth in Section 2.01.
(b) Notwithstanding any other provision in this Agreement, no Global
Security Certificate may be exchanged in whole or in part for Security
Certificates registered, and no transfer of a Global Security Certificate in
whole or in part may be registered, in the name of any Person other than the
Depositary for such Global Security Certificate or a nominee thereof unless (i)
the Depositary elects to discontinue its services as securities depositary with
respect to the Securities and a successor Depositary is not appointed within 90
days after such discontinuance or (ii) the Company elects after consultation
with the Agent to terminate the book entry system through the Depositary with
respect to the Securities.
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(c) Subject to clause (b) above, any exchange of a Global Security
Certificate for other Security Certificates may be made in whole or in part, and
all Security Certificates issued in exchange for a Global Security Certificate
or any portion thereof shall be registered in such names as the Depositary for
such shall direct.
(d) Every Security Certificate authenticated and delivered upon
registration of transfer of, or in exchange for or in lieu of, a Global Security
Certificate or any portion thereof, whether pursuant to this Section, Section
3.04, 3.06, 5.09 or 8.05 or otherwise, shall be authenticated, executed on
behalf of the Holders and delivered in the form of, and shall be, a Global
Security Certificate, unless such Security Certificate is registered in the name
of a Person other than the Depositary for such Global Security Certificate or a
nominee thereof.
SECTION 3.06. Mutilated, Destroyed, Lost and Stolen Security
Certificates. If any mutilated Security Certificate is surrendered to the Agent,
the Company shall execute and deliver to the Agent, and the Agent shall
authenticate, execute on behalf of the Holder, and deliver in exchange therefor,
a new Security Certificate, evidencing the same number of Securities of the same
tenor (Coupon Securities or Zero Coupon Securities) and bearing a number not
contemporaneously outstanding.
If there shall be delivered to the Company and the Agent (i) evidence
to their satisfaction of the destruction, loss or theft of any Security
Certificate, and (ii) such security or indemnity as may be required by them to
save each of them and any agent of any of them harmless, then, in the absence of
notice to the Company or the Agent that such Security Certificate has been
acquired by a protected purchaser, the Company shall execute and deliver to the
Agent, and the Agent shall authenticate, execute on behalf of the Holder, and
deliver to the Holder, in lieu of any such destroyed, lost or stolen Security
Certificate, a new Security Certificate, evidencing the same number of
Securities of the same tenor (Coupon Securities or Zero-Coupon Securities) and
bearing a number not contemporaneously outstanding.
Notwithstanding the foregoing, the Company shall not be obligated to
execute and deliver to the Agent, and the Agent shall not be obligated to
authenticate, execute on behalf of the Holder, and deliver to the Holder, a
Security Certificate on or after the Final Settlement Date or the Termination
Date. In lieu of delivery of a new Security Certificate, upon satisfaction of
the applicable conditions specified above in this Section and receipt of
appropriate registration or transfer instructions from such Holder, the Agent
shall (i) if the Final Settlement Date has occurred, deliver the shares of
Common Stock issuable in respect of the Purchase Contracts forming a part of the
Securities evidenced by
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such Security Certificate, or (ii) if a Termination Event shall have occurred
prior to the Final Settlement Date, transfer the principal amount of the
Treasury Securities evidenced thereby, in each case subject to the applicable
conditions and in accordance with the applicable provisions of Article 5 hereof.
Upon the issuance of any new Security Certificate under this Section,
the Company and the Agent may require the payment by the Holder of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto.
Every new Security Certificate issued pursuant to this Section in lieu
of any destroyed, lost or stolen Security Certificate shall constitute an
original additional contractual obligation of the Company and of the Holder,
whether or not the destroyed, lost or stolen Security Certificate shall be at
any time enforceable by anyone, and shall be entitled to all the benefits and be
subject to all the obligations of this Agreement equally and proportionately
with any and all other Security Certificates delivered hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
settlement of mutilated, destroyed, lost or stolen Security Certificates.
SECTION 3.07. Persons Deemed Owners. Prior to due presentment of a
Security Certificate for registration of transfer, the Company and the Agent,
and any agent of the Company or the Agent, may treat the Person in whose name
such Security Certificate is registered as the owner of the Securities evidenced
thereby, for the purpose of receiving payments of interest on the Treasury Notes
(in the case of Coupon Securities), receiving payments of Contract Fees and any
Deferred Contract Fees, delivery of the Treasury Securities, performance of the
Purchase Contracts and for all other purposes whatsoever, whether or not the
payment of interest on the Treasury Notes (in the case of Coupon Securities) or
any Contract Fees payable in respect of the Purchase Contracts constituting a
part of the Securities evidenced thereby shall be overdue and notwithstanding
any notice to the contrary, and neither the Company nor the Agent, nor any agent
of the Company or the Agent, shall be affected by notice to the contrary.
Notwithstanding the foregoing, with respect to any Global Security
Certificate, nothing herein shall prevent the Company, the Agent or any agent of
the Company or the Agent, from giving effect to any written certification, proxy
or other authorization furnished by any Depositary (or its nominee), as a
Holder, with respect to such Global Security Certificate or impair, as between
such Depositary and the Beneficial Owners, the operation of customary practices
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governing the exercise of rights of such Depositary (or its nominee) as Holder
of such Global Security Certificate.
SECTION 3.08. Cancellation. All Security Certificates surrendered for
delivery of shares of Common Stock on or after the Final Settlement Date,
transfer of Treasury Securities after the occurrence of a Termination Event or
pursuant to an Early Settlement or Collateral Substitution or registration of
transfer or exchange shall, if surrendered to any Person other than the Agent,
be delivered to the Agent and, if not already canceled, shall be promptly
canceled by it. The Company may at any time deliver to the Agent for
cancellation any Security Certificates previously authenticated, executed and
delivered hereunder that the Company may have acquired in any manner whatsoever,
and all Security Certificates so delivered shall, upon the receipt by the Agent
of an Issuer Order requesting such cancellation, be promptly canceled by the
Agent. No Security Certificates shall be authenticated, executed on behalf of
the Holder and delivered in lieu of or in exchange for any Security Certificates
canceled as provided in this Section, except as expressly permitted by this
Agreement. All canceled Security Certificates held by the Agent shall be
disposed of as directed in an Issuer Order.
If the Company or any Affiliate of the Company shall acquire any
Security Certificate, such acquisition shall not operate as a cancellation of
such Security Certificate unless and until such Security Certificate is
delivered to the Agent canceled or for cancellation.
SECTION 3.09. Securities Not Separable. Notwithstanding anything
contained herein or in the Security Certificates to the contrary (except as
provided in Section 4.03), for so long as the Purchase Contract comprising a
portion of a Security remains in effect, such Security shall not be separable
into its constituent parts for purposes of transfer or exchange of such
Security, and the rights and obligations of the Holder of such Security in
respect of the Treasury Securities and Purchase Contracts comprising such
Security may be acquired, and may be transferred and exchanged, only as a
Security. Other than a Security Certificate evidencing a Security, no Holder of
a Security, or any transferee thereof, shall be entitled to receive a
certificate evidencing the ownership of Treasury Securities (except as provided
in Section 4.03) or the rights and obligations of the Holder and the Company
under a Purchase Contract for so long as the Purchase Contract underlying the
Security remains in effect.
SECTION 3.10. No Consent to Assumption. Each Holder of a Security, by
acceptance thereof, shall be deemed expressly to have withheld any consent to
the assumption under Section 365 of the Bankruptcy Code or otherwise, of the
Purchase Contract by the Company or its trustee in the event that the Company
becomes a debtor under the Bankruptcy Code.
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ARTICLE 4
THE TREASURY SECURITIES
SECTION 4.01. Payment of Interest; Interest Rights Preserved. Interest
on any Treasury Note that is paid on any Payment Date shall, subject to receipt
thereof by the Agent from the Collateral Agent as provided by the terms of the
Pledge Agreement, be paid to the Person in whose name the Security Certificate
(or one or more Predecessor Security Certificates) representing the Securities
of which the Treasury Security corresponding to such Treasury Note is a part is
registered at the close of business on the Record Date immediately preceding
such Payment Date; provided, that on the first Payment Date, the Agent shall
remit to the Persons in whose names such Security Certificates are registered on
the Record Date with respect thereto, in addition to interest on the Treasury
Notes paid on such Payment Date, interest payable with respect to the Treasury
Notes for the period from the date of initial issuance of the Securities until
November 29, 1998. Interest payable with respect to the Treasury Notes that
accrued prior to the date of initial issuance of the Securities and that is
payable on the first interest payment date with respect to the Treasury Notes,
received from the Collateral Agent following the date of initial issuance of the
Securities, shall be remitted by the Agent, upon its receipt thereof, to Xxxxxx
Xxxxxxx & Co. Incorporated for the account of the Underwriters by 2:00 p.m. New
York City time on the date of receipt by the Agent. Funds received by the
Purchase Contract Agent for interest accrued from and including the date of
initial issuance to the first interest payment date with respect to the Treasury
Notes shall remain uninvested.
Except as otherwise provided in the immediately preceding paragraph,
each Security Certificate that evidences, in part, Coupon Treasury Securities
delivered under this Agreement upon registration of transfer of or in exchange
for or in lieu of any other Security Certificate shall carry the rights to
interest accrued and unpaid, and to accrue, that were carried by the Coupon
Treasury Securities forming a part of the Securities represented by such other
Security Certificate.
In the case of any Coupon Security with respect to which Early
Settlement of the underlying Purchase Contract is effected on an Early
Settlement Date, or with respect to which a Collateral Substitution is effected
on any Collateral Substitution Date, in either case after any Record Date and on
or prior to the next succeeding Payment Date, the Agent shall remit to the
Person in whose name the Security Certificate representing such Coupon Security
is registered on the Record Date with respect thereto interest on the Treasury
Notes corresponding to the Treasury Securities underlying such Security
otherwise payable on such Payment Date notwithstanding the release of the
Treasury Securities pursuant to such Early
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Settlement or Collateral Substitution. Except as otherwise expressly provided in
the immediately preceding sentence, in the case of any Coupon Security with
respect to which Early Settlement of the underlying Purchase Contract is
effected on an Early Settlement Date or Collateral Substitution is effected on a
Collateral Substitution Date, interest on the related Treasury Notes that would
otherwise be payable after the Early Settlement Date or the Collateral
Substitution Date, as the case may be, shall not be payable hereunder to the
Holder of such Security.
SECTION 4.02. Transfer of Treasury Securities Upon Occurrence of
Termination Event. Upon the occurrence of a Termination Event and the transfer
to the Agent of the Treasury Securities forming a part of the Securities
pursuant to the terms of the Pledge Agreement, the Agent shall request transfer
instructions with respect to such Treasury Securities from each Holder by
written request mailed to such Holder at such Holder's address as it appears in
the Security Register, in respect of the Treasury Securities forming a part of
the Securities represented by the Security Certificate held by such Holder. Upon
surrender to the Agent of a Security Certificate with such transfer instructions
in proper form for transfer of the Treasury Securities by Federal Reserve
Bank-Wire or other appropriate procedure, the Agent shall transfer the Treasury
Securities evidenced by such Security Certificate to such Holder in accordance
with such instructions. If a Security Certificate is not duly surrendered to the
Agent with appropriate transfer instructions, the Agent shall hold the Treasury
Securities evidenced by such Security Certificate as custodian for the Holder of
such Security Certificate.
Treasury Securities shall be transferred only in denominations of
$1,000 and integral multiples thereof. As promptly as practicable following the
occurrence of a Termination Event, the Agent shall determine (i) the excess of
(A) the aggregate principal amount of Coupon Treasury Securities underlying the
Outstanding Securities that are Coupon Securities over (B) the aggregate
principal amount of Coupon Treasury Securities in denominations of $1,000 and
integral multiples thereof transferrable to Holders of record on the date of
such Termination Event (such excess being herein referred to as the "EXCESS
COUPON TREASURY SECURITIES") and (ii) the excess of (A) the aggregate principal
amount of Zero-Coupon Treasury Securities underlying the Outstanding Securities
that are Zero-Coupon Securities over (B) the aggregate principal amount of
Zero-Coupon Treasury Securities in denominations of $1,000 and integral
multiples thereof transferrable to Holders of record on the date of such
Termination Event (such excess being herein referred to as the "EXCESS
ZERO-COUPON TREASURY SECURITIES"). As soon as practicable after transfer to the
Agent of the Treasury Securities underlying the Outstanding Securities as
provided in the Pledge Agreement, the Agent shall sell the Excess Coupon
Treasury Securities and the Excess Zero-Coupon Treasury Securities to or through
one or more U.S. Government securities dealers at then prevailing prices. The
Agent shall deduct
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from the proceeds of such sales all commissions and other out-of-pocket
transaction costs incurred in connection with such sales and, until the net
proceeds of such sale or sales have been distributed to Holders, the Agent shall
hold such proceeds as custodian for the Holders. Such proceeds shall be held by
the Agent uninvested without liability to any Person for interest or other
compensation thereon. Each Holder of Coupon Securities shall be entitled to
receive a portion, if any, of the net proceeds of such sales of Excess Coupon
Treasury Securities in lieu of Treasury Securities with a principal amount of
less than $1,000 determined by multiplying the aggregate amount of such net
proceeds by a fraction, the numerator of which is the fraction of $1,000 in
principal amount of Treasury Securities to which such Holder would otherwise be
entitled (after taking into account all Securities then held by such Holder) and
the denominator of which is the aggregate principal amount of Excess Coupon
Treasury Securities. Each Holder of Zero-Coupon Securities shall be entitled to
receive a portion, if any, of the net proceeds of such sales of Excess
Zero-Coupon Treasury Securities in lieu of Treasury Securities with a principal
amount of less than $1,000 determined by multiplying the aggregate amount of
such net proceeds by a fraction, the numerator of which is the fraction of
$1,000 in principal amount of Treasury Securities to which such Holder would
otherwise be entitled (after taking into account all Securities then held by
such Holder) and the denominator of which is the aggregate principal amount of
Excess Zero-Coupon Treasury Securities.
SECTION 4.03. Substitution of Collateral. (a) Subject to and upon
compliance with the provisions of this Section 4.03, at any time prior to
November 15, 2001, the Holder of any Coupon Securities may, in integral
multiples of 1,000 Securities, substitute Zero-Coupon Treasury Securities for
the Coupon Treasury Securities forming a part thereof, thereby forming
Zero-Coupon Securities ("COLLATERAL SUBSTITUTION") as provided herein. In order
to exercise the right to effect Collateral Substitution with respect to any
Coupon Securities, the Holder of the Security Certificate evidencing such
Securities shall (i) deposit with the Collateral Agent Zero-Coupon Treasury
Securities having an aggregate principal amount equal to the aggregate Stated
Amount of such Securities, in the manner provided in the Pledge Agreement, and
(ii) shall deliver such Security Certificate to the Agent at the Corporate Trust
Office duly endorsed for transfer to the Company or in blank with the form of
Election to Substitute Collateral on the reverse thereof duly completed. If the
foregoing requirements are first satisfied with respect to any Securities at or
prior to 5:00 p.m., New York City time, on a Business Day, such day shall be the
"COLLATERAL SUBSTITUTION DATE" with respect to such Securities and if such
requirements are first satisfied after 5:00 p.m, New York City time, on a
Business Day or on a day that is not a Business Day, the "COLLATERAL
SUBSTITUTION DATE" with respect to such Securities shall be the next succeeding
Business Day.
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(b) Upon a Collateral Substitution, the Company shall execute, and the
Agent shall authenticate, execute on behalf of the Holder and deliver to the
Holder a Security Certificate evidencing a number of Zero-Coupon Securities
equal to the number of Coupon Securities evidenced by the Security Certificate
surrendered.
(c) The Company shall cause the Coupon Treasury Securities deliverable
upon Collateral Substitution to be released from the Pledge by the Collateral
Agent and credited to a securities account of the Agent for delivery or credit
to the Holder or its designee no later than 5:00 p.m. New York City time on the
third Business Day after the applicable Collateral Substitution Date.
(d) Upon Collateral Substitution, and subject to receipt thereof from
the Collateral Agent, the Agent shall, in accordance with the instructions
provided by the Holder on the applicable form of Election to Substitute
Collateral on the reverse of the Security Certificate evidencing the relevant
Securities, credit the Treasury Securities forming a part of such Securities to
the securities account so designated by such Holder.
(e) In the event that Collateral Substitution is effected with respect
to less than all the Securities evidenced by a Security Certificate, upon such
Collateral Substitution, the Company shall execute, and the Agent shall
authenticate, execute on behalf of the Holder and deliver to the Holder, at the
expense of the Company, a Security Certificate evidencing the Securities as to
which Collateral Substitution was not effected.
ARTICLE 5
THE PURCHASE CONTRACTS
SECTION 5.01. Purchase of Shares of Common Stock. Each Purchase
Contract shall obligate the Holder of the related Security to purchase, and the
Company to sell, on the Final Settlement Date at a price equal to the Stated
Amount, a number of shares of Common Stock equal to the Settlement Rate, unless,
on or prior to the Final Settlement Date, there shall have occurred a
Termination Event or an Early Settlement with respect to the Security of which
such Purchase Contract is a part. The "SETTLEMENT RATE" is equal to (a) if the
Applicable Market Value (as defined below) is greater than $51.60 (the
"THRESHOLD APPRECIATION PRICE"), .8333 of a share of Common Stock per Purchase
Contract, (b) if the Applicable Market Value is less than or equal to the
Threshold Appreciation Price but is greater than the Stated Amount, a fractional
share of Common Stock per Purchase Contract equal to the Stated Amount
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divided by the Applicable Market Value (rounded upward or downward to the
nearest 1/10,000th of a share) and (c) if the Applicable Market Value is less
than or equal to the Stated Amount, one share of Common Stock per Purchase
Contract, in each case subject to adjustment as provided in Section 5.06. As
provided in Section 5.10, no fractional shares of Common Stock shall be issued
upon settlement of Purchase Contracts.
Subject to Section 5.06(b), the "APPLICABLE MARKET VALUE" means the
average of the Closing Prices per share of Common Stock on each of the twenty
consecutive Trading Days ending on the second Trading Day immediately preceding
the Final Settlement Date. The "CLOSING PRICE" of the Common Stock on any date
of determination means the closing sale price (or, if no closing price is
reported, the last reported sale price) of the Common Stock on the 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 such price of 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.
Each Holder of a Security, by such Holder's acceptance thereof,
authorizes the Agent to enter into and perform the related Purchase Contracts on
such Holder's behalf as such Holder's attorney-in-fact, agrees to be bound by
the terms and provisions thereof, expressly withholds any consent to the
assumption (i.e., affirmance) of the Purchase Contracts by the Company or its
trustee in the event that the Company becomes the subject of a case under the
Bankruptcy Code, covenants and agrees to perform such Holder's obligations under
such Purchase Contracts, consents to the provisions hereof, authorizes the Agent
to enter into and perform the Pledge Agreement on such Holder's behalf as such
Holder's attorney-in-fact, and consents to and agrees to be bound by the Pledge
of the Treasury Securities underlying such Security Certificate pursuant to the
Pledge Agreement; provided that upon a Termination Event the rights of the
Holder of such Security under the Purchase Contract may be enforced without
regard to any other rights or obligations. Each Holder of a Security, by such
Holder's
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acceptance thereof, further covenants and agrees that, to the extent and in the
manner provided in Section 5.04 and the Pledge Agreement, but subject to the
terms thereof, payments in respect of principal of the Treasury Securities on
the Final Settlement Date shall be paid by the Collateral Agent to the Company
in satisfaction of such Holder's obligations under such Purchase Contract and
such Holder shall acquire no right, title or interest in such payments.
Upon registration of transfer of a Security Certificate evidencing
Purchase Contracts, the transferee shall be bound (without the necessity of any
other action on the part of such transferee) under the terms of this Agreement,
the Purchase Contracts evidenced thereby and the Pledge Agreement, and the
transferor shall be released from the obligations under the Purchase Contracts
evidenced by the Security Certificates so transferred. The Company covenants and
agrees, and each Holder of a Security Certificate, by such Holder's acceptance
thereof, likewise covenants and agrees, to be bound by the provisions of this
paragraph.
SECTION 5.02. Contract Fees. Subject to Section 5.03, the Company shall
pay by 10:00 A.M. New York City time to the Agent, on each Payment Date, the
Contract Fees payable in respect of each Purchase Contract for the benefit of
the Person in whose name the Security Certificate (or one or more Predecessor
Security Certificates) evidencing the Security of which such Purchase Contract
is a part is registered at the close of business on the Record Date next
preceding such Payment Date. The Contract Fees shall be payable at the office or
agency of the Agent in The City of New York maintained for that purpose or, at
the option of the Company, by check mailed to the address of the Person entitled
thereto at such address as it appears on the Security Register. Notwithstanding
any provisions of this Agreement and the Securities to the contrary, if the
Company and a Holder of at least $1,000,000 Stated Amount of Securities so
agree, payments of Contract Fees and Deferred Contract Fees, if any, payable in
respect of each Purchase Contract, and interest on the Treasury Notes (in the
case of Coupon Securities), in each case underlying such Securities shall be
made by the Agent, upon receipt from the Company and the Collateral Agent (in
the case of Coupon Securities) of immediately available funds by 1:00 P.M. New
York City time (or such other time as may be agreed to between the Company and
the Agent), directly to the Holder of such Security (by Federal funds wire
transfer or otherwise within the United States) if the Holder has delivered
written instructions to the Agent at least 15 days prior to such Payment Date
requesting that such payment shall be so made and designating the bank account
in the United States to which such payment shall be so made. The Agent shall be
entitled to rely on the last instruction delivered by the Holder pursuant to
this Section 5.02 unless a new instruction is delivered at least 15 days prior
to a Payment Date.
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Each Security Certificate delivered under this Agreement upon
registration of transfer of or in exchange for or in lieu of any other Security
Certificate shall carry the rights to Contract Fees and Deferred Contract Fees,
if any, accrued and unpaid, and to accrue, which were carried by the Purchase
Contracts that were a part of the Securities evidenced by such other Security
Certificate.
In the case of any Security with respect to which Early Settlement of
the underlying Purchase Contract is effected on an Early Settlement Date after
any Record Date and on or prior to the next succeeding Payment Date, Contract
Fees and Deferred Contract Fees, if any, otherwise payable on such Payment Date
shall be payable on such Payment Date notwithstanding such Early Settlement, and
such Contract Fees and Deferred Contract Fees, if any, shall be paid to the
Person in whose name the Security Certificate evidencing such Security (or one
or more Predecessor Security Certificates) is registered at the close of
business on such Record Date. Except as otherwise expressly provided in the
immediately preceding sentence, in the case of any Security with respect to
which Early Settlement of the underlying Purchase Contract is effected on an
Early Settlement Date, Contract Fees and Deferred Contract Fees, if any, that
would otherwise be payable after the Early Settlement Date with respect to the
Purchase Contract underlying such Security shall not be payable.
The Company's obligations with respect to Contract Fees and Deferred
Contract Fees, if any, are subordinate and junior in right of payment to all
other liabilities of the Company (other than liabilities that expressly provide
that they are pari passu with the Company's obligations with respect to Contract
Fees and Deferred Contract Fees, if any) and pari passu with the most senior
preferred stock directly issued from time to time, if any, by the Company.
SECTION 5.03. Deferral of Payment Dates for Contract Fees. The Company
shall have the right, at any time prior to the Final Settlement Date, to defer
the payment of any or all of the Contract Fees otherwise payable on any Payment
Date (on a pro rata basis among all Outstanding Securities), but only if the
Company shall give the Holders and the Agent written notice of its election to
defer such payment (specifying the amount to be deferred and the period of
deferment) 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 Fees
to the NYSE or other applicable self-regulatory organization or to Holders, but
in any event not less than two Business Days prior to such Record Date. Any
Contract Fees so deferred shall bear additional Contract Fees thereon at the
rate of 8.25% per annum (computed on the basis of the actual number of days
elapsed in a year of 365 or 366 days, as the case may be), compounding on each
succeeding Payment Date, until paid in full (such deferred installments of
Contract Fees,
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together with the additional Contract Fees accrued thereon, are referred to
herein as the "DEFERRED CONTRACT FEES"). The Company may pay the Deferred
Contract Fees in whole or in part on any Payment Date (on a pro rata basis among
all Outstanding Securities). No Contract Fees or Deferred Contract Fees may be
deferred to a date that is after the Final Settlement Date.
In the event that the Company elects to defer the payment of Contract
Fees on the Purchase Contracts until the Final Settlement Date, each Holder
shall receive on the Final Settlement Date, in lieu of a cash payment, a number
of shares of Common Stock (in addition to a number of shares of Common Stock
equal to the Settlement Rate) equal to (x) the aggregate amount of Deferred
Contract Fees payable to a Holder divided by (y) the Applicable Market Value.
No fractional shares of Common Stock shall be issued by the Company
with respect to the payment of Deferred Contract Fees on the Final Settlement
Date. In lieu of fractional shares otherwise issuable with respect to such
payment of Deferred Contract Fees, the Holder shall be entitled to receive an
amount in cash as provided in Section 5.10.
In the event the Company exercises its option to defer the payment of
Contract Fees, then, until the Deferred Contract Fees have been paid in full,
the Company (a) shall not declare or pay dividends on, make distributions with
respect to, or redeem, purchase or acquire, or make a liquidation payment with
respect to, any of its capital stock (other than (i) purchases or acquisitions
of Common Stock in connection with the satisfaction by the Company or any of its
subsidiaries of their respective obligations under any benefit plans for
directors, officers, agents or employees or the Company's dividend reinvestment
or director, officer, agent or employee stock purchase plans, (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 capital stock, (iii) the purchase of fractional interests in
shares of the Company's capital stock pursuant to the conversion or exchange
provisions of the Company's capital stock or the security being converted or
exchanged for the Company's capital stock, (iv) dividends or distributions in
the form of shares of, or options, warrants or rights to subscribe for or
purchase, shares of capital stock of the Company or (v) any declaration of a
dividend in connection with the implementation of extension of a stockholders'
rights plan, or the issuance of stock under any such plan (including the
existing such plan) in the future, or the redemption or repurchase of any such
rights pursuant thereto)), (b) shall not make any payment of interest, principal
or premium, if any, on, or repay, repurchase or redeem any debt securities
issued by the Company that rank pari passu with or junior to such Contract Fees
and (c) shall not make any guarantee payments with respect to any guarantee by
the Company of any securities of any subsidiary of the
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Company if such guarantee ranks pari passu with or junior in right of payment to
the Contract Fees.
SECTION 5.04. Payment of Purchase Price. Unless a Holder settles the
underlying Purchase Contract either through the early delivery of cash to the
Agent in the manner described in Section 5.09 or otherwise, the purchase price
for the shares of Common Stock purchased pursuant to a Purchase Contract shall
be paid by application of payments received by the Company on the Final
Settlement Date from the Collateral Agent pursuant to the Pledge Agreement in
respect of the principal of the Treasury Securities pledged to secure the
obligations of the relevant Holder under such Purchase Contract. Such
application shall satisfy in full the obligations under such Purchase Contract
of the Holder of the Security of which such Purchase Contract is a part. The
Company shall not be obligated to issue any shares of Common Stock in respect of
a Purchase Contract or deliver any certificates therefor to the Holder unless it
shall have received payment in full of the aggregate purchase price for the
shares of Common Stock to be purchased thereunder in the manner herein set
forth.
SECTION 5.05. Issuance of Shares of Common Stock. Unless a Termination
Event or an Early Settlement shall have occurred on or prior to the Final
Settlement Date, on the Final Settlement Date, upon its receipt of payment in
full of the purchase price for the shares of Common Stock purchased by the
Holders pursuant to the foregoing provisions of this Article, and in payment of
Deferred Contract Fees, if any, owed by the Company to the Holders and subject
to Section 5.06(b), the Company shall issue and deposit with the Agent, for the
benefit of the Holders of the Outstanding Securities, one or more certificates
representing the shares of Common Stock to which the Holders are entitled
hereunder, registered in the name of the Agent (or its nominee) as custodian for
the Holders (such certificates for shares of Common Stock, together with any
dividends or distributions with respect thereto, being hereinafter referred to
as the "FINAL SETTLEMENT FUND"). Subject to the foregoing, upon surrender of a
Security Certificate to the Agent on or after the Final Settlement Date,
together with settlement instructions thereon duly completed and executed, the
Holder of such Security Certificate shall be entitled to receive in exchange
therefor a certificate representing that number of whole shares of Common Stock
that such Holder is entitled to receive pursuant to the provisions of this
Article 5 (after taking into account all Securities then held by such Holder)
together with cash in lieu of fractional shares as provided in Section 5.10 and
any dividends or distributions with respect to such shares constituting part of
the Final Settlement Fund, but without any interest thereon, and the Security
Certificate so surrendered shall forthwith be canceled. Each certificate
evidencing such shares shall be registered in the name of the Holder or the
Holder's designee as specified in the settlement instructions on the Security
Certificate. If any shares of Common Stock
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issued in respect of a Purchase Contract and in payment of any Deferred Contract
Fees are to be registered to a Person other than the Person in whose name the
Security Certificate evidencing such Purchase Contract is registered, no such
registration shall be made unless the Person requesting such registration has
paid any transfer and other taxes required by reason of such registration in a
name other than that of the registered Holder of the Security Certificate
evidencing such Purchase Contract or has established to the satisfaction of the
Company that such tax either has been paid or is not payable.
SECTION 5.06. Adjustment of Settlement Rate. (a) Adjustments for
Dividends, Distributions, Stock Splits, Etc.
(i) In case the Company shall pay or make a dividend or other
distribution on any class of common stock of the Company in Common
Stock, the Settlement Rate in effect at the opening of business on the
day following the date fixed for the determination of stockholders
entitled to receive such dividend or other distribution shall be
increased by dividing such Settlement Rate by a fraction of which the
numerator shall be the number of shares of Common Stock outstanding at
the close of business on the date fixed for such determination and the
denominator shall be the sum of such number of shares and the total
number of shares constituting such dividend or other distribution, such
increase to become effective immediately after the opening of business
on the day following the date fixed for such determination. For the
purposes of this clause (i), the number of shares of Common Stock at
any time outstanding shall not include shares held in the treasury of
the Company but shall include shares issuable in respect of scrip
certificates issued in lieu of fractions of Common Stock. The Company
shall not pay any dividend or make any distribution on shares of Common
Stock held in the treasury of the Company.
(ii) 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 upon settlement of the Purchase Contracts
underlying such Securities) entitling them, for a period expiring
within 45 days after the record date for the determination of
stockholders entitled to receive such rights, options or warrants, to
subscribe for or purchase shares of Common Stock at a price per share
less than the Current Market Price per share of Common Stock on the
date fixed for the determination of stockholders entitled to receive
such rights, options or warrants (other than pursuant to a dividend
reinvestment plan), the Settlement Rate in effect at the opening of
business on the day following the date fixed for such determination
shall be increased by dividing such Settlement Rate by a
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fraction of which the numerator shall be the number of shares of Common
Stock outstanding at the close of business on the date fixed for such
determination plus the number of shares of Common Stock that the
aggregate of the offering price of the total number of shares of Common
Stock so offered for subscription or purchase would purchase at such
Current Market Price and the denominator shall be the number of shares
of Common Stock outstanding at the close of business on the date fixed
for such determination plus the number of shares of Common Stock so
offered for subscription or purchase, such increase to become effective
immediately after the opening of business on the day following the date
fixed for such determination. For the purposes of this clause (ii), the
number of shares of Common Stock at any time outstanding shall not
include shares held in the treasury of the Company but shall include
shares issuable in respect of scrip certificates issued in lieu of
fractions of shares of Common Stock. The Company shall not issue any
such rights, options or warrants in respect of shares of Common Stock
held in the treasury of the Company.
(iii) In case outstanding shares of Common Stock shall be
subdivided or split into a greater number of shares of Common Stock,
the Settlement Rate in effect at the opening of business on the day
following the day upon which such subdivision or split becomes
effective shall be proportionately increased, and, conversely, in case
outstanding shares of Common Stock shall each be combined into a
smaller number of shares of Common Stock, the Settlement Rate in effect
at the opening of business on the day following the day upon which such
combination becomes effective shall be proportionately reduced, such
increase or reduction, as the case may be, to become effective
immediately after the opening of business on the day following the day
upon which such subdivision, split or combination becomes effective.
(iv) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock evidences of its
indebtedness, shares of capital stock, securities, cash or property
(excluding any rights or warrants referred to in Section 5.06(a)(ii),
any dividend or distribution paid exclusively in cash and any dividend
or distribution referred to in Section 5.06(a)(i)), the Settlement Rate
shall be adjusted so that the same shall equal the rate determined by
dividing the Settlement Rate in effect immediately prior to the close
of business on the date fixed for the determination of stockholders
entitled to receive such distribution by a fraction of which the
numerator shall be the Current Market Price per share of Common Stock
on the date fixed for such determination less the then fair market
value (as determined by the Board
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of Directors, whose determination shall be conclusive and described in
a Board Resolution filed with the Agent) of the portion of the assets
or evidences of indebtedness so distributed applicable to one share of
Common Stock and the denominator shall be such Current Market Price per
share of 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.
(v) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock cash (excluding (x) any
quarterly cash dividend on the Common Stock to the extent that the
aggregate cash dividend per share of Common Stock in any fiscal quarter
does not exceed the greater of (A) the amount per share of Common Stock
of the next preceding quarterly cash dividend on the Common Stock to
the extent that such preceding quarterly dividend did not require an
adjustment of the Settlement Rate pursuant to this Section 5.06(a)(v)
(as adjusted to reflect subdivisions or combinations of the Common
Stock), and (B) 3.75% of the arithmetic average of the Closing Prices
of the Common Stock during the ten consecutive Trading Days immediately
prior to the date of declaration of such dividend, and (y) any dividend
or distribution in connection with the liquidation, dissolution or
winding up of the Company, whether voluntary or involuntary), then, in
such case, the Settlement Rate shall be increased so that the same
shall equal the rate determined by multiplying the Settlement Rate in
effect immediately prior to the close of business on such record date
by a fraction of which the numerator shall be the Current Market Price
of the Common Stock, and the denominator shall be the Current Market
Price of the Common Stock on the record date less the amount of cash so
distributed (and not excluded as provided above) applicable to one
share of Common Stock, such increase to be effective immediately prior
to the opening of business on the day following the record date;
provided, however, that in the event the portion of the cash so
distributed applicable to one share of Common Stock of the Company is
equal to or greater than the Current Market Price of the Common Stock
of the Company on the record date, in lieu of the foregoing adjustment,
adequate provision shall be made so that each holder of a Security
shall have the right to receive upon settlement of the Securities the
amount of cash such Holder would have received had such Holder settled
each Security on the record date. In the event that such dividend or
distribution is not so paid or made, the Settlement Rate shall again be
adjusted to be the Settlement Rate which would then be in effect if
such dividend or distribution had not been declared. If any adjustment
is required to be made as set forth in this Section 5.06(a)(v) as a
result of a
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distribution that is a quarterly dividend, such adjustment shall be
based upon the amount by which such distribution exceeds the amount of
the quarterly cash dividend permitted to be excluded pursuant to this
Section 5.06(a)(v) (notwithstanding the provisions of Section
5.06(a)(x)). If an adjustment is required to be made as set forth in
this Section 5.06(a)(v) above as a result of a distribution that is not
a quarterly dividend, such adjustment shall be based upon the full
amount of the distribution.
(vi) In case of a tender or exchange offer made by a Person
other than the Company or any subsidiary of the Company for an amount
which increases the offeror's ownership of Common Stock of the Company
to more than 25% of the Common Stock outstanding and shall involve the
payment by such Person of consideration per share of Common Stock
having a fair market value (as determined by the Board of Directors,
whose determination shall be conclusive, and described in a Board
Resolution) at the last time (the "EXPIRATION TIME") tenders or
exchanges may be made pursuant to such tender or exchange offer (as it
shall have been amended) that exceeds the Current Market Price of the
Common Stock on the Trading Day next succeeding the Expiration Time,
and in which, as of the Expiration Time, the Board of Directors is
recommending acceptance of the offer, the Settlement Rate shall be
increased so that the same shall equal the rate determined by
multiplying the Settlement Rate in effect immediately prior to the
Expiration Time by a fraction of which the numerator shall be the sum
of (x) the fair market value (determined as aforesaid) of the aggregate
consideration payable to stockholders based on the acceptance (up to
any maximum specified in the terms of the tender or exchange offer) of
all shares validly tendered or exchanged 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") and (y) the product of the
number of shares of Common Stock of the Company outstanding (less any
Purchased Shares) on the Expiration Time and the Current Market Price
of the Common Stock on the Trading Day next succeeding the Expiration
Time, and the denominator shall be the number of shares of Common Stock
of the Company outstanding (including any tendered or exchanged shares)
on the Expiration Time multiplied by the Current Market Price of the
Common Stock on the Trading Day next succeeding the Expiration Time,
such increase to become effective immediately prior to the opening of
business on the day following the Expiration Time. In the event that
such Person is obligated to purchase shares pursuant to any such tender
or exchange offer, but such Person is permanently prevented by
applicable law from effecting any such purchases or all such purchases
are rescinded, the Settlement Rate shall again be adjusted to be the
Settlement Rate which would then be in effect
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if such tender or exchange offer had not been made. Notwithstanding the
foregoing, the adjustment described in this Section 5.06(a)(vi) shall
not be made if, as of the Expiration Time, the offering documents with
respect to such offer disclose a plan or intention to cause the Company
to engage in a consolidation or merger of the Company or a sale of all
or substantially all of the assets of the Company.
(vii) In the event that the rights (the "RIGHTS") are
separated from the Common Stock in accordance with the provisions of
the Rights Agreement dated as of August 21, 1995 between the Company
and The Bank of New York, as Rights Agent (or any successor rights
plan) such that the Holders would thereafter not be entitled to receive
any such Rights in respect of the Common Stock issuable pursuant to the
Purchase Contracts, the Settlement Rate shall be adjusted as provided
in Section 5.06(a)(iv) (subject to readjustment in the event of the
expiration, termination or redemption of the Rights).
(viii) The reclassification of Common Stock into securities
including securities other than Common Stock (other than any
reclassification upon a Reorganization Event to which Section 5.06(b)
applies) shall be deemed to involve (A) a distribution of such
securities other than Common Stock to all holders of Common Stock (and
the 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 (iv) of this Section), and (B) a subdivision,
split or combination, as the case may be, of the number of shares of
Common Stock outstanding immediately prior to such reclassification
into the number of shares of Common Stock outstanding immediately
thereafter (and the effective date of such reclassification shall be
deemed to be "the date 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 Section
5.06(a)(iii)).
(ix) The "CURRENT MARKET PRICE" per share of Common Stock on
any day means the average of the daily Closing Prices for the five
consecutive Trading Days selected by the Company commencing not more
than 20 Trading Days before, and ending not later than, the earlier of
the day in question and the day before the "ex date" with respect to
the issuance or distribution requiring such computation. For purposes
of this paragraph, the term "EX DATE", when used with respect to any
issuance or distribution, shall mean the first date on which the Common
Stock trades
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regular way on the applicable exchange or in the applicable market
without the right to receive such issuance or distribution.
(x) All adjustments to the Settlement Rate shall be calculated
to the nearest 1/10,000th of a share of Common Stock (or if there is
not a nearest 1/10,000th of a share to the next lower 1/10,000th of a
share). No adjustment in the Settlement Rate shall be required unless
such adjustment would require an increase or decrease of at least one
percent therein; provided, however, that any adjustments that by reason
of this clause (x) are not required to be made shall be carried forward
and taken into account in any subsequent adjustment. If an adjustment
is made to the Settlement Rate pursuant to Section 5.06(a)(i), (ii),
(iii), (iv), (v), (vi), (vii), (viii) or (xi), an adjustment shall also
be made to the Applicable Market Value solely to determine which of
clauses (a), (b) or (c) of the definition of Settlement Rate in Section
5.01 shall apply on the Final Settlement Date. Such adjustment shall be
made by multiplying the Applicable Market Value by a fraction of which
the numerator shall be the Settlement Rate immediately after such
adjustment pursuant to Section 5.06(a)(i), (ii), (iii), (iv), (v),
(vi), (vii), (viii) or (xi) and the denominator shall be the Settlement
Rate immediately before such adjustment.
(xi) The Company may make such increases in the Settlement
Rate, in addition to those required by this Section, as the Board of
Directors deems advisable in order to avoid or diminish any income tax
to any holders of Common Stock resulting from any dividend or
distribution of stock or issuance of rights or warrants to purchase or
subscribe for stock or from any event treated as such for income tax
purposes or for any other reasons.
(b) Adjustment for Consolidation, Merger or Other Reorganization
Event. In the event of (i) any consolidation or merger of the Company with or
into another Person (other than a merger or consolidation in which the Company
is the continuing corporation and in which the Common Stock outstanding
immediately prior to the merger or consolidation is not exchanged for cash,
securities or other property of the Company or another corporation), (ii) any
sale, transfer, lease or conveyance to another Person of the property of the
Company as an entirety or substantially as an entirety, (iii) any statutory
exchange of securities of the Company with another Person (other than in
connection with a merger or acquisition) or (iv) any liquidation, dissolution or
winding up of the Company other than as a result of or after the occurrence of a
Termination Event (any such event, a "REORGANIZATION EVENt"), the Settlement
Rate shall be adjusted to provide that each Holder of Securities shall receive
on the Final Settlement Date with respect to each Purchase Contract forming a
part thereof, the kind and
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amount of securities, cash and other property (the "EVENT CONSIDERATION")
receivable upon consummation of the Reorganization Event by a holder of a number
of shares of Common Stock equal to the Settlement Rate, assuming such holder of
Common Stock is not a Person with which the Company consolidated or into which
the Company merged or that merged into the Company or to which such sale or
transfer was made, as the case may be ("CONSTITUENT PERSON"), or an Affiliate of
a Constituent Person, and that such holder failed to exercise such holder's
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). Following a Reorganization Event, the Applicable Market
Value shall equal the value of the Event Consideration receivable in respect of
one share of Common Stock, determined in the following manner: (i) for any Event
Consideration consisting of cash, the amount of such cash; (ii) for any Event
Consideration consisting of Marketable Common Stock, the average of the Closing
Prices per share of such Marketable Common Stock on each of the twenty
consecutive Trading Days ending on the second Trading Day immediately preceding
the Final Settlement Date; and (iii) for any Event Consideration consisting of
securities or other property other than cash or Marketable Common Stock, an
amount equal to the fair market value of such Event Consideration on the Final
Settlement Date as determined by the Board of Directors. "MARKETABLE COMMON
STOCK" means any common equity securities listed on a U.S. national exchange or
automated quotation system. In the event of such a Reorganization Event, the
Person formed by such consolidation, merger or exchange or the Person that
acquires the assets of the Company or, in the event of a liquidation or
dissolution of the Company, the Company or a liquidating trust created in
connection therewith, shall execute and deliver to the Agent an agreement
supplemental hereto providing that the Holders of each Outstanding Security
shall have the rights provided by this Section 5.06. Such supplemental agreement
shall provide for adjustments that, 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, and shall provide
for such modifications to the definition of "Common Stock" and such other
provisions hereof and of the Securities as shall be necessary to carry out the
economic intent of this Agreement. The above provisions of this Section shall
similarly apply to successive Reorganization Events.
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SECTION 5.07. Notice of Adjustments and Certain Other Events. (a)
Whenever the Settlement Rate is adjusted as herein provided, the Company shall:
(i) forthwith compute the adjusted Settlement Rate in
accordance with Section 5.06 and prepare and transmit to the Agent an
Officers' Certificate setting forth the adjusted Settlement Rate, the
method of calculation thereof in reasonable detail and the facts
requiring such adjustment and upon which such adjustment is based; and
(ii) within 10 Business Days following the occurrence of an
event that permits or requires an adjustment to the Settlement Rate
pursuant to Section 5.06 (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 occurrence of such event and a
statement in reasonable detail setting forth the method by which the
adjustment to the Settlement Rate was determined and setting forth the
adjusted Settlement Rate.
(b) The Agent shall not at any time be under any duty or
responsibility to any Holder to determine whether any facts exist that may
require any adjustment of the Settlement Rate, or with respect to the nature or
extent or calculation of any such adjustment when made, or with respect to the
method employed in making the same. The Agent shall not be accountable with
respect to the validity or value (or the kind or amount) of any shares of Common
Stock, or of any securities or property, which may at the time be issued or
delivered with respect to any Purchase Contract; and the Agent makes no
representation with respect thereto. The Agent shall not be responsible for any
failure of the Company to issue, transfer or deliver any shares of Common Stock
pursuant to a Purchase Contract or to comply with any of the duties,
responsibilities or covenants of the Company contained in this Article.
SECTION 5.08. Termination Event; Notice. The Purchase Contracts and the
obligations and rights of the Company and the Holders thereunder, including,
without limitation, the rights of the Holders to receive and the obligation of
the Company to pay any Contract Fees or any Deferred Contract Fees, shall
immediately and automatically terminate, without the necessity of any notice or
action by any Holder, the Agent or the Company, if, on or prior to the Final
Settlement Date, a Termination Event shall have occurred. Upon and after the
occurrence of a Termination Event, the Securities shall thereafter represent the
right to receive the Treasury Securities forming a part of such Securities in
accordance with the provisions of Section 4.02 and the Pledge Agreement. Upon
the occurrence of a Termination Event, the Company shall promptly but in no
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event more than two Business Days thereafter give written notice to the Agent,
the Collateral Agent and the Holders.
SECTION 5.09. Early Settlement. (a) Subject to and upon compliance with
the provisions of this Section 5.09, at the option of the Holder thereof, any
Purchase Contracts in integral multiples of 1,000 Securities may be settled
early ("EARLY SETTLEMENT") as provided herein. In order to exercise the right to
effect Early Settlement with respect to any Purchase Contracts, the Holder of
the Security Certificate evidencing such Purchase Contracts shall deliver such
Security Certificate to the Agent at the Corporate Trust Office duly endorsed
for transfer to the Company or in blank with the form of Election to Settle
Early on the reverse thereof duly completed and accompanied by payment in the
form of immediately available funds in an amount (the "EARLY SETTLEMENT AMOUNT")
equal to (i) the product of (A) the Stated Amount times (B) the number of
Purchase Contracts with respect to which the Holder has elected to effect Early
Settlement plus (ii) if such delivery is made with respect to any Purchase
Contracts during the period from the close of business on any Record Date
immediately preceding any Payment Date to the opening of business on such
Payment Date, an amount equal to the sum of (x) the Contract Fees and Deferred
Contract Fees, if any, payable on such Payment Date with respect to such
Purchase Contracts plus (y) if such Security Certificate evidences Coupon
Securities, the interest on the related Treasury Notes payable on such Payment
Date. Except as provided in the immediately preceding sentence and subject to
the second to the last paragraph of Section 5.02, no payment or adjustment shall
be made upon Early Settlement of any Purchase Contract on account of any
Contract Fees or Deferred Contract Fees, if any, accrued on such Purchase
Contract or on account of any dividends on the Common Stock issued upon such
Early Settlement. If the foregoing requirements are first satisfied with respect
to Purchase Contracts underlying any Securities at or prior to 5:00 p.m., New
York City time, on a Business Day, such day shall be the "EARLY SETTLEMENT DATE"
with respect to such Securities and if such requirements are first satisfied
after 5:00 p.m, New York City time, on a Business Day or on a day that is not a
Business Day, the "EARLY SETTLEMENT DATE" with respect to such Securities shall
be the next succeeding Business Day. Notwithstanding the foregoing, a Holder of
Zero-Coupon Securities will not have the right to elect Early Settlement on any
Early Settlement Date occurring after November 14, 2001.
(b) Upon Early Settlement of Purchase Contracts by a Holder of the
related Securities, the Company shall issue, and the Holder shall be entitled to
receive, a number of shares of Common Stock on account of each Purchase Contract
as to which Early Settlement is effected equal to the Early Settlement Rate;
provided, however, that upon the Early Settlement of the Purchase Contracts, the
Holder of such related Securities shall forfeit the right to receive
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accrued Contract Fees and any Deferred Contract Fees. The "EARLY SETTLEMENT
RATE" shall initially be equal to .8333 and shall be adjusted in the same manner
and at the same time as the Settlement Rate is adjusted. As promptly as
practicable after Early Settlement of Purchase Contracts in accordance with the
provisions of this Section 5.09, the Company shall issue and shall deliver to
the Agent at the Corporate Trust Office a certificate or certificates for the
full number of shares of Common Stock issuable upon such Early Settlement
together with payment in lieu of any fraction of a share, as provided in Section
5.10.
(c) The Company shall cause the shares of Common Stock issuable, and
Treasury Securities deliverable, upon Early Settlement of Purchase Contracts to
be issued and delivered to the Agent, in the case of such shares of Common
Stock, and released from the Pledge by the Collateral Agent and credited to a
securities account of the Agent, in the case of such Treasury Securities, for
delivery or credit to the Holder thereof or its designee, no later than 5:00
p.m. New York City time the third Business Day after the applicable Early
Settlement Date.
(d) Upon Early Settlement of any Purchase Contracts, and subject to
receipt thereof from the Company or the Collateral Agent, as applicable, the
Agent shall, in accordance with the instructions provided by the Holder thereof
on the applicable form of Election to Settle Early on the reverse of the
Security Certificate evidencing the related Securities, (i) credit the Treasury
Securities forming a part of such Securities to the securities account so
designated by such Holder and (ii) deliver a certificate or certificates for the
full number of shares of Common Stock issuable upon such Early Settlement
together with payment in lieu of any fraction of a share, as provided in Section
5.10.
(e) In the event that Early Settlement is effected with respect to
Purchase Contracts underlying less than all the Securities evidenced by a
Security Certificate, upon such Early Settlement the Company shall execute, and
the Agent shall authenticate, execute on behalf of the Holder and deliver to the
Holder, at the expense of the Company, a Security Certificate evidencing the
Securities as to which Early Settlement was not effected.
SECTION 5.10. No Fractional Shares. No fractional shares or scrip
representing fractional shares of Common Stock shall be issued or delivered upon
settlement on the Final Settlement Date or upon Early Settlement of any Purchase
Contracts or with respect to the payment of Deferred Contract Fees, if any, on
the Final Settlement Date. If Security Certificates evidencing more than one
Purchase Contract shall be surrendered for settlement at one time by the same
Holder, the number of full shares of Common Stock that shall be delivered upon
settlement shall be computed on the basis of the aggregate number of Purchase
Contracts evidenced by the Security Certificates so surrendered. Instead of any
fractional
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shares of Common Stock that would otherwise be deliverable upon settlement of
any Purchase Contracts on the Final Settlement Date or upon Early Settlement or
with respect to the payment of any Deferred Contract Fees, the Company, through
the Agent, shall make a cash payment in respect of such fractional interest in
an amount equal to the value of such fractional shares at the Closing Price per
share on the second Trading Day immediately preceding the Final Settlement Date
or the related Early Settlement Date, respectively. The Company shall provide
the Agent from time to time with sufficient funds to permit the Agent to make
all cash payments required by this Section 5.10 in a timely manner.
SECTION 5.11. Charges and Taxes. The Company shall pay all stock
transfer and similar taxes attributable to the initial issuance and delivery of
the shares of Common Stock pursuant to the Purchase Contracts and in payment of
any Deferred Contract Fees; provided, however, that the Company shall not be
required to pay any such tax or taxes that may be payable in respect of any
exchange of or substitution for a Security Certificate evidencing a Purchase
Contract or any issuance of a share of Common Stock in a name other than that of
the registered Holder of a Security Certificate surrendered in respect of the
Purchase Contracts evidenced thereby, other than in the name of the Agent, as
custodian for such Holder, and the Company shall not be required to issue or
deliver such share certificates or Security Certificates unless or until the
Person or Persons requesting the transfer or issuance thereof shall have paid to
the Company the amount of such tax or shall have established to the satisfaction
of the Company that such tax has been paid or is not payable.
ARTICLE 6
REMEDIES
SECTION 6.01. Unconditional Right of Holders to Receive Contract Fees
and Purchase Common Stock. The Holder of any Security shall have the right,
which is absolute and unconditional (subject to the right of the Company to
defer payment thereof pursuant to Section 5.03 and subject to the forfeiture of
accrued Contract Fees and any Deferred Contract Fees upon Early Settlement
pursuant to Section 5.09(b) and upon a Termination Event pursuant to Section
5.08), to receive payment of each installment of the Contract Fees with respect
to the Purchase Contract constituting a part of such Security on the respective
Payment Date for such Security and to purchase Common Stock pursuant to such
Purchase Contract and, in each such case, to institute suit for the enforcement
of any such payment and right to purchase Common Stock, and such rights shall
not be impaired without the consent of such Holder.
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SECTION 6.02. 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 6.03. Rights and Remedies Cumulative. Except as otherwise
provided with respect to the replacement of mutilated, destroyed, lost or stolen
Security Certificates in the last paragraph of Section 3.06, no right or remedy
herein conferred upon or reserved to the Holders is intended to be exclusive of
any other right or remedy, and every right and remedy shall, to the extent
permitted by law, be cumulative and in addition to every other right and remedy
given hereunder or now or hereafter existing at law or in equity or otherwise.
The assertion or employment of any right or remedy hereunder, or otherwise,
shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.
SECTION 6.04. Delay or Omission Not Waiver. No delay or omission of any
Holder to exercise any right or remedy shall impair any such right or remedy or
constitute a waiver of any such right. Every right and remedy given by this
Article or by law to the Holders may be exercised from time to time, and as
often as may be deemed expedient, by such Holders.
SECTION 6.05. Undertaking for Costs. All parties to this Agreement
agree, and each Holder of any Security by such Holder's acceptance of the
Security Certificate evidencing such Security shall be deemed to have agreed,
that any court may in its discretion require, in any suit for the enforcement of
any right or remedy under this Agreement, or in any suit against the Agent for
any action taken, suffered or omitted by it as Agent, the filing by any party
litigant in such suit of an undertaking to pay the costs of such suit, and that
such court may in its discretion assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in such suit, having due regard to
the merits and good faith of the claims or defenses made by such party litigant;
provided that the provisions of this Section shall not apply to any suit
instituted by the Company, to any suit instituted by the Agent, to any suit
instituted by any Holder, or group of Holders, holding in the aggregate more
than 10% of the Outstanding Securities, or to any suit instituted by any Holder
for the enforcement of the payment of the interest on any Treasury Note or the
Contract Fees or Deferred Contract Fees, if any, on any Purchase Contract on or
after the respective Payment Date therefor constituting a part of the Securities
held by such Holder, or for enforcement of the right to
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purchase Common Stock under the Purchase Contracts constituting a part of the
Securities held by such Holder.
SECTION 6.06. Waiver of Stay or Extension Laws. The Company covenants
(to the extent that it may lawfully do so) that it shall not at any time insist
upon, or plead, or in any manner whatsoever claim or take the benefit or
advantage of, any stay or extension law wherever enacted, now or at any time
hereafter in force, which may affect the covenants or the performance of this
Agreement; and the Company (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law and covenants that it
shall not hinder, delay or impede the execution of any power herein granted to
the Agent or the Holders, but shall suffer and permit the execution of every
such power as though no such law had been enacted.
ARTICLE 7
THE AGENT
SECTION 7.01. Certain Duties and Responsibilities.
(a) (i) the Agent undertakes to perform, with respect to the
Securities, such duties and only such duties as are specifically set
forth in this Agreement and the Pledge Agreement, and no implied
covenants or obligations shall be read into this Agreement against the
Agent; and
(ii) in the absence of bad faith or negligence on its part, the Agent
may, with respect to the Securities, conclusively rely, as to the truth
of the statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the Agent and
conforming to the requirements of this Agreement, but in the case of
any certificates or opinions that by any provision hereof are
specifically required to be furnished to the Agent, the Agent shall be
under a duty to examine the same to determine whether or not they
conform to the requirements of this Agreement; and
(iii) in case of a Termination Event, the Agent shall exercise such of
the rights and powers vested in it by this Agreement, and use the same
degree of care and skill in their exercise, as a prudent person would
exercise or use under the circumstances in the conduct of his or her
own affairs.
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(b) No provision of this Agreement shall be construed to relieve the
Agent from liability for its own negligent action, its own negligent failure to
act, or its own wilful misconduct, except that
(i) this Subsection shall not be construed to limit the effect
of Subsection (a) of this Section;
(ii) the Agent shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it shall be proved
that the Agent was negligent in ascertaining the pertinent facts; and
(iii) no provision of this Agreement shall require the Agent
to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder, or in the
exercise of any of its rights or powers, if adequate indemnity is not
provided to it.
(c) Whether or not therein expressly so provided, every provision of
this Agreement relating to the conduct or affecting the liability of or
affording protection to the Agent shall be subject to the provisions of this
Section.
SECTION 7.02. Notice of Default. Within 30 days after the occurrence of
any default by the Company in the performance of any of its obligations
hereunder, of which a Responsible Officer of the Agent has actual knowledge, the
Agent shall transmit by mail to all Holders, as their names and addresses appear
in the Security Register, notice of such default hereunder, unless such default
shall have been cured or waived.
SECTION 7.03. Certain Rights of Agent. Subject to the provisions of
Section 7.01:
(a) the Agent may rely and shall be protected in acting or refraining
from acting upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document believed by it to be genuine
and to have been signed or presented by the proper party or parties;
(b) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by an Officers' Certificate, Issuer Order or Issuer
Request, and any resolution of the Board of Directors 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
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or omitting any action hereunder, the Agent (unless other evidence be herein
specifically prescribed) may, in the absence of bad faith on its part, rely upon
an Officers' Certificate;
(d) the Agent may consult with counsel and the written advice of such
counsel or any Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it hereunder
in good faith and in reliance thereon;
(e) the Agent shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document, but the Agent,
in its discretion, may make reasonable further inquiry or investigation into
such facts or matters related to the issuance of the Securities and the
execution, delivery and performance of the Purchase Contracts as it may see fit,
and, if the Agent shall determine to make such further inquiry or investigation,
it shall be entitled to examine the books, records and promises of the Company,
personally or by agent or attorney; and
(f) the Agent may execute any of its powers hereunder or perform any
duties hereunder either directly or by or through agents or attorneys or an
Affiliate and the Agent shall not be responsible for any misconduct or
negligence on the part of any agent or attorney or an Affiliate appointed with
due care by it hereunder.
SECTION 7.04. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Security Certificates shall be taken as
the statements of the Company and the Agent assumes no responsibility for their
accuracy. The Agent makes no representations as to the validity or sufficiency
of either this Agreement or of the Securities, or of the Pledge Agreement or the
Pledge. The Agent shall not be accountable for the use or application by the
Company of the proceeds in respect of the Purchase Contracts.
SECTION 7.05. May Hold Securities. Any Security Registrar or any other
agent of the Company, or the Agent and its Affiliates, in their individual or
any other capacity, may become the owner or pledgee of Securities and may
otherwise deal with the Company, the Collateral Agent or any other Person with
the same rights it would have if it were not Security Registrar or such other
agent, or the Agent.
SECTION 7.06. Money Held in Custody. Money held by the Agent in
custody hereunder need not be segregated from the other funds except to the
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extent required by law. The Agent shall be under no obligation to invest or pay
interest on any money received by it hereunder except pursuant to the provisions
of Section 4.01 or as otherwise agreed in writing with the Company.
SECTION 7.07. Compensation and Reimbursement. The Company agrees:
(a) to pay to the Agent from time to time reasonable
compensation for all services rendered by it hereunder as the Company
and the Agent shall, from time to time, agree in writing;
(b) except as otherwise expressly provided herein, to
reimburse the Agent upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Agent in accordance
with any provision of this Agreement (including the reasonable
compensation and the expenses and disbursements of its agents and
counsel), except any such expense, disbursement or advance as may be
attributable to its negligence or bad faith; and
(c) to indemnify the Agent and any predecessor Agent for, and
to hold each of them harmless against, any loss, liability or expense
incurred without negligence or bad faith on its part, arising out of or
in connection with the acceptance or administration of its duties
hereunder, including the costs and expenses of defending itself against
any claim or liability in connection with the exercise or performance
of any of its powers or duties hereunder.
SECTION 7.08. Corporate Agent Required; Eligibility. There shall at all
times be an Agent hereunder, which shall be a corporation organized and doing
business under the laws of the United States of America, any State thereof or
the District of Columbia, authorized under such laws to exercise corporate trust
powers, having (or being a member of a bank holding company having) a combined
capital and surplus of at least $50,000,000, subject to supervision or
examination by Federal or State authority, 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.
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SECTION 7.09. Resignation and Removal; Appointment of Successor. (a) No
resignation or removal of the Agent and no appointment of a successor Agent
pursuant to this Article shall become effective until the acceptance of
appointment by the successor Agent in accordance with the applicable
requirements of Section 7.10.
(b) The Agent may resign at any time by giving written notice thereof
to the Company 60 days prior to the effective date of such resignation. If the
instrument of acceptance by a successor Agent required by Section 7.10 shall not
have been delivered to the Agent within 30 days after the giving of such notice
of resignation, the resigning Agent may petition any court of competent
jurisdiction for the appointment of a successor Agent.
(c) The Agent may be removed at any time by Act of the Holders of a
majority in Stated Amount of the Outstanding Securities delivered to the Agent
and the Company.
(d) If at any time
(i) the Agent fails to comply with Section 310(b) of the TIA,
as if the Agent were an indenture trustee under an indenture qualified
under the TIA, after written request therefor by the Company or by any
Holder who has been a Holder of a Security for at least six months, or
(ii) the Agent shall cease to be eligible under Section 7.08
and shall fail to resign after written request therefor by the Company
or by any such Holder, or
(iii) 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, (i) the Company by a Board Resolution may remove the
Agent, or (ii) any Holder who has been a Holder of a Security for at least six
months may, on behalf of himself and all others similarly situated, petition any
court of competent jurisdiction for the removal of the Agent and the appointment
of a successor Agent.
(e) If the Agent shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Agent for any cause, the
Company, by a Board Resolution, shall promptly appoint a successor Agent and
shall comply
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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 Holder of a Security for at
least six months may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the appointment of a successor
Agent.
(f) The Company shall give, or shall cause such successor Agent to
give, notice of each resignation and each removal of the Agent and each
appointment of a successor Agent by mailing written notice of such event by
first-class mail, postage prepaid, to all Holders as their names and addresses
appear in the Security Register. Each notice shall include the name of the
successor Agent and the address of its Corporate Trust Office.
SECTION 7.10. Acceptance of Appointment by Successor. (a) In case of
the appointment hereunder of a successor Agent, every such successor Agent so
appointed shall execute, acknowledge and deliver to the Company and to the
retiring Agent an instrument accepting such appointment, and thereupon the
resignation or removal of the retiring Agent shall become effective and such
successor Agent, without any further act, deed or conveyance, shall become
vested with all the rights, powers, agencies and duties of the retiring Agent;
but, on the request of the Company or the successor Agent, such retiring Agent
shall, upon payment of its charges, execute and deliver an instrument
transferring to such successor Agent all the rights, powers and trusts of the
retiring Agent and shall duly assign, transfer and deliver to such successor
Agent all property and money held by such retiring Agent hereunder.
(b) Upon request of any such successor Agent, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Agent all such rights, powers and agencies referred
to in Section 7.10(a).
(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
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or filing of any paper or any further act on the part of any of the parties
hereto. In case any Security Certificates shall have been authenticated and
executed on behalf of the Holders, but not delivered, by the Agent then in
office, any successor by merger, conversion or consolidation to such Agent may
adopt such authentication and execution and deliver the Security Certificates so
authenticated and executed with the same effect as if such successor Agent had
itself authenticated and executed such Securities.
SECTION 7.12. Preservation of Information; Communications to Holders.
(a) The Agent shall preserve, in as current a form as is reasonably practicable,
the names and addresses of Holders received by the Agent in its capacity as
Security Registrar.
(b) If one or more Holders (herein referred to as "APPLICANTS") apply
in writing to the Agent, and furnish to the Agent reasonable proof that each
such applicant has owned a Security for a period of at least six months
preceding the date of such application, and such application states that the
applicants desire to communicate with other Holders with respect to their rights
under this Agreement or under the Securities and is accompanied by a copy of the
form of proxy or other communication that such applicants propose to transmit,
then the Agent shall, within five Business Days after the receipt of such
application, afford such applicants access to the information preserved at the
time by the Agent in accordance with Section 7.12(a).
(c) Every Holder, by receiving and holding the Security Certificates
evidencing the Securities, agrees with the Company and the Agent that none of
the Company, the Agent nor any agent of any of them shall be held accountable by
reason of the disclosure of any such information as to the names and addresses
of the Holders in accordance with Section 7.12(b), regardless of the source from
which such information was derived.
SECTION 7.13. No Obligations of Agent. Except to the extent otherwise
provided in this Agreement, the Agent assumes no obligations and shall not be
subject to any liability under this Agreement, the Pledge Agreement or any
Purchase Contract in respect of the obligations of the Holder of any Security
thereunder. The Company agrees, and each Holder of a Security Certificate, by
such Holder's acceptance thereof, shall be deemed to have agreed, that the
Agent's execution of the Security Certificates on behalf of the Holders shall be
solely as agent and attorney-in-fact for the Holders, and that the Agent shall
have no obligation to perform such Purchase Contracts on behalf of the Holders,
except to the extent expressly provided in Article 5 hereof.
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SECTION 7.14. Tax Compliance. (a) The Agent, on its own behalf and on
behalf of the Company, shall comply with all applicable certification,
information reporting and withholding (including "backup" withholding)
requirements imposed by applicable tax laws, regulations or administrative
practice with respect to (i) any payments made with respect to the Securities or
(ii) the issuance, delivery, holding, transfer, redemption or exercise of rights
under the Securities. Such compliance shall include, without limitation, the
preparation and timely filing of required returns and the timely payment of all
amounts required to be withheld to the appropriate taxing authority or its
designated agent.
(b) The Agent shall comply with any direction received from the
Company with respect to the application of such requirements to particular
payments or Holders or in other particular circumstances, and may for purposes
of this Agreement rely on any such direction in accordance with the provisions
of Section 7.01(a)(ii) hereof.
(c) The Agent shall maintain all appropriate records documenting
compliance with such requirements, and shall make such records available, on
written request, to the Company or to its authorized representative within a
reasonable period of time after receipt of such request.
ARTICLE 8
SUPPLEMENTAL AGREEMENTS
SECTION 8.01. 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 Security Certificates; or
(b) to add to the covenants of the Company for the benefit of the
Holders, or to surrender any right or power herein conferred upon the Company;
or
(c) to evidence and provide for the acceptance of appointment
hereunder by a successor Agent; or
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(d) to make provision with respect to the rights of Holders pursuant
to the requirements of Section 5.06(b); or
(e) to make any of the following changes with respect to the Treasury
Securities underlying a Security: (i) from a Treasury Note or a Treasury Strip,
as the case may be, to a security entitlement in respect thereof, (ii) from a
security entitlement in respect of a Treasury Note or a Treasury Strip, as the
case may be, to a Treasury Note or a Treasury Strip, as the case may be, or
(iii) from a security entitlement in respect of one securities account to a
security entitlement in respect of another securities account, whether or not
with the same securities intermediary; or
(f) to cure any ambiguity, to correct or supplement any provisions
herein that 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 in each case that such action shall not adversely affect the
interests of the Holders.
SECTION 8.02. Supplemental Agreements with Consent of Holders. With the
consent of the Holders of not less than 66 2/3% in Stated Amount of the
Outstanding Securities, by Act of said Holders delivered to the Company and the
Agent, the Company, when authorized by a Board Resolution, and the Agent may
enter into an agreement or agreements supplemental hereto for the purpose of
modifying in any manner the terms of the Securities, or the provisions of this
Agreement or the rights of the Holders in respect of the Securities; provided,
however, that no such supplemental agreement shall, without the consent of the
Holder of each Outstanding Security affected thereby,
(a) change any Payment Date;
(b) change the amount or type (other than a change of the type
described in Section 8.01(e)) of Treasury Securities underlying a Security,
impair the right of the Holder of any Security to receive interest payments on
the Coupon Treasury Securities underlying Coupon Securities or otherwise
adversely affect the Holder's rights in or to any such Treasury Securities;
(c) change the place or currency of payment or reduce any Contract
Fees or any Deferred Contract Fees;
(d) impair the right to institute suit for the enforcement of any
Purchase Contract;
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(e) reduce the number of shares of Common Stock purchasable under any
Purchase Contract, increase the price to purchase Common Stock upon settlement
of any Purchase Contract, change the Final Settlement Date or otherwise
adversely affect the Holder's rights under any Purchase Contract; or
(f) reduce the percentage of the Outstanding Securities the consent of
whose Holders is required for any modification or amendment of the provisions of
the Purchase Contracts or this Agreement.
Notwithstanding the foregoing, if any agreement supplemental hereto
would modify only the terms of the Coupon Securities or the Zero-Coupon
Securities, or would modify the rights of Holders of only Coupon Securities or
Zero-Coupon Securities, then only Holders of Coupon Securities or Zero-Coupon
Securities, as the case may be, shall be entitled to consent or withhold consent
with respect thereto, and, with the consent of the Holders of not less than 66
2/3% in Stated Amount of the Outstanding Securities that are Coupon Securities
or Zero-Coupon Securities, as the case may be, 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 to such agreement supplemental hereto.
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 8.03. Execution of Supplemental Agreements. In executing, or
accepting the additional agencies created by, any supplemental agreement
permitted by this Article or the modifications thereby of the agencies created
by this Agreement, the Agent shall be entitled to receive and (subject to
Section 7.01) 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 that affects the Agent's own rights, duties
or immunities under this Agreement or otherwise.
SECTION 8.04. Effect of Supplemental Agreements. Upon the execution of
any supplemental agreement under this Article, this Agreement shall be modified
in accordance therewith, and such supplemental agreement shall form a part of
this Agreement for all purposes; and every Holder of Security Certificates
theretofore or thereafter authenticated, executed on behalf of the Holders and
delivered hereunder shall be bound thereby.
SECTION 8.05. Reference to Supplemental Agreements. Security
Certificates authenticated, executed on behalf of the Holders and delivered
after
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the execution of any supplemental agreement pursuant to this Article may, and
shall if required by the Agent, bear a notation in form approved by the Agent as
to any matter provided for in such supplemental agreement. If the Company shall
so determine, new Security Certificates so modified as to conform, in the
opinion of the Agent and the Company, to any such supplemental agreement may be
prepared and executed by the Company and authenticated, executed on behalf of
the Holders and delivered by the Agent in exchange for Outstanding Security
Certificates.
ARTICLE 9
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
SECTION 9.01. Covenant Not to Merge, Consolidate, Sell or Convey
Property Except Under Certain Conditions. The Company covenants that it shall
not merge or consolidate with any other Person or sell, assign, transfer, lease
or convey all or substantially all of its properties and assets to any Person or
group of affiliated Persons in one transaction or a series of related
transactions, unless (a) either the Company shall be the continuing corporation,
or the successor (if other than the Company) shall be a corporation organized
and existing under the laws of the United States of America or a State thereof
or the District of Columbia and such corporation shall expressly assume all the
obligations of the Company under the Purchase Contracts, this Agreement and the
Pledge Agreement by one or more supplemental agreements in form satisfactory to
the Agent and the Collateral Agent, executed and delivered to the Agent and the
Collateral Agent by such corporation, and (b) the Company or such successor
corporation, as the case may be, shall not, immediately after such merger or
consolidation, or such sale, assignment, transfer, lease or conveyance, be in
default in the performance of any covenant or condition hereunder, under any of
the Securities or under the Pledge Agreement.
SECTION 9.02. Rights and Duties of Successor Corporation. In case of
any such consolidation, merger, sale, assignment, transfer, lease or conveyance
and upon any such assumption by the successor corporation in accordance with
Section 9.01 such successor corporation shall succeed to and be substituted for
the Company with the same effect as if it had been named herein as the Company;
provided that no consolidation or merger with or into, and no such sale,
assignment, transfer, lease or conveyance to, one or more subsidiaries of the
Company shall relieve the Company from any of its obligations under this
Agreement or the Securities. Such successor corporation thereupon may cause to
be signed, and may issue either in its own name or in the name of K N Energy,
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Inc., any or all of the Security Certificates evidencing Securities issuable
hereunder that theretofore shall not have been signed by the Company and
delivered to the Agent; and, upon the order of such successor corporation,
instead of the Company, and subject to all the terms, conditions and limitations
in this Agreement prescribed, the Agent shall authenticate and execute on behalf
of the Holders and deliver any Security Certificates that previously shall have
been signed and delivered by the officers of the Company to the Agent for
authentication and execution, and any Security Certificates evidencing
Securities that such successor corporation thereafter shall cause to be signed
and delivered to the Agent for that purpose. All the Security Certificates so
issued shall in all respects have the same legal rank and benefit under this
Agreement as the Security Certificates theretofore or thereafter issued in
accordance with the terms of this Agreement as though all of such Security
Certificates had been issued at the date of the execution hereof.
In case of any such consolidation, merger, sale, assignment, transfer,
lease or conveyance such change in phraseology and form (but not in substance)
may be made in Security Certificates evidencing Securities thereafter to be
issued as may be appropriate.
SECTION 9.03. Opinion of Counsel to Agent. The Agent, subject to
Sections 7.01 and 7.03, shall receive an Opinion of Counsel as conclusive
evidence that any such consolidation, merger, sale, assignment, transfer, lease
or conveyance, and any such assumption, complies with the provisions of this
Article and that all conditions precedent to the consummation of any such
consolidation, merger, sale, assignment, transfer, lease or conveyance have been
met.
ARTICLE 10
COVENANTS
SECTION 10.01. Performance under Purchase Contracts. The Company
covenants and agrees for the benefit of the Holders from time to time that it
shall duly and punctually perform its obligations under the Purchase Contracts
in accordance with the terms of the Purchase Contracts and this Agreement.
SECTION 10.02. Maintenance of Office or Agency. The Company shall
maintain in the Borough of Manhattan, The City of New York, an office or agency
where Security Certificates may be presented or surrendered for acquisition of
shares of Common Stock upon settlement or Early Settlement and
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for transfer of Treasury Securities upon occurrence of a Termination Event,
where Security Certificates may be surrendered for registration of transfer or
exchange and where notices and demands to or upon the Company in respect of the
Securities and this Agreement may be served. The Company shall give prompt
written notice to the Agent of the location, and any change in the location, of
such office or agency. If at any time the Company shall fail to maintain any
such required office or agency or shall fail to furnish the Agent with the
address thereof, such presentations, surrenders, notices and demands may be made
or served at the Corporate Trust Office, and the Company hereby appoints the
Agent as its agent to receive all such presentations, surrenders, notices and
demands.
The Company may also from time to time designate one or more other
offices or agencies where Security Certificates may be presented or surrendered
for any or all purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the
Borough of Manhattan, The City of New York, for such purposes. The Company shall
give prompt written notice to the Agent of any such designation or rescission
and of any change in the location of any such other office or agency. The
Company hereby designates as the place of payment for the Securities the
Corporate Trust Office and appoints the Agent at its Corporate Trust Office as
paying agent in such city.
SECTION 10.03. Company to Reserve Common Stock. The Company shall at
all times prior to the Final Settlement Date reserve and keep available, free
from preemptive rights, out of its authorized but unissued Common Stock the full
number of shares of Common Stock issuable (x) against tender of payment in
respect of all Purchase Contracts constituting a part of the Securities
evidenced by Outstanding Security Certificates and (y) in payment of Deferred
Contract Fees, if any, owed by the Company to the Holders.
SECTION 10.04. Covenant as to Common Stock. The Company covenants that
all Common Stock that may be issued against tender of payment in respect of any
Purchase Contract constituting a part of the Outstanding Securities and in
payment of any Deferred Contract Fees shall, upon issuance, be duly authorized,
validly issued, fully paid and nonassessable.
SECTION 10.05. Statement of Officers of the Company as to Default. The
Company shall deliver to the Agent, within 120 days after the end of each fiscal
year of the Company ending after the date hereof, an Officers' Certificate,
stating whether or not to the best knowledge of the signers thereof the Company
is in default in the performance and observance of any of the terms, provisions
and
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conditions hereof, and if the Company shall be in default, specifying all such
defaults and the nature and status thereof of which they may have knowledge.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
K N ENERGY, INC.
By: _______________________________________
Name:
Title:
U.S. BANK TRUST NATIONAL
ASSOCIATION, as Agent
By: _______________________________________
Name:
Title:
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EXHIBIT A
THIS SECURITY CERTIFICATE IS A GLOBAL SECURITY CERTIFICATE WITHIN THE MEANING OF
THE PURCHASE CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN THE
NAME OF THE DEPOSITORY TRUST COMPANY ("DTC") OR A NOMINEE OF DTC. THIS SECURITY
IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN DTC
OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE
CONTRACT AGREEMENT AND NO TRANSFER OF THIS SECURITY (OTHER THAN A TRANSFER OF
THIS SECURITY AS A WHOLE BY DTC TO A NOMINEE OF DTC OR BY A NOMINEE OF DTC TO
DTC OR ANOTHER NOMINEE OF DTC) MAY BE REGISTERED EXCEPT IN LIMITED
CIRCUMSTANCES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF DTC, TO
ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE
TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
K N ENERGY, INC.
8.25% PREMIUM EQUITY PARTICIPATING SECURITY UNITS
(STATED AMOUNT $43 PER SECURITY)
No. CUSIP No. 000000000
_____ Coupon Securities
This Security Certificate certifies that Cede & Co. is the registered
Holder of the number of Securities set forth above. Each Security represents (i)
ownership by the Holder of 5.875% United States Treasury Notes due November 30,
2001 (CUSIP No. 0000000X0) that are held through the Treasury/Reserve
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Automated Debt Entry System ("TREASURY NOTES"), or security entitlements in
respect thereof (together with Treasury Notes, "TREASURY SECURITIES"), with a
principal amount equal to the Stated Amount, subject to the Pledge of such
Treasury Securities by such Holder pursuant to the Pledge Agreement, and (ii)
the rights and obligations of the Holder under one Purchase Contract with K N
Energy, Inc., a Kansas corporation (the "COMPANY"). The Treasury Securities
represented by this Security Certificate were acquired by the Underwriters at
the direction of the Company for the benefit of the Holder hereof and are being
conveyed to the Holder of this Security Certificate (or such Holder's
predecessor-in-interest) and pledged pursuant to the Pledge Agreement
simultaneously therewith.
Pursuant to the Pledge Agreement, the Treasury Securities constituting
part of each Security evidenced hereby are pledged to the Collateral Agent to
secure the obligation of the Holder under the Purchase Contract comprising a
portion of such Security.
The Pledge Agreement provides that all payments of principal of, or
interest on, any Treasury Notes corresponding to Treasury Securities comprising
a portion of the Securities received by the Collateral Agent shall be paid by
the Collateral Agent by wire transfer in same day funds no later than 12:00
noon, 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 11:30 a.m., New
York City time, on a Business Day, then such payment shall be made no later than
10:00 a.m., New York City time, on the next succeeding Business Day) (i) in the
case of (A) interest payments and (B) any principal payments with respect to any
Treasury Notes corresponding to Treasury Securities that have been released from
the Pledge pursuant to the Pledge Agreement, to the Agent to the account
designated by it for such purpose and (ii) in the case of principal payments on
any Treasury Notes corresponding to Pledged Treasury Securities (as defined in
the Pledge Agreement), at the direction of the Agent on behalf of the Holders,
to the Company, in full satisfaction of the respective obligations of the
Holders of the Securities of which such Pledged Treasury Securities are a part
under the Purchase Contracts forming a part of such Securities. Interest on any
Treasury Note corresponding to any Treasury Security forming part of a Security
evidenced hereby that is paid on any May 31 or November 30, commencing May 31,
1999 (a "PAYMENT DATE"), shall, subject to receipt thereof by the Agent from the
Collateral Agent, be paid to the Person in whose name this Security Certificate
(or a Predecessor Security Certificate) is registered at the close of business
on the Record Date next preceding such Payment Date; provided, that on the first
Payment Date, the Agent shall remit to the Persons in whose names such Security
Certificates are registered on the Record Date with respect thereto, in addition
to
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interest on the Treasury Notes paid on such Payment Date, interest payable with
respect to the Treasury Notes for the period from the date of initial issuance
of the Securities until November 29, 1998. Interest payable with respect to the
Treasury Notes that accrued prior to the date of initial issuance of the
Securities, and that is payable on the first interest payment date with respect
to the Treasury Notes following the date of initial issuance of the Securities
shall be remitted by the Agent to Xxxxxx Xxxxxxx & Co. Incorporated for the
account of the Underwriters by 2:00 p.m. New York City time on the date of
receipt by the Agent.
The Holder of this Security Certificate shall have the right to
substitute Zero-Coupon Treasury Securities for the Treasury Securities forming a
part of the Securities evidenced hereby, thereby forming Zero-Coupon Securities,
in the manner set forth in the Purchase Contract Agreement and the Pledge
Agreement.
Each Purchase Contract evidenced hereby obligates the Holder of this
Security Certificate to purchase, and the Company to sell, on November 30, 2001
(the "FINAL SETTLEMENT DATE"), at a price equal to the Stated Amount, a number
of shares of common stock, par value $5.00 per share ("COMMON STOCK"), of the
Company, equal to the Settlement Rate, unless on or prior to the Final
Settlement Date there shall have occurred a Termination Event or Early
Settlement with respect to the Security of which such Purchase Contract is a
part, all as provided in the Purchase Contract Agreement referred to on the
reverse hereof and more fully described on the reverse hereof. The purchase
price for the Common Stock purchased pursuant to each Purchase Contract
evidenced hereby, if not paid earlier, shall be paid on the Final Settlement
Date by application of payment received in respect of the principal of the
Treasury Securities pledged to secure the obligations under such Purchase
Contract of the Holder of the Security of which such Purchase Contract is a
part.
The Company shall pay, on each Payment Date, in respect of each
Purchase Contract forming part of a Security evidenced hereby, an amount (the
"CONTRACT FEES") equal to 2.375% per annum of the Stated Amount, computed on the
basis of the actual number of days elapsed in a year of 365 or 366 days, as the
case may be, subject to deferral at the option of the Company as provided in the
Purchase Contract Agreement and more fully described on the reverse hereof. Such
Contract Fee shall be payable to the Person in whose name this Security
Certificate (or a Predecessor Security Certificate) is registered at the close
of business on the Record Date immediately preceding such Payment Date.
Interest on the Treasury Notes and the Contract Fees shall be payable
at the office or agency 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 Security Register.
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Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Agent by manual signature, this Security Certificate shall not be entitled
to any benefit under the Pledge Agreement or the Purchase Contract Agreement or
be valid or obligatory for any purpose.
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IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
K N ENERGY, INC.
By: _________________________
Name:
Title:
Attested by:
_________________________ HOLDER SPECIFIED ABOVE (as to
obligations of such Holder under the
Purchase Contracts evidenced hereby)
By: U.S. BANK TRUST NATIONAL
ASSOCIATION, not individually
but solely as Attorney-in-Fact of
such Holder
By: _________________________
Authorized Signatory
Dated:
(Form of Certificate of Authentication)
This is one of the Security Certificates referred to in the within
mentioned Purchase Contract Agreement.
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Agent
By: ___________________________
Authorized Signatory
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[FORM OF REVERSE OF SECURITY CERTIFICATE]
Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of November 25, 1998 (the "PURCHASE CONTRACT
AGREEMENT"), between the Company and U.S. Bank Trust National Association, as
Purchase Contract Agent (herein called the "AGENT"), to which Purchase Contract
Agreement and supplemental agreements thereto reference is hereby made for a
description of the respective rights, limitations of rights, obligations, duties
and immunities thereunder of the Agent, the Company and the Holders and of the
terms upon which the Security Certificates are, and are to be, executed and
delivered.
Each Purchase Contract evidenced hereby shall obligate the Holder of
this Security Certificate to purchase, and the Company to sell, on the Final
Settlement Date at a price equal to the Stated Amount, a number of shares of
Common Stock of the Company equal to the Settlement Rate, unless, on or prior to
the Final Settlement Date, there shall have occurred a Termination Event or an
Early Settlement with respect to the Security of which such Purchase Contract is
a part. The "SETTLEMENT RATE" is equal to (a) if the Applicable Market Value (as
defined below) is greater than $51.60 (the "THRESHOLD APPRECIATION PRICE"),
.8333 of a share of Common Stock per Purchase Contract, (b) if the Applicable
Market Value is less than or equal to the Threshold Appreciation Price but is
greater than the Stated Amount, a fractional share of Common Stock per Purchase
Contract equal to the Stated Amount divided by the Applicable Market Value
(rounded upward or downward to the nearest 1/10,000th of a share) and (c) if the
Applicable Market Value is less than or equal to the Stated Amount, one share of
Common Stock per Purchase Contract, in each case subject to adjustment as
provided in the Purchase Contract Agreement. No fractional shares of Common
Stock shall be issued upon settlement of Purchase Contracts, as provided in the
Purchase Contract Agreement.
The "APPLICABLE MARKET VALUE" means the average of the Closing Prices
per share of Common Stock on each of the twenty consecutive Trading Days ending
on the second Trading Day immediately preceding the Final Settlement Date. The
"CLOSING PRICE" of the Common Stock on any date of determination means the
closing sale price (or, if no closing price is reported, the last reported sale
price) of the Common Stock on The New York Stock Exchange, Inc. (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 such price of the Common
Stock is not so reported, the last quoted bid price for the Common
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Stock in the over-the-counter market as reported by the National Quotation
Bureau or similar organization or, if such bid price is not available, the
market value of the Common Stock on such date as determined by a nationally
recognized independent investment banking firm retained for this purpose by the
Company. A "TRADING DAY" means a day on which the Common Stock (A) is not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (B) has
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of the Common Stock.
The purchase price for the shares of Common Stock purchased pursuant to
each Purchase Contract shall be paid by application of payments received by the
Company on the Final Settlement Date from the Collateral Agent at the direction
of the Agent on behalf of the Holders pursuant to the Pledge Agreement in
respect of the principal of the Treasury Securities pledged to secure the
obligations of the relevant Holder under such Purchase Contract.
The Company shall not be obligated to issue any shares of Common Stock
in respect of a Purchase Contract or deliver any certificates therefor to the
Holder unless it shall have received payment in full of the aggregate purchase
price for the shares of Common Stock to be purchased thereunder in the manner
set forth herein and in the Purchase Contract Agreement.
Subject to the next succeeding paragraph and the provisions of the
Purchase Contract Agreement, the Company shall pay, on each Payment Date, the
Contract Fee payable in respect of each Purchase Contract to the Person in whose
name the Security Certificate (or one or more Predecessor Security Certificates)
evidencing the Security of which such Purchase Contract is a part and is
registered at the close of business on the Record Date immediately preceding
such Payment Date.
The Company shall have the right, at any time prior to the Final
Settlement Date, to defer the payment of any or all of the Contract Fees
otherwise payable on any Payment Date (on a pro rata basis among all Outstanding
Securities), but only if the Company shall give the Holders and the Agent
written notice of its election to defer such payment (specifying the amount to
be deferred and the period of deferment) as provided in the Purchase Contract
Agreement. Any Contract Fees so deferred shall bear additional Contract Fees
thereon at the rate of 8.25% per annum (computed on the basis of the actual
number of days elapsed in a year of 365 or 366 days, as the case may be),
compounding on each succeeding Payment Date, until paid in full (such deferred
installments of Contract Fees, together with the additional Contract Fees
accrued thereon, are
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referred to herein as the "DEFERRED CONTRACT FEES"). Deferred Contract Fees
shall be due on the next succeeding Payment Date except to the extent that
payment is deferred pursuant to the Purchase Contract Agreement. No Contract
Fees may be deferred to a date that is after the Final Settlement Date.
In the event that the Company elects to defer the payment of Contract
Fees on Purchase Contracts until the Final Settlement Date, the Holder of this
Security Certificate shall receive on the Final Settlement Date, in lieu of a
cash payment, a number of shares of Common Stock (in addition to a number of
Common Stock equal to the Settlement Rate) equal to (x) the aggregate amount of
Deferred Contract Fees payable to the Holder of this Security Certificate
divided by (y) the Applicable Market Value. No fractional shares of Common Stock
shall be issued with respect to the payment of Deferred Contract Fees on the
Final Settlement Date, as provided in the Purchase Contract Agreement.
In the event the Company exercises its option to defer the payment of
Contract Fees, then, until the Deferred Contract Fees have been paid in full,
the Company (a) shall not declare or pay dividends on, make distributions with
respect to, or redeem, purchase or acquire, or make a liquidation payment with
respect to, any of its capital stock (other than (i) purchases or acquisitions
of Common Stock in connection with the satisfaction by the Company or any of its
subsidiaries of their respective obligations under any benefit plans for
directors, officers, agents or employees or the Company's dividend reinvestment
or director, officer, agent or employee stock purchase plans, (ii) as a result
of a reclassification of the Company's capital stock or the exchange or
conversion of one class or series of capital stock for another class or series
of the Company's capital stock, (iii) the purchase of fractional interests in
shares of the Company's capital stock pursuant to the conversion or exchange
provisions of the Company's capital stock or the security being converted or
exchanged for the Company's capital stock), (iv) dividends or distributions in
the form of shares of, or options, warrants or rights to subscribe for or
purchase, shares of capital stock of the Company or (v) any declaration of a
dividend in connection with the implementation of extension of a stockholders'
rights plan, or the issuance of stock under any such plan (including the
existing such plan) in the future, or the redemption or repurchase of any such
rights pursuant thereto)), (b) shall not make any payment of interest, principal
or premium, if any, on, or repay, repurchase or redeem any debt securities
issued by the Company that rank pari passu with or junior to such Contract Fees
and (c) shall not make any guarantee payments with respect to any guarantee by
the Company of any securities of any subsidiary of the Company if such guarantee
ranks pari passu with or junior in right of payment to the Contract Fees.
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The Purchase Contracts and the obligations and rights of the Company
and the Holders thereunder, including, without limitation, the rights of the
Holders to receive and the obligation of the Company to pay any Contract Fee or
any Deferred Contract Fees, shall immediately and automatically terminate,
without the necessity of any notice or action by any Holder, the Agent or the
Company, if, on or prior to the Final Settlement Date, a Termination Event shall
have occurred. Upon the occurrence of a Termination Event, the Company shall
promptly but in no event more than two Business Days thereafter give written
notice to the Agent, the Collateral Agent and the Holders. Upon and after the
occurrence of a Termination Event, the Collateral Agent shall release the
Treasury Securities from the Pledge in accordance with the provisions of the
Pledge Agreement. The Securities shall thereafter represent the right to receive
the Treasury Securities forming a part of such Securities in accordance with the
provisions of the Purchase Contract Agreement and the Pledge Agreement.
Subject to and upon compliance with the provisions of the Purchase
Contract Agreement, at the option of the Holder thereof, any Purchase Contracts
underlying Securities having an aggregate Stated Amount equal to $43,000 or an
integral multiple thereof may be settled early ("EARLY SETTLEMENT") as provided
in the Purchase Contract Agreement. In order to exercise the right to effect
Early Settlement with respect to any Purchase Contracts evidenced by this
Security Certificate, the Holder of this Security Certificate shall deliver this
Security Certificate to the Agent at the Corporate Trust Office duly endorsed
for transfer to the Company or in blank with the form of Election to Settle
Early set forth below duly completed and accompanied by payment in the form of
immediately available funds in an amount (the "EARLY SETTLEMENT AMOUNT") equal
to (i) the product of (A) the Stated Amount times (B) the number of Purchase
Contracts with respect to which the Holder has elected to effect Early
Settlement plus (ii) if such delivery is made with respect to any Purchase
Contracts during the period from the close of business on any Record Date
immediately preceding any Payment Date to the opening of business of such
Payment Date, an amount equal to the sum of (x) the Contract Fees and Deferred
Contract Fees, if any, payable on such Payment Date with respect to such
Purchase Contracts plus (y) the interest with respect to the related Treasury
Notes payable on such Payment Date. Upon Early Settlement of Purchase Contracts
by a Holder of the related Securities, the Treasury Securities underlying such
Securities shall be released from the Pledge as provided in the Pledge Agreement
and the Holder shall be entitled to receive a number of shares of Common Stock
on account of each Purchase Contract forming part of a Security as to which
Early Settlement is effected equal to the Early Settlement Rate; provided,
however, that upon the Early Settlement of the Purchase Contracts, the Holder
thereof shall forfeit the right to receive accrued Contract Fees and any
Deferred Contract Fees on such Purchase Contracts. The "EARLY SETTLEMENT RATE"
shall initially be equal to .8333 and shall be adjusted in
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the same manner and at the same time as the Settlement Rate is adjusted as
provided in the Purchase Contract Agreement.
The Security Certificates are issuable only in registered form and only
in denominations of a single Security and any integral multiple thereof. The
transfer of any Security Certificates shall be registered and Security
Certificates may be exchanged as provided in the Purchase Contract Agreement.
The Security Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents permitted by the Purchase
Contract Agreement. No service charge shall be required for any such
registration of transfer or exchange, but the Company and the Agent may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith. For so long as the Purchase Contract underlying
a Security remains in effect, such Security shall not be separable into its
constituent parts (provided that the Holder shall have the right to effect a
Collateral Substitution), and the rights and obligations of the Holder of such
Security in respect of the Treasury Securities and Purchase Contract
constituting such Security may be transferred and exchanged only as a Security.
Upon registration of transfer of this Security Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee) under the terms of the Purchase Contract Agreement, the
Purchase Contracts evidenced hereby and the Pledge Agreement, and the transferor
shall be released from the obligations under the Purchase Contracts evidenced by
this Security Certificate. The Company covenants and agrees, and the Holder, by
such Holder's acceptance hereof, likewise covenants and agrees, to be bound by
the provisions of this paragraph.
The Holder of this Security Certificate, by such Holder's acceptance
hereof, authorizes the Agent to enter into and perform the related Purchase
Contracts forming part of the Securities evidenced hereby on such Holder's
behalf as such Holder's attorney-in-fact, expressly withholds any consent to the
assumption (i.e., affirmance) of the Purchase Contracts by the Company or such
Holder's trustee in the event that the Company becomes the subject of a case
under the Bankruptcy Code, agrees to be bound by the terms and provisions
thereof, covenants and agrees to perform its obligations under the Purchase
Contracts forming a part of the Securities evidenced hereby, consents to the
provisions of the Purchase Contract Agreement, authorizes the Agent to enter
into and perform the Pledge Agreement on such Holder's behalf as such Holder's
attorney-in-fact, and consents to the Pledge of the Treasury Securities
underlying this Security Certificate pursuant to the Pledge Agreement. The
Holder, by such Holder's acceptance hereof, further covenants and agrees that,
to the extent and in the manner provided in the Purchase Contract Agreement and
the Pledge
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Agreement, but subject to the terms thereof, payments in respect of principal of
the Treasury Securities on the Final Settlement Date shall be paid by the
Collateral Agent to the Company in satisfaction of such Holder's obligations
under such Purchase Contract and such Holder shall acquire no right, title or
interest in such payments.
Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of at least 66 2/3% in
Stated Amount of the Outstanding Securities.
All terms used herein that are defined in the Purchase Contract
Agreement have the meanings set forth therein.
The Purchase Contracts shall for all purposes be governed by, and
construed in accordance with, the laws of the State of New York.
The Company and the Agent, and any agent of the Company or the Agent,
may treat the Person in whose name this Security Certificate is registered as
the owner of the Securities evidenced hereby for the purpose of receiving
payments of interest on the Treasury Notes, receiving payments of Contract Fees
and any Deferred Contract Fees, performance of the Purchase Contracts and for
all other purposes whatsoever, whether or not the payment of interest on the
Treasury Notes or any Contract Fee payable in respect of the Purchase Contracts
constituting a part of the Securities evidenced thereby shall be overdue and
notwithstanding any notice to the contrary, and neither the Company, the Agent
nor any such agent shall be affected by notice to the contrary.
The Purchase Contracts shall not, prior to the settlement thereof,
entitle the Holder to any of the rights of a holder of shares of Common Stock.
A copy of the Purchase Contract Agreement is available for inspection
at the offices of the Agent.
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SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for shares of Common
Stock deliverable upon settlement on or after the Final Settlement Date of the
Purchase Contracts underlying the number of Securities evidenced by this
Security Certificate be registered in the name of, and delivered, together with
a check in payment for any fractional share, to, the undersigned at the address
indicated below, unless a different name and address have been indicated below.
If shares are to be registered in the name of a Person other than the
undersigned, the undersigned shall pay any transfer tax payable incident
thereto.
Dated:
_________________________ _________________________
Signature
If shares are to be registered in the
name of and delivered to a Person
other than the Holder, please print REGISTERED HOLDER
such Person's name and address:
Please print name and address
of Registered Holder:
_________________________ _________________________
Name Name
_________________________ _________________________
Address Address
_________________________
Social Security or other Taxpayer
Identification Number, if any _________________________
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ELECTION TO SETTLE EARLY
The undersigned Holder of this Security Certificate hereby irrevocably
exercises the option to effect Early Settlement in accordance with the terms of
the Purchase Contract Agreement with respect to the Purchase Contracts
underlying the number of Securities evidenced by this Security Certificate
specified below. The option to effect Early Settlement may be exercised only
with respect to integral multiples of 1,000 Securities. The undersigned Holder
directs that a certificate for shares of Common Stock deliverable upon such
Early Settlement be registered in the name of, and delivered, together with a
check in payment for any fractional share and any Security Certificate
representing any Securities evidenced hereby as to which Early Settlement of the
related Purchase Contracts is not effected, to, the undersigned at the address
indicated below, unless a different name and address have been indicated below.
Treasury Securities deliverable upon such Early Settlement shall 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 shall pay any transfer tax payable incident thereto.
Dated:
_________________________ _________________________
Signature
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Number of Securities evidenced hereby as to which Early Settlement of
the related Purchase Contracts is being elected:
If shares or Security Certificates are to REGISTERED HOLDER
be registered in the name of and
delivered to and Treasury Securities
are to be transferred to a Person other
than the Holder, please print such
Person's name and address:
Please print name and address
of Registered Holder:
Name Name
_________________________ _________________________
Address Address
_________________________ _________________________
Social Security or other Taxpayer
Identification Number, if any _________________________
Transfer Instructions for Treasury Securities transferable upon Early
Settlement:
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ELECTION TO SUBSTITUTE COLLATERAL
The undersigned Holder of this Security Certificate hereby irrevocably
exercises the option to effect Collateral Substitution in accordance with the
terms of the Purchase Contract Agreement and the Pledge Agreement with respect
to the number of Securities evidenced by this Security Certificate specified
below. The option to effect Collateral Substitution may be exercised only with
respect to integral multiples of 1,000 Securities. The undersigned Holder hereby
represents and warrants to the Company and the Agent that the undersigned Holder
has deposited with the Collateral Agent Zero-Coupon Treasury Securities having
an aggregate principal amount equal to the aggregate Stated Amount of the
Securities evidenced hereby with respect to which Collateral Settlement is being
elected, in the manner provided in the Pledge Agreement. The undersigned Holder
directs that a Security Certificate for Zero-Coupon Securities deliverable upon
such Collateral Substitution be registered in the name of, and delivered,
together with any Security Certificate representing any Securities evidenced
hereby as to which Collateral Substitution is not effected, to, the undersigned
at the address indicated below, unless a different name and address have been
indicated below. Coupon Treasury Securities deliverable upon such Collateral
substitution shall be transferred in accordance with the transfer instructions
set forth below. If Zero-Coupon Securities are to be registered in the name of a
Person other than the undersigned, the undersigned shall pay any transfer tax
payable incident thereto.
Dated:
_________________________ _________________________
Signature
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Number of Securities evidenced hereby as to which Collateral
Substitution is being elected:
If Security Certificates are to be REGISTERED HOLDER
registered in the name of and
delivered to and Treasury Securities
are to be transferred to a Person
other than the Holder, please print
such Person's name and address:
Please print name and address
of Registered Holder:
Name Name
_________________________ _________________________
Address Address
_________________________ _________________________
Social Security or other Taxpayer
Identification Number, if any _________________________
Transfer Instructions for Treasury Securities transferable upon
Collateral Substitution:
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EXHIBIT B
THIS SECURITY CERTIFICATE IS A GLOBAL SECURITY CERTIFICATE WITHIN THE
MEANING OF THE PURCHASE CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND IS
REGISTERED IN THE NAME OF THE DEPOSITORY TRUST COMPANY ("DTC") OR A NOMINEE OF
DTC. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A
PERSON OTHER THAN DTC OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED
IN THE PURCHASE CONTRACT AGREEMENT AND NO TRANSFER OF THIS SECURITY (OTHER THAN
A TRANSFER OF THIS SECURITY AS A WHOLE BY DTC TO A NOMINEE OF DTC OR BY A
NOMINEE OF DTC TO DTC OR ANOTHER NOMINEE OF DTC) MAY BE REGISTERED EXCEPT IN
LIMITED CIRCUMSTANCES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC, TO ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
K N ENERGY, INC.
8.25% PREMIUM EQUITY PARTICIPATING SECURITY UNITS
(STATED AMOUNT $43 PER SECURITY)
No. CUSIP No. 000000000
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_____ Zero-Coupon Securities
This Security Certificate certifies that Cede & Co. is the registered
Holder of the number of Securities set forth above. Each Security represents (i)
ownership by the Holder of United States Treasury Strips due November 15, 2001
(CUSIP No. 000000XX0) that are held through the Treasury/Reserve Automated Debt
Entry System ("TREASURY STRIPS"), or security entitlements in respect thereof
(together with Treasury Strips, "TREASURY SECURITIES"), with a principal amount
equal to the Stated Amount, subject to the Pledge of such Treasury Securities by
such Holder pursuant to the Pledge Agreement, and (ii) the rights and
obligations of the Holder under one Purchase Contract with K N Energy, Inc., a
Kansas corporation (the "COMPANY"). The Treasury Securities represented by this
Security Certificate were acquired by the Holder hereof (or such Holder's
predecessor-in-interest) in the open market and are being conveyed to the Holder
of this Security Certificate (or such Holder's predecessor-in-interest) and
pledged pursuant to the Pledge Agreement simultaneously therewith.
Pursuant to the Pledge Agreement, the Treasury Securities constituting
part of each Security evidenced hereby are pledged to the Collateral Agent to
secure the obligation of the Holder under the Purchase Contract comprising a
portion of such Security.
The Pledge Agreement provides that all payments of principal of any
Treasury Strips corresponding to Treasury Securities comprising a portion of the
Securities received by the Collateral Agent shall be paid by the Collateral
Agent by wire transfer in same day funds no later than 12:00 noon, New York City
time, on the Final Settlement Date (i) in the case of any principal payments
with respect to any Treasury Strips corresponding to Treasury Securities that
have been released from the Pledge pursuant to the Pledge Agreement, to the
Agent to the account designated by it for such purpose and (ii) in the case of
principal payments on any Treasury Strips corresponding to Pledged Treasury
Securities (as defined in the Pledge Agreement), at the direction of the Agent
on behalf of the Holders, to the Company, in full satisfaction of the respective
obligations of the Holders of the Securities of which such Pledged Treasury
Securities are a part under the Purchase Contracts forming a part of such
Securities.
Each Purchase Contract evidenced hereby obligates the Holder of this
Security Certificate to purchase, and the Company to sell, on November 30, 2001
(the "FINAL SETTLEMENT DATE"), at a price equal to the Stated Amount, a number
of
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shares of common stock, par value $5.00 per share ("COMMON STOCK"), of the
Company, equal to the Settlement Rate, unless on or prior to the Final
Settlement Date there shall have occurred a Termination Event or Early
Settlement with respect to the Security of which such Purchase Contract is a
part, all as provided in the Purchase Contract Agreement referred to on the
reverse hereof and more fully described on the reverse hereof. The purchase
price for the Common Stock purchased pursuant to each Purchase Contract
evidenced hereby, if not paid earlier, shall be paid on the Final Settlement
Date by application of payment received in respect of the principal of the
Treasury Securities pledged to secure the obligations under such Purchase
Contract of the Holder of the Security of which such Purchase Contract is a
part.
The Company shall pay, on each Payment Date, in respect of each
Purchase Contract forming part of a Security evidenced hereby, an amount (the
"CONTRACT FEES") equal to 2.375% per annum of the Stated Amount, computed on the
basis of the actual number of days elapsed in a year of 365 or 366 days, as the
case may be, subject to deferral at the option of the Company as provided in the
Purchase Contract Agreement and more fully described on the reverse hereof. Such
Contract Fee shall be payable to the Person in whose name this Security
Certificate (or a Predecessor Security Certificate) is registered at the close
of business on the Record Date immediately preceding such Payment Date.
The Contract Fees shall be payable at the office or agency 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 Security
Register.
Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Agent by manual signature, this Security Certificate shall not be entitled
to any benefit under the Pledge Agreement or the Purchase Contract Agreement or
be valid or obligatory for any purpose.
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IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
K N ENERGY, INC.
By: _________________________
Name:
Title:
Attested by:
_________________________
HOLDER SPECIFIED ABOVE (as to
obligations of such Holder under the
Purchase Contracts evidenced hereby)
By: U.S. BANK TRUST NATIONAL
ASSOCIATION, not individually
but solely as Attorney-in-Fact of
such Holder
By: _________________________
Authorized Signatory
Dated:
(Form of Certificate of Authentication)
This is one of the Security Certificates referred to in the within
mentioned Purchase Contract Agreement.
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Agent
By: ___________________________
Authorized Signatory
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[FORM OF REVERSE OF SECURITY CERTIFICATE]
Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of November 25, 1998 (the "PURCHASE CONTRACT
AGREEMENT"), between the Company and U.S. Bank Trust National Association, as
Purchase Contract Agent (herein called the "AGENT"), to which Purchase Contract
Agreement and supplemental agreements thereto reference is hereby made for a
description of the respective rights, limitations of rights, obligations, duties
and immunities thereunder of the Agent, the Company and the Holders and of the
terms upon which the Security Certificates are, and are to be, executed and
delivered.
Each Purchase Contract evidenced hereby shall obligate the Holder of
this Security Certificate to purchase, and the Company to sell, on the Final
Settlement Date at a price equal to the Stated Amount, a number of shares of
Common Stock of the Company equal to the Settlement Rate, unless, on or prior to
the Final Settlement Date, there shall have occurred a Termination Event or an
Early Settlement with respect to the Security of which such Purchase Contract is
a part. The "SETTLEMENT RATE" is equal to (a) if the Applicable Market Value (as
defined below) is greater than $51.60 (the "THRESHOLD APPRECIATION PRICE"),
.8333 of a share of Common Stock per Purchase Contract, (b) if the Applicable
Market Value is less than or equal to the Threshold Appreciation Price but is
greater than the Stated Amount, a fractional share of Common Stock per Purchase
Contract equal to the Stated Amount divided by the Applicable Market Value
(rounded upward or downward to the nearest 1/10,000th of a share) and (c) if the
Applicable Market Value is less than or equal to the Stated Amount, one share of
Common Stock per Purchase Contract, in each case subject to adjustment as
provided in the Purchase Contract Agreement. No fractional shares of Common
Stock shall be issued upon settlement of Purchase Contracts, as provided in the
Purchase Contract Agreement.
The "APPLICABLE MARKET VALUE" means the average of the Closing Prices
per share of Common Stock on each of the twenty consecutive Trading Days ending
on the second Trading Day immediately preceding the Final Settlement Date. The
"CLOSING PRICE" of the Common Stock on any date of determination means the
closing sale price (or, if no closing price is reported, the last reported sale
price) of the Common Stock on The New York Stock Exchange, Inc. (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 such price of the Common
Stock is not so reported, the last quoted bid price for the Common
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Stock in the over-the-counter market as reported by the National Quotation
Bureau or similar organization or, if such bid price is not available, the
market value of the Common Stock on such date as determined by a nationally
recognized independent investment banking firm retained for this purpose by the
Company. A "TRADING DAY" means a day on which the Common Stock (A) is not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (B) has
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of the Common Stock.
The purchase price for the shares of Common Stock purchased pursuant to
each Purchase Contract shall be paid by application of payments received by the
Company on the Final Settlement Date from the Collateral Agent at the direction
of the Agent on behalf of the Holders pursuant to the Pledge Agreement in
respect of the principal of the Treasury Securities pledged to secure the
obligations of the relevant Holder under such Purchase Contract.
The Company shall not be obligated to issue any shares of Common Stock
in respect of a Purchase Contract or deliver any certificates therefor to the
Holder unless it shall have received payment in full of the aggregate purchase
price for the shares of Common Stock to be purchased thereunder in the manner
set forth herein and in the Purchase Contract Agreement.
Subject to the next succeeding paragraph and the provisions of the
Purchase Contract Agreement, the Company shall pay, on each Payment Date, the
Contract Fee payable in respect of each Purchase Contract to the Person in whose
name the Security Certificate (or one or more Predecessor Security Certificates)
evidencing the Security of which such Purchase Contract is a part and is
registered at the close of business on the Record Date immediately preceding
such Payment Date.
The Company shall have the right, at any time prior to the Final
Settlement Date, to defer the payment of any or all of the Contract Fees
otherwise payable on any Payment Date (on a pro rata basis among all Outstanding
Securities), but only if the Company shall give the Holders and the Agent
written notice of its election to defer such payment (specifying the amount to
be deferred and the period of deferment) as provided in the Purchase Contract
Agreement. Any Contract Fees so deferred shall bear additional Contract Fees
thereon at the rate of 8.25% per annum (computed on the basis of the actual
number of days elapsed in a year of 365 or 366 days, as the case may be),
compounding on each succeeding Payment Date, until paid in full (such deferred
installments of Contract Fees, together with the additional Contract Fees
accrued thereon, are
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referred to herein as the "DEFERRED CONTRACT FEES"). Deferred Contract Fees
shall be due on the next succeeding Payment Date except to the extent that
payment is deferred pursuant to the Purchase Contract Agreement. No Contract
Fees may be deferred to a date that is after the Final Settlement Date.
In the event that the Company elects to defer the payment of Contract
Fees on Purchase Contracts until the Final Settlement Date, the Holder of this
Security Certificate shall receive on the Final Settlement Date, in lieu of a
cash payment, a number of shares of Common Stock (in addition to a number of
Common Stock equal to the Settlement Rate) equal to (x) the aggregate amount of
Deferred Contract Fees payable to the Holder of this Security Certificate
divided by (y) the Applicable Market Value. No fractional shares of Common Stock
shall be issued with respect to the payment of Deferred Contract Fees on the
Final Settlement Date, as provided in the Purchase Contract Agreement.
In the event the Company exercises its option to defer the payment of
Contract Fees, then, until the Deferred Contract Fees have been paid in full,
the Company (a) shall not declare or pay dividends on, make distributions with
respect to, or redeem, purchase or acquire, or make a liquidation payment with
respect to, any of its capital stock (other than (i) purchases or acquisitions
of Common Stock in connection with the satisfaction by the Company or any of its
subsidiaries of their respective obligations under any benefit plans for
directors, officers, agents or employees or the Company's dividend reinvestment
or director, officer, agent or employee stock purchase plans, (ii) as a result
of a reclassification of the Company's capital stock or the exchange or
conversion of one class or series of capital stock for another class or series
of the Company's capital stock, (iii) the purchase of fractional interests in
shares of the Company's capital stock pursuant to the conversion or exchange
provisions of the Company's capital stock or the security being converted or
exchanged for the Company's capital stock), (iv) dividends or distributions in
the form of shares of, or options, warrants or rights to subscribe for or
purchase, shares of capital stock of the Company or (v) any declaration of a
dividend in connection with the implementation of extension of a stockholders'
rights plan, or the issuance of stock under any such plan (including the
existing such plan) in the future, or the redemption or repurchase of any such
rights pursuant thereto)), (b) shall not make any payment of interest, principal
or premium, if any, on, or repay, repurchase or redeem any debt securities
issued by the Company that rank pari passu with or junior to such Contract Fees
and (c) shall not make any guarantee payments with respect to any guarantee by
the Company of any securities of any subsidiary of the Company if such guarantee
ranks pari passu with or junior in right of payment to the Contract Fees.
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The Purchase Contracts and the obligations and rights of the Company
and the Holders thereunder, including, without limitation, the rights of the
Holders to receive and the obligation of the Company to pay any Contract Fee or
any Deferred Contract Fees, shall immediately and automatically terminate,
without the necessity of any notice or action by any Holder, the Agent or the
Company, if, on or prior to the Final Settlement Date, a Termination Event shall
have occurred. Upon the occurrence of a Termination Event, the Company shall
promptly but in no event more than two Business Days thereafter give written
notice to the Agent, the Collateral Agent and the Holders. Upon and after the
occurrence of a Termination Event, the Collateral Agent shall release the
Treasury Securities from the Pledge in accordance with the provisions of the
Pledge Agreement. The Securities shall thereafter represent the right to receive
the Treasury Securities forming a part of such Securities in accordance with the
provisions of the Purchase Contract Agreement and the Pledge Agreement.
Subject to and upon compliance with the provisions of the Purchase
Contract Agreement, at the option of the Holder thereof, any Purchase Contracts
underlying Securities having an aggregate Stated Amount equal to $43,000 or an
integral multiple thereof may be settled early ("EARLY SETTLEMENT") as provided
in the Purchase Contract Agreement. In order to exercise the right to effect
Early Settlement with respect to any Purchase Contracts evidenced by this
Security Certificate, the Holder of this Security Certificate shall deliver this
Security Certificate to the Agent at the Corporate Trust Office duly endorsed
for transfer to the Company or in blank with the form of Election to Settle
Early set forth below duly completed and accompanied by payment in the form of
immediately available funds in an amount (the "EARLY SETTLEMENT AMOUNT") equal
to (i) the product of (A) the Stated Amount times (B) the number of Purchase
Contracts with respect to which the Holder has elected to effect Early
Settlement plus (ii) if such delivery is made with respect to any Purchase
Contracts during the period from the close of business on any Record Date
immediately preceding any Payment Date to the opening of business of such
Payment Date, an amount equal to the Contract Fees and Deferred Contract Fees,
if any, payable on such Payment Date with respect to such Purchase Contracts.
Upon Early Settlement of Purchase Contracts by a Holder of the related
Securities, the Treasury Securities underlying such Securities shall be released
from the Pledge as provided in the Pledge Agreement and the Holder shall be
entitled to receive a number of shares of Common Stock on account of each
Purchase Contract forming part of a Security as to which Early Settlement is
effected equal to the Early Settlement Rate; provided, however, that upon the
Early Settlement of the Purchase Contracts, the Holder thereof shall forfeit the
right to receive accrued Contract Fees and any Deferred Contract Fees on such
Purchase Contracts. The "EARLY SETTLEMENT RATE" shall initially be equal to
.8333 and shall be adjusted in the same manner
B-8
89
and at the same time as the Settlement Rate is adjusted as provided in the
Purchase Contract Agreement.
The Security Certificates are issuable only in registered form and only
in denominations of a single Security and any integral multiple thereof. The
transfer of any Security Certificates shall be registered and Security
Certificates may be exchanged as provided in the Purchase Contract Agreement.
The Security Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents permitted by the Purchase
Contract Agreement. No service charge shall be required for any such
registration of transfer or exchange, but the Company and the Agent may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith. For so long as the Purchase Contract underlying
a Security remains in effect, such Security shall not be separable into its
constituent parts, and the rights and obligations of the Holder of such Security
in respect of the Treasury Securities and Purchase Contract constituting such
Security may be transferred and exchanged only as a Security.
Upon registration of transfer of this Security Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee) under the terms of the Purchase Contract Agreement, the
Purchase Contracts evidenced hereby and the Pledge Agreement, and the transferor
shall be released from the obligations under the Purchase Contracts evidenced by
this Security Certificate. The Company covenants and agrees, and the Holder, by
such Holder's acceptance hereof, likewise covenants and agrees, to be bound by
the provisions of this paragraph.
The Holder of this Security Certificate, by such Holder's acceptance
hereof, authorizes the Agent to enter into and perform the related Purchase
Contracts forming part of the Securities evidenced hereby on such Holder's
behalf as such Holder's attorney-in-fact, expressly withholds any consent to the
assumption (i.e., affirmance) of the Purchase Contracts by the Company or such
Holder's trustee in the event that the Company becomes the subject of a case
under the Bankruptcy Code, agrees to be bound by the terms and provisions
thereof, covenants and agrees to perform its obligations under the Purchase
Contracts forming a part of the Securities evidenced hereby, consents to the
provisions of the Purchase Contract Agreement, authorizes the Agent to enter
into and perform the Pledge Agreement on such Holder's behalf as such Holder's
attorney-in-fact, and consents to the Pledge of the Treasury Securities
underlying this Security Certificate pursuant to the Pledge Agreement. The
Holder, by such Holder's acceptance hereof, further covenants and agrees that,
to the extent and in the manner provided in the Purchase Contract Agreement and
the Pledge Agreement, but subject to the terms thereof, payments in respect of
principal of
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90
the Treasury Securities on the Final Settlement Date shall be paid by the
Collateral Agent to the Company in satisfaction of such Holder's obligations
under such Purchase Contract and such Holder shall acquire no right, title or
interest in such payments.
Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of at least 66 2/3% in
Stated Amount of the Outstanding Securities.
All terms used herein that are defined in the Purchase Contract
Agreement have the meanings set forth therein.
The Purchase Contracts shall for all purposes be governed by, and
construed in accordance with, the laws of the State of New York.
The Company and the Agent, and any agent of the Company or the Agent,
may treat the Person in whose name this Security Certificate is registered as
the owner of the Securities evidenced hereby for the purpose of receiving
payments of Contract Fees and any Deferred Contract Fees, performance of the
Purchase Contracts and for all other purposes whatsoever, whether or not the
payment of any Contract Fee payable in respect of the Purchase Contracts
constituting a part of the Securities evidenced thereby shall be overdue and
notwithstanding any notice to the contrary, and neither the Company, the Agent
nor any such agent shall be affected by notice to the contrary.
The Purchase Contracts shall not, prior to the settlement thereof,
entitle the Holder to any of the rights of a holder of shares of Common Stock.
A copy of the Purchase Contract Agreement is available for inspection
at the offices of the Agent.
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91
SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for shares of Common
Stock deliverable upon settlement on or after the Final Settlement Date of the
Purchase Contracts underlying the number of Securities evidenced by this
Security Certificate be registered in the name of, and delivered, together with
a check in payment for any fractional share, to, the undersigned at the address
indicated below, unless a different name and address have been indicated below.
If shares are to be registered in the name of a Person other than the
undersigned, the undersigned shall pay any transfer tax payable incident
thereto.
Dated:
_________________________ _________________________
Signature
If shares are to be registered in
the name of and delivered to a Person
other than the Holder, please print REGISTERED HOLDER
such Person's name and address:
Please print name and address
of Registered Holder:
Name Name
_________________________ _________________________
Address Address
_________________________ _________________________
Social Security or other Taxpayer
Identification Number, if any _________________________
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92
ELECTION TO SETTLE EARLY
The undersigned Holder of this Security Certificate hereby irrevocably
exercises the option to effect Early Settlement in accordance with the terms of
the Purchase Contract Agreement with respect to the Purchase Contracts
underlying the number of Securities evidenced by this Security Certificate
specified below. The option to effect Early Settlement may be exercised only
with respect to integral multiples of 1,000 Securities. The undersigned Holder
directs that a certificate for shares of Common Stock deliverable upon such
Early Settlement be registered in the name of, and delivered, together with a
check in payment for any fractional share and any Security Certificate
representing any Securities evidenced hereby as to which Early Settlement of the
related Purchase Contracts is not effected, to, the undersigned at the address
indicated below, unless a different name and address have been indicated below.
Treasury Securities deliverable upon such Early Settlement shall 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 shall pay any transfer tax payable incident thereto.
Dated:
_________________________ _________________________
Signature
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93
Number of Securities evidenced hereby as to which Early Settlement of
the related Purchase Contracts is being elected:
If shares or Security Certificates are to REGISTERED HOLDER
be registered in the name of and
delivered to and Treasury Securities
are to be transferred to a Person other
than the Holder, please print such
Person's name and address:
Please print name and address
of Registered Holder:
Name Name
_________________________ _________________________
Address Address
_________________________ _________________________
Social Security or other Taxpayer
Identification Number, if any _________________________
Transfer Instructions for Treasury Securities transferable upon Early
Settlement:
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