Exhibit 4.33
EXECUTION COPY
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STATE STREET CORPORATION
Bank One, N.A.
as Collateral Agent, Custodial Agent
and Securities Intermediary
AND
Bank One Trust Company, N.A.,
as Purchase Contract Agent
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PLEDGE AGREEMENT
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DATED AS OF JANUARY 21, 2003
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ARTICLE I
Definitions
Section 1.1. Definitions ................................................ 2
ARTICLE II
Pledge; Control And Perfection
Section 2.1. The Pledge ................................................. 4
Section 2.2. Control and Perfection .................................... 5
ARTICLE III
Distributions on Collateral
Section 3.1. Distributions .............................................. 7
Section 3.2. Application of Payments .................................... 8
ARTICLE IV
Substitution, Release, Repledge and Settlement of Securities
Section 4.1. Collateral Substitution and the Splitting Apart of SPACES .. 9
Section 4.2. Collateral Substitution and the Re-Creation of SPACES ...... 9
Section 4.3. Termination Event ......................................... 10
Section 4.4. Early Settlement; Merger Early Settlement .................. 10
Section 4.5. Application of Proceeds; Collateral Insufficiency .......... 11
ARTICLE V
Voting Rights -- Pledged Common Stock
Section 5.1. Exercise by Purchase Contract Agent ........................ 13
ARTICLE VI
Rights and Remedies
Section 6.1. Rights and Remedies of the Collateral Agent ................ 13
Section 6.2. Substitutions .............................................. 14
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ARTICLE VII
Representations and Warranties; Covenants
Section 7.1. Representations and Warranties ................................ 15
Section 7.2. Covenants ..................................................... 15
ARTICLE VIII
The Collateral Agent
Section 8.1. Appointment, Powers and Immunities ............................ 16
Section 8.2. Instructions of the Company ................................... 17
Section 8.3. Reliance ...................................................... 17
Section 8.4. Certain Rights ................................................ 17
Section 8.5. Merger, Conversion, Consolidation or Succession to Business ... 18
Section 8.6. Rights in Other Capacities .................................... 18
Section 8.7. Non-reliance on Collateral Agent, the Custodial Agent and
Securities Intermediary ....................................... 18
Section 8.8. Compensation and Indemnity .................................... 18
Section 8.9. Failure to Act ................................................ 19
Section 8.10. Resignation of Collateral Agent, the Custodial Agent and the
Securities Intermediary ....................................... 20
Section 8.11. Right to Appoint Agent or Advisor ............................. 21
Section 8.12. Survival ...................................................... 21
Section 8.13. Exculpation ................................................... 21
ARTICLE IX
Amendment
Section 9.1. Amendment Without Consent of Holders .......................... 21
Section 9.2. Amendment With Consent of Holders ............................. 22
Section 9.3. Execution of Amendments ....................................... 22
Section 9.4. Effect of Amendments .......................................... 23
Section 9.5. Reference To Amendments ....................................... 23
ARTICLE X
Miscellaneous
Section 10.1. No Waiver ..................................................... 23
Section 10.2. Governing Law ................................................. 23
Section 10.3. Notices ....................................................... 24
Section 10.4. Successors and Assigns ........................................ 24
Section 10.5. Counterparts .................................................. 24
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Section 10.6. Severability ................................................ 24
Section 10.7. Expenses, Etc ............................................... 24
Section 10.8. Security Interest Absolute .................................. 25
Section 10.9. Waiver of Jury Trial ........................................ 25
Exhibit A Collateral Insufficiency Notice
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PLEDGE AGREEMENT, dated as of January 21, 2003 (this
"Agreement"), among State Street Corporation, a
Massachusetts corporation (the "Company"), as pledgee, Bank
One, N.A., a national banking association, not individually
but solely as collateral agent (in such capacity, together
with its successors in such capacity, the "Collateral
Agent"), as custodial agent (in such capacity, together with
its successors in such capacity, the "Custodial Agent") and
as securities intermediary as defined in Section
8-102(a)(14) of the Code (as defined herein) (in such
capacity, together with its successors in such capacity, the
"Securities Intermediary"), and Bank One Trust Company,
N.A., a national banking association, not individually but
solely as purchase contract agent and as attorney-in-fact of
the Holders (as defined herein) from time to time of the
Securities (in such capacity, together with its successors
in such capacity, the "Purchase Contract Agent") under the
Purchase Contract Agreement (terms not otherwise defined
herein are used herein with the meaning ascribed to them in
the Purchase Contract Agreement).
RECITALS
WHEREAS, the Company and the Purchase Contract Agent are
parties to the Purchase Contract Agreement, dated as of the date hereof (as
modified and supplemented and in effect from time to time, the "Purchase
Contract Agreement"), pursuant to which the Securities will be issued.
WHEREAS, each SPACES will be comprised of (a) a Variable-Share
Repurchase Contract and (b) a PACES, which will consist of (i) a Fixed-Share
Purchase Contract, subject to the pledge of the Fixed-Share Rights, (ii) an
Ownership Interest in the Treasury Strip, subject to the pledge thereof, and
(iii) an Ownership Interest in the Treasury Portfolio.
WHEREAS, in accordance with the terms of the Purchase Contract
Agreement, a Holder of SPACES may separate the PACES from the related
Variable-Share Repurchase Contract by substituting for the Pledged Fixed-Share
Rights Common Stock sufficient to secure the Holder's obligation under the
Variable-Share Repurchase Contract. Upon such separation, the SPACES will become
a Separate PACES and a Separate COVERS.
WHEREAS, pursuant to the terms of the Purchase Contract
Agreement, the Holders, from time to time, of the Securities have irrevocably
authorized the Purchase Contract Agent, as attorney-in-fact of such Holders,
among other things, to execute and deliver this Agreement on behalf of such
Holders and to grant the pledge provided hereby of the Collateral.
NOW, THEREFORE, and for other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, the Company, the
Collateral Agent, the Securities Intermediary, the Custodial Agent and the
Purchase Contract Agent, on its own behalf and as attorney-in-fact of the
Holders from time to time of the Securities, agree as follows:
ARTICLE I
Definitions
Section 1.1. Definitions. For all purposes of this Agreement,
except as otherwise expressly provided or unless the context otherwise requires:
(a) the defined terms in this Article have the meanings
assigned to them in this Article and include the plural as well as the singular
and nouns and pronouns of the masculine gender include the feminine and neuter
genders; and
(b) 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.
"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.
"CODE" has the meaning specified in Section 6.1 hereof.
"COLLATERAL" has the meaning specified in Section 2.1 hereof.
"COLLATERAL AGENT" has the meaning specified in the first
paragraph of this Agreement.
"COLLATERAL ACCOUNT" means the securities account maintained
at Bank One, N.A. in the name "Bank One Trust Company, N.A., as Purchase
Contract Agent on behalf of the holders of certain securities of State Street
Corporation, Collateral Account subject to the security interest of Bank One,
N.A., as Collateral Agent, for the benefit of State Street Corporation, as
pledgee" and any successor account.
"COLLATERAL INSUFFICIENCY" has the meaning specified in
Section 4.5(c).
"COLLATERAL INSUFFICIENCY NOTICE" has the meaning specified in
Section 4.5(c).
"COMPANY" means the Person named as the "Company" in the first
paragraph of this Agreement until a successor shall have become such, and
thereafter "Company" shall mean such successor.
"CUSTODIAL AGENT" has the meaning specified in the first
paragraph of this Agreement.
"INTERMEDIARY" means any entity that in the ordinary course of
its business maintains securities accounts for others and is acting in that
capacity.
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"MERGER CONSIDERATION" means cash, securities or other
property received in exchange for Common Stock in connection with a Cash Merger.
"PLEDGE" has the meaning specified in Section 2.1 hereof.
"PLEDGED FIXED-SHARE RIGHT has the meaning set forth in
Section 2.1(c).
"PLEDGED COMMON STOCK" has the meaning set forth in Section
2.1(c).
"PLEDGED MERGER CONSIDERATION" has the meaning set forth in
Section 2.1(c).
"PLEDGED OWNERSHIP INTEREST IN THE TREASURY STRIP" has the
meaning set forth in Section 2.1(c).
"PROCEEDS" means all interest, dividends, cash, instruments,
securities, financial assets (as defined in Section 8-102(a)(9) of the Code) and
other property from time to time received, receivable or otherwise distributed
upon the sale, exchange, collection or disposition of the Collateral or any
proceeds of any of the foregoing items.
"PURCHASE CONTRACT AGENT" has the meaning specified in the
first paragraph of this Agreement.
"PURCHASE CONTRACT AGREEMENT" has the meaning specified in the
second paragraph of this Agreement.
"SECURITIES INTERMEDIARY" has the meaning specified in the
first paragraph of this Agreement.
"SECURITY ENTITLEMENT" has the meaning set forth in Section
8-102(a)(17) of the Code.
"STATED AMOUNT" means, with respect to any one SPACES or
PACES, $200.
"TERMINATION DATE" means the date, if any, on which a
Termination Event occurs.
"TRADES REGULATIONS" means the regulations of the United
States Department of the Treasury, published at 31 C.F.R. Part 357, as amended
from time to time. Unless otherwise defined herein, all terms defined in the
TRADES Regulations are used herein as therein defined.
"TRANSFER" means, with respect to the Collateral and in
accordance with the instructions of the Collateral Agent, the Purchase Contract
Agent or the Holder, as applicable:
(i) in the case of Collateral consisting of securities which
cannot be delivered by book-entry or which the parties agree are to be
delivered in physical form, delivery in
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appropriate physical form to the recipient accompanied by any duly
executed instruments of transfer, assignments in blank, transfer tax
stamps and any other documents necessary to constitute a legally valid
transfer to the recipient;
(ii) in the case of Collateral consisting of securities
maintained in book-entry form, by causing a securities intermediary (as
defined in Section 8-102(a)(14) of the Code) to (a) credit a Security
Entitlement with respect to such securities to a "securities account"
(as defined in Section 8-501(a) of the Code) maintained by or on behalf
of the recipient and (b) to issue a confirmation to the recipient with
respect to such credit. In the case of Collateral to be delivered to
the Collateral Agent, the securities intermediary shall be the
Securities Intermediary and the securities account shall be the
Collateral Account. In addition, any Transfer of Treasury Strips
hereunder shall be made in accordance with the TRADES Regulations and
other applicable law.
ARTICLE II
Pledge; Control And Perfection
Section 2.1. The Pledge. (a) The Holders from time to time
acting through the Purchase Contract Agent, as their attorney-in-fact, and the
Purchase Contract Agent, as such attorney-in-fact, hereby pledge and grant to
the Collateral Agent, for the benefit of the Company, as collateral security for
the performance when due by such Holders of their respective obligations under
the related Contracts, a security interest in all of the right, title and
interest of the Purchase Contract Agent and such Holders in:
(i) (A) Ownership Interests in the Treasury Strips and the Fixed-Share
Rights constituting a part of the SPACES, (B) Ownership Interests in the
Treasury Strips constituting a part of the Separate PACES, (C) Common Stock
relating to Variable-Share Repurchase Contracts forming a part of the Separate
COVERS, (D) Common Stock or Merger Consideration delivered in accordance with
Section 4.1, Section 4.4 or Section 4.5 hereof, and (E) Fixed-Share Rights
delivered in accordance with Section 4.2 hereof, in each case that have been
Transferred to or otherwise received by the Collateral Agent and not released by
the Collateral Agent to such Holders under the provisions of this Agreement;
(ii) the Collateral Account and all securities, financial
assets, security entitlements, cash and other property credited thereto
and all Security Entitlements related thereto; and
(iii) all Proceeds of the foregoing (all of the foregoing,
collectively, the "Collateral").
(b) Prior to or concurrently with the execution and delivery
of this Agreement, the Purchase Contract Agent, on behalf of the initial Holders
of the SPACES, Separate PACES, and Separate COVERS, shall cause the Ownership
Interests in the Treasury Strip, the Fixed-Share Rights (including the
Fixed-Share Rights Certificates evidencing such rights) and the Common Stock
relating to the Variable-Share Repurchase Contracts forming a part of the
Separate COVERS to be Transferred to the Collateral Agent for the benefit of the
Company.
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(c) The pledge provided in this Section 2.1 is herein referred
to as the "Pledge" and the Ownership Interest in the Treasury Strip, the
Fixed-Share Right, the Common Stock and other Collateral subject to the Pledge,
excluding any of the foregoing that have been released from the Pledge as
provided in Article IV hereof, are hereinafter referred to as "Pledged Ownership
Interest in the Treasury Strip," "Pledged Fixed-Share Right", "Pledged Common
Stock" and "Pledged Merger Consideration" respectively. Subject to the Pledge
and the provisions of Section 2.2 hereof, the Holders from time to time shall
have full beneficial ownership of the Collateral. For purposes of perfecting the
Pledge under applicable law, including, to the extent applicable, the TRADES
Regulations or the Uniform Commercial Code, including Uniform Commercial Code
-314, 9-106 and 8-106(e), as adopted and in effect in any applicable
jurisdiction, the Collateral Agent shall be the agent of the Company as provided
herein and shall not be acting on behalf of itself individually or on behalf of
the Holders or the Purchase Contract Agent. Whenever directed by the Collateral
Agent acting on behalf of the Company, the Securities Intermediary shall have
the right to re-register in its name the Common Stock, the Fixed-Share Rights
Certificate or any other securities held in physical form.
(d) Except as may be required in order to release Pledged
Fixed-Share Rights or Pledged Common Stock, as applicable, in connection with a
Holder's election to convert its investment from a SPACES to a Separate PACES
and a Separate COVERS, or a Holder's election to re-create SPACES, or except as
otherwise required to release any Collateral as specified herein, neither the
Collateral Agent, the Custodial Agent nor the Securities Intermediary shall
relinquish physical possession of any certificate evidencing an Ownership
Interest in a Treasury Strip, the Fixed-Share Right, Common Stock or Merger
Consideration, as applicable, prior to the termination of this Agreement. If it
becomes necessary for the Securities Intermediary to relinquish physical
possession of a certificate in order to release a portion of the Collateral
evidenced thereby from the Pledge, the Securities Intermediary shall use its
best efforts to obtain physical possession of a replacement certificate
evidencing any Collateral remaining subject to the Pledge hereunder registered
to it or endorsed in blank within fifteen days of the date it relinquished
possession. The Securities Intermediary shall promptly notify the Company and
the Collateral Agent of the Securities Intermediary's failure to obtain
possession of any such replacement certificate as required hereby.
Section 2.2. Control and Perfection.
(a) In connection with the Pledge granted in Section 2.1, and
subject to the other provisions of this Agreement, the Holders from time to time
acting through the Purchase Contract Agent, as their attorney-in-fact, hereby
authorize and direct the Securities Intermediary (without the necessity of
obtaining the further consent of the Purchase Contract Agent or any of the
Holders), and the Securities Intermediary agrees, to comply with and follow any
instructions and "entitlement orders" (as defined in Section 8-102(a)(8) of the
Code) that the Company or the Collateral Agent may deliver with respect to the
Collateral Account, the Collateral credited thereto and any Security
Entitlements with respect to financial assets maintained in the Collateral
Account. In the event the Securities Intermediary receives from the Holders or
the Purchase Contract Agent entitlement orders which conflict with entitlement
orders received from the Company or the Collateral Agent, the Securities
Intermediary shall follow the entitlement orders received from the Collateral
Agent. Such instructions and entitlement orders may, without limitation, direct
the Securities Intermediary to transfer, redeem, assign, or otherwise dispose of
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the Treasury Strips or Ownership Interests therein, the Fixed-Share Rights,
Common Stock, Merger Consideration and any Security Entitlements with respect
thereto or sell, liquidate or dispose of such assets through a broker designated
by the Company, and to pay and deliver any income, proceeds or other funds
derived therefrom to the Company. The Purchase Contract Agent and the Holders
from time to time acting through the Purchase Contract Agent, each hereby
further authorize and direct the Company or the Collateral Agent, as agent of
the Company, to itself issue instructions and entitlement orders, and to
otherwise take action, with respect to the Collateral Account, the Collateral
credited thereto and any Security Entitlements with respect thereto, pursuant to
the terms and provisions hereof, all without the necessity of obtaining the
further consent of the Purchase Contract Agent or any of the Holders. The
Collateral Agent shall be the agent of the Company only and shall not be the
agent of the Holders or the Purchase Contract Agent and shall act only in
accordance with the terms hereof or as otherwise directed by the Company.
Without limiting the generality of the foregoing, the Collateral Agent shall
issue entitlement orders to the Securities Intermediary when and as required by
the terms hereof or as otherwise directed by the Company.
(b) The Securities Intermediary and the Purchase Contract
Agent, for itself and as agent and attorney-in-fact for the Holders, hereby
confirm and agree that:
(i) all securities or other property underlying any financial
assets credited to the Collateral Account shall be registered in the
name of the Securities Intermediary, or its nominee, indorsed to the
Securities Intermediary, or its nominee, or in blank or credited to
another collateral account maintained in the name of the Securities
Intermediary and in no case will any financial asset credited to the
Collateral Account be registered in the name of the Purchase Contract
Agent or any Holder, payable to the order of, or specially indorsed to,
the Purchase Contract Agent or any Holder except to the extent the
foregoing have been specially indorsed to the Securities Intermediary
or in blank;
(ii) all property delivered to the Securities Intermediary
pursuant to this Agreement (including, without limitation, any Treasury
Strips, Fixed-Share Rights Certificates, or Common Stock or Merger
Consideration) will be promptly credited to the Collateral Account;
(iii) the Collateral Account is an account to which financial
assets are or may be credited, and the Securities Intermediary shall,
subject to the terms of this Agreement, treat the Purchase Contract
Agent as the "entitlement holder" (as defined in Section 8-102(a)(7) of
the Code) with respect to the Collateral Account;
(iv) the Securities Intermediary has not entered into, and
until the termination of this Agreement will not enter into, any
agreement with any other Person relating to the Collateral Account
and/or any financial assets credited thereto pursuant to which it has
agreed to comply with entitlement orders of such other Person; and
(v) the Securities Intermediary has not entered into, and until
the termination of this Agreement will not enter into, any agreement
with the Company, the Collateral Agent, the Purchase Contract Agent or
the Holders of the Securities purporting to limit or
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condition the obligation of the Securities Intermediary to comply with
entitlement orders as set forth in this Section 2.2 hereof.
(c) The Securities Intermediary and the Purchase Contract
Agent, for itself and as agent and attorney-in-fact for the Holders, hereby
agree that each item of property (whether investment property, financial asset,
security, instrument, cash or otherwise) credited to the Collateral Account,
including any Treasury Strips, Fixed-Share Rights and Common Stock, shall be
treated as a "financial asset" within the meaning of Section 8-102(a)(9) of the
Code.
(d) In the event of any conflict between this Agreement (or
any portion hereof) and any other agreement now existing or hereafter entered
into, the terms of this Agreement shall prevail.
(e) The Purchase Contract Agent hereby irrevocably constitutes
and appoints the Collateral Agent and the Company, and each of them severally,
with full power of substitution, as the Purchase Contract Agent's
attorney-in-fact to take on behalf of, and in the name, place and stead of, the
Purchase Contract Agent and the Holders, any action necessary or desirable to
perfect and to keep perfected the security interest in the Collateral referred
to in Section 2.1. The grant of such power-of-attorney shall not be deemed to
require of the Collateral Agent any specific duties or obligations not otherwise
assumed by the Collateral Agent hereunder. Notwithstanding the foregoing, in no
event shall the Collateral Agent or Securities Intermediary be responsible for
the preparation or filing of any financing or continuation statements in the
appropriate jurisdictions or responsible for maintenance or perfection (other
than by control) of any Security Interest hereunder. The Collateral Agent agrees
to file such financing statements and amendments thereto as the Company may
direct from time to time.
(f) The Purchase Contract Agent represents and warrants that
its chief executive office is located in Columbus, Ohio and that it has more
than one place of business.
ARTICLE III
Distributions on Collateral
Section 3.1. Distributions. (a) So long as the Purchase
Contract Agent is the registered owner of the Pledged Ownership Interest in the
Treasury Strips, the Pledged Fixed-Share Right, the Pledged Common Stock or any
securities forming a part of the Pledged Merger Consideration, it shall receive
all payments thereon. If the Pledged Ownership Interest in the Treasury Strips,
the Pledged Fixed-Share Right, the Pledged Common Stock or any securities
forming a part of Pledged Merger Consideration are reregistered, such that the
Collateral Agent becomes the registered holder, all payments and other
distributions thereon including payments of the principal of the Pledged
Ownership Interest in the Treasury Strips and payments or other distributions on
the Pledged Fixed-Share Rights or the Pledged Common Stock or any securities
forming a part of the Pledged Merger Consideration, that are received by the
Collateral Agent and that are properly payable or deliverable hereunder, shall
be:
(i) In the case of (A) payments or other distributions on the
Pledged Fixed-Share Right or the Pledged Common Stock or any securities
forming a part of Pledged Merger
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Consideration and (B) any payment of the Ownership Interest in the
Treasury Strips with respect to any Ownership Interest in the Treasury
Strips that has been released from the Pledge pursuant to Section 4.3
hereof, shall be paid by wire transfer in same day funds, or delivered,
by the Collateral Agent to the Purchase Contract Agent, for the benefit
of the Holders of the applicable Securities, to the account designated
by the Purchase Contract Agent for such purpose no later than 11:00
a.m., New York City time, on the Business Day such payment or other
distribution is received by the Collateral Agent (provided that in the
event such payment or other distribution is received by the Collateral
Agent on a day that is not a Business Day or after 9:00 a.m., New York
City time, on a Business Day, then such payment or delivery shall be
made no later than 9:30 a.m., New York City time, on the next
succeeding Business Day); and
(ii) In the case of payments in respect of any Pledged
Ownership Interest in the Treasury Strips to be paid upon settlement of
such Holder's obligations to purchase Common Stock under the
Fixed-Share Purchase Contract, paid by wire transfer in same day funds
to the Company on the Fixed-Share Stock Purchase Date in accordance
with the procedure set forth in Section 4.5 hereof, in full
satisfaction of the respective corresponding obligations of the Holders
under the related Fixed-Share Purchase Contracts.
(b) Upon declaration of a dividend or any other distribution
with respect to the Pledged Common Stock, the Company will prepare and transmit
to the Collateral Agent, no later than two Business Days after the date of such
declaration, a Company Certificate setting forth (i) the type and amount of
distribution, (ii) the record date established by the Company for such
distribution and (iii) the date that such distribution will be made to holders
of Common Stock.
Section 3.2. Application of Payments. All payments or other
distributions received by the Purchase Contract Agent as provided herein shall
be applied by the Purchase Contract Agent pursuant to the provisions of the
Purchase Contract Agreement. If, notwithstanding the foregoing, (i) the Purchase
Contract Agent or a Holder of a SPACES or Separate PACES shall receive any
payments of principal on account of any Ownership Interest in the Treasury Strip
that, at the time of such payment, is a Pledged Ownership Interest in the
Treasury Strip, the Purchase Contract Agent or such Holder shall hold the same
as trustee of an express trust for the benefit of the Company (and promptly
deliver the same over to the Company) for application to the obligations of
Holders under the related Fixed-Share Purchase Contracts, and Holders shall
acquire no right, title or interest in any such payments of principal so
received or (ii) a Holder of a SPACES shall receive any shares of Common Stock
on account of any Fixed-Share Right that, at the time of receipt of such shares,
is a Pledged Fixed-Share Right, such Holder shall hold the same for the benefit
of the Company and shall promptly deliver the same over to the Purchase Contract
Agent, who shall, as attorney-in-fact for such Holder, in accordance with the
terms hereof and of the Purchase Contract Agreement, pledge and grant to the
Collateral Agent, for the benefit of the Company, as collateral security for the
performance when due by such Holder of its obligations under the related
Variable-Share Repurchase Contract, a security interest in all of the right,
title and interest of the Purchase Contract Agent and such Holder in such Common
Stock.
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ARTICLE IV
Substitution, Release, Repledge and Settlement of Securities
Section 4.1. Collateral Substitution and the Splitting Apart
of SPACES. At any time on or prior to the third Business Day immediately
preceding the Fixed-Share Stock Purchase Date, a Holder of SPACES shall have the
right to separate the PACES and the related Variable-Share Repurchase Contract
by substituting a number of shares of Common Stock equal to the Maximum
Variable-Share Settlement Rate per Variable-Share Repurchase Contract (subject
to adjustment under Section 5.6 of the Purchase Contract Agreement), rounded up
to the nearest whole share, for the Pledged Fixed-Share Rights securing such
Holder's obligations under the Variable-Share Repurchase Contracts comprising a
part of such SPACES by (a) Transferring to the Collateral Agent the applicable
number of shares of Common Stock (subject to adjustment) for each Variable-Share
Repurchase Contract being replaced and (b) delivering such SPACES to the
Purchase Contract Agent, accompanied by a notice, substantially in the form of
Exhibit E to the Purchase Contract Agreement, to the Purchase Contract Agent
stating that such Holder has transferred Common Stock to the Collateral Agent
pursuant to clause (a) above and requesting that the Purchase Contract Agent
instruct the Collateral Agent to release from the Pledge the Fixed-Share Rights
related to such SPACES, whereupon the Purchase Contract Agent shall promptly
give such instruction to the Collateral Agent in the form provided in Exhibit D
to the Purchase Contract Agreement. Upon receipt of Common Stock from a Holder
of SPACES and the related instruction from the Purchase Contract Agent, the
Collateral Agent shall release the Fixed-Share Rights and shall promptly
Transfer such Fixed-Share Rights, free and clear of any lien, pledge or security
interest created hereby, to the Purchase Contract Agent. At such point, for each
SPACES that is split apart, the Holder will hold a Separate PACES and Separate
COVERS. All items Transferred and/or substituted by any Holder pursuant to this
Section 4.1, Section 4.2 or any other Section of this Agreement shall be
Transferred and/or substituted free and clear of all liens, claims and
encumbrances.
Section 4.2. Collateral Substitution and the Re-Creation of
SPACES. At any time on or prior to the third Business Day immediately preceding
the Fixed-Share Stock Purchase Date, a Holder of Separate PACES and Separate
COVERS shall have the right to recreate SPACES by (a) Transferring to the
Collateral Agent the Fixed-Share Rights then comprising such number of SPACES as
is equal to such Separate COVERS and (b) delivering such Separate PACES and
Separate COVERS to the Purchase Contract Agent, accompanied by a notice,
substantially in the form of Exhibit E to the Purchase Contract Agreement, to
the Purchase Contract Agent stating that such Holder has Transferred the
relevant amount of Fixed-Share Rights to the Collateral Agent pursuant to clause
(a) above and requesting that the Purchase Contract Agent instruct the
Collateral Agent to release from the Pledge the Pledged Common Stock related to
such Separate COVERS, whereupon the Purchase Contract Agent shall promptly give
such instruction to the Collateral Agent in the form provided in Exhibit D to
the Purchase Contract Agreement. Upon receipt of the Fixed-Share Rights from
such Holder and the instruction from the Purchase Contract Agent, the Collateral
Agent shall release the Pledged Common Stock and shall promptly Transfer such
Pledged Common Stock, free and clear of any lien, pledge or security interest
created hereby, to the Purchase Contract Agent.
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Section 4.3. Termination Event.
(a) Upon receipt by the Collateral Agent of written notice
from the Company or written notice from the Purchase Contract Agent that has
been confirmed in writing by the Company that there has occurred a Termination
Event, the Collateral Agent shall release all Collateral from the Pledge and
shall promptly Transfer any Pledged Fixed-Share Rights, Pledged Ownership
Interest in the Treasury Strips, Pledged Common Stock or Pledged Merger
Consideration to the Purchase Contract Agent for the benefit of the Holders of
the Securities, as applicable, free and clear of any lien, pledge or security
interest or other interest created hereby, provided that, if such Termination
Event results from the Company being a debtor under the Bankruptcy Code, the
Collateral Agent shall not release any Collateral except upon receipt of an
opinion, as provided in Section 4.3(b) hereof or as required by final order of
the court with jurisdiction of the Company's case under the Bankruptcy Code.
(b) If such Termination Event shall result from the Company
becoming a debtor under the Bankruptcy Code, and if the Collateral Agent shall
for any reason fail promptly to effectuate the release and Transfer of all
Pledged Collateral, as provided by this Section 4.3, the Purchase Contract Agent
shall, in its sole discretion, either:
(i) use best efforts to obtain an opinion of a nationally
recognized law firm reasonably acceptable to the Collateral Agent
addressed to the Company and the Collateral Agent to the effect that,
as a result of the Company being the debtor under the Bankruptcy Code,
the Collateral Agent will not be prohibited from releasing or
Transferring the Collateral as provided in this Section 4.3, and, if
such opinion is obtained, shall deliver such opinion to the Collateral
Agent within ten days after the occurrence of such Termination Event,
and if (y) the Purchase Contract Agent shall be unable to obtain such
opinion within ten days after the occurrence of such Termination Event
or (z) the Collateral Agent shall continue, after delivery of such
opinion, to refuse to effectuate the release and Transfer of all
Collateral as provided in this Section 4.3, then the Purchase Contract
Agent shall within 15 days after the occurrence of such Termination
Event commence an action or proceeding in the court with jurisdiction
of the Company's case under the Bankruptcy Code seeking an order
requiring the Collateral Agent to effectuate the release and Transfer
of all Pledged Collateral, as provided by this Section 4.3 or
(ii) commence an action or proceeding like that described in
subsection (i)(z) hereof within ten days after the occurrence of such
Termination Event.
Section 4.4. Early Settlement; Merger Early Settlement. Upon
written notice to the Collateral Agent by the Purchase Contract Agent that one
or more Holders of Securities have elected to effect Early Settlement or Merger
Early Settlement of their respective obligations under the Fixed-Share Purchase
Contracts or Variable-Share Repurchase Contracts forming a part of such
Securities in accordance with the terms of the Contracts and the Purchase
Contract Agreement (setting forth the number of such Contracts as to which such
Holders have elected to effect such Early Settlement or Merger Early
Settlement), and that the Purchase Contract Agent has received from such
Holders, and paid or delivered to the Company, as confirmed to the Collateral
Agent in writing by the Company, in the case of the Fixed-Share Purchase
Contracts,
10
the related Early Settlement Amounts or Merger Early Settlement Amounts, as the
case may be, and in the case of the Variable-Share Repurchase Contracts, Common
Stock as specified in Section 5.9(c) of the Purchase Contract Agreement or
Merger Consideration as specified in Section 5.10(b) of the Purchase Contract
Agreement, as applicable, in each case pursuant to the terms of the Fixed-Share
Purchase Contracts or the Variable-Share Repurchase Contracts, as applicable,
and the Purchase Contract Agreement and that all conditions to such Early
Settlement or Merger Early Settlement, as the case may be, have been satisfied,
then:
(i) in the case of a Fixed-Share Purchase Contract, (A) the
Collateral Agent shall release from the Pledge the Pledged Ownership
Interest in the Treasury Strip and shall Transfer such Pledged
Ownership Interest in the Treasury Strip, free and clear of the Pledge
created hereby, to the Purchase Contract Agent for the benefit of the
applicable Holders and (B) if the Fixed-Share Purchase Contract being
settled forms a part of a SPACES, and the related Variable-Share
Repurchase Contract is not also being settled, the Purchase Contract
Agent, as attorney-in-fact of the Holder of such Fixed-Share Purchase
Contract, shall Pledge to the Collateral Agent, out of the shares of
Common Stock deposited with the Purchase Contract Agent for the benefit
of such Holder in connection with Early Settlement or Merger Early
Settlement (subject to Section 5.9(j) of the Purchase Contract
Agreement), a number of shares of Common Stock equal to the Maximum
Variable-Share Settlement Rate (subject to adjustment under Section 5.6
of the Purchase Contract Agreement), rounded up to the nearest whole
share, in order to secure such Holder's obligation to sell Common Stock
under the related Variable-Share Repurchase Contract; and
(ii) in the case of a Variable-Share Repurchase Contract, the
Collateral Agent shall release from the Pledge, (A) if the
Variable-Share Repurchase Contract is held as a component of SPACES,
the Fixed-Share Right, and (B) if the Variable-Share Repurchase
Contract is held as a component of a Separate COVERS, the Pledged
Common Stock, and shall Transfer such Pledged Fixed-Share Rights or
Pledged Common Stock, as applicable, to the Purchase Contract Agent for
the benefit of the applicable Holders (subject to the terms of the
Purchase Contract Agreement).
Section 4.5. Application of Proceeds; Collateral
Insufficiency. (a) In the event a Holder has not made an Early Settlement or a
Merger Early Settlement of the Fixed-Share Purchase Contracts underlying its
Securities prior to the Fixed-Share Stock Purchase Date, such Holder shall be
deemed to have elected to pay for the shares of Common Stock to be issued under
such Fixed-Share Purchase Contracts from the proceeds received in respect of the
related Pledged Ownership Interests in the Ownership Interest in the maturing
Treasury Strips. Without receiving any instruction from any such Holder, the
Collateral Agent shall apply such proceeds to the settlement of such Fixed-Share
Purchase Contracts on the Fixed-Share Stock Purchase Date.
(b) In the event a Holder has not made an Early Settlement or
a Merger Early Settlement of the Variable-Share Repurchase Contracts underlying
its securities prior to the Variable-Share Stock Purchase Date, such Holder
shall be deemed to have elected to satisfy its delivery obligations thereunder
with the Pledged Common Stock or the Pledged Merger Consideration, as
applicable. Without receiving any instruction from any such Holder, the
11
Collateral Agent shall apply such Pledged Common Stock or Pledged Merger
Consideration to the settlement of such Variable-Share Repurchase Contract on
the Variable-Share Stock Purchase Date. Upon receipt of an Issuer Order, the
Collateral Agent shall be authorized to dispose of any Pledged Common Stock or
any securities forming a part of Pledged Merger Consideration to the extent
necessary to make a cash payment in respect of a fractional share. Any Pledged
Common Stock or Pledged Merger Consideration in excess of the product of (y) a
number of shares of Common Stock (or equivalent Merger Consideration) equal to
the Variable-Share Settlement Rate times (z) the number of Variable-Share
Repurchase Contracts being settled, and any excess cash resulting from the
disposition by the Collateral Agent of Collateral in order to make a cash
payment in respect of a fractional share, shall be delivered by the Collateral
Agent to the Purchase Contract Agent for the benefit of the Holders of such
Variable-Share Repurchase Contracts.
(c) Notwithstanding anything herein to the contrary, if an
event occurs that requires the Settlement Rates to be adjusted pursuant to
Section 5.6 of the Purchase Contract Agreement, no Proceeds with respect to
Collateral received in connection with such an event shall be distributed to the
Purchase Contract Agent for the benefit of the Holders, and all such Proceeds
shall be held by the Collateral Agent as Collateral, until such time as the
Company determines, in accordance with this Section 4.5(c), that a Collateral
Insufficiency (as defined below) does not exist or has been cured. Upon the
occurrence of such an event, the Company shall forthwith determine, in
consultation with the Collateral Agent, whether the Collateral then securing
Separate COVERS is still sufficient to satisfy in full a Holder's delivery
obligations thereunder (an insufficiency of Collateral being referred to as a
"Collateral Insufficiency"). The Company shall specify in the Company
Certificate deliverable to the Collateral Agent and the Purchase Contract Agent
pursuant to Section 5.7(a)(i) of the Purchase Contract Agreement whether a
Collateral Insufficiency exists. The Collateral Agent shall forthwith send to
each applicable Holder a notice, substantially in the form of Exhibit A hereto
(a "Collateral Insufficiency Notice"), requesting that such Holder cure the
Collateral Insufficiency within five Business Days of receipt of the Collateral
Insufficiency Notice by delivering to the Purchase Contract Agent, for Pledge to
the Collateral Agent by the Purchase Contract Agent as attorney-in-fact of such
Holders, additional Common Stock such that, thereafter, the Pledged Common Stock
per Variable-Share Repurchase Contract shall equal the Variable-Share Settlement
Rate or, if in effect prior thereto, the Fixed Variable-Share Settlement Rate,
as adjusted pursuant to Section 5.6 of the Purchase Contract Agreement. If the
Holder does not cure the Collateral Insufficiency within five Business Days of
receiving the Collateral Insufficiency Notice, upon receipt of an Issuer Order
the Collateral Agent shall undertake to sell the Proceeds of the Collateral
received by it in connection with the event triggering the adjustment to the
Settlement Rates, and use the proceeds of such sale to purchase the type and
amount of Collateral necessary to cure the Collateral Insufficiency. If the
Collateral Agent is unable to cure the Collateral Insufficiency as described
above, the Proceeds of the Collateral received in connection with the event
triggering the adjustment to the Settlement Rates shall be retained by the
Collateral Agent as Collateral and, upon settlement of the related
Variable-Share Repurchase Contract, an amount thereof, based on its fair market
value at the time of settlement, equal to the Applicable Market Value of the
Collateral deficiency shall be delivered to the Company on the applicable
Settlement Date. If requested by the Collateral Agent or as otherwise necessary,
a nationally recognized independent investment banking firm shall be retained by
the Company to ascertain the fair market value of such Proceeds at the time of
settlement. If a Holder or the Collateral
12
Agent cures the Collateral Insufficiency, any Collateral held by the Collateral
Agent in excess of that necessary to fully secure a Holder's delivery
obligations under a Variable-Share Repurchase Contract shall be delivered to the
Purchase Contract Agent for the benefit of such Holder in accordance with the
provisions of this Agreement and the Purchase Contract Agreement. Subject to the
foregoing, the obligations of each Holder of COVERS to deliver Common Stock
pursuant to the underlying Variable-Share Repurchase Contracts are non-recourse
obligations and shall be satisfied solely out of the Collateral pledged to
secure the obligations of such Holders under such Variable-Share Repurchase
Contracts and in no event will such Holders be liable for any deficiency between
such Collateral and the applicable Settlement Rate.
ARTICLE V
Voting Rights -- Pledged Common Stock
Section 5.1. Exercise by Purchase Contract Agent. The Purchase
Contract Agent may exercise, or refrain from exercising, any and all voting and
other consensual rights pertaining to the Pledged Common Stock or any part
thereof for any purpose not inconsistent with the terms of this Agreement and in
accordance with the terms of the Purchase Contract Agreement; provided, that the
Purchase Contract Agent shall not exercise or, as the case may be, shall not
refrain from exercising such right if, in the judgment of the Company, such
action would impair or otherwise have a material adverse effect on the value of
all or any of the Pledged Common Stock; and provided, further, that the Purchase
Contract Agent shall give the Company and the Collateral Agent at least five
days' prior written notice of the manner in which it intends to exercise, or its
reasons for refraining from exercising, any such right. Upon receipt of any
notices and other communications in respect of any Pledged Common Stock,
including notice of any meeting at which holders of Common Stock are entitled to
vote or solicitation of consents or proxies of holders of Common Stock, the
Collateral Agent shall use reasonable efforts to send promptly to the Purchase
Contract Agent such notice or communication, and as soon as reasonably
practicable after receipt of a written request therefor from the Purchase
Contract Agent, execute and deliver to the Purchase Contract Agent such proxies
and other instruments in respect of such Pledged Common Stock (in form and
substance satisfactory to the Collateral Agent) as are prepared by the Purchase
Contract Agent with respect to the Pledged Common Stock.
ARTICLE VI
Rights and Remedies
Section 6.1. Rights and Remedies of the Collateral Agent. (a)
In addition to the rights and remedies available at law or in equity, after an
event of default under the Fixed-Share Purchase Contracts or Variable-Share
Repurchase Contracts, the Collateral Agent shall have all of the rights and
remedies with respect to the Collateral of a secured party under the Uniform
Commercial Code (or any successor thereto) as in effect in the State of New York
from time to time (the "Code") (whether or not the Code is in effect in the
jurisdiction where the rights and remedies are asserted) and the TRADES
Regulations and such additional rights and remedies to
13
which a secured party is entitled under the laws in effect in any jurisdiction
where any rights and remedies hereunder may be asserted. Wherever reference is
made in this Agreement to any section of the Code, such reference shall be
deemed to include a reference to any provision of the Code, which is a successor
to, or amendment of, such section. Without limiting the generality of the
foregoing, such remedies may include, to the extent permitted by applicable law,
(i) retention of the Pledged Collateral in full satisfaction of the Holders'
obligations under the Contracts or (ii) sale of the Collateral in one or more
public or private sales, in each case at the written direction of the Company.
(b) Without limiting any rights or powers otherwise granted by
this Agreement to the Collateral Agent, in the event the Collateral Agent is
unable to make payments to the Company on account of any Pledged Ownership
Interest in the Treasury Strip, Pledged Fixed-Share Right, Pledged Common Stock
or Pledged Merger Consideration as provided in Article III hereof in
satisfaction of the obligations of the Holder of the Securities of which such
Pledged Ownership Interest in the Treasury Strip, Pledged Fixed-Share Right,
Pledged Common Stock or Pledged Merger Consideration, as applicable, is a part
under the related Contracts, the inability to make such payments shall
constitute an event of default under the applicable Contracts and the Collateral
Agent shall have and may exercise, with reference to such Pledged Ownership
Interest in the Treasury Strip, Pledged Fixed-Share Right, Pledged Common Stock
or Pledged Merger Consideration, as applicable, and such obligations of such
Holder, any and all of the rights and remedies available to a secured party
under the Code and the TRADES Regulations after default by a debtor, and as
otherwise provided herein or under any other law.
(c) Without limiting any rights or powers otherwise granted by
this Agreement to the Collateral Agent, the Collateral Agent is hereby
irrevocably authorized to receive and collect all payments and other
distributions (i) of the principal amount of the Pledged Ownership Interests in
the Treasury Strips, or (ii) on the Pledged Common Stock or the Pledged Merger
Consideration, subject, in each case, to the provisions of Article III, and as
otherwise granted herein.
(d) The Purchase Contract Agent, individually and as
attorney-in-fact for each Holder of Securities, agrees that, from time to time,
upon the written request of the Company or the Collateral Agent, such Holder
shall execute and deliver such further documents and do such other acts and
things as the Company or the Collateral Agent may reasonably request in order to
maintain the Pledge, and the perfection and priority thereof, and to confirm the
rights of the Collateral Agent hereunder. The Purchase Contract Agent shall have
no liability to any Holder for executing any documents or taking any such acts
requested by the Company or the Collateral Agent (acting upon the written
request of the Company) hereunder, except for liability for its own grossly
negligent act, its own grossly negligent failure to act, its bad faith or its
own willful misconduct.
Section 6.2. Substitutions. Whenever a Holder has the right to
substitute the Fixed-Share Rights or Common Stock, as the case may be, for
Collateral held by the Collateral Agent, such substitution shall not constitute
a novation of the security interest created hereby.
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ARTICLE VII
Representations and Warranties; Covenants
Section 7.1. Representations and Warranties. The Holders from
time to time, acting through the Purchase Contract Agent as their
attorney-in-fact (it being understood that the Purchase Contract Agent shall not
be liable for any representation or warranty made by or on behalf of a Holder),
hereby represent and warrant to the Collateral Agent, which representations and
warranties shall be deemed repeated on each day a Holder Transfers Collateral
that:
(a) such Holder has the power to grant a security interest in
and lien on the Collateral;
(b) such Holder is the sole beneficial owner of the Collateral
and, in the case of Collateral delivered in physical form, is the sole holder of
such Collateral and is the sole beneficial owner of, or has the right to
Transfer, the Collateral it Transfers to the Collateral Agent, free and clear of
any security interest, lien, encumbrance, call, liability to pay money or other
restriction other than the security interest and lien granted under Section 2.1;
(c) upon the Transfer of the Collateral to the Collateral
Account, the Collateral Agent, for the benefit of the Company, will have a valid
and perfected first priority security interest therein (assuming that any
central clearing operation or any Intermediary or other entity not within the
control of the Holder involved in the Transfer of the Collateral, including the
Collateral Agent, gives the notices and takes the action required of it
hereunder and under applicable law for perfection of that interest and assuming
the establishment and exercise of control pursuant to Section 2.2); and
(d) the execution and performance by the Holder of its
obligations under this Agreement will not result in the creation of any security
interest, lien or other encumbrance on the Collateral other than the security
interest and lien granted under Section 2.1 or violate any provision of any
existing law or regulation applicable to it or of any mortgage, charge, pledge,
indenture, contract or undertaking to which it is a party or which is binding on
it or any of its assets.
Section 7.2. Covenants. The Holders from time to time, acting
through the Purchase Contract Agent as their attorney-in-fact (it being
understood that the Purchase Contract Agent shall not be liable for any covenant
made by or on behalf of a Holder), hereby covenant to the Collateral Agent that
for so long as the Collateral remains subject to the Pledge:
(a) neither the Purchase Contract Agent nor such Holders will
create or purport to create or allow to subsist any mortgage, charge, lien,
pledge or any other security interest whatsoever over the Collateral or any part
of it other than pursuant to this Agreement; and
(b) neither the Purchase Contract Agent nor such Holders will
sell or otherwise dispose (or attempt to dispose) of the Collateral or any part
of it except for the beneficial interest therein, subject to the pledge
hereunder, transferred in connection with the Transfer of the Securities.
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ARTICLE VIII
The Collateral Agent
Section 8.1. Appointment, Powers and Immunities. (a) The
Collateral Agent, Custodial Agent, and Securities Intermediary shall each act as
agent for the Company hereunder with such powers as are specifically vested in
the Collateral Agent by the terms of this Agreement, together with such other
powers as are reasonably incidental thereto. Each of the Collateral Agent, the
Custodial Agent and the Securities Intermediary:
(i) shall have no duties or responsibilities except those
expressly set forth or incorporated in this Agreement and no implied
covenants or obligations shall be inferred from this Agreement against
any of them, nor shall any of them be bound by the provisions of any
agreement by any party hereto beyond the specific or incorporated terms
hereof;
(ii) shall not be responsible for any recitals contained in
this Agreement, or in any certificate or other document referred to or
provided for in, or received by it under, this Agreement, the
Securities or the Purchase Contract Agreement (except as specifically
incorporated by reference herein), or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this
Agreement (other than as against the Collateral Agent), the Securities
or the Purchase Contract Agreement or any other document referred to or
provided for herein (except as specifically incorporated by reference
herein) or therein or for any failure by the Company or any other
Person (except the Collateral Agent, the Custodial Agent or the
Securities Intermediary, as the case may be) to perform any of its
obligations hereunder or thereunder or for the, priority or, except as
expressly required hereby, existence, validity, perfection or
maintenance of any security interest created hereunder;
(iii) shall not be required to initiate or conduct any
litigation or collection proceedings hereunder (except in the case of
the Collateral Agent, pursuant to directions furnished under Section
8.2, subject to Section 8.6);
(iv) shall not be responsible for any action taken or omitted
to be taken by it hereunder or under any other document or instrument
referred to or provided for herein or in connection herewith or
therewith, except for its own gross negligence, bad faith or willful
misconduct; and
(v) shall not be required to advise any party as to selling or
retaining, or taking or refraining from taking any action with respect
to, the Securities or other property deposited hereunder.
Subject to the foregoing, during the term of this Agreement, the Collateral
Agent, Custodial Agent, and Securities Intermediary shall take all reasonable
action in connection with the safekeeping and preservation of the Collateral
hereunder.
(b) No provision of this Agreement shall require the
Collateral Agent, the Custodial Agent or the Securities Intermediary to expend
or risk its own funds or otherwise incur
16
any financial liability in the performance of any of its duties hereunder. In no
event shall the Collateral Agent, the Custodial Agent or the Securities
Intermediary be liable for any amount in excess of the value of the Collateral,
except for its own gross negligence, bad faith or willful misconduct.
Section 8.2. Instructions of the Company. The Company shall
have the right, by one or more instruments in writing executed and delivered to
the Collateral Agent, the Custodial Agent or the Securities Intermediary, as the
case may be, to direct the time, method and place of conducting any proceeding
for the realization of any right or remedy available to the Collateral Agent, or
of exercising any power conferred on the Collateral Agent, the Custodial Agent
or the Securities Intermediary, as the case may be, or to direct the taking or
refraining from taking of any action authorized by this Agreement; provided,
however, that (i) such direction shall not conflict with the provisions of any
law or of this Agreement and (ii) the Collateral Agent shall receive indemnity
satisfactory to it as provided herein. Nothing in this Section 8.2 shall impair
the right of the Collateral Agent in its discretion to take any action or omit
to take any action which it deems proper and which is not inconsistent with such
direction. None of the Collateral Agent, the Custodial Agent or the Securities
Intermediary has any obligation or responsibility to file UCC financing
statements, except as directed by the Company.
Section 8.3. Reliance. Each of the Securities Intermediary,
the Custodial Agent and the Collateral Agent shall be entitled conclusively to
rely upon any certification, order, judgment, opinion, notice or other
communication (including, without limitation, any thereof by telephone,
telecopy, telex or facsimile) believed by it to be genuine and correct and to
have been signed or sent by or on behalf of the proper Person or Persons
(without being required to determine the correctness of any fact stated
therein), and upon advice and statements of legal counsel and other experts
selected in good faith by the Collateral Agent, the Custodial Agent or the
Securities Intermediary, as the case may be. As to any matters not expressly
provided for by this Agreement, the Collateral Agent, the Custodial Agent and
the Securities Intermediary shall in all cases be fully protected in acting, or
in refraining from acting, hereunder in accordance with instructions given by
the Company in accordance with this Agreement.
Section 8.4. Certain Rights. (a) Whenever in the
administration of the provisions of this Agreement the Collateral Agent, the
Custodial Agent or the Securities Intermediary shall deem it necessary or
desirable that a matter be proved or established prior to taking or suffering
any action to be taken hereunder, such matter (unless other evidence in respect
thereof be herein specifically prescribed) may, in the absence of gross
negligence or bad faith or willful misconduct on the part of the Collateral
Agent, the Custodial Agent or the Securities Intermediary, be deemed to be
conclusively proved and established by a certificate signed by one of the
Company's officers, and delivered to the Collateral Agent, the Custodial Agent
or the Securities Intermediary and such certificate, in the absence of gross
negligence or bad faith or willful misconduct on the part of the Collateral
Agent, the Custodial Agent or the Securities Intermediary, shall be full warrant
to the Collateral Agent, the Custodial Agent or the Securities Intermediary for
any action taken, suffered or omitted by it under the provisions of this
Agreement upon the faith thereof.
(b) The Collateral Agent, the Custodial Agent or the
Securities Intermediary shall not be bound to make any investigation into the
facts or matters stated in any resolution,
17
certificate, statement, instrument, opinion, report, notice, request, consent,
entitlement order, approval or other paper or document.
Section 8.5. Merger, Conversion, Consolidation or Succession
to Business. Any corporation into which the Collateral Agent, the Custodial
Agent or the Securities Intermediary 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 Collateral Agent, the Custodial Agent or the
Securities Intermediary shall be a party, or any corporation succeeding to the
business of the Collateral Agent, the Custodial Agent or the Securities
Intermediary shall be the successor of the Collateral Agent, the Custodial Agent
or the Securities Intermediary hereunder without the execution or filing of any
of paper with any party hereto or any further act on the part of any of the
parties hereto except where an instrument or transfer or assignment is required
by law to effect such succession, anything herein to the contrary
notwithstanding.
Section 8.6. Rights in Other Capacities. The Collateral Agent,
the Custodial Agent and the Securities Intermediary and their affiliates may
(without having to account therefor to the Company) accept deposits from, lend
money to, make their investments in and generally engage in any kind of banking,
trust or other business with the Purchase Contract Agent, any other Person
interested herein and any Holder of Securities (and any of their respective
subsidiaries or affiliates) as if it were not acting as the Collateral Agent,
the Custodial Agent or the Securities Intermediary, as the case may be, and the
Collateral Agent, the Custodial Agent, the Securities Intermediary and their
affiliates may accept fees and other consideration from the Purchase Contract
Agent and any Holder of Securities without having to account for the same to the
Company; provided that each of the Securities Intermediary, the Custodial Agent
and the Collateral Agent covenants and agrees with the Company that it shall not
accept, receive or permit there to be created in favor of itself and shall take
no affirmative action to permit there to be created in favor of any other
Person, any security interest, lien or other encumbrance of any kind in or upon
the Collateral other than the lien created by the Pledge.
Section 8.7. Non-reliance on Collateral Agent, the Custodial
Agent and Securities Intermediary. None of the Securities Intermediary, the
Custodial Agent or the Collateral Agent shall be required to keep itself
informed as to the performance or observance by the Purchase Contract Agent or
any Holder of Securities of this Agreement, the Purchase Contract Agreement, the
Securities or any other document referred to or provided for herein or therein
or to inspect the properties or books of the Purchase Contract Agent or any
Holder of Securities. None of the Collateral Agent, the Custodial Agent or the
Securities Intermediary shall have any duty or responsibility to provide the
Company with any credit or other information concerning the affairs, financial
condition or business of the Purchase Contract Agent or any Holder of Securities
(or any of their respective affiliates) that may come into the possession of the
Collateral Agent, the Custodial Agent or the Securities Intermediary or any of
their respective affiliates.
Section 8.8. Compensation and Indemnity. The Company agrees to:
(a) pay the Collateral Agent, the Custodial Agent and the
Securities Intermediary from time to time such compensation as shall be agreed
in writing between the Company and the
18
Collateral Agent, the Custodial Agent or the Securities Intermediary, as the
case may be, for all services rendered by them hereunder;
(b) indemnify and hold harmless the Collateral Agent, the
Custodial Agent, the Securities Intermediary and each of their respective
directors, officers, agents and employees (collectively, the "Indemnitees"),
from and against any and all claims, liabilities, losses, damages, fines,
penalties and expenses (including reasonable fees and expenses of counsel)
(collectively, "Losses" and individually, a "Loss") that may be imposed on,
incurred by, or asserted against, the Indemnitees or any of them for following
any instructions or other directions upon which either the Collateral Agent, the
Custodial Agent or the Securities Intermediary is entitled to rely pursuant to
the terms of this Agreement, provided that the Collateral Agent, the Custodial
Agent or the Securities Intermediary has not acted with gross negligence or
engaged in wilful misconduct or bad faith with respect to the specific Loss
against which indemnification is sought; and
(c) in addition to and not in limitation of paragraph (b)
immediately above, indemnify and hold the Indemnitees and each of them harmless
from and against, any and all Losses that may be imposed on, incurred by or
asserted against, the Indemnitees or any of them in connection with or arising
out of the Collateral Agent's, the Custodial Agent's or the Securities
Intermediary's acceptance or performance of its powers and duties under this
Agreement, provided the Collateral Agent, the Custodial Agent or the Securities
Intermediary has not acted with gross negligence or engaged in wilful misconduct
or bad faith with respect to the specific Loss against which indemnification is
sought.
The provisions of this Section and Section 10.7 shall survive
the resignation or removal of the Collateral Agent, the Custodial Agent or
Securities Intermediary and the termination of this Agreement.
Section 8.9. Failure to Act. In the event of any ambiguity in
the provisions of this Agreement or any dispute between or conflicting claims by
or among the parties hereto or any other Person with respect to any funds or
property deposited hereunder, then at its sole option, each of the Collateral
Agent, the Custodial Agent and the Securities Intermediary shall be entitled,
after prompt notice to the Company and the Purchase Contract Agent, to refuse to
comply with any and all claims, demands or instructions with respect to such
property or funds so long as such dispute or conflict shall continue, and the
Collateral Agent, the Custodial Agent and the Securities Intermediary shall not
be or become liable in any way to any of the parties hereto for its failure or
refusal to comply with such conflicting claims, demands or instructions. The
Collateral Agent, the Custodial Agent and the Securities Intermediary shall be
entitled to refuse to act until either:
(a) such conflicting or adverse claims or demands shall have
been finally determined by a court of competent jurisdiction or settled by
agreement between the conflicting parties as evidenced in a writing satisfactory
to the Collateral Agent, the Custodial Agent or the Securities Intermediary; or
(b) the Collateral Agent, the Custodial Agent or the
Securities Intermediary shall have received security or an indemnity
satisfactory to it sufficient to save it harmless from and
19
against any and all loss, liability or reasonable out-of-pocket expense which it
may incur by reason of its acting.
The Collateral Agent, the Custodial Agent and the Securities
Intermediary may in addition elect to commence an interpleader action or seek
other judicial relief or orders as the Collateral Agent, the Custodial Agent or
the Securities Intermediary may deem necessary. Notwithstanding anything
contained herein to the contrary, none of the Collateral Agent, the Custodial
Agent or the Securities Intermediary shall be required to take any action that
is in its opinion contrary to law or to the terms of this Agreement, or which
would in its opinion subject it or any of its officers, employees or directors
to liability.
Section 8.10. Resignation of Collateral Agent, the Custodial
Agent and the Securities Intermediary.
(a) Subject to the appointment and acceptance of a successor
Collateral Agent, Custodial Agent or Securities Intermediary as provided below:
(i) the Collateral Agent, the Custodial Agent and the
Securities Intermediary may resign at any time by giving notice thereof
to the Company and the Purchase Contract Agent as attorney-in-fact for
the Holders of Securities;
(ii) the Collateral Agent, the Custodial Agent and the
Securities Intermediary may be removed at any time by the Company; and
(iii) if the Securities Intermediary fails to perform any of its
material obligations hereunder in any material respect for a period of
not less than 20 days after receiving written notice of such failure by
the Purchase Contract Agent and such failure shall be continuing, the
Securities Intermediary may be removed by the Purchase Contract Agent,
acting at the direction of the Holders of Securities.
The Purchase Contract Agent shall promptly notify the Company
of any notice of grounds for removal of the Securities Intermediary pursuant to
clause (iii) of this Section 8.10. Upon any resignation or removal of the
Collateral Agent, Custodial Agent or Securities Intermediary, the Company shall
have the right to appoint a successor Collateral Agent, Custodial Agent or
Securities Intermediary, as the case may be, which shall not be an Affiliate of
the Purchase Contract Agent. If no successor Collateral Agent, Custodial Agent
or Securities Intermediary shall have been so appointed and shall have accepted
such appointment within 30 days after the retiring Collateral Agent's, Custodial
Agent's or Securities Intermediary's giving of notice of resignation or the
Company's or the Purchase Contract Agent's giving notice of such removal, then
the retiring or removed Collateral Agent, Custodial Agent or Securities
Intermediary may petition any court of competent jurisdiction, at the expense of
the Company, for the appointment of a successor Collateral Agent, Custodial
Agent or Securities Intermediary. The Collateral Agent, the Custodial Agent and
the Securities Intermediary shall each be a bank or a national banking
association which has an office (or an agency office) in New York City with a
combined capital and surplus of at least $50,000,000. Upon the acceptance of any
appointment as Collateral Agent, Custodial Agent or Securities Intermediary
hereunder by a successor Collateral Agent, Custodial Agent or Securities
Intermediary, as the case may be, such
20
successor Collateral Agent, Custodial Agent or Securities Intermediary, as the
case may be, shall thereupon succeed to and become vested with all the rights,
powers, privileges and duties of the retiring Collateral Agent, Custodial Agent
or Securities Intermediary, as the case may be, and the retiring Collateral
Agent, Custodial Agent or Securities Intermediary, as the case may be, shall
take all appropriate action, subject to payment of any amounts then due and
payable to it hereunder, to transfer any money and property held by it hereunder
(including the Collateral) to such successor, and shall follow the Company's
instructions, if any, to ensure that the perfection of the Pledge is not
affected thereby. The retiring Collateral Agent, Custodial Agent or Securities
Intermediary shall, upon such succession, be discharged from its duties and
obligations as Collateral Agent, Custodial Agent or Securities Intermediary
hereunder. After any retiring Collateral Agent's, Custodial Agent's or
Securities Intermediary's resignation hereunder as Collateral Agent, Custodial
Agent or Securities Intermediary, the provisions of this Article 8 shall
continue in effect for its benefit in respect of any actions taken or omitted to
be taken by it while it was acting as the Collateral Agent, Custodial Agent or
Securities Intermediary. Any resignation or removal of the Collateral Agent,
Custodial Agent or Securities Intermediary hereunder, at a time when such Person
is acting as the Collateral Agent, Custodial Agent or Securities Intermediary,
shall be deemed for all purposes of this Agreement as the simultaneous
resignation or removal of the Collateral Agent, Securities Intermediary or
Custodial Agent, as the case may be.
Section 8.11. Right to Appoint Agent or Advisor. The
Collateral Agent shall have the right to appoint agents or advisors in
connection with any of its duties hereunder, and the Collateral Agent shall not
be liable for any action taken or omitted by, or in reliance upon the advice of,
such agents or advisors selected in good faith. The appointment of agents
pursuant to this Section 8.11 shall be subject to prior written consent of the
Company, which consent shall not be unreasonably withheld.
Section 8.12. Survival. The provisions of this Article 8 shall
survive termination of this Agreement and the resignation or removal of the
Collateral Agent, the Custodial Agent or the Securities Intermediary.
Section 8.13. Exculpation. Anything contained in this
Agreement to the contrary notwithstanding, in no event shall the Collateral
Agent, the Custodial Agent or the Securities Intermediary or their officers,
directors, employees or agents be liable under this Agreement to any third party
for indirect, special, punitive, or consequential loss or damage of any kind
whatsoever, including, but not limited to, lost profits, whether or not the
likelihood of such loss or damage was known to the Collateral Agent, the
Custodial Agent or the Securities Intermediary, or any of them and regardless of
the form of action.
ARTICLE IX
Amendment
Section 9.1. Amendment Without Consent of Holders. Without the
consent of any Holders, the Company, the Collateral Agent, the Custodial Agent,
the Securities Intermediary and the Purchase Contract Agent, at any time and
from time to time, may amend
21
this Agreement, in form satisfactory to the Company, the Collateral Agent, the
Custodial Agent, the Securities Intermediary and the Purchase Contract Agent,
for any of the following purposes:
(i) to evidence the succession of another Person to the
Company, and the assumption by any such successor of the covenants of
the Company herein;
(ii) 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 so long as such covenants or such surrender do not
adversely affect the validity, perfection or priority of the security
interests granted or created hereunder;
(iii) to evidence and provide for the acceptance of appointment
hereunder by a successor Collateral Agent, Custodial Agent, Securities
Intermediary or Purchase Contract Agent; or
(iv) to cure any ambiguity, to correct or supplement any
provisions herein which may be inconsistent with any other such
provisions herein, or to make any other provisions with respect to such
matters or questions arising under this Agreement, provided such action
shall not adversely affect the interests of the Holders.
Section 9.2. Amendment With Consent of Holders. With the
consent of the Holders of not less than a majority of the total Contracts at the
time outstanding voting together as one class, by Act of said Holders delivered
to the Company, the Purchase Contract Agent or the Collateral Agent, as the case
may be, the Company, the Purchase Contract Agent, the Collateral Agent, the
Custodial Agent and the Securities Intermediary may amend this Agreement for the
purpose of modifying in any manner 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 adversely affected thereby,
(i) change the amount or type of Collateral underlying a
Security (except as contemplated by Article IV of this Agreement),
impair the right of the Holder of any Security to receive distributions
on the underlying Collateral or otherwise adversely affect the Holder's
rights in or to such Collateral; or
(ii) otherwise effect any action that would require the consent
of the Holder of each Security affected thereby pursuant to the
Purchase Contract Agreement if such action were effected by an
agreement supplemental thereto; or
(iii) reduce the percentage of such Contracts the consent of
whose Holders is required for any such amendment.
It shall not be necessary for any Act of Holders under this Section to approve
the particular form of any proposed amendment, but it shall be sufficient if
such Act shall approve the substance thereof.
Section 9.3. Execution of Amendments. In executing any
amendment permitted by this Section, the Collateral Agent, the Custodial Agent,
the Securities Intermediary and the
22
Purchase Contract Agent shall be entitled to receive and (subject to Section 6.1
hereof, with respect to the Collateral Agent, and Section 7.1 of the Purchase
Contract Agreement, with respect to the Purchase Contract Agent) shall be fully
protected in relying upon, a Company Certificate and Opinion of Counsel stating
that the execution of such amendment is authorized or permitted by this
Agreement and that all conditions precedent, if any, to the execution and
delivery of such amendment have been satisfied and, in the case of an amendment
pursuant to Section 9.1, that such amendment does not adversely affect the
validity, perfection or priority of the security interests granted or created
hereunder.
Section 9.4. Effect of Amendments. Upon the execution of any
amendment under this Article IX, this Agreement shall be modified in accordance
therewith, and such amendment shall form a part of this Agreement for all
purposes; and every Holder of Certificates theretofore or thereafter
authenticated, executed on behalf of the Holders and delivered under the
Purchase Contract Agreement shall be bound thereby.
Section 9.5. Reference To Amendments. Certificates
authenticated, executed on behalf of the Holders and delivered after the
execution of any amendment pursuant to this Article IX may, and shall if
required by the Collateral Agent or the Purchase Contract Agent, bear a notation
in form approved by the Purchase Contract Agent and the Collateral Agent as to
any matter provided for in such amendment. If the Company shall so determine,
new Certificates so modified as to conform, in the opinion of the Collateral
Agent, the Purchase Contract Agent and the Company, to any such amendment may be
prepared and executed by the Company and authenticated, executed on behalf of
the Holders and delivered by the Purchase Contract Agent in accordance with the
Purchase Contract Agreement in exchange for outstanding Certificates.
ARTICLE X
Miscellaneous
Section 10.1. No Waiver. No failure on the part of any party
hereto or any of its agents to exercise, and no course of dealing with respect
to, and no delay in exercising, any right, power or remedy hereunder shall
operate as a waiver thereof; nor shall any single or partial exercise by any
party hereto or any of its agents of any right, power or remedy hereunder
preclude any other or further exercise thereof or the exercise of any other
right, power or remedy. The remedies herein are cumulative and are not exclusive
of any remedies provided by law.
Section 10.2. Governing Law. THIS AGREEMENT SHALL BE GOVERNED
BY AND DEEMED TO BE A CONTRACT UNDER, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THEREOF.
Without limiting the foregoing, the above choice of law is expressly agreed to
by the Securities Intermediary, the Collateral Agent, the Custodial Agent and
the Holders from time to time acting through the Purchase Contract Agent, as
their attorney-in-fact, in connection with the establishment and maintenance of
the Collateral Account, which law, for purposes of the Code, shall be deemed to
be the law governing all Security Entitlements related thereto. In addition,
such parties agree that, for purposes of the Massachusetts or New York Uniform
Commercial Code, as applicable, New York shall be the Securities Intermediary's
23
jurisdiction. The Company, the Collateral Agent and the Holders from time to
time of the Securities, acting through the Purchase Contract Agent as their
attorney-in-fact, hereby submit to the nonexclusive jurisdiction of the United
States District Court for the Southern District of New York and of any New York
state court sitting in New York City for the purposes of all legal proceedings
arising out of or relating to this Agreement or the transactions contemplated
hereby. The Company, the Collateral Agent and the Holders from time to time of
the Securities, acting through the Purchase Contract Agent as their
attorney-in-fact, irrevocably waive, to the fullest extent permitted by
applicable law, any objection which they may now or hereafter have to the laying
of the venue of any such proceeding brought in such a court and any claim that
any such proceeding brought in such a court has been brought in an inconvenient
forum.
Section 10.3. Notices. Unless otherwise stated herein, all
notices, requests, consents and other communications provided for herein
(including, without limitation, any modifications of, or waivers or consents
under, this Agreement) shall be given or made in writing (including, without
limitation, by telecopy) delivered to the intended recipient at the "Address for
Notices" specified below its name on the signature pages hereof (or in the case
of Holders, may be made and deemed given as provided in Sections 1.5 and 1.6 of
the Purchase Contract Agreement) or, as to any party, at such other address as
shall be designated by such party in a notice to the other parties. Except as
otherwise provided in this Agreement, all such communications shall be deemed to
have been duly given when personally delivered or, in the case of a mailed
notice or notice transmitted by telecopier, upon receipt, in each case given or
addressed as aforesaid.
Section 10.4. Successors and Assigns. This Agreement shall be
binding upon and inure to the benefit of the respective successors and assigns
of the Company, the Collateral Agent, the Custodial Agent, the Securities
Intermediary and the Purchase Contract Agent, and the Holders from time to time
of the Securities, by their acceptance of the same, shall be deemed to have
agreed to be bound by the provisions hereof and to have ratified the agreements
of, and the grant of the Pledge hereunder by, the Purchase Contract Agent.
Section 10.5. Counterparts. This Agreement may be executed in
any number of counterparts, all of which taken together shall constitute one and
the same instrument, and any of the parties hereto may execute this Agreement by
signing any such counterpart.
Section 10.6. Severability. If any provision hereof is invalid
and unenforceable in any jurisdiction, then, to the fullest extent permitted by
law, (i) the other provisions hereof shall remain in full force and effect in
such jurisdiction and shall be liberally construed in order to carry out the
intentions of the parties hereto as nearly as may be possible and (ii) the
invalidity or unenforceability of any provision hereof in any jurisdiction shall
not affect the validity or enforceability of such provision in any other
jurisdiction.
Section 10.7. Expenses, Etc. The Company agrees to reimburse
the Collateral Agent, the Securities Intermediary and the Custodial Agent for:
(a) all reasonable out-of-pocket costs and all reasonable
expenses of the Collateral Agent, the Custodial Agent and the Securities
Intermediary (including, without limitation, the reasonable fees and expenses of
counsel to the Collateral Agent, the Custodial
24
Agent and the Securities Intermediary), in connection with (i) the negotiation,
preparation, execution and delivery or performance of this Agreement and (ii)
any modification, supplement or waiver of any of the terms of this Agreement;
(b) all reasonable costs and expenses of the Collateral Agent
(including, without limitation, reasonable fees and expenses of counsel) in
connection with (i) any enforcement or proceedings resulting or incurred in
connection with causing any Holder of Securities to satisfy its obligations
under the Contracts forming a part of the Securities and (ii) the enforcement of
this Section 10.7; and
(c) all transfer, stamp, documentary or other similar taxes,
assessments or charges levied by any governmental or revenue authority in
respect of this Agreement or any other document referred to herein and all
costs, expenses, taxes, assessments and other charges incurred in connection
with any filing, registration, recording or perfection of any security interest
contemplated hereby.
Section 10.8. Security Interest Absolute. All rights of the
Collateral Agent and security interests hereunder, and all obligations of the
Holders from time to time hereunder, shall be absolute and unconditional
irrespective of:
(a) any lack of validity or enforceability of any provision of
the Contracts or the Securities or any other agreement or instrument relating
thereto;
(b) any change in the time, manner or place of payment of, or
any other term of, or any increase in the amount of, all or any of the
obligations of Holders of Securities under the related Contracts, or any other
amendment or waiver of any term of, or any consent to any departure from any
requirement of, the Purchase Contract Agreement or any Contract or any other
agreement or instrument relating thereto; or
(c) any other circumstance which might otherwise constitute a
defense available to, or discharge of, a borrower, a guarantor or a pledgor.
Section 10.9. Waiver of Jury Trial. EACH PARTY ACKNOWLEDGES
AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY
TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE, TO THE EXTENT
PERMITTED BY APPLICABLE LAW, IT HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES
ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY
OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
25
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first above written.
STATE STREET CORPORATION
By:/s/ Xxxxxxxxx X. Xxxxxxxx
-------------------------------
Name: Xxxxxxxxx X. Xxxxxxxx
Title: Senior Vice President,
Controller & Chief
Accounting Officer
Address for Notices:
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: General Counsel
Telecopy: (000) 000-0000
BANK ONE TRUST COMPANY, N.A.,
as Purchase Contract Agent and as
attorney-in-fact of the Holders
from time to time of the
Securities
By:/s/ Xxxxxxx Xxxxxx
-------------------------------
Name: Xxxxxxx Xxxxxx
Title: Authorized Officer
Address for Notices:
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy: (000) 000-0000
26
BANK ONE, N.A.
as Collateral Agent, Custodial
Agent and Securities Intermediary
By:/s/ Xxxxxx Xxxxxx Xxxxxx
--------------------------
Name: Xxxxxx Xxxxxx Xxxxxx
Title: Authorized Officer
Address for Notices:
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy: (000) 000-0000
Pledge Agreement
27
COLLATERAL INSUFFICIENCY NOTICE
[ ],
as Holder of [ ]Separate COVERS
[ ]
[ ]
Attention:
Telecopy:
Re: Separate COVERS of State Street Corporation (the "Company")
We hereby notify you in accordance with Section 4.5(c) of the
Pledge Agreement, dated as of January 21, 2003, among the Company, us, as
Collateral Agent, Custodial Agent and Securities Intermediary, and Bank One
Trust Company, N.A., as Purchase Contract Agent and as attorney-in-fact for the
holders of Separate COVERS from time to time (the "Pledge Agreement"), that, as
a result of an adjustment to the Settlement Rates under Section 5.6 of the
Purchase Contract Agreement between the Company and Bank One Trust Company,
N.A., as Purchase Contract Agent, in connection with [describe triggering
event], the Collateral securing your obligation to deliver shares of Common
Stock pursuant to the Variable-Share Repurchase Contract underlying your
Separate COVERS is no longer sufficient (such insufficiency, a "Collateral
Insufficiency"). In accordance with Section 4.5(c) of the Pledge Agreement, you
are hereby requested to deliver, within five Business Days of receipt of this
notice, [ ] shares of [Common Stock] to the Purchase Contract Agent, to be
pledged to the Collateral Agent to cure the Collateral Insufficiency. If such
delivery is not made within such five Business Day period, the Collateral Agent
shall take such actions as it is authorized to take under the Pledge Agreement
in order to cure such Collateral Insufficiency. Capitalized terms used and not
defined herein shall have the meanings assigned to them in the Pledge Agreement.
Date: _____________________
BANK ONE, N.A.,
as Collateral Agent
By:_______________________________
Name:
Title:
