EXHIBIT 4.18
FORM OF STOCK
PURCHASE CONTRACT AGREEMENT
HEFTEL BROADCASTING CORPORATION
AND
{PURCHASE CONTRACT AGENT}
DATED AS OF __________________
TABLE OF CONTENTS
Page
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PARTIES
RECITALS
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 101. Definitions
Section 102. Compliance Certificates and Opinions
Section 103. Form of Documents Delivered to Agent
Section 104. Acts of Holders; Record Dates
Section 105. Notice, etc., to Agent and the Company
Section 106. Notice to Holders; Waiver
Section 107. Effect of Headings and Table of Contents
Section 108. Successors and Assigns
Section 109. Separability Clause
Section 110. Benefits of Agreement
Section 111. Governing Law
Section 112. Legal Holidays
Section 113. Counterparts
Section 114. Inspection of Agreement
ARTICLE TWO
Security Certificate Forms
Section 201. Forms of Security Certificates Generally
Section 202. Form of Agent's Certificate of Authentication
ARTICLE THREE
The Securities
Section 301. Title and Terms; Denominations
Section 302. Rights and Obligations Evidenced by the Security Certificates
Section 303. Execution, Authentication, Delivery and Dating
Section 304. Temporary Security Certificates
Section 305. Registration; Registration of Transfer and Exchange
Section 306. Mutilated, Destroyed, Lost and Stolen Security Certificates
Section 307. Persons Deemed Owners
Section 308. Cancellation
Section 309. Securities Not Separable
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ARTICLE FOUR
The Pledged Securities
Section 401. Payment of Distributions; Distributions Rights Preserved
Section 402. Transfer of Pledged Securities Upon Occurrence of Termination Event
ARTICLE FIVE
The Purchase Contracts
Section 501. Purchase of Shares of Common Stock
Section 502. Contract Fees
Section 503. Deferral of Payment Dates For Contract Fee
Section 504. Payment of Purchase Price
Section 505. Issuance of Shares of Common Stock
Section 506. Adjustment of Settlement Rate
Section 507. Notice of Adjustments and Certain Other Events
Section 508. Termination Event; Notice
Section 509. Early Settlement
Section 510. No Fractional Shares
Section 511. Charges and Taxes
ARTICLE SIX
Remedies
Section 601. Unconditional Right of Holders to Receive Contract Fee
Section 602. Restoration of Rights and Remedies
Section 603. Rights and Remedies Cumulative
Section 604. Delay or Omission Not Waiver
Section 605. Undertaking for Costs
Section 606. Waiver of Stay or Extension Laws
ARTICLE SEVEN
The Agent
Section 701. Certain Duties and Responsibilities
Section 702. Notice of Default
Section 703. Certain Rights of Agent
Section 704. Not Responsible for Recitals or Issuance of Securities
Section 705. May Hold Securities
Section 706. Money Held in Trust
Section 707. Compensation and Reimbursement
Section 708. Corporate Agent Required; Eligibility
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Section 709. Resignation and Removal; Appointment of Successor
Section 710. Acceptance of Appointment by Successor
Section 711. Merger, Conversion, Consolidation or Succession to Business
Section 712. Preservation of Information; Communications to Holders
Section 713. No Obligations of Agent
Section 714. Tax Compliance
ARTICLE EIGHT
Supplemental Agreements
Section 801. Supplemental Agreements Without Consent of Holders
Section 802. Supplemental Agreements with Consent of Holders
Section 803. Execution of Supplemental Agreements
Section 804. Effect of Supplemental Agreements
Section 805. Reference to Supplemental Agreements
ARTICLE NINE
Consolidation, Merger, Sale or Conveyance
Section 901. Covenant Not to Merger Consolidate, Sell or Convey Property Except Under Certain Conditions
Section 902. Rights and Duties of Successor Corporation
Section 903. Opinion of Counsel to Agent
ARTICLE TEN
Covenants
Section 1001. Performance Under Purchase Contracts
Section 1002. Maintenance of Office or Agency
Section 1003. Company to Reserve Common Stock
Section 1004. Covenants as to Common Stock
Section 1005. Statements of Officers of the Company as to Default
TESTIMONIUM
SIGNATURES
EXHIBIT A Form of Security Certificate
PURCHASE CONTRACT AGREEMENT, dated as of ____________, 1997,
between HEFTEL BROADCASTING CORPORATION, a Delaware corporation (the
"Company"), and {PURCHASE CONTRACT AGENT}, acting as purchase contract agent
for the Holders of Securities from time to time (the "Agent").
RECITALS
A. The Company has duly authorized the execution and delivery of this
Agreement and the Security Certificates evidencing the Securities.
B. All things necessary to make the Company's obligations under the
Securities, when the Security Certificates are executed by the Company
and authenticated, executed on behalf of the Holders and delivered by
the Agent, as in this Agreement provided, the valid obligations of the
Company, and to constitute these presents a valid agreement of the
Company, in accordance with its terms, have been done.
WITNESSETH: For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually agreed as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 101. Definitions.
For all purposes of this Agreement, except as otherwise
expressly provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to them
in this Article and include the plural as well as the singular; and
(2) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Agreement as 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 104.
"Affiliate" of any specified Person means any other
Person directly or indirectly controlling or controlled
by or under direct or indirect common control with such
specified Person, For the
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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 501.
"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.
"Business Day" means any day that is not a Saturday,
Sunday or a day on which the NYSE or banking institutions or
trust companies in the City of New York are authorized or
obligated by law or executive order to be closed.
"Closing Price" has the meaning specified in Section
501.
"Collateral Agent" means _____________, as Collateral
Agent under the Pledge Agreement until a successor Collateral
Agent shall have become
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such pursuant to the applicable provisions of the Pledge
Agreement, and thereafter "Collateral Agent" shall mean the
Person who is then the Collateral Agent thereunder.
"Common Stock" means the Common Stock, par value $0.01
per share, of the Company.
"Company" means the Person named as the "Company" in the
first paragraph of this instrument until a successor shall
have become such, and thereafter "Company" shall mean such
successor.
"Contract Fee" means the fee payable by the Company in
respect of each Purchase Contract, equal to __% per annum of
the Stated Amount, accruing from ____________, 199__, computed
on the basis of the actual number of days elapsed in a year of
365 or 366 days, as the case may be, plus any additional fees
accrued pursuant to Section 503.
"Corporate Trust Office" means the principal office of
the Agent in the Borough of Manhattan, The City of New York,
at which at any particular time its corporate trust business
shall be administered, which office at the date hereof is
located at ________________, New York, New York.
"Current Market Price" has the meaning specified in
Section 506(a)(8).
"Depositary" means a clearing agency registered under
the Exchange Act that is designated to act as Depositary for
the Securities as contemplated by Section 305.
"Early Settlement" has the meaning specified in Section
509(a).
"Early Settlement Amount" has the meaning specified in
Section 509(a).
"Early Settlement Date" has the meaning specified in
Section 509(a).
"Early Settlement Rate" has the meaning specified in
Section 509(b).
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"Exchange Act" means the Securities Act of 1934 and any
statute successor thereto, in each case as amended from time
to time.
"Excess Pledged Securities" has the meaning specified in
Section 402.
"Expiration Date" has the meaning specified in Section
104.
"Expiration Time" has the meaning specified in Section
506(a)(6).
"Final Settlement Date" means ____________, 199__.
"Final Settlement Fund" has the meaning specified in
Section 505.
"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.
"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.
"NYSE" has the meaning specified in Section 501.
"Officer's Certificate" means a certificate signed by
the Chairman of the Board, any Vice Chairman, 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.
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"Opinion of Counsel" means an opinion in writing signed
by legal counsel, who may be an employee of or counsel to the
Company.
"Outstanding Securities" means, as of the date of
determination, all Securities evidenced by then Outstanding
Security Certificates, except:
(i) If a Termination Event has occurred, Securities for
which the underlying Pledged Securities have been
theretofore deposited with the Agent in trust for the
Holders of such Securities; and
(ii) On and after the applicable Early Settlement Date,
Securities as to which the Holder has elected to effect
Early Termination of the related Purchase Contracts;
provided, however, that in determining whether the
Holders of the requisite number of Securities have given
any request, demand, authorization, direction, notice,
consent or waiver hereunder, Securities owned by the
Company or any Affiliate of the Company shall be
disregarded and deemed not to be outstanding, except
that, in determining whether the Agent shall be
protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver,
only Securities which the Agent knows to be so owned
shall be so disregarded. Securities so owned which have
been pledged in good faith may be regarded as
outstanding if the pledgee establishes to the
satisfaction of the Agent the pledgee's right so to act
with respect to such Securities and that the pledgee is
not the Company or any Affiliate of the Company.
"Outstanding Security Certificates" means, as of the date of
determination, all Security Certificates theretofore authenticated,
executed and delivered under this Agreement, except:
(i) Security Certificates theretofore cancelled by the Agent
or delivered to the Agent for cancellation; and
(ii) Security Certificates in exchange for or in lieu of
which other Security Certificates have been
authenticated, executed on behalf
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of the Holder and delivered pursuant to this Agreement,
other than any such Security Certificate in respect of
which there shall have been presented to the Agent proof
satisfactory to it that such Security Certificate is
held by a bona fide purchaser in whose hands the
Securities evidenced by such Security Certificate are
valid obligations of the Company.
"Payment Date" means each _________ and ___________,
commencing ____________, 19__.
"Persons" 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
Pledged 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.
"Pledged Securities" means [ ].
"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 306 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 Five hereof.
"Purchased Shares" has the meaning specified in Section
506(a)(6).
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"Record Date" for the distributions and Contract Fees payable
on any Payment Date means the _____________ or _______________
(whether or not a Business Day), as the case may be, next preceding
such Payment Date.
"Reorganization Event" has the meaning specified in Section
506(b).
"Responsible Officer," when used with respect to the Agent,
means any officer of the Agent assigned by the Agent to administer its
corporate trust matters.
"Security" means the collective rights and obligations of a
Holder of a Security Certificate in respect of Pledged Securities with
a principal amount or liquidation preference equal to the Stated
Amount, subject to the Pledge thereof, and a Purchase Contract.
"Security Certificate" means a certificate evidencing the
rights and obligations of a Holder in respect of the number of
Securities specified on such certificate.
"Security Register" and "Security Registrar" have the
respective meanings specified in Section 305.
"Settlement Rate" has the meaning specified in Section 501.
"Stated Amount" means $_______________.
"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 decree or order by a court having jurisdiction in the premises
shall have been entered adjudging the Company a bankrupt or insolvent,
or approving as properly filed a petition seeking reorganization of
the Company under the United States Bankruptcy Code or any other
similar applicable Federal or State law, and, unless such 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 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
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property, or for the winding up or liquidation of its affairs, shall
have been entered, and, unless such 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 (iii) at any time on or prior to the Final Settlement
Date the Company shall institute proceedings to be adjudicated a
bankrupt, or shall consent to the filing of a bankruptcy proceeding
against it, or shall file a petition or answer or consent seeking
reorganization under the United States Bankruptcy Code or any other
similar applicable Federal or State law, or shall consent to the
filing of any such petition, or shall consent to the appointment of a
receiver or liquidator or trustee or assignee in bankruptcy or
insolvency of it or of its property, or shall make an assignment for
the benefit of creditors, or shall admit in writing its inability to
pay its debts generally as they become due.
"Threshold Appreciation Price" has the meaning specified in
Section 501.
"TIA" means the Trust Indenture Act of 1939, as xxxxxx, or any
successor statute.
"Trading Day" has the meaning specified in Section 501.
"Underwriting Agreement" means the Underwriting Agreement
dated ____________, 199__ between the Company and ________________, as
representative of the several Underwriters named therein.
"Vice President" means any vice president, whether or not
designated by a number or a word or words added before or after the
title "vice president."
Section 102. Compliance Certificates and Opinions.
Except as otherwise expressly provided by this Agreement, upon
any application or request by the Company to the Agent to take any action under
any provision of this Agreement, the Company shall furnish to the Agent an
Officer's Certificate stating that all conditions precedent, if any, provided
for in this Agreement relating to the proposed action have been complied with
and 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
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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:
(1) a statement that each individual signing such
certificate or opinion has read such covenant or
condition and the definitions herein relating thereto;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements
or opinions contained in such certificate or opinion are
based;
(3) a statement that, in the opinion of each such
individual, he has made such examination or
investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant
or condition has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied
with.
Section 103. Form of Documents Delivered to Agent.
In any case where several matters are required to be certified
by, or covered by an opinion of, any specified Person, it is not necessary that
all such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be
based, insofar as it relates to legal matters, upon a certificate or opinion
of, or representations by, counsel, unless such officer knows, or in the
exercise of reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which his certificate or
opinion is based are erroneous. Any such certificate or Opinion of Counsel may
be based, insofar as it relates to factual matters, upon
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a certificate or opinion of, or representations by, an officer or officers of
the Company stating that the information with respect to such factual matters
is in the possession of the Company unless such counsel knows, or in the
exercise of reasonable care should know, that the certificate or opinion or
representations with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Agreement, they may, but need not, be consolidated
and form one instrument.
Section 104. Acts of Holders; Record Dates.
(a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Agreement to be given or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by
agent duly appointed in writing; and, except as herein otherwise
expressly provided, such action shall become effective when such
instrument or instruments are delivered to the Agent and, where it is
hereby expressly required, to the Company. Such instrument or
instruments (and the action embodied therein and evidenced thereby)
are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be
sufficient for any purpose of this Agreement and (subject to Section
701) conclusive in favor of the Agent and the Company, if made in the
manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of
such execution or by a certificate of a notary public or other officer
authorized by law to take acknowledgments of deeds, certifying that
the individual signing such instrument or writing acknowledged to him
the execution thereof. Where such execution is by a signer acting in
a capacity other than his individual capacity, such certificate or
affidavit shall also constitute sufficient proof of his authority.
The fact and date of the execution of any such instrument or writing,
or the authority of the Person executing the same, may also be proved
in any other manner which the Agent deems sufficient.
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(c) The ownership of Securities shall be proved by the Security Register.
(d) Any request, demand, authorization, direction, notice, consent, waiver
or other Act of the Holder of any Security shall bind every future
Holder of the same Security and the Holder of every Security
Certificate evidencing such Security issued upon the registration of
transfer thereof or in exchange therefor or in lieu thereof in respect
of anything done, omitted or suffered to be done by the Agent or the
Company in reliance thereon, whether or not notation of such action is
made upon such Security Certificate.
(e) The Company may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities entitled to give,
make or take any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this
Agreement to be given, made or taken by Holders of Securities. If any
record date is set pursuant to this paragraph, the Holders of
Outstanding Securities on such record date, and no other Holders,
shall be entitled to take the relevant action, whether or not such
Holders remain Holders after such record date; provided that no such
action shall be effective hereunder unless taken on or prior to the
applicable Expiration Date by Holders of the requisite number of
Outstanding Securities on such record date. Nothing in this paragraph
shall be construed to prevent the Company from setting a new record
date for any action for which a record date has previously been set
pursuant to this paragraph (whereupon the record date previously set
shall automatically and with no action by any Person be cancelled and
of no effect), and nothing in this paragraph shall be construed to
render ineffective any action taken by Holders of the requisite number
of Outstanding Securities on the date such action is taken. Promptly
after any record date is set pursuant to this paragraph, the Company,
at its own expense, shall cause notice of such record date, the
proposed action by Holders and the applicable Expiration Date to be
given to the Agent in writing and to each Holder of Securities in the
manner set forth in Section 106.
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
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proposed new Expiration Date is given to the Agent in writing, and to each
Holder of Securities in the manner set forth in Section 106, 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 105. Notices, etc., to Agent and the Company.
Any request, demand, authorization, direction, notice,
consent, waiver or Act of Holders or other document provided or permitted by
this Agreement to be made upon, given or furnished to, or filed with,
(1) the Agent by any Holder or by the Company shall be sufficient for
every purpose hereunder (unless otherwise herein expressly provided)
if made, given, furnished or filed in writing and personally delivered
or mailed, first class postage prepaid, to the Agent at
_______________, Attention: Stock Transfer Department, or at any
other address previously furnished in writing by the Agent to the
Holders and the Company, or
(2) the Company by the Agent or by any Holder shall be sufficient for
every purpose hereunder (unless otherwise herein expressly provided)
if made, given, furnished or filed in writing and personally delivered
or mailed, first-class postage prepaid, to the Company at Xxx
Xxxxxxxxxx Xxxxxx, Xxx Xxxxxxxxx, Xxxxxxxxxx 00000, Attention: Senior
Vice President, Legal, or at any other address previously furnished in
writing to the Agent by the Company.
Section 106. 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 his address as it appears in the
Security Register, not later than the latest date, and not earlier than the
earliest date, prescribed for the giving of such notice. In any case where
notice to Holders is given by mail, neither the failure to mail such notice,
nor any defect in any notice so mailed to any particular Holder shall affect
the sufficiency of such notice with
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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 107. 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 108. 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 109. 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 110. Benefits of Agreement.
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.
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Section 111. 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 112. 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 distributions on Pledged Securities or 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, or the Purchase
Contracts shall be performed or Early Settlement effected, as applicable, on
the next succeeding Business Day with the same force and effect as if made on
such Payment Date, Early Settlement Date or Final Settlement Date, as the case
may be; provided, that no interest shall accrue or be payable by the Company or
any Holder for the period from and after any such Payment Date, Early
Settlement Date or Final Settlement Date, as the case may be.
Section 113. 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 114. 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.
ARTICLE TWO
SECURITY CERTIFICATE FORMS
Section 201. Forms of Security Certificates Generally.
The Security Certificates (including the form of Purchase
Contracts forming part of the Securities evidenced thereby) shall be in
substantially the form set forth in Exhibit A hereto, with such letters,
numbers or other marks of identification or designation and such legends or
endorsements printed, lithographed or engraved thereon as may be required by
the rules of any securities exchange on
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which the Securities are listed or Depositary therefor, or as may, consistently
herewith, be determined by the officers of the Company executing such Security
Certificates, as evidenced by their execution of the Security Certificates.
The definitive Security Certificates shall be printed,
lithographed or engraved on steel engraved borders or may be produced in any
other manner, all as determined by the officers of the Company executing the
Security Certificates, consistent with the provisions of this Agreement, as
evidenced by their execution thereof.
Every Global Security Certificate authenticated, executed on
behalf of the Holders and delivered hereunder shall bear a legend in
substantially the following form:
THIS SECURITY CERTIFICATE IS A GLOBAL SECURITY CERTIFICATE WITHIN THE MEANING
OF THE PURCHASE CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN
THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF. THIS SECURITY CERTIFICATE MAY
NOT BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY CERTIFICATE REGISTERED, AND
NO TRANSFER OF THIS SECURITY CERTIFICATE IN WHOLE OR IN PART MAY BE REGISTERED,
IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE THEREOF.
EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT
AGREEMENT.
Section 202. Form of Agent's Certificate of Authentication.
The form of the Agent's certificate of authentication of the
Securities shall be in substantially the form set forth on the form of the
Security Certificates.
ARTICLE THREE
THE SECURITIES
Section 301. Title and Terms; Denominations.
The aggregate number of Securities evidenced by Security
Certificates authenticated, executed on behalf of the Holders and delivered
hereunder is limited to _________ (subject to increase up to a maximum of
_____________ to the extent the overallotment option of the underwriters under
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
304, 305, 306, 509 or 805.
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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 302. Rights and Obligations Evidenced by the Security Certificates.
Each Security Certificate shall evidence the number of
Securities specified therein, with each such Security representing the
ownership by the Holder thereof of Pledged Securities with a principal amount
or liquidation preference equal to the Stated Amount, subject to the Pledge of
such Pledged Securities by such Holder pursuant to the Pledge Agreement, and
the rights and obligations of the Holder under one Purchase Contract. 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 303. Execution, Authentication, Delivery and Dating.
Upon the execution and delivery of this Agreement, and at any
time and from time to time thereafter, the Company may deliver Security
Certificates executed by the Company to the Agent for authentication, execution
on behalf of the Holders and delivery, together with its Issuer Order for
authentication of such Security Certificates, and the Agent in accordance with
such Issuer Order shall authenticate, execute on behalf of the Holder and
deliver such Security Certificates.
The Security Certificates shall be executed on behalf of the
Company by its Chairman of the Board, its Vice Chairman of the Board, its
President or one of its Vice Presidents, under its corporate seal reproduced
thereon attested by its Secretary or one of its Assistant Secretaries. The
signature of any of these officers on the Security Certificates may be manual
or facsimile.
Security Certificates bearing the manual or facsimile
signatures of individuals who were at any time the proper officers of the
Company shall bind the Company, notwithstanding that such individuals or any of
them have
17
ceased to hold such offices prior to the authentication and delivery of such
Security Certificates or did not hold such offices at the date of such Security
Certificates.
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 304. Temporary Security Certificates.
Pending the preparation of definitive Security Certificates,
the Company shall execute and deliver to the Agent, and the Agent shall
authenticate, execute on behalf of the Holders, and deliver, in lieu of such
definitive Security Certificates, temporary Security Certificates which are in
substantially the form set forth in Exhibit A hereto, with such letters,
numbers or other marks of identification or designation and such legends or
endorsements printed, lithographed or engraved thereon as may be required by
the rules of any securities exchange on which the Securities are listed, or as
may, consistently herewith, be determined by the officers of the Company
executing such Security Certificates, as evidenced by their execution of the
Security Certificates.
If temporary Security Certificates are issued, the Company
will cause definitive Security Certificates to be prepared without unreasonable
delay. After the preparation of definitive Security Certificates, the
temporary Security Certificates shall be exchangeable for definitive Security
18
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 cancelation of any one or more temporary Security
Certificates, the Company shall execute and deliver to the Agent, and the Agent
shall authenticate, execute on behalf of the Holder, and deliver in exchange
therefor, one or more definitive Security Certificates of authorized
denominations and evidencing a like number of Securities as the temporary
Security Certificate or Security Certificates so surrendered. Until so
exchanged, the temporary Security Certificates shall in all respects evidence
the same benefits and the same obligations with respect to the Securities
evidenced thereby as definitive Security Certificates.
Section 305. Registration; Registration of Transfer and Exchange.
The Agent shall keep at the Corporate Trust Office a register
(the register maintained in such office being herein referred to as the
"Security Register") in which, subject to such reasonable regulations as it may
prescribe, the Agent shall provide for the registration of Security
Certificates and of transfers of Security Certificates (the Agent, in such
capacity, the "Security Registrar").
Upon surrender for registration of transfer of any Security
Certificate at the Corporate Trust Office, the Company shall execute and
deliver to the Agent, and the Agent shall authenticate, execute on behalf of
the designated transferee or transferees, and deliver, in the name of the
designated transferee or transferees, one or more new Security Certificates of
any authorized denominations and evidencing a like number of Securities.
At the option of the Holder, Security Certificates may be
exchanged for other Security Certificates, of any authorized denominations and
evidencing a like number of Securities, upon surrender of the Security
Certificates to be exchanged at the Corporate Trust Office. Whenever any
Security Certificates are so surrendered for exchange, the Company shall
execute and deliver to the Agent, and the Agent shall authenticate, execute on
behalf of the Holder, and deliver the Security Certificates which the Holder
making the exchange is entitled to receive.
All Security Certificates issued upon any registration of
transfer or exchange of a Security Certificate shall evidence the ownership of
the same number of Securities and be entitled to the same benefits and
19
subject to the same obligations, under this Agreement as the Securities
evidenced by the Security Certificate surrendered upon such registration of
transfer or exchange.
Every Security Certificate presented or surrendered for
registration of transfer or for exchange shall (if so required by the Agent) be
duly endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Agent duly executed, by the Holder thereof
or his attorney duly authorized in writing.
No service charge shall be made for any registration of
transfer or exchange of a Security Certificate, but the Company and the Agent
may require payment from the Holder of a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection with any
registration of transfer or exchange of Security Certificates, other than any
exchanges pursuant to Sections 306 and 805 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 or liquidation amount, as
the case may be, of the Pledged Securities evidenced thereby, in each case
subject to the applicable conditions and in accordance with the applicable
provisions of Article Five hereof.
The provisions of Clauses (1), (2), (3) and (4) below shall
apply only to Global Security Certificates:
(1) Each Global Security Certificate authenticated and executed on behalf
of the Holders under this Agreement shall be registered in the name of
the Depositary designated for such Global Security Certificate or a
nominee thereof and delivered to such Depositary or a nominee thereof
or custodian therefor, an each such Global Security Certificate shall
constitute a single
20
Security Certificate for all purposes of this Agreement.
(2) Notwithstanding any other provision in this Agreement, no Global
Security Certificate may be exchanged in whole or in part of Security
Certificates registered, and no transfer for a Global Security
Certificate in whole or in part may be registered, in the name of any
Person other than the Depositary for such Global Security Certificate
or a nominee thereof unless (A) such Depositary (i) has notified the
Company that it is unwilling or unable to continue as Depositary for
such Global Security Certificate or (ii) has ceased to be a clearing
agency registered under the Exchange Act or (b) there shall have
occurred and be continuing a default by the Company in respect to its
obligations under one or more Purchase Contracts.
(3) Subject to Clause (2) above, any exchange of a Global Security
Certificate for other Security Certificates may be made in whole or in
part, and all Security Certificates issued in exchange for a Global
Security Certificate or any portion thereof shall be registered in
such names as the Depositary for such Global Security Certificate
shall direct.
(4) Every Security Certificate authenticated and delivered upon
registration of transfer of, or in exchange for or in lieu of, a
Global Security Certificate or any portion thereof, whether pursuant
to this Section, Section 304, 306, 509 or 805 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 306. Mutilated, Destroyed, Lost and Stolen Security Certificates.
If any mutilated Security Certificate is surrendered to the Agent, the
Company shall execute and deliver to the Agent, and the Agent shall
authenticate, execute on behalf of the Holder, and deliver in exchange
therefor, a new Security Certificate, evidencing the same number of Securities
and bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company and the Agent (i) evidence
to their satisfaction of the destruction,
21
loss or theft of any Security Certificate, and (ii) such security or indemnity
as may be required by them to save each of them and any agent of any of them
harmless, then, in the absence of notice to the Company or the Agent that such
Security Certificate has been acquired by a bona fide purchaser, the Company
shall execute and deliver to the Agent, and the Agent shall authenticate,
execute on behalf of the Holder, and deliver to the Holder, in lieu of any such
destroyed, lost or stolen Security Certificate, a new Security Certificate,
evidencing the same number of Securities and bearing a number not
contemporaneously outstanding.
Notwithstanding the foregoing, the Company shall not be obligated to
execute and deliver to the Agent, and the Agent shall not be obligated to
authenticate, execute on behalf of the Holder, and deliver to the Holder, a
Security Certificate on or after the Final Settlement Date or the Termination
Date. In lieu of delivery of a new Security Certificate, upon satisfaction of
the applicable conditions specified above in this Section and receipt of
appropriate registration or transfer instructions from such Holder, the Agent
shall (i) if the Final Settlement Date has occurred, deliver the shares of
Common Stock issuable in respect of the Purchase Contracts forming a part of
the Securities evidenced by such Security Certificate, or (ii) if a Termination
Event shall have occurred prior to the Final Settlement Date, transfer the
principal amount of the Pledged Securities evidenced thereby, in each case
subject to the applicable conditions and in accordance with the applicable
provisions of Article Five hereof.
Upon the issuance of any new Security Certificate under this Section,
the Company and the Agent may require the payment by the Holder of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other expenses (including the fees and expenses of the
Agent) connected therewith.
Every new Security Certificate issued pursuant to this Section in lieu
of any destroyed, lost or stolen Security Certificate shall constitute an
original additional contractual obligation of the Company and of the Holder,
whether or not the destroyed, lost or stolen Security Certificate shall be at
any time enforceable by anyone, and shall be entitled to all the benefits and
be subject to all the obligations of this Agreement equally and proportionately
with any and all other Security Certificates delivered hereunder.
22
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 307. 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 distributions on the Pledged Securities, receiving payments of
Contract Fees, performance of the Purchase Contracts and for all other purposes
whatsoever, whether or not the payment of distributions on the Pledged
Securities 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 nor the
Agent, nor any agent or 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 owners of beneficial interests in such Global Security
Certificate, the operation of customary practices governing the exercise of
rights of such Depositary (or its nominee) as Holder of such Global Security
Certificate.
Section 308. Cancellation.
All Security Certificates surrendered for delivery of shares of Common
Stock on or after the Final Settlement Date, transfer of Pledged Securities
after the occurrence of a Termination Event or pursuant to an Early Settlement
or registration of transfer or exchange shall, if surrendered to any Person
other than the Agent, be delivered to the Agent and, if not already cancelled,
shall be promptly cancelled by it. The Company may at any time deliver to the
Agent for cancellation any Security Certificates previously authenticated,
executed and delivered hereunder which the Company may have acquired in any
manner whatsoever, and all Security Certificates so delivered shall, upon
Issuer Order, be promptly cancelled by the Agent. No Security Certificates
shall be authenticated, executed on behalf of
23
the Holder and delivered in lieu of or in exchange for any Security
Certificates cancelled as provided in this Section, except as expressly
permitted by this Agreement. All cancelled Security Certificates held by the
Agent shall be disposed of as directed by Issuer Order.
If the Company or any Affiliate of the Company shall acquire any
Security Certificate, such acquisition shall not operate as a cancellation of
such Security Certificate unless and until such Security Certificate is
delivered to the Agent cancelled or for cancellation.
Section 309. Securities Not Separable.
Notwithstanding anything contained herein or in the Security
Certificates to the contrary, 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 Pledged Securities and Purchase Contracts
constituting 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 Pledged Securities 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.
ARTICLE FOUR
THE PLEDGED SECURITIES
Section 401. Payment of Distributions; Rights to Distributions Preserved.
Distributions on any Pledged Security which is paid on any Payment
Date shall, subject to receipt thereof by the Agent from the Collateral Agent
as provided by the terms of the Pledge Agreement, be paid to the Person in
whose name the Security Certificate (or one or more Predecessor Security
Certificates) of which such Pledged Security is a part is registered at the
close of business on the Record Date next preceding such Payment Date.
Each Security Certificate evidencing Pledged 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 distributions
accrued and unpaid, and to accrue, which were carried by the
24
Pledged Securities underlying such other Security Certificate.
In the case of any Security with respect to which Early Settlement of
the underlying Purchase Contract is effected on an Early Settlement Date after
any Record Date and on or prior to the next succeeding Payment Date,
distributions on the Pledged Securities underlying such Security otherwise
payable on such Payment Date shall be payable on such Payment Date
notwithstanding such Early Settlement, and such distributions shall, subject to
receipt thereof by the Agent, be paid to the Person in whose name the Security
Certificate (or one or more Predecessor Security Certificates) is registered at
the close of business on the Record Date. Except as otherwise expressly
provided in the immediately preceding sentence, in the case of any Security
with respect to which Early Settlement of the underlying Purchase Contract is
effected on an Early Settlement Date, distributions on the related Pledged
Securities that would otherwise be payable after the Early Settlement Date
shall not be payable hereunder to the Holder of such Security.
Section 402. Transfer of Pledged Securities Upon Occurrence of
Termination Event.
Upon the occurrence of a Termination Event and the transfer to the
Agent of the Pledged Securities underlying such Securities pursuant to the
terms of the Pledge Agreement, the Agent shall request transfer instructions
with respect to such Pledged Securities from each Holder of Securities by
written request mailed to such Holder at his address as it appears in the
Security Register, in respect of the Pledged Securities underlying the Security
Certificate held by such Holder. Upon surrender to the Agent of a Security
Certificate with such transfer instructions in proper form for transfer of the
Pledged Securities by Federal Reserve BankWire, book entry transfer through the
facilities of the Depositary Trust Company, or other appropriate procedure, the
Agent shall transfer the Pledged 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 Pledged Securities evidenced by such
Security Certificate as custodian for the Holder of such Security Certificate.
Pledged Securities shall be transferred only in denominations of
$__________ and integral multiples thereof. As promptly as practicable
following the occurrence of a
25
Termination Event, the Agent shall determine the excess of (i) the aggregate
principal amount or liquidation preference, as the case may be, of Pledged
Securities underlying the Outstanding Securities over (ii) the aggregate
principal amount or liquidation preference, as the case may be, of Pledged
Securities in denominations of $__________ 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 Pledged Securities"). As soon
as practicable after transfer to the Agent of the Pledged Securities underlying
the Outstanding Securities as provided in the Pledge Agreement, the Agent shall
sell the Excess Pledged Securities to or through one or more registered broker
dealers at then prevailing prices. The Agent shall deduct from the proceeds of
such sales all commissions and other out-of-pocket transaction costs incurred
in connection with such sales of Excess Pledged Securities and, until the net
proceeds of such sale or sales have been distributed to Holders of the
Securities, the Agent shall hold such proceeds in trust for the Holders of
Securities. Each Holder shall be entitled to receive a portion, if any, of
such net proceeds in lieu of Pledged Securities with a principal amount of less
than $ determined by multiplying the aggregate amount of such net proceeds
by a fraction, the numerator of which is the fraction of $_____________ in
principal amount of Pledged 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
Pledged Securities.
ARTICLE FIVE
THE PURCHASE CONTRACTS
Section 501. 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 $____ (the "Threshold Appreciation Price"), __________ of a share of
Common Stock per Purchase Contract, (b) if the Applicable Market Value is less
than or equal to the Threshold Appreciation Price but is greater than the
Stated Amount, a fractional share of
26
Common Stock per Purchase Contract equal to the Stated Amount divided by the
Applicable Market Value (rounded upward or downward to the nearest 1/10,000th
of a share) and (c) if the Applicable Market Value is less than or equal to the
Stated Amount, one share of Common Stock per Purchase Contract, in each case
subject to adjustment as provided in Section 506. As provided in Section 510,
no fractional shares of Common Stock will be issued upon settlement of Purchase
Contracts.
The "Applicable Market Value" means the average of the Closing Prices
per share of Common Stock on each of the twenty consecutive Trading Days ending
on the last Trading Day immediately preceding the Final Settlement Date. The
"Closing Price" of the Common Stock on any date of determination means the
closing sale price (or, if no closing price is reported, the last reported sale
price) of the Common Stock on the New York Stock Exchange (the "NYSE") on such
date or, if the Common Stock is not listed for trading on the NYSE on any such
date, as reported in the composite transactions for the principal United States
securities exchange on which the Common Stock is so listed, or if the Common
Stock is not so listed on a United States national or regional securities
exchange, as reported by The Nasdaq Stock Market, or, if the Common Stock is
not so reported, the last quoted bid price for the Common Stock in the over-
the-counter market as reported by the National Quotation Bureau or similar
organization, or, if such bid price is not available, the market value of the
Common Stock on such date as determined by a nationally recognized independent
investment banking firm retained for this purpose by the Company. A "Trading
Day" means a day on which the Common Stock (A) is not suspended from trading on
any national or regional securities exchange or association or over-the-counter
market at the close of business and (B) has traded at least once on the
national or regional securities exchange or association or over-the-counter
market that is the primary market for the trading of the Common Stock.
Each Holder of a Security Certificate evidencing Securities, by his
acceptance thereof, irrevocably authorizes the Agent to enter into and perform
the related Purchase Contracts on his behalf as his attorney-in-fact, agrees to
be bound by the terms and provisions thereof, covenants and agrees to perform
his obligations under such Purchase Contracts, consents to the provisions
hereof, irrevocably authorizes the Agent as his attorney-in-fact to enter into
and perform the Pledge Agreement on his behalf as his attorney-in-fact, and
consents to and agrees to be bound by the Pledge of the Pledged Securities
underlying such
27
Security Certificate pursuant to the Pledge Agreement. Each Holder of a
Security, by his acceptance thereof, further irrevocably covenants and agrees
that, to the extent and in the manner provided in Section 504 and the Pledge
Agreement, but subject to the terms thereof, payments in respect of principal
or redemption price of the Pledged 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 his
acceptance thereof, likewise covenants and agrees, to be bound by the
provisions of this paragraph.
Section 502. Contract Fees.
Subject to Section 503, the Company shall pay, on each Payment Date,
the Contract Fees payable in respect of each Purchase Contract to the Person in
whose name the Security Certificate (or one or more Predecessor Security
Certificates) evidencing such Purchase Contract is registered at the close of
business on the Record Date next preceding such Payment Date. The Contract Fee
will be payable at the office of the Agent in the City of New York maintained
for that purpose or, at the option of the Company, by check mailed to the
address of the Person entitled thereto at such address as it appears on the
Security Register.
Each Security Certificate delivered under this Agreement upon
registration of transfer of or in exchange for or in lieu of any other Security
Certificate shall carry the rights to Contract Fees accrued and unpaid, and to
accrue, which were carried by the Purchase Contracts evidenced by such other
Security Certificate.
In the case of any Security with respect to which Early Settlement of
the underlying Purchase Contract is effected on an Early Settlement Date after
any Record Date and on or prior to the next succeeding Payment Date, Contract
Fees otherwise payable on such Payment Date shall be payable on such Payment
Date notwithstanding such Early
28
Settlement, and such Contract Fees 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 that would otherwise be payable after the Early Settlement Date
with respect to the Purchase Contract underlying such Security shall not be
payable.
Section 503. Deferral of Payment Dates For Contract Fee.
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, but only if the Company shall give the
Holders and the Agent written notice of its election to defer such payment
(specifying the amount to be deferred) at least ten Business Days prior to the
earlier of (i) the next succeeding Payment Date or (ii) the date the Company is
required to give notice of the Record Date or Payment Date with respect to
payment of such Contract Fee to the New York Stock Exchange or other applicable
self-regulatory organization or to Holders of the Securities, but in any event
not less than two Business Days prior to such Record Date. Any Contract Fees
so deferred shall bear additional Contract Fees thereon at the rate of per
annum set forth in Appendix _______ hereto (computed on the basis set forth in
Appendix ____), compounding on each succeeding Payment Date, until paid in
full. Deferred Contract Fees (and additional Contract Fees accrued thereon)
shall be due on the next succeeding Payment Date except to the extent that
payment is deferred pursuant to this Section. No Contract Fees may be deferred
to a date that is after the Final Settlement Date or, with respect to any
particular Purchase Contract, Early Settlement thereof.
Section 504. Payment of Purchase Price.
The purchase price for the shares of Common Stock purchased pursuant
to a Purchase Contract shall be paid by application of payments received by the
Company on the Final Settlement Date from the Collateral Agent pursuant to the
Pledge Agreement in respect of the principal or redemption price, as the case
may be, of the Pledged 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.
29
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 505. Issuance of Share of Common Stock.
Unless a Termination Event shall have occurred on or prior to the
Final Settlement Date, on the Final Settlement Date, upon its receipt of
payment in full of the purchase price for the shares of Common Stock purchased
by the Holders pursuant to the foregoing provisions of this Article, and
subject to Section 506(b), the Company shall deposit with the Agent, for the
benefit of the Holders of the Outstanding Securities, one or more certificates
representing the shares of Common Stock registered in the name of the Agent (or
its nominee) as custodian for the Holders (such certificates for shares of
Common Stock, together with any dividends or distributions with respect
thereto, being hereinafter referred to as the "Final Settlement Fund") to which
the Holders are entitled hereunder. Subject to the foregoing, upon surrender
of a Security Certificate to the Agent on or after the Final Settlement Date,
together with settlement instructions thereon duly completed and executed, the
Holder of such Security Certificate shall be entitled to receive in exchange
therefor a certificate representing that number of whole shares of Common Stock
with such Holder is entitled to receive pursuant to the provisions of this
Article Five (after taking into account all Securities then held by such
Holder) together with cash in lieu of fractional shares as provided in Section
510 and any dividends or distributions with respect to such shares constituting
part of the Final Settlement Fund, but without any interest thereon, and the
Security Certificate so surrendered shall forthwith be cancelled. Such shares
shall be registered in the name of the Holder or the Holder's designee as
specified in the settlement instructions on the Security Certificate.
If any shares of Common Stock issued in respect of a Purchase Contract
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 Contractor has established to the satisfaction
30
of the Company that such tax either has been paid or is not payable.
Section 506. Adjustment of Settlement Rate.
(a) Adjustments for Dividends, Distributions, Stock Splits, Etc.
(1) In case the Company shall pay or make a dividend or
other distribution on any class of Common Stock of the
Company in Common Stock, the Settlement Rate in effect
at the opening of business on the day following the date
fixed for the determination of stockholders entitled to
receive such dividend or other distribution shall be
increased by dividing such Settlement Rate by a fraction
of which the numerator shall be the number of shares of
Common Stock outstanding at the close of business on the
date fixed for such determination and the denominator
shall be the sum of such number of shares and the total
number of shares constituting such dividend or other
distribution, such increase to become effective
immediately after the opening of business on the day
following the date fixed for such determination. For
the purposes of this paragraph (1), the number of shares
of Common Stock at any time outstanding shall not
include shares held in the treasury of the Company but
shall include shares issuable in respect of scrip
certificates issued in lieu of fractions of shares of
Common Stock. The Company will not pay any dividend or
make any distribution on shares of Common Stock held in
the treasury of the Company.
(2) In case the Company shall issue rights, options or
warrants to all holders of its Common Stock (not being
available on an equivalent basis to Holders of the
Securities upon settlement of the Purchase Contracts
underlying such Securities) entitling them, for a period
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 the
Common Stock on the date
31
fixed for the determination of stockholders entitled to
receive such rights, options or warrants (other than
pursuant to a dividend reinvestment plan), the
Settlement Rate in effect at the opening of business on
the day following the date fixed for such determination
shall be increased by dividing such Settlement Rate by a
fraction of which the numerator shall be the number of
shares of Common Stock outstanding at the close of
business on the date fixed for such determination plus
the number of shares of Common Stock which the aggregate
of the offering price of the total number of shares of
Common Stock so offered for subscription or purchase
would purchase at such Current Market Price and the
denominator shall be the number of shares of Common
Stock outstanding at the close of business on the date
fixed for such determination plus the number of shares
of Common Stock so offered for subscription or purchase,
such increase to become effective immediately after the
opening of business on the day following the date fixed
for such determination. For the purposes of this
paragraph (2), the number of shares of Common Stock at
any time outstanding shall not include shares held in
the treasury of the Company but shall include shares
issuable in respect of scrip certificates issued in lieu
of fractions of shares of Common Stock. The Company
shall not issue any such rights, options or warrants in
respect of shares of Common Stock held in the treasury
of the Company.
(3) In case outstanding shares of Common Stock shall be
subdivided 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 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
32
effective immediately after the opening of business on
the day following the day upon which such subdivision or
combination becomes effective.
(4) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock evidences
of its indebtedness or assets (including securities, but
excluding any rights or warrants referred to in
paragraph (2) of this Section, any dividend or
distribution paid exclusively in cash and any dividend
or distribution refereed to in paragraph (1) of this
Section), the Settlement Rate shall be adjusted so that
the same shall equal the rate determined by dividing the
Settlement Rate in effect immediately prior to the close
of business on the date fixed for the determination of
stockholders entitled to receive such distribution by a
fraction of which the numerator shall be the Current
Market Price per share of the Common Stock on the date
fixed for such determination less the then fair market
value (as determined by the Board of Directors, whose
determination shall be conclusive and described in a
Board Resolution filed with the Agent) of the portion of
the assets or evidences of indebtedness so distributed
applicable to one share of Common Stock and the
denominator shall all be such Current market Price per
share of the Common Stock, such adjustment to become
effective immediately prior to the opening of business
on the day following the date fixed for the
determination of stockholders entitled to receive such
distribution. In any case in which this paragraph (4)
is applicable, paragraph (2) of this Section shall not
be applicable.
(5) In case the company shall, by dividend or otherwise,
distribute to all holders of its Common Stock cash
(excluding any cash that is distributed in a
Reorganization Event to which Section 506(b) applies or
as part of a distribution referred to in paragraph (4)
of this Section) in an aggregate amount that, combined
together with (I) the aggregate amount of any other
distributions to all holders of its Common Stock made
exclusively
33
in cash within the 12 months preceding the date of
payment of such distribution and in respect of which no
adjustment pursuant to this paragraph (5) or paragraph
(6) of this Section has been made and (II) the aggregate
of any cash plus the fair market value (as determined by
the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution) of
consideration payable in respect of any tender or
exchange offer by the Company or any of its subsidiaries
of all or any portion of the Common Stock concluded
within the 12 months preceding the date of payment of
such distribution and in respect of which no adjustment
pursuant to this paragraph (5) or paragraph (6) of this
Section has been made, exceeds 10% of the product of the
Current Market Price per share of the Common Stock on
the date for the determination of holders of shares of
Common Stock entitled to receive such distribution times
the number of shares of Common Stock outstanding on such
date, then, and in each such case, immediately after the
close of business on such date for determination, the
Settlement Rate shall be increased so that the same
shall equal the rate determined by dividing the
Settlement Rate in effect immediately prior to the close
of business on the date fixed for determination of the
stockholders entitled to receive such distribution by a
fraction (i) the numerator of which shall be equal to
the Current Market Price per share of the Common Stock
on the date fixed for such determination less an amount
equal to the quotient of (x) the excess of such combined
amount over such 10% and (y) the number of shares of
Common Stock outstanding on such date for determination
and (ii) the denominator of which shall be equal to the
Current Market Price per share of the Common Stock on
such date for determination.
(6) In case a tender or exchange offer made by the Company
or any subsidiary of the Company for all or any portion
of the Common stock shall expire and such tender or
exchange offer (as amended upon the expiration thereof)
shall require the payment to stockholders (based on the
acceptance (up to
34
any maximum specified in the terms of the tender or
exchange offer) of Purchased Shares) of an aggregate
consideration having a fair market value (as determined
by the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution) that
combined together with (I) the aggregate of the cash
plus the fair market value (as determined by the Board
of Directors, whose determination shall be conclusive
and described in a Board Resolution), as of the
expiration of such tender or exchange offer, of
consideration payable in respect of any other tender or
exchange offer, by the Company or any subsidiary of the
Company for all or any portion of the Common Stock
expiring within the 12 months preceding the expiration
of such tender or exchange offer and in respect of which
no adjustment pursuant to paragraph (5) of this Section
or this paragraph (6) has been made and (II) the
aggregate amount of any distributions to all holders of
the Company's Common Stock made exclusively in cash
within 12 months preceding the expiration of such tender
or exchange offer and in respect of which no adjustment
pursuant to paragraph (5) of this Section or this
paragraph (6) has been made, exceeds 10% of the product
of the Current Market Price per share of the Common
Stock as of the last time (the "Expiration Time")
tenders could have been made pursuant to such tender or
exchange offer (as it may be amended) times the number
of shares of Common Stock outstanding (including any
tendered shares) on the Expiration Time, then, and in
each such case, immediately prior to the opening of
business on the day after the date of the Expiration
Time, the Settlement Rate shall be adjusted so that the
same shall equal the rate determined by dividing the
Settlement Rate immediately prior to close of business
on the date of the Expiration Time by a fraction (i) the
numerator of which shall be equal to (A) the product of
(I) the Current Market Price per share of the Common
Stock on the date of the Expiration Time and (II) the
number of shares of Common Stock outstanding (including
any tendered shares) on the Expiration Time less (B) the
amount of
35
cash plus 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 Purchased shares, and (ii) the denominator of which
shall be equal to the product of (A) the Current Market
Price per share of the Common Stock as of the Expiration
Time and (B) the number of shares of Common Stock
outstanding (including any tendered shares) as of the
Expiration Time less the number of all shares validly
tendered and not withdrawn as of the Expiration Time
(the shares deemed so accepted, up to any such maximum
being referred to as the "Purchased Shares").
(7) The reclassification of Common Stock into securities
including securities other than Common Stock (other than
any reclassification upon a Reorganization Event to
which Section 506(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 (4) of this Section), and (b) a subdivision or
combination, as the case may be, of the number of share
of Common Stock outstanding immediately prior to such
reclassification into the number of shares of Common
Stock outstanding immediately thereafter (and the
effective date of such reclassification shall be deemed
to be "the day upon which such subdivision becomes
effective" or "the day upon which such combination
becomes effective", as the case may be, and "the day
upon which such subdivision or combination becomes
effective" within the meaning of paragraph (3) of this
Section).
(8) The "Current Market Price" per share of Common Stock on
any day means the average of the daily Closing Prices
for the 5 consecutive Trading Days selected by the
Company commencing not more than 20 Trading
36
Days before, and ending not later than, the earlier of
the day in question and the day before the "ex" date
with respect to the issuance or distribution requiring
such computation. For purposes of this paragraph, the
term "'ex' date", when used with respect to any issuance
or distribution, shall mean the first date on which the
Common Stock trades regular way on such exchange or in
such market without the right to receive such issuance
or distribution.
(9) All adjustments to the Settlement Rate shall be
calculated to the nearest 1/10,000th of a share of
Common Stock (or if there is not a nearest 1/10,000th of
a share to the next lower 1/10,000th of a share). No
adjustment in the Settlement Rate shall be required
unless such adjustment would require an increase or
decrease of at least one percent therein; provided,
however, that any adjustments which by reason of this
subparagraph are not required to be made shall be
carried forward and taken into account in any subsequent
adjustment. If an adjustment is made to the Settlement
Rate pursuant to paragraph (1), (2), (3), (4), (5), (6),
(7) or (10) of this Section 506(a), an adjustment shall
also be made to the Applicable Market Value solely to
determine which of clauses (a), (b) or (c) of the
definition of Settlement Rate in Section 501 will 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 in clause (c) of the Settlement Rate definition in
Section 501 immediately after such adjustment pursuant
to paragraph (1),(2), (3), (4), (5), (6), (7) or (10) of
this Section 506(a) and the denominator shall be the
Settlement Rate in clause (c) of the Settlement Rate
definition in Section 501 immediately before such
adjustment.
(10) The Company may make such increases in the Settlement
Rate, in addition to those required by this Section, as it
considers to be advisable in order to avoid or diminish any
income tax to any holders of shares of common Stock resulting
from any dividend or distribution of stock or issuance
37
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 (any such event, a
"Reorganization Event"), the Settlement Rate will be adjusted to
provide that each Holder of Securities will receive on the Final
Settlement Date with respect to each Purchase Contract forming a part
thereof, the kind and amount of securities, cash and other property
receivable upon such Reorganization Event by a Holder of the number of
shares of Common Stock issuable on account of each Purchase Contract
if the Final Settlement Date had occurred immediately prior to such
Reorganization Event, assuming such Holder of Common Stock is not a
Person with which the Company consolidated or into which the Company
merged or which merged into the Company or to which such sale or
transfer was made, as the case may be ("constituent Person"), or an
Affiliate of a constituent Person, and failed to exercise his rights
of election, if any, as to 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 ("nonelecting 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 nonelecting share shall be
deemed to be the kind and amount so receivable per share by a
38
plurality of the nonelecting shares). In the event of such a
Reorganization Event, the Person formed by such consolidation, merger
or exchange or the Person which acquires the assets of the Company or,
in the event of a liquidation or dissolution of the Company, the
Company or a liquidating trust created in connection therewith, shall
execute and deliver to the Agent an agreement supplemental hereto
providing that the Holders of each Outstanding Security shall have the
rights provided by this Section 506. Such supplemental agreement
shall provide for adjustments which, for events subsequent to the
effective date of such supplemental agreement, shall be as nearly
equivalent as may be practicable to the adjustments provided for in
this Section. The above provisions of this Section shall similarly
apply to successive Reorganization Events.
Section 507. 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 506 and prepare and transmit to
the Agent an Officer's Certificate setting forth the
Settlement Rate, the method of calculation thereof in
reasonable detail, and the acts 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 506 (or if the
Company is not aware of such occurrence, as soon as
practicable after becoming so aware), provide a written
notice to the Holders of the Securities of the
occurrence of such event and a statement in reasonable
detail setting forth the method by which the adjustment
to the Settlement Rate was determined and setting forth
the adjusted Settlement Rate.
(b) The Agent shall not at any time be under any duty or
responsibility to any holder of Securities to determine
whether any facts exist which may require any adjustment of
the Settlement Rate, or with respect to the nature or extent
or
39
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 508. 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
Fee, 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 give written notice to
the Agent, the Collateral Agent and to the Holders, at their addresses as they
appear in the Security Register. Upon and after the occurrence of a
Termination Event, the Securities shall thereafter represent the right to
receive the Pledged Securities forming a part of such Securities in accordance
with the provisions of Section 402 and the Pledge Agreement.
Section 509. Early Settlement.
(a) Subject to and upon compliance with the provisions of this
Section 509 at the option of the Holder thereof, any Purchase
Contracts underlying securities having an aggregate Stated
Amount to $____________ or an integral multiple thereof may be
settled early ("Early Settlement") as provided herein. In
order to exercise the right to effect Early Settlement with
respect to any Purchase Contracts, the Holder of the Security
Certificate evidencing such Purchase Contracts shall deliver
such Security Certificate to the Agent at the Corporate Trust
Office duly endorsed for transfer to the Company or in blank
with the form of Election to Settle Early on the reverse
thereof
40
duly completed and accompanied by payment in the form of a
certified or cashier's check payable to the order of the
Company in immediately available funds in an amount (the
"Early Settlement Amount") equal to (i) the product of (A) the
Stated Amount times (B) the number of Purchase Contracts with
respect to which the Holder has elected to effect Early
Settlement minus (ii) the aggregate amount of Contract Fees,
if any, otherwise payable on or prior to the immediately
preceding Payment Date deferred at the option of the Company
pursuant to Section 503 and remaining unpaid as of such
immediately preceding Payment Date plus (iii) if such delivery
is made with respect to any Purchase Contracts during the
period from the close of business on any Record Date next
preceding any Payment Date to the opening of business on such
Payment Date, an amount equal to the sum of (x) the Contract
Fees payable on such Payment Date with respect to such
Purchase Contracts plus (y) the distributions on the related
Pledged Securities payable on such Payment Date. Except as
provided in the immediately preceding sentence and subject to
the last paragraph of Section 502, no payment or adjustment
shall be made upon Early Settlement of any Purchase Contract
on account of any Contract Fees 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.
(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.
The Early Settlement Rate shall initially be equal to
__________ and shall be adjusted in the same manner and at the
same time as the Settlement Rate is adjusted. As promptly
41
as practicable after Early Settlement of Purchase Contracts in
accordance with the provisions of this Section 509, 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 510.
(c) The Company shall cause the shares of Common Stock issuable,
and Pledged Securities deliverable, upon Early Settlement of
Purchase Contracts to be issued and delivered, in the case of
such shares of Common Stock, and released from the Pledge by
the Collateral Agent and transferred, in the case of such
Pledged Securities, to the Agent, for delivery to the Holder
thereof or its designee, no later than the third Business Day
after the applicable Early Settlement Date.
(d) Upon Early Settlement of any Purchase Contracts, and subject
to receipt thereof from the Company or the Collateral Agent,
as applicable, the Agent shall, in accordance with the
instructions provided by the Holder thereof on the applicable
form of Election to Settle Early on the reverse of the
Security Certificate evidencing the related Securities, (i)
transfer the Pledged Securities forming a part of such
Securities 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 510.
(e) In the event that Early Settlement is effected with respect to
Purchase Contracts underlying less than all the Securities
evidenced by a Security Certificate, upon such Early
Settlement the Company shall execute and the Agent shall
authenticate, countersign and deliver to the Holder thereof,
at the expense of the Company, a Security Certificate
evidencing the Securities as to which Early Settlement was not
effected.
Section 510. 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. If
42
Security Certificates evidencing more than one Purchase Contract shall be
surrendered for settlement at one time by the same Holder, the number of full
shares of Common Stock which at one time by the same Holder, the number of full
shares of Common Stock which shall be delivered upon settlement shall be
computed on the basis of the aggregate number of Purchase Contracts evidenced
by the Security Certificates so surrendered. Instead of any fractional share
of Common Stock which would otherwise be deliverable upon settlement of any
Purchase Contracts on the Final Settlement Date or upon Early Settlement, the
Company, through the Agent, shall make a cash payment in respect of such
fractional interest in an amount equal to the value of such fractional shares
at the Closing Price per share on the Trading Day immediately preceding the
Final Settlement Date or the related Early Settlement Date, respectively. The
Company shall provide the Agent from time to time with sufficient funds to
permit the Agent to make all cash payments required by this Section 510 in a
timely manner.
Section 511. Charges and Taxes.
The Company will pay all stock transfer and similar taxes
attributable to the initial issuance and delivery of the shares of Common Stock
pursuant to the Purchase Contracts; provided, however, that the Company shall
not be required to pay any such tax or taxes which may be payable in respect to
any exchange of or substitution for a Security Certificate evidencing a
Purchase Contract or any issuance of a share of Common Stock in a name other
than that of the registered Holder of a Security Certificate surrendered in
respect of the Purchase Contracts evidenced thereby, other than in the name of
the Agent, as custodian for such Holder, and the Company shall not be required
to issue or deliver such share certificates or Security Certificates unless or
until the Person or Persons requesting the transfer or issuance thereof shall
have paid to the Company the amount of such tax or shall have established to
the satisfaction of the Company that such tax has been paid.
ARTICLE SIX
REMEDIES
Section 6.01. Unconditional Right of Holders to Receive Contract Fee.
Notwithstanding any other provision in this Agreement, 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
43
503), to receive payment of each installment of the Contract Fee with respect
to the Purchase Contract constituting a party of such Security on the
respective Payment Date for such Security and to purchase Common Stock pursuant
to such Purchase Contract and, in each such case, to institute suit for the
enforcement of any such payment and right to purchase Common Stock, and such
rights shall not be impaired without the consent of such Holder.
Section 6.02. Restoration of Rights and Remedies.
If any Holder of Securities has instituted any proceeding to
enforce any right or remedy under this Agreement and such proceeding has been
discontinued or abandoned for any reason, or has been determine 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 Certificate in the last
paragraph of Section 306, no right or remedy herein conferred upon or reserved
to the Holders of Securities is intended to be exclusive of any other right or
remedy, and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent
the concurrent assertion or employment of any other appropriate right or
remedy.
Section 604. 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 his acceptance of the Security Certificate evidencing such Security
shall be deemed to have
44
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 of Securities, or group of Holders,
holding in the aggregate more than 10% of the Outstanding Securities, or to any
suit instituted by any Holder for the enforcement of the payment of the
distributions on any Pledged Security or the Contract Fee on any Purchase
Contract on or after the respective Payment Date therefor constituting a part
of the Securities held by such Holder, or for enforcement of the right to
purchase shares of Common Stock under the Purchase Contracts constituting a
part of the Securities held by such Holder.
Section 6.06. Waiver of Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do
so) that it will not at any time insist upon, or plead, or in any manner
whatsoever enacted, now or at any time hereafter in force, which may affect the
covenants or the performance of this Agreement; and the Company (to the extent
that it may lawfully do so) hereby expressly waives all benefit or advantage of
any such law and covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Agent or the Holders, but will
suffer and permit the execution of every such power as though no such law had
been enacted.
ARTICLE SEVEN
THE AGENT
Section 7.01. Certain Duties and Responsibilities.
(a) 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 no implied
covenants or obligations shall be read into this
Agreement against the Agent; and in the absence of bad
faith or negligence on its part, the Agent may, with
respect to the Securities,
45
conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Agent and
conforming to the requirements of this Agreement, but in
the case of any certificates or opinions which by any
provision hereof are specifically required to be
furnished to the Agent, the Agent shall be under a duty
to examine the same to determine whether or not they
conform to the requirements of this Agreement.
(b) No provision of this Agreement shall be construed to
relieve the Agent from liability for its own negligent
action, its own negligent failure to act, or its own
wilful misconduct, except that
(1) this Subsection shall not be construed to
limit the effect of Subsection (a) of this
Section;
(2) the Agent shall not be liable for any error
of judgment made in good faith by a
Responsible Officer, unless it shall be
proved that the Agent was negligent in
ascertaining the pertinent facts; and
(3) no provision of this Agreement shall require
the Agent to expend or risk its own funds or
otherwise incur any financial liability in
the performance of any of its duties
hereunder, or in the exercise of any of its
rights or powers, if it shall have reasonable
grounds for believing that repayment of such
funds or adequate indemnity against such risk
or liability is not reasonably assured to it.
(d) 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 702. Notice of Default.
Within 90 days after the occurrence of any default by the
Company hereunder, of which a Responsible Officer of
46
the Agent has actual knowledge, the Agent shall transmit by mail to all Holders
of Securities, as their names and addresses appear in the Security Register,
notice of such default hereunder, unless such default shall have been cured or
waived.
Section 703. Certain Rights of Agent.
Subject to the provisions of Section 701:
(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 Officer's Certificate, Issuer
Order or Issuer Request, and any resolution of the Board of
Directors of the Company may be sufficiently evidenced by a
Board Resolution;
(c) whenever in the administration of this Agreement the Agent
shall deem it desirable that a matter be proved or established
prior to taking, suffering or omitting any action hereunder,
the Agent (unless other evidence be herein specifically
prescribed) may, in the absence of bad faith on its part, rely
upon an Officer's Certificate of the Company;
(d) the Agent may consult with counsel 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
47
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 and the Agent shall not be responsible for any
misconduct or negligence on the part of any agent or attorney
appointed with due care by it hereunder.
Section 704. 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 correctness. The Agent makes no representations as to
the validity or sufficiency of this Agreement or of the Securities. The Agent
shall not be accountable for the use or application by the Company of the
proceeds in respect of the Purchase Contracts.
Section 705. May Hold Securities.
Any Security Registrar or any other agent of the Company, or
the Agent, in its individual or any other capacity, may become the owner or
pledgee of Securities and may otherwise deal with the Company with the same
rights it would have if it were not Security Registrar or such other agent, or
the Agent.
Section 706. Money Held in Trust.
Money held by the Agent in trust hereunder need not be
segregated from the other funds except to the extent required by law. The
Agent shall be under no obligation to invest or pay interest on any money
received by it hereunder except as otherwise agreed with the Company.
Section 707. Compensation and Reimbursement.
The Company agrees:
48
(1) to pay to the Agent from time to time reasonable compensation
for all services rendered by it hereunder;
(2) except as otherwise expressly provided herein, to reimburse
the Agent upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Agent in
accordance with any provision of this Agreement (including the
reasonable compensation and the expenses and disbursements of
its agents and counsel), except any such expense, disbursement
or advance as may be attributable to its negligence or bad
faith; and
(3) to indemnify the Agent and any predecessor Agent for, and to
hold each of them harmless against, any loss, liability or
expense incurred without negligence or bad faith on its part,
arising out of or in connection with the acceptance or
administration of its duties hereunder, including the costs
and expenses of defending itself against any claim or
liability in connection with the exercise or performance of
any of its powers or duties hereunder.
Section 708. 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 a combined capital and
surplus of at least $100,000,000, subject to supervision or examination by
Federal or State authority and having its Corporate Trust Office in the Borough
of Manhattan, The City of New York, if there be such a corporation in the
Borough of Manhattan, The City of New York qualified and eligible under this
Article and willing to act on reasonable terms. If such corporation publishes
reports of condition at least annually, pursuant to law or to the requirements
of said supervising or examining authority, then for the purposes of this
Section, the combined capital and surplus of such corporation shall be deemed
to be its combined capital and 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.
49
Section 709. 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 710.
(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 710 shall not have been
delivered to the Agent within 30 days after the giving of such
notice of resignation, the resigning Agent may petition any
court of competent jurisdiction for the appointment of a
successor Agent.
(c) The Agent may be removed at any time by Act of the Holders of
a majority in number of the Outstanding Securities delivered
to the Agent and the Company.
(d) If at any time
(1) the Agent fails to comply with Section 310(b) of the
TIA, as if the Agent were an indenture trustee under an
indenture qualified under the TIA, after written request
therefor by the Company or by any Holder who has been a
bona fide Holder of a Security for at least six months,
or
(2) the Agent shall cease to be eligible under Section 708
and shall fail to resign after written request therefor
by the Company or by any such Holder, or
(3) the Agent shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the
Agent or of its property shall be appointed or any
public officer shall take charge or control of the Agent
or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation, then, in
any such case, (i) the Company by a Board Resolution may
remove the Agent, or (ii) any Holder who has been a bona
fide Holder of a Security for at least six months
50
may, on behalf of himself and all others similarly
situated, petition any court of competent jurisdiction
for the removal of the Agent and the appointment of a
successor Agent.
(e) If the Agent shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Agent for
any cause, the Company, by a Board Resolution, shall promptly
appoint a successor Agent and shall comply with the applicable
requirements of Section 710. If no successor Agent shall have
been so appointed by the Company and accepted appointment in
the manner required by Section 710, any Holder who has been a
bona fide Holder of a Security for at least six months may, on
behalf of himself and all others similarly situated, petition
any court of competent jurisdiction for the appointment of a
successor Agent.
(f) The Company shall give, or shall cause such successor Agent to
give, notice of each resignation and each removal of the Agent
and each appointment of a successor Agent by mailing written
notice of such event by first class mail, postage prepaid, to
all Holders of Securities as their names and addresses appear
in the Security Register. Each notice shall include the name
of the successor Agent and the address of its Corporate Trust
Office.
Section 710. 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
51
to such successor Agent all property and money held by such
retiring Agent hereunder.
(b) Upon request of any such successor Agent, the Company shall
execute any and all instruments for more fully and certainly
vesting in and confirming to such successor Agent all such
rights, powers and agencies referred to in paragraph (a) of
this Section.
(c) No successor Agent shall accept its appointment unless at the
time of such acceptance such successor Agent shall be
qualified and eligible under this Article.
Section 711. Merger, Consolidation or Succession to Business.
Any corporation into which the Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Agent shall be a
party, or any corporation succeeding to all or substantially all the corporate
trust business of the Agent, shall be the successor of the Agent hereunder,
provided such corporation shall be otherwise qualified and eligible under this
Article, without the execution or filing of any paper or any further act on the
part of any of the parties hereto. In case any Security Certificates shall
have been authenticated and executed on behalf of the Holders, but not
delivered, by the Agent then in office, any successor by merger, conversion or
consolidation to such Agent may adopt such authentication and execution and
deliver the Security Certificates so authenticated and executed with the same
effect as if such successor Agent had itself authenticated and executed such
Securities.
Section 712. 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 three or more Holders (herein referred to as "applicants")
apply in writing to the Agent, and furnish to the Agent
reasonable proof that each such applicant has owned a Security
for a period of at least six months preceding the date of such
application, and such application states that the
52
applicants desire to communicate with other Holders with
respect to their rights under this Agreement or under the
Securities and its accompanied by a copy of the form of proxy
or other communication which such applicants propose to
transmit, then the Agent shall, within five Business Days
after the receipt of such application, afford such applicants
access to the information preserved at the time by the Agent
in accordance with Section 712(a).
(c) Every Holder of Securities, by receiving and holding the
Security Certificates evidencing the same, agrees with the
Company and the Agent that none of the Company, the Agent nor
any agent of any of them shall be held accountable by reason
of the disclosure of any such information as to the names and
addresses of the Holders in accordance with Section 712(b),
regardless of the source from which such information was
derived.
Section 713. 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 or any Purchase Contract in respect of the obligations of the
Holder of any Security thereunder. The Company agrees, and each Holder of a
Security Certificate, by his acceptance thereof, shall be deemed to have
agreed, that the Agent's execution of the Security Certificates on behalf of
the Holders shall be solely as agent and attorney-in-fact for the Holders, and
that the Agent shall have no obligations to perform such Purchase Contracts on
behalf of the Holders, except to the extent expressly provided in Article Five
hereof.
Section 714. Tax Compliance.
(a) The Agent, on its own behalf and on behalf of the Company,
will comply with all applicable certification, information
reporting and withholding (including "backup" withholding)
requirements imposed by applicable tax laws, regulations or
administrative practice with 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
53
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 701(a)(2) hereof.
(c) The Agent shall maintain all appropriate records documenting
compliance with such requirements, and shall make such records
available on request to the Company or to its authorized
representative.
ARTICLE EIGHT
SUPPLEMENTAL AGREEMENTS
Section 801. Supplemental Agreements Without Consent of Holders.
Without the consent of any Holders, the Company and the Agent,
at any time and from time to time, may enter into one or more agreements
supplemental hereto, in form satisfactory to the Company and the Agent, for any
of the following purposes:
(1) to evidence the succession of another Person to the Company,
and the assumption by any such successor of the covenants of
the Company herein and in the Security Certificates; or
(2) to add to the covenants of the Company for the benefit of the
Holders, or to surrender any right or power herein conferred
upon the Company; or
(3) to evidence and provide for the acceptance of appointment
hereunder by a successor Agent; or
(4) to make provision with respect to the rights of Holders
pursuant to the requirements of Section 506(b); or
(5) to cure any ambiguity, to correct or supplement any provisions
herein which may be inconsistent with any other provisions
herein, or to make any other provisions with respect to such
matters or questions arising under this Agreement, provided
54
such action shall not adversely affect the interests of the
Holders.
Section 802. Supplemental Agreements with Consent of Holders.
With the consent of the Holders of not less than a majority of the Outstanding
Securities 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 the manner the terms of the
Securities, or the provisions of this Agreement or the rights of the Holders in
respect of the Securities, provided, however, that no such supplemental
agreement shall, without the consent of the Holder of Each Outstanding Security
affected thereby,
(1) change any Payment Date;
(2) change the amount or type of Pledged Securities underlying a
Security, impair the right of the Holder of any Security to
receive distribution payments on the underlying Pledged
Securities or otherwise adversely affect the Holder's rights
in or to such Pledged Securities;
(3) reduce any Contract Fee or change any place where, or the coin
or currency in which, any Contract Fee is payable;
(4) impair the right to institute suit for the enforcement of any
Purchase Contract;
(5) reduce the number of shares of Common Stock to be purchased
pursuant to any Purchase Contract, increase the price to
purchase shares of Common Stock upon settlement of any
Purchase Contract, change the Final Settlement Date or
otherwise adversely affect the Holder's rights under any
Purchase Contract; or
(6) reduce the percentage of the Outstanding Securities the
consent of whose Holders is required for any such supplemental
agreement.
It shall not be necessary for any Act of Holders under this
Section to approve the particular form of any proposed supplemental agreement,
but it shall be sufficient if such Act shall approve the substance thereof.
55
Section 803. 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 701) shall be fully protected in relying
upon, an Opinion of Counsel stating that the execution of such supplemental
agreement is authorized or permitted by this Agreement. The Agent may, but
shall not be obligated to, enter into any such supplemental agreement which
affects the Agent's own rights, duties or immunities under this Agreement or
otherwise.
Section 804. 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 805. Reference to Supplemental Agreements.
Security Certificates authenticated, executed on behalf of the
Holders and delivered after the execution of any supplemental agreement
pursuant to this Article may, and shall if required by the Agent, bear a
notation in form approved by the Agent as to any matter provided for in such
supplemental agreement. If the Company shall so determine, new Security
Certificates so modified as to conform, in the opinion of the Agent and the
Company, to any such supplemental agreement may be prepared and executed by the
Company and authenticated, executed on behalf of the Holders and delivered by
the Agent in exchange for Outstanding Security Certificates.
ARTICLE NINE
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
Section 901. Covenant Not to Merge, Consolidate, Sell or Convey Property
Except Under Certain Conditions.
The Company covenants that it will not merge or consolidate
with any other Person or sell or convey all or substantially all of its assets
to any Person, except that the Company may merge or consolidate with, or sell
or convey all or substantially all of its assets to, any other Person, provided
that (i) the Company shall be the continuing
56
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 and such corporation shall assume the obligations of
the Company under the Purchase Contracts, this Agreement and the Pledge
Agreement by one or more supplemental agreements in form satisfactory to the
Agent and the Collateral Agent, executed and delivered to the Agent and the
Collateral Agent by such corporation, and (ii) the Company or such successor
corporation, as the case may be, shall not, immediately after such merger or
consolidation, or such sale 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 902. Rights and Duties of Successor Corporation.
In case of any such consolidation, merger, sale or conveyance
and upon any such assumption by the successor corporation, such successor
corporation shall succeed to and be substituted for the Company with the same
effect as if it had been named herein as the Company. Such successor
corporation thereupon may cause to be signed, and may issue either in its own
name or in the name of Heftel Broadcasting Corporation, any or all of the
Security Certificates evidencing Securities issuable hereunder which
theretofore shall not have been signed by the Company and delivered to the
Agent; and, upon the order of such successor corporation, instead of the
Company, and subject to all the terms, conditions and limitations in this
Agreement prescribed, the Agent shall authenticate and execute on behalf of the
Holders and deliver any Security Certificates which previously shall have been
signed and delivered by the officers of the Company to the Agent for
authentication and execution, and any Security Certificate evidencing
Securities which such successor corporation thereafter shall cause to be signed
and delivered to the Agent for that purpose. All the Security Certificates so
issued shall in all respects have the same legal rank and benefit under this
Agreement as the Security Certificates theretofore or thereafter issued in
accordance with the terms of this Agreement as though all of such Security
Certificates had been issued at the date of the execution hereof.
In case of any such consolidation, merger, sale or conveyance
such change in phraseology and form (but not in substance) may be made in the
Security Certificates evidencing Securities thereafter to be issued as may be
appropriate.
57
Section 903. Opinion of Counsel to Agent.
The Agent, subject to Sections 701 and 703, may receive an
Opinion of Counsel as conclusive evidence that any such consolidation, merger,
sale or conveyance, and any such assumption, complies with the provisions of
this Article.
ARTICLE TEN
COVENANTS
Section 1001. Performance Under Purchase Contracts.
The Company covenants and agrees for the benefit of the
Holders from time to time of the Securities that it will duly and punctually
perform its obligations under the Purchase Contracts in accordance with the
terms of the Purchase Contracts and this Agreement.
Section 1002. Maintenance of Office or Agency.
The Company will maintain in the Borough of Manhattan, The
City of New York an office or agency where Security Certificates may be
presented or surrendered for acquisition of shares of Common Stock upon
settlement or Early Settlement and for transfer of Pledged 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 will give prompt written notice to the
Agent of the location, and any change in the location, of such office or
agency. If at any time the Company shall fail to maintain any such required
office or agency or shall fail to furnish the Agent with the address thereof,
such presentations, surrenders, notices and demands may be made or served at
the Corporate Trust Office, and the Company hereby appoints the Agent as its
agent to receive all such presentations, surrenders, notices and demands.
The Company may also from time to time designate one or more
other offices or agencies where Security Certificates may be presented or
surrendered for any or all such purposes and may from time to time rescind
such designations; provided, however, that no such designation or rescission
shall in any manner relieve the Company of its obligation to maintain an
office or agency in the Borough of Manhattan, the City of New York for such
purposes. The Company will give prompt written notice to the Agent of any
such designation or rescission and of any change in the
58
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 1003. 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 against tender of payment in respect of all Purchase Contracts
constituting a part of the Securities evidenced by Outstanding Security
Certificates.
Section 1004. Covenants as to Common Stock.
The Company covenants that all shares of Common Stock which
may be issued against tender of payment in respect of any Purchase Contract
constituting a part of the Outstanding Securities will, upon issuance, be duly
authorized, validly issued, fully paid and nonassessable.
Section 1005. Statements of Officers of the Company as to Default.
The Company will deliver to the Agent, within 120 days after
the end of each fiscal year of the Company ending after the date hereof, an
Officer's Certificate, stating whether or not to the best knowledge of the
signers thereof the Company is in default in the performance and observance of
any of the terms, provisions and conditions hereof, and if the Company shall be
in default, specifying all such defaults and the nature and status thereof of
which they may have knowledge.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first above written.
HEFTEL BROADCASTING CORPORATION [AGENT] Agent
By: By:
Attested by Attested by
59
EXHIBIT A
HEFTEL BROADCASTING CORPORATION
___% ____________ SECURITIES
(STATED AMOUNT $___ PER SECURITY)
No. Securities
This Security Certificate certifies that is the registered
Holder of the number of Securities set forth above. Each Security represents
ownership by the Holder of ____% United States Pledged Securities due _________
("Pledged Securities") with a principal amount equal to the Stated Amount,
subject to the Pledge of such Pledged Securities by such Holder pursuant to the
Pledge Agreement, and the rights and obligations of the Holder under one
Purchase Contract with Heftel Broadcasting Corporation, a Delaware corporation
(the "Company").
Pursuant to the Pledge Agreement, the Pledged Securities
constituting part of each Security evidenced hereby have been pledged to the
Collateral Agent to secure the obligations of the Holder under the Purchase
Contract constituting part of such Security.
The Pledge Agreement provides that all payments of principal
of, or distributions on, any Pledged Securities constituting part of the
Securities received by the Collateral Agent shall be paid by the Collateral
Agent by wire transfer in same day funds no later than , ______________
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 , ______________ time, on a
Business Day, then such payment shall be made no later than ,
______________ time, on the next succeeding Business Day) (i) in the case of
(A) distributions payments and (B) any principal payments with respect to any
Pledged 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 Pledged Securities (as
defined in the Pledge Agreement), 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. Distributions on any Pledged Security forming part of a
Security evidenced hereby which is paid on any or, commencing, 1995 (a "Payment
60
Date"), shall, subject to receipt thereof by the Agent from the Collateral
Agent, be paid to the Person in whose name this Security Certificate (or a
Predecessor Security Certificate) is registered at the close of business on the
Record Date next preceding such Payment Date.
Each Purchase Contract evidenced hereby obligates the Holder
of this Security Certificate to purchase, and the Company to sell, on
___________, (the "Final Settlement Date"), at a price equal to $_________ (the
"Stated Amount"), a number of shares of Common Stock, par value $.01 per share
("Common Stock"), of the Company, equal to the Settlement Rate, unless on or
prior to the Final Settlement Date there shall have occurred a Termination
Event or Early Settlement with respect to the Security of which such Purchase
Contract is a part, all as provided in the Purchase Contract Agreement and more
fully described on the reverse hereof. The purchase price for the shares of
Common Stock purchased pursuant to each Purchase Contract evidenced hereby, if
not paid earlier, shall be paid on the Final Settlement Date by application of
payment received in respect of the principal of the Pledged 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 a fee (the
"Contract Fee") equal to ___% per annum of the Stated Amount, from __________,
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 next preceding such Payment Date.
Distributions on the Pledged Securities and the Contract Fee
will be payable at the office of the Agent in The City of New York or, at the
option of the Company, by check mailed to the address of the Person entitled
thereto as such address appears on the Security Register.
Reference is hereby made to the further provisions set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
61
Unless the certificate of authentication hereon has been
executed by the Agent by manual signature, this Security Certificate shall not
be entitled to any benefit under the Pledge Agreement or the Purchase Contract
Agreement or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed.
HEFTEL BROADCASTING CORPORATION
By:
Attest:
HOLDER SPECIFIED ABOVE (as to obligations of such Holder under the
Purchase Contracts evidenced hereby)
By:
as Attorney-in-Fact of such Holder
By:
Dated:
This is one of the Security Certificates referred to in the
within mentioned Purchase Contract Agreement.
_____________________________,
as Agent
By:
Form of Reverse of Security Certificate
Each Purchase Contract evidenced hereby is governed by a
Purchase Contract Agreement, dated as of ____________ (the "Purchase Contract
Agreement"), between the Company and __________, as Agent (herein called the
"Agent"), to which Purchase Contract Agreement and supplemental agreements
thereto reference is hereby made for a description of the respective rights,
limitations of rights, obligations, duties and immunities thereunder of the
Agent, the Company, and the Holders and of the terms upon which the Security
Certificates are, and are to be, executed and delivered.
Each Purchase Contract evidenced hereby obligates the Holder
of this Security Certificate to purchase, and the Company to sell, on the Final
Settlement Date at a price equal to the Stated Amount, a number of shares of
Common
62
Stock of the Company equal to the Settlement Rate, unless, on or prior to the
Final Settlement Date, there shall have occurred a Termination Event or an
Early Settlement with respect to the Security of which such Purchase Contract
is a part. The "Settlement Rate" is equal to (a) if the Applicable Market
Value (as defined below) is greater than $_________ (the "Threshold
Appreciation Price"), of a share of Common Stock per Purchase Contract, (b) if
the Applicable Market Value is less than or equal to the Threshold Appreciation
Price but is greater than the Stated Amount, a fractional share of Common Stock
per Purchase Contract equal to the Stated Amount divided by the Applicable
Market Value and (c) if the Applicable Market Amount is less than or equal to
the Stated Amount, one share of Common Stock per Purchase Contract, in each
case subject to adjustment as provided in the Purchase Contract. No fractional
shares of Common Stock will be issued upon settlement of Purchase Contracts, as
provided in the Purchase Contract Agreement.
The "Applicable Market Value" means the average of the Closing
Prices per share of Common Stock on each of the twenty consecutive Trading Days
ending on the last Trading Day immediately preceding the Final Settlement Date.
The "Closing Price" of the Common Stock on any date of determination means the
closing sale price (or, if no closing price is reported, the last reported sale
price) of the Common Stock on the New York Stock Exchange (the "NYSE") on such
date or, if the Common Stock is not listed for trading on the NYSE on any such
date, as reported in the composite transactions for the principal United States
securities exchange on which the Common Stock is so listed, or if the Common
Stock is not so listed on a United States national or regional securities
exchange, as reported by The Nasdaq Stock Market, or, if the Common Stock is
not so reported, the last quoted bid price for the Common Stock in the over-
the-counter market as reported by the National Quotation Bureau or similar
organization, or, if such bid price is not available, the market value of the
Common Stock on such date as determined by a nationally recognized independent
investment banking firm retained for this purpose by the Company. A "Trading
Day" means a day on which the Common Stock (A) is not suspended from trading on
any national or regional securities exchange or association or over-the-counter
market at the close of business and (B) has traded at 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
63
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 Pledged 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 herein set forth.
Subject to the next succeeding paragraph, 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 evidencing such
Purchase Contract is registered at the close of business on the Record Date
next preceding such Payment Date. Contract Fees will be payable at the office
of the Agent in The City of New York or, at the option of the Company, by check
mailed to the address of the Person entitled thereto at such address as it
appears on the Security Register.
The Company shall have the right, at any time prior to the
Final Settlement Date, to defer the payment of any or all of the Contract Fees
otherwise payable on any Payment Date, but only if the Company shall give the
Holders and the Agent written notice of its election to defer such payment
(specifying the amount to be deferred) as provided in the Purchase Contract
Agreement. Any Contract Fees so deferred shall bear additional Contract Fees
thereon at the rate of per annum (computed on the basis of the actual number of
days elapsed in a year of 365 or 366 days, as the case may be), compounding on
each succeeding Payment Date, until paid in full. Deferred Contract Fees (and
additional Contract Fees accrued thereon) 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.
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, 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 give written notice to
the Agent and to the Holders, at their
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addresses as they appear in the Security Register. Upon and after the
occurrence of a Termination Event, the Collateral Agent shall release the
Pledged Securities from the Pledge. The Securities shall thereafter represent
the right to receive the Pledged 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, Purchase
Contracts underlying securities having an aggregate Stated Amount equal to
$_________ or an integral multiple thereof may be settled early ("Early
Settlement") as provided in the Purchase Contract Agreement. In order to
exercise the right to effect Early Settlement with respect to any Purchase
Contracts evidenced by this Security Certificate, the Holder of this Security
Certificate shall deliver this Security Certificate to the Agent at the
Corporate Trust Office duly endorsed for transfer to the Company on in blank
with the form of Election to Settle Early set forth below duly completed and
accompanied by payment in the form of a certified or cashier's check payable
to the order of the Company in immediately available funds in an amount (the
"Early Settlement Amount") equal to (i) the product of (A) the Stated Amount
times (B) the number of Purchase Contracts with respect to which the Holder
has elected to effect Early Settlement minus (ii) the aggregate amount of
Contract Fees, if any, otherwise payable on or prior to the immediately
preceding Payment Date deferred at the option of the Company pursuant to the
Purchase Contract Agreement and remaining unpaid as of such immediately
preceding Payment Date plus (iii) if such delivery is made with respect to
any Purchase Contracts during the period from the close of business on any
Record Date next preceding any Payment Date to the opening of business on
such Payment Date, an amount equal to the sum of (x) the Contract Fees
payable on such Payment Date with respect to such Purchase Contracts plus (y)
the distributions with respect to the related Pledged Securities payable on
such Payment Date. Upon Early Settlement of Purchase Contracts by a Holder
of the related Securities, the Pledged 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. The Early
Settlement Rate shall initially be equal to and shall be adjusted in the same
manner and at the same time as the Settlement Rate is adjusted as provided in
the Purchase Contract Agreement.
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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 Certificate will be registered and
Security Certificates may be exchanged as provided in the Purchase Contract
Agreement. The Security Registrar may require a Holder, among other things,
to furnish appropriate endorsements and transfer documents permitted by the
Purchase Contract Agreement. No service charge shall be required for any
such registration of transfer or exchange, but the Company and the Agent may
require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith. For so long as the Purchase Contract
underlying a Security remains in effect, such Security shall not be separable
into its constituent parts, and the rights and obligations of the Holder of
such Security in respect of the Pledged 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, except as may be required by the Agent pursuant
to the Purchase Contract Agreement), under the terms of the Purchase Contract
Agreement and the Purchase Contracts evidenced hereby and the transferor
shall be released from the obligations under the Purchase Contracts evidenced
by this Security Certificate. The Company covenants and agrees, and the
Holder, by his acceptance hereof, likewise covenants and agrees, to be bound
by the provisions of this paragraph.
The Holder of this Security Certificate, by his acceptance
hereof, authorizes the Agent to enter into and perform the related Purchase
Contracts forming part of the Securities evidenced hereby on his behalf as
his attorney-in-fact, agrees to be bound by the terms and provisions thereof,
covenants and agrees to perform his obligations under such Purchase
Contracts, consents to the provisions of the Purchase Contract Agreement,
authorizes the Agent to enter into and perform the Pledged Agreement on his
behalf as his attorney-in-fact, and consents to the Pledge of the Pledged
Securities underlying this Security Certificate pursuant to the Pledge
Agreement. The Holder further covenants and agrees, that, to the extent and
in the manner provided in the Purchase Contract Agreement and the Pledge
Agreement, but subject to the terms thereof, payments in respect of principal
of the Pledged Securities on the Final Settlement Date shall be paid by the
Collateral Agent to the Company in satisfaction of such Holder's obligations
under
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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 a majority of the Outstanding Securities.
All terms used herein which are defined in the Purchase
Contract Agreement have the meanings set forth therein.
The Purchase Contracts shall for all purposes be governed
by, and construed in accordance with, the laws of the State of New York.
The Company, the Agent and 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 distributions on the Pledged Securities, receiving
payments of Contract Fees, performance of the Purchase Contracts and for all
other purposes whatsoever, whether or not any payments in respect thereof be
overdue and notwithstanding any notice to the contrary, and neither the
Company, the Agent nor any such agent shall be affected by notice to the
contrary.
The Purchase Contracts shall not, prior to the settlement
thereof, entitle the Holder to any of the rights of a holder of shares of
Common Stock.
A copy of the Purchase Contract Agreement is available for
inspection at the offices of the Agent.
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
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name of a Person other than the undersigned, the undersigned will pay any
transfer tax payable incident thereto.
Dated:
Signature
If shares are to be registered in the name of and delivered
to REGISTERED HOLDER a Person other than the Holder, please print such
Person's name and address: Please print name and address of Registered
Holder:
Name
Address
Social Security or other Taxpayer Identification Number, if any
ELECTION TO SETTLE EARLY
The undersigned Holder of this Security Certificate hereby
irrevocably exercises the option to effect Early Settlement in accordance
with the terms of the Purchase Contract Agreement with respect to the
Purchase Contracts underlying the number of Securities evidenced by this
Security Certificate specified below. The option to effect Early Settlement
may be exercised only with respect to Purchase Contracts underlying
Securities with an aggregate Stated Amount equal to $__________ or an
integral multiple thereof. The undersigned Holder directs that a certificate
for shares of Common Stock deliverable upon such Early Settlement be
registered in the name of, and delivered, together with a check in payment
for any fractional share and any Security Certificate representing any
Securities evidenced hereby as to which Early Settlement of the related
Purchase Contracts is not effected, to the undersigned at the address
indicated below unless a different name and address have been indicated
below. Pledged Securities deliverable upon such Early Settlement will be
transferred in accordance with the transfer instructions set forth below. If
shares are to be registered in the name of a Person other than the
undersigned, the undersigned will pay any transfer tax payable incident
thereto.
Dated:
Signature
Number of Securities evidenced hereby as to which Early
Settlement of the related Purchase Contracts is being elected:
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REGISTERED HOLDER
If shares or Security Certificates are to be registered in
the name of and delivered to and Pledged 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
Address
Social Security or other Taxpayer Identification Number, if any
