EXHIBIT 5
ELECTRONIC DATA SYSTEMS CORPORATION
AND
THE CHASE MANHATTAN BANK
as Purchase Contract Agent
--------------------
PURCHASE CONTRACT AGREEMENT
--------------------
dated as of June __, 2001
PURCHASE CONTRACT AGREEMENT, dated as of _________, 2001 between
Electronic Data Systems Corporation, a Delaware corporation (the "Company"), and
The Chase Manhattan Bank, a _____________ corporation, acting as purchase
contract agent for the Holders of Securities from time to time (the "Agent").
RECITALS
The Company has duly authorized the execution and delivery of this
Agreement and the Certificates evidencing the Securities.
All things necessary to make the Purchase Contracts, when the
Certificates are executed by the Company and authenticated, executed on behalf
of the Holders and delivered by the Agent, as provided in this Agreement, the
valid obligations of the Company, and to constitute 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 I
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATIONS
Section 1.1 Definitions.
For all purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular; and
nouns and pronouns of the masculine gender include the feminine and neuter
genders;
(b) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles in the United States;
(c) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular
Article, Section or other subdivision;
(d) the following terms have the meanings given to them in this
Section 1.1(d).
"Act" when used with respect to any Holder, has the meaning
specified in Section 1.4.
"Affiliate" has the same meaning as given to that term in Rule
405 promulgated under the Securities Act of 1993, as amended, as is in
effect on the date hereof.
"Agent" means the Person named as the "Agent" in the first
paragraph of this instrument until a successor Agent shall have become
such pursuant to the applicable provisions of this Agreement, and
thereafter "Agent" shall mean such Person.
"Agreement" means this instrument as originally executed or as it
may from time to time be supplemented or amended by one or more
agreements supplemental hereto entered into pursuant to the applicable
provisions hereof.
"Applicable Market Value" has the meaning specified in Section
5.1.
"Applicable Ownership Interest" means, with respect to an Income
PRIDES and the Treasury Securities in the Treasury Portfolio, (A) a
1/20, or 5.0%, undivided beneficial ownership interest in a $1,000
principal or interest amount of a principal or interest strip in a
U.S. Treasury Security included in such Treasury Portfolio which
matures on or prior to August 17, 2004 and (B) for the scheduled
interest payment date on the Notes that occurs on the Purchase
Contract Settlement Date, in the case of a Successful Initial
Remarketing, or after the Tax Event Redemption Date and on or before
the Purchase Contract Settlement Date, in the case of a Tax Event
Redemption, a ___% undivided beneficial ownership interest in a $1,000
face amount of such U.S. Treasury Security which is a principal or
interest strip maturing on such interest payment date.
"Applicable Principal Amount" means the aggregate principal
amount of the Notes which are components of Income PRIDES on the
Initial Remarketing Date.
"Authorized Newspaper" means a daily newspaper, in the English
language, customarily published on each day that is a Business Day in
The City of New York, whether or not published on days that are Legal
Holidays, and of general circulation in The City of New York. The
Authorized Newspaper for the purposes of the Reset Announcement Date
is currently anticipated to be The Wall Street Journal.
"Bankruptcy Code" means title 11 of the United States Code, or
any other law of the United States that from time to time provides a
uniform system of bankruptcy laws.
"Beneficial Owner" means, with respect to a Book-Entry Interest,
a Person who is the owner of such Book-Entry Interest as reflected on
the books of the Clearing Agency or on the books of a Person
maintaining an account with such Clearing Agency (directly as a
Clearing Agency Participant or as an indirect participant, in each
case in accordance with the rules of such Clearing Agency).
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"Board of Directors" means the board of directors of the Company
or a duly authorized committee of that board.
"Board Resolution" means one or more resolutions of the Board of
Directors, a copy of which has been certified by the Secretary or an
Assistant Secretary of the Company to have been duly adopted by the
Board of Directors and to be in full force and effect on the date of
such certification and delivered to the Agent.
"Book-Entry Interest" means a beneficial interest in a Global
Certificate, ownership and transfers of which shall be maintained and
made through book entries by a Clearing Agency as described in Section
3.6.
"Business Day" means any day other than a Saturday, a Sunday or
any other day on which banking institutions in Xxx Xxxx Xxxx (xx xxx
Xxxxx xx Xxx Xxxx) are permitted or required by any applicable law to
close.
"Cash Settlement" has the meaning set forth in Section 5.4(a)(i).
"Certificate" means an Income PRIDES Certificate or a Growth
PRIDES Certificate.
"Clearing Agency" means an organization registered as a "Clearing
Agency" pursuant to Section 17A of the Exchange Act that is acting as
a depositary for the Securities and in whose name, or in the name of a
nominee of that organization, shall be registered a Global Certificate
and which shall undertake to effect book entry transfers and pledges
of the Securities.
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time the
Clearing Agency effects book entry transfers and pledges of securities
deposited with the Clearing Agency.
"Closing Price" has the meaning specified in Section 5.1.
"Collateral" has the meaning specified in Section 2.1 of the
Pledge Agreement.
"Collateral Agent" means The First Union Trust Company, as
Collateral Agent under the Pledge Agreement until a successor
Collateral Agent shall have become such pursuant to the applicable
provisions of the Pledge Agreement, and thereafter "Collateral Agent"
shall mean the Person who is then the Collateral Agent thereunder.
"Collateral Substitution" has the meaning specified in Section
3.13.
"Common Equity Securities" means shares of a class of stock of
the Company that is not entitled to priority over any other class of
stock of the
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Company in the payment of dividends or with respect to rights upon the
liquidation, dissolution or winding up of the Company.
"Common Stock" means the Common Stock, $0.01 par value, of the
Company.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor shall have become such
pursuant to the applicable provisions of this Agreement, and
thereafter "Company" shall mean such successor.
"Contract Adjustment Payments" means, in the case of Income
PRIDES and Growth PRIDES, the amount payable by the Company in respect
of each Purchase Contract constituting a part of an Income PRIDES or a
Growth PRIDES, equal to [__]% per year of the Stated Amount, in each
case computed on the basis of a 360 day year of twelve 30 day months,
plus any Deferred Contract Adjustment Payments accrued pursuant to
Section 5.2 or 5.3.
"Corporate Trust Office" means the principal corporate trust
office of the Agent at which, at any particular time, its corporate
trust business shall be administered, which office at the date hereof
is located at ____________________________.
"Coupon Rate" means the percentage rate per year at which each
Note will bear interest initially.
"Current Market Price" has the meaning specified in Section
5.7(a)(8).
"Deferred Contract Adjustment Payments" has the meaning specified
in Section 5.3.
"Depositary" means, initially, DTC until another Clearing Agency
becomes its successor.
"DTC" means The Depository Trust Company, the initial Clearing
Agency.
"Early Settlement" has the meaning specified in Section 5.10(a).
"Early Settlement Amount" has the meaning specified in Section
5.10(a).
"Early Settlement Date" has the meaning specified in Section
5.10(a).
"Early Settlement Rate" has the meaning specified in Section
5.10(b).
"Exchange Act" means the Securities Exchange Act of 1934 and any
statute successor thereto, in each case as amended from time to time,
and the rules and regulations promulgated thereunder.
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"Expiration Date" has the meaning specified in Section 1.4.
"Expiration Time" has the meaning specified in Section 5.7(a)(6).
"Failed Initial Remarketing" has the meaning specified in Section
5.4.
"Failed Secondary Remarketing" has the meaning specified in
Section 5.5(b).
"Global Certificate" means a Certificate that evidences all or
part of the Securities and is registered in the name of a Depositary
or a nominee thereof.
"Global Note Certificate" means a certificate evidencing the
respective rights and obligations of Holders in respect of the number
of Notes specified on such certificate and which is registered in the
name of a Clearing Agency or a nominee thereof.
"Growth PRIDES" means the collective rights and obligations of a
Holder of a Growth PRIDES Certificate in respect of the Treasury
Securities, subject to the Pledge thereof, and the related Purchase
Contract.
"Growth PRIDES Certificate" means a certificate evidencing the
rights and obligations of a Holder in respect of the number of Growth
PRIDES specified on such certificate.
"Growth PRIDES Register" and "Growth PRIDES Registrar" have the
respective meanings specified in Section 3.5.
"Holder," when used with respect to a Security, means the Person
in whose name the Security evidenced by an Income PRIDES Certificate
and/or a Growth PRIDES Certificate is registered in the related Income
PRIDES Register and/or Growth PRIDES Register, as the case may be.
"Income PRIDES" means the collective rights and obligations of a
Holder of an Income PRIDES Certificate in respect of a Note or an
appropriate Applicable Ownership Interest of the Treasury Portfolio,
as the case may be, subject in each case to the Pledge thereof, and
the related Purchase Contract.
"Income PRIDES Certificate" means a certificate evidencing the
rights and obligations of a Holder in respect of the number of Income
PRIDES specified on such certificate.
"Income PRIDES Register" and "Income PRIDES Registrar" have the
respective meanings specified in Section 3.5.
"Indenture" means the Indenture dated as of August 12, 1996
between the Company and the Indenture Trustee, as amended and
supplemented by the Second
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Supplemental Indenture dated as of June __, 2001 between the Company
and the Indenture Trustee.
"Indenture Trustee" means Chase Bank of Texas National
Association (formerly Texas Commerce Bank National Association), as
trustee under the Indenture, or any successor thereto.
"Initial Remarketing" has the meaning specified in Section 5.4.
"Initial Remarketing Date" means the third business day
immediately preceding May 17, 2004.
"Issuer Order" or "Issuer Request" means a written order or
request signed in the name of the Company by its Chairman of the
Board, its President or a Vice President and by its Chief Financial
Officer, its Treasurer, an Assistant Treasurer, its Secretary or an
Assistant Secretary, and delivered to the Agent.
"New York Office" shall have the meaning set forth in Section
10.2
"Notes" means the series of senior notes of the Company
designated the senior notes due August 17, 2006, to be issued under
the Indenture as of the date hereof.
"NYSE" has the meaning specified in Section 5.1.
"Officer's Certificate" means a certificate of the Company signed
on its behalf by the Chairman of the Board, the President, any Vice
President, the Treasurer, any Assistant Treasurer, the Secretary or
any Assistant Secretary of the Company and delivered to the Agent.
"Opinion of Counsel" means an opinion in writing signed by legal
counsel, who may be an employee of or counsel to the Company or an
Affiliate and who shall be reasonably acceptable to the Agent.
"Outstanding Securities," with respect to the Income PRIDES or
Growth PRIDES, means, as of the date of determination, all Income
PRIDES or Growth PRIDES, as the case may be, evidenced by Certificates
theretofore authenticated, executed and delivered under this
Agreement, except:
(i) If a Termination Event has occurred, (A) Growth PRIDES
for which the Stated Amount of Treasury Securities has been
theretofore deposited with the Agent in trust for the Holders of
such Growth PRIDES and (B) Income PRIDES for which the Stated
Amount of the related Notes or the appropriate Applicable
Ownership Interest of the Treasury Portfolio, as the case may be,
has been theretofore deposited with the Agent in trust for the
Holders of such Income PRIDES;
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(ii) Income PRIDES or Growth PRIDES evidenced by
Certificates theretofore cancelled by the Agent or delivered to
the Agent for cancellation or deemed cancelled pursuant to the
provisions of this Agreement; and
(iii) Income PRIDES or Growth PRIDES evidenced by
Certificates in exchange for or in lieu of which other
Certificates have been authenticated, executed on behalf of the
Holder and delivered pursuant to this Agreement, other than any
such Certificate in respect of which there shall have been
presented to the Agent proof satisfactory to it that such
Certificate is held by a protected purchaser in whose hands the
Income PRIDES or Growth PRIDES evidenced by such Certificate are
valid obligations of the Company;
provided, however, that in determining whether the Holders of the
requisite number of the Income PRIDES or Growth PRIDES have given any
request, demand, authorization, direction, notice, consent or waiver
hereunder, Income PRIDES or Growth PRIDES 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 Income PRIDES or Growth
PRIDES which a Responsible Officer of the Agent knows to be so owned
shall be so disregarded. Income PRIDES or Growth PRIDES so owned
which have been pledged in good faith may be regarded as Outstanding
Securities if the pledgee establishes to the satisfaction of the Agent
the pledgee's right so to act with respect to such Income PRIDES or
Growth PRIDES and that the pledgee is not the Company or any Affiliate
of the Company.
"Payment Date" means each February 17, May 17, August 17 and
November 17, commencing August 17, 2001.
"Permitted Investments" has the meaning set forth in Section 1 of
the Pledge Agreement.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint-
stock company, limited liability company, trust, unincorporated
association or government or any agency or political subdivision
thereof or any other entity of whatever nature.
"Pledge" means the pledge under the Pledge Agreement of the Notes
or the appropriate Applicable Ownership Interest of the Treasury
Portfolio, as the case may be, and of the Treasury Securities, in each
case constituting a part of the Securities.
"Pledge Agreement" means the Pledge Agreement, dated as of the
date hereof, by and 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
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Securities, as the same may hereafter be amended in accordance with
the terms thereof.
"Predecessor Certificate" means a Predecessor Income PRIDES
Certificate or a Predecessor Growth PRIDES Certificate.
"Predecessor Income PRIDES Certificate" of any particular Income
PRIDES Certificate means every previous Income PRIDES Certificate
evidencing all or a portion of the rights and obligations of the
Company and the Holder under the Income PRIDES evidenced thereby; and,
for the purposes of this definition, any Income PRIDES Certificate
authenticated and delivered under Section 3.10 in exchange for or in
lieu of a mutilated, destroyed, lost or stolen Income PRIDES
Certificate shall be deemed to evidence the same rights and
obligations of the Company and the Holder as the mutilated, destroyed,
lost or stolen Income PRIDES Certificate.
"Predecessor Growth PRIDES Certificate" of any particular Growth
PRIDES Certificate means every previous Growth PRIDES Certificate
evidencing all or a portion of the rights and obligations of the
Company and the Holder under the Growth PRIDES evidenced thereby; and,
for the purposes of this definition, any Growth PRIDES Certificate
authenticated and delivered under Section 3.10 in exchange for or in
lieu of a mutilated, destroyed, lost or stolen Growth PRIDES
Certificate shall be deemed to evidence the same rights and
obligations of the Company and the Holder as the mutilated, destroyed,
lost or stolen Growth PRIDES Certificate.
"Primary Treasury Dealer" means a primary U.S. government
securities dealer in The City of New York.
"Proceeds" has the meaning set forth in Section 1 of the Pledge
Agreement.
"Purchase Contract," when used with respect to any Security,
means the contract forming a part of such Security and 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.
"Purchase Contract Settlement Date" means August 17, 2004.
"Purchase Contract Settlement Fund" has the meaning specified in
Section 5.5.
"Purchase Price" has the meaning specified in Section 5.1.
"Purchased Shares" has the meaning specified in Section
5.7(a)(6).
"Quotation Agent" means (i) Xxxxxxx Xxxxx Government Securities,
Inc. and its respective successors, provided, however, that if the
foregoing shall cease
8
to be a Primary Treasury Dealer, the Company shall substitute therefor
another Primary Treasury Dealer or (ii) any other Primary Treasury
Dealer selected by the Sponsor.
"Recapitalization Transaction" has the meaning specified in
Section 5.7(a)(7).
"Record Date" for the distribution payable in respect of the
Notes or the Applicable Ownership Percentage of the Treasury Portfolio
payable on any Payment Date means the first day of the month in which
the relevant Payment Date occurs.
"Redemption Amount" means, for each Note, the product of (i) the
principal amount of such Note and (ii) a fraction whose numerator is
the applicable Treasury Portfolio Purchase Price and whose denominator
is the applicable Tax Event Redemption Principal Amount.
"Redemption Price" means the redemption price per Note equal to
the Redemption Amount plus any accrued and unpaid interest on such
Note to the date of redemption.
"Register" means the Income PRIDES Register and the Growth PRIDES
Register.
"Registrar" means the Income PRIDES Registrar and the Growth
PRIDES Registrar.
"Remarketing Agent" has the meaning specified in Section 5.3.
"Remarketing Agreement" means the Remarketing Agreement dated as
of June __, 2001 by and among the Company, the Remarketing Agent and
the Purchase Contract Agent.
"Remarketing Fee" has the meaning specified in Section 5.4.
"Reorganization Event" has the meaning specified in Section
5.7(c).
"Reset Agent" means a nationally recognized investment banking
firm chosen by the Company to determine the Reset Rate. It is
currently anticipated that Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated will act in such capacity.
"Reset Announcement Date" means, in the case of the Reset Rate to
be determined on the Initial Remarketing Date, the tenth Business Day
immediately preceding May 17, 2004 and, in the case of the Reset Rate
to be determined on the Secondary Remarketing Date, the tenth Business
Day immediately preceding the Purchase Contract Settlement Date.
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"Reset Rate" means the interest rate per year (to be determined
by the Reset Agent), equal to the sum of (X) the Reset Spread and (Y)
the rate of interest on (1) in the case of the Reset Rate to be
determined on the Initial Remarketing Date, the Two and One-Quarter
Year Benchmark Treasury in effect on the Initial Remarketing Date or
(2) in the case of the Reset Rate to be determined on the Secondary
Remarketing Date, the Two-Year Benchmark Treasury in effect on the
Secondary Remarketing Date.
"Reset Spread" means (a) in the case of the Reset Rate to be
determined on the Initial Remarketing Date, a spread amount to be
determined by the Reset Agent on the applicable Reset Announcement
Date as the appropriate spread so that the Reset Rate will be the
interest rate that the Notes should bear in order for the Applicable
Principal Amount of Notes to have an approximate aggregate market
value of 100.5% of the Treasury Portfolio Purchase Price on the
Initial Remarketing Date and (b) in the case of the Reset Rate to be
determined on the Secondary Remarketing Date, a spread amount
determined by the Reset Agent on the applicable Reset Announcement
Date as the appropriate spread so that the Reset Rate will be the
interest rate that the Notes should bear in order for the Notes to
have an approximate market value of 100.5% of their principal amount
on the Secondary Remarketing Date.
"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.
"Secondary Remarketing" has the meaning specified in Section
5.5(b).
"Secondary Remarketing Date" means the third business day
immediately preceding the Purchase Contract Settlement Date.
"Security" means an Income PRIDES or a Growth PRIDES.
"Senior Indebtedness" means indebtedness of any kind of the
Company unless the instrument under which such indebtedness is
incurred expressly provides that it is on a parity in right of payment
with or subordinate in right of payment to the Contract Adjustment
Payments.
"Settlement Rate" has the meaning specified in Section 5.1.
"Stated Amount" means $50.
"Subsidiary" means (i) a corporation, a majority of whose capital
stock with voting power, under ordinary circumstances, to elect
directors is, at the date of determination, directly or indirectly
owned by the Company, by one or more Subsidiaries of the Company or by
the Company and one or more Subsidiaries of the Company, (ii) a
partnership in which the Company or a Subsidiary of the Company holds
a majority interest in the equity capital or profits of such
partnership, or (iii) any other person (other than a corporation) in
which the
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Company, a Subsidiary of the Company or the Company and one or more
Subsidiaries of the Company, directly or indirectly, at the date of
determination, has (x) at least a majority ownership interest or (y)
the power to elect or direct the election of a majority of the
directors or other governing body of such person.
"Successful Initial Remarketing" has the meaning specified in
Section 5.4.
"Successful Secondary Remarketing" has the meaning specified in
Section 5.5(b).
"Tax Event" means the receipt by the Company of an opinion of a
nationally recognized independent tax counsel experienced in such
matters to the effect that, as a result of (a) any amendment to, or
change (including any announced proposed change) in, the laws (or any
regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein affecting taxation,
(b) any amendment to or change in an interpretation or application of
such laws or regulations by any legislative body, court, governmental
agency or regulatory authority or (c) any interpretation or
pronouncement that provides for a position with respect to such laws
or regulations that differs from the generally accepted position on
the date the Notes are issued, which amendment, change or proposed
change is effective or which interpretation or pronouncement is
announced on or after the date of the first issuance of Notes under
the Indenture, there is more than an insubstantial risk that interest
payable by the Company on the Notes would not be deductible, in whole
or in part, by the Company for United States federal income tax
purposes.
"Tax Event Redemption" means, if a Tax Event shall occur and be
continuing, the redemption of the Notes, at the option of the Company,
in whole but not in part, on not less than 30 days nor more than 60
days' written notice.
"Tax Event Redemption Date" means the date upon which a Tax Event
Redemption is to occur.
"Tax Event Redemption Principal Amount" means either (i) if the
Tax Event Redemption Date occurs prior to May 17, 2004 or, in the
event of Failed Initial Remarketing, prior to the Purchase Contract
Settlement Date, the aggregate principal amount of the Notes which are
components of Income PRIDES on the Tax Event Redemption Date or (ii)
if the Tax Event Redemption Date occurs on or after May 17, 2004 or,
in the event of a Failed Initial Remarketing, on or after the Purchase
Contract Settlement Date, the aggregate principal amount of the Notes
outstanding on such Tax Event Redemption Date.
"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 Purchase Contract
Settlement Date, a judgment, decree or court order shall have been
entered granting relief under the Bankruptcy
11
Code, adjudicating the Company to be insolvent, or approving as
properly filed a petition seeking reorganization or liquidation of the
Company under the Bankruptcy Code or any other similar applicable
Federal or State law, and, unless such judgment, decree or order shall
have been entered within 60 days prior to the Purchase Contract
Settlement Date, such decree or order shall have continued
undischarged and unstayed for a period of 60 days; or (ii) at any time
on or prior to the Purchase Contract Settlement Date, a judgment,
decree or court order for the appointment of a receiver or liquidator
or trustee or assignee in bankruptcy or insolvency of the Company or
of its property, or for the winding up or liquidation of its affairs,
shall have been entered, and, unless such judgment, decree or order
shall have been entered within 60 days prior to the Purchase Contract
Settlement Date, such judgment, decree or order shall have continued
undischarged and unstayed for a period of 60 days, or (iii) at any
time on or prior to the Purchase Contract Settlement Date the Company
shall file a petition for relief under the Bankruptcy Code, or shall
consent to the filing of a bankruptcy proceeding against it, or shall
file a petition or answer or consent seeking reorganization or
liquidation under the Bankruptcy Code or any other similar applicable
Federal or State law, or shall consent to the filing of any such
petition, or shall consent to the appointment of a receiver or
liquidator or trustee or assignee in bankruptcy or insolvency of it or
of its property, or shall make an assignment for the benefit of
creditors, or shall admit in writing its inability to pay its debts
generally as they become due.
"Threshold Appreciation Price" has the meaning specified in
Section 5.1.
"TIA" means the Trust Indenture Act of 1939, as amended, or any
successor statute.
"Trading Day" has the meaning specified in Section 5.1.
"Treasury Portfolio" means (1) in connection with the Initial
Remarketing, a portfolio of zero-coupon U.S. Treasury Securities
consisting of (a) principal or interest strips of U.S. Treasury
Securities that mature on or prior to May 17, 2004 in an aggregate
amount equal to the Applicable Principal Amount and (b) with respect
to the scheduled interest payment date on the Notes that occurs on the
Purchase Contract Settlement Date, principal or interest strips of
U.S. Treasury Securities that mature on or prior to such date in an
aggregate amount equal to the aggregate interest payment that would be
due on the Applicable Principal Amount of the Notes on such date if
the applicable Coupon Rate on the Notes were not reset to the Reset
Rate as described in Section 4.1 and (2) in connection with a Tax
Event Redemption, (a) if the Tax Event Redemption Date occurs prior to
May 17, 2004 or, in the event of a Failed Initial Remarketing, prior
to the Purchase Contract Settlement Date, a portfolio of zero-coupon
U.S. Treasury Securities consisting of (i) principal or interest
strips of U.S. Treasury Securities which mature on or prior to August
17, 2004 in an aggregate amount equal to the applicable Tax Event
Redemption Principal Amount and (ii) with respect to each scheduled
interest payment date on the Notes that occurs after the Tax Event
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Redemption Date and on or before the Purchase Contract Settlement
Date, principal or interest strips of U.S. Treasury Securities that
mature on or prior to such date in an aggregate amount equal to the
aggregate interest payment that would be due on the applicable Tax
Event Redemption Principal Amount of the Notes on such date, and (b)
if the Tax Event Redemption Date occurs on or after May 17, 2004 or,
in the event of a Failed Initial Remarketing, on or after the Purchase
Contract Settlement Date, a portfolio of zero-coupon U.S. Treasury
Securities consisting of (i) principal or interest strips of U.S.
Treasury Securities which mature on or prior to August 17, 2006 in an
aggregate amount equal to the applicable Tax Event Redemption
Principal Amount and (ii) with respect to each scheduled interest
payment date on the Notes that occurs after the Tax Event Redemption
Date, principal or interest strips of such U.S. Treasury Securities
that mature on or prior to such date in an aggregate amount equal to
the aggregate interest payment that would be due on the applicable Tax
Event Redemption Principal Amount of the Notes on such date.
"Treasury Portfolio Purchase Price" means the lowest aggregate
price quoted by the Primary Treasury Dealer to the Quotation Agent (a)
in the case of a Tax Event Redemption, on the third Business Day
immediately preceding the Tax Event Redemption Date for the purchase
of the applicable Treasury Portfolio for settlement on the Tax Event
Redemption Date and (b) in the case of the Initial Remarketing, on the
Initial Remarketing Date for the purchase of the applicable Treasury
Portfolio for settlement on May 17, 2004.
"Treasury Security" means zero-coupon U.S. Treasury Securities
(CUSIP Number ________) which are the principal strip of the U.S.
Treasury Securities that mature on August 16, 2004.
"Two-Year Benchmark Treasury" means direct obligations of the
United States (which may be obligations traded on a when-issued basis
only) having a maturity comparable to the remaining term to maturity
of the Notes, as agreed upon by the Company and the Reset Agent. The
rate for the Two-Year Benchmark Treasury will be the bid side rate
displayed at 10:00 A.M., New York City time, on the third Business Day
immediately preceding the Purchase Contract Settlement Date in the
Telerate system (or if the Telerate system is (a) no longer available
on the Secondary Remarketing Date or (b) in the opinion of the Reset
Agent (after consultation with the Company) no longer an appropriate
system from which to obtain such rate, such other nationally
recognized quotation system as, in the opinion of the Reset Agent
(after consultation with the Company), is appropriate). If such rate
is not so displayed, the rate for the Two-Year Benchmark Treasury
shall be, as calculated by the Reset Agent, the yield to maturity for
the Two-Year Benchmark Treasury, expressed as a bond equivalent on the
basis of a year of 365 or 366 days, as applicable, and applied on a
daily basis, and computed by taking the arithmetic mean of the
secondary market bid rates, as of 10:30 A.M., New York City time, on
the Secondary Remarketing Date of three leading United States
government securities dealers selected by the Reset
13
Agent (after consultation with the Company)(which may include the
Reset Agent or an Affiliate thereof).
"Two and One-Quarter Year Benchmark Treasury" means direct
obligations of the United States (which may be obligations traded on a
when-issued basis only) having a maturity comparable to the remaining
term to maturity of the Notes, as agreed upon by the Company and the
Reset Agent. The rate for the Two and One-Quarter Year Benchmark
Treasury will be the bid side rate displayed at 10:00 A.M., New York
City time, on the Initial Remarketing Date in the Telerate system (or
if the Telerate system is (a) no longer available on the Initial
Remarketing Date or (b) in the opinion of the Reset Agent (after
consultation with the Company), no longer an appropriate system from
which to obtain such rate, such other nationally recognized quotation
system as, in the opinion of the Reset Agent (after consultation with
the Company) is appropriate). If such rate is not so displayed, the
rate for the Two and One-Quarter Year Benchmark Treasury shall be, as
calculated by the Reset Agent, the yield to maturity for the Two and
One-Quarter Year Benchmark Treasury, expressed as a bond equivalent on
the basis of a year of 365 or 366 days, as applicable, and applied on
a daily basis, and computed by taking the arithmetic mean of the
secondary market bid rates, as of 10:30 A.M., New York City time, on
the Initial Remarketing Date of three leading United States government
securities dealers selected by the Reset Agent (after consultation
with the Company) (which may include the Reset Agent or an Affiliate
thereof).
"Underwriting Agreement" means the Underwriting Agreement dated
June __, 2001 between the Company and Xxxxxxx Lynch, Pierce, Xxxxxx &
Xxxxx Incorporated, Xxxxxxx Xxxxx Barney Inc. and Credit Suisse First
Boston Corporation, as representatives of the underwriters named
therein.
"Vice President" means any vice president, whether or not
designated by a number or a word or words added before or after the
title "vice president."
Section 1.2 Compliance Certificates and Opinions.
Except as otherwise expressly provided by this Agreement, upon any
application or request by the Company to the Agent to take any action under any
provision of this Agreement, the Company shall furnish to the Agent an Officer's
Certificate stating that all conditions precedent, if any, provided for in this
Agreement relating to the proposed action have been complied with and, if
reasonably requested by the Agent, an Opinion of Counsel stating that, in the
opinion of such counsel, all such conditions precedent, if any, have been
complied with, except that in the case of any such application or request as to
which the furnishing of such documents is specifically required by any provision
of this Agreement relating to such particular application or request, no
additional certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Agreement shall include:
14
(1) a statement that each Person 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 Person, he or she
or it has made such examination or investigation as is necessary to enable
such individual to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(4) a statement as to whether, in the opinion of each such Person,
such condition or covenant has been complied with.
Section 1.3 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 the Company may be based, insofar as it
relates to legal matters, upon a certificate or opinion of, or representations
by, counsel, unless the Company knows, or in the exercise of reasonable care
should know, that the certificate or opinion or representations with respect to
the matters upon which his certificate or opinion is based are erroneous. Any
such certificate or Opinion of Counsel may be based, insofar as it relates to
factual matters, upon a certificate or opinion of, or representations by, the
Company stating that the information with respect to such factual matters is in
the possession of the Company unless the Person giving such certificate or
Opinion of Counsel knows, or in the exercise of reasonable care should know,
that the certificate or opinion or representations with respect to such matters
are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Agreement, they may, but need not, be consolidated and
form one instrument.
Section 1.4 Acts of Holders; Record Dates.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Agreement to be given or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by 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
15
referred to as the "Act" of the Holders signing such instrument or instruments.
Proof of execution of any such instrument or of a writing appointing any such
agent shall be sufficient for any purpose of this Agreement and (subject to
Section 7.1) conclusive in favor of the Agent and the Company, if made in the
manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved in any manner which the Agent deems
sufficient.
(c) The ownership of Securities shall be proved by the Income PRIDES
Register or the Growth PRIDES Register, as the case may be.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Certificate shall bind every future
Holder of the same Certificate and the Holder of every Certificate issued upon
the registration of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done, omitted or suffered to be done by the Agent or the
Company in reliance thereon, whether or not notation of such action is made upon
such Certificate.
(e) The Company may set any day as a record date for the purpose of
determining the Holders of Outstanding 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 the Outstanding Income PRIDES and the Outstanding Growth PRIDES, as
the case may be, on such record date, and no other Holders, shall be entitled to
take the relevant action with respect to the Income PRIDES or the Growth PRIDES,
as the case may be, whether or not such Holders remain Holders after such record
date; provided that no such action shall be effective hereunder unless taken on
or prior to the applicable Expiration Date by Holders of the requisite number of
Outstanding 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 1.6.
With respect to any record date set pursuant to this Section, the
Company may designate any date as the "Expiration Date" and from time to time
may change the Expiration Date to any earlier or later day; provided that no
such change shall be effective unless notice of the proposed new Expiration Date
is given to the Agent in writing, and to each Holder of Securities in the manner
set forth in Section 1.6, on or prior to the existing Expiration Date. If an
Expiration Date is not designated with respect to any record date set pursuant
to this Section, the Company shall be deemed to have initially designated the
180th day after such record date as the Expiration Date with respect thereto,
subject to its right to change the Expiration Date as
16
provided in this paragraph. Notwithstanding the foregoing, no Expiration Date
shall be later than the 180th day after the applicable record date.
Section 1.5 Notices.
Any request, demand, authorization, direction, notice, consent, waiver
or Act of Holders or other document provided or permitted by this Agreement to
be made upon, given or furnished to, or filed with,
(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 ____________________,
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 Electronic Data
Systems Corporation, 0000 Xxxxxx Xxxxx Xxxxx, Xxxxx 00000-0000, Attention:
[Chief Financial Officer], or at any other address previously furnished in
writing to the Agent by the Company; or
(3) the Collateral Agent by the Agent, the Company or any Holder
shall be sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if made, given, furnished or filed in writing and
personally delivered or mailed, first-class postage prepaid, addressed to
the Collateral Agent at _________________________________________________,
or at any other address previously furnished in writing by the Collateral
Agent to the Agent, the Company and the Holders; or
(4) the Indenture Trustee by the Company shall be sufficient for
every purpose hereunder (unless otherwise herein expressly provided) if
made, given, furnished or filed in writing and personally delivered or
mailed, first-class postage prepaid, addressed to the Indenture Trustee at
__________________________, or at any other address previously furnished in
writing by the Indenture Trustee to the Company.
Section 1.6 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 its address as it appears in the applicable Register, not
later than the latest date, and not earlier than the earliest date, prescribed
for the giving of such notice. In any case where notice to Holders is given by
mail, neither the failure to mail such notice, nor any defect in any notice so
mailed, to any particular Holder shall affect the sufficiency of such notice
with respect to other Holders. Where this Agreement provides for notice in any
manner, such notice may be waived in writing by the Person entitled to receive
such notice, either before or after the event, and such waiver shall be the
equivalent of such notice. Waivers of notice by Holders shall be filed with the
Agent, but
17
such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made with the approval of the Agent shall
constitute a sufficient notification for every purpose hereunder.
Section 1.7 Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
Section 1.8 Successors and Assigns.
All covenants and agreements in this Agreement by the Company shall
bind its successors and assigns, whether so expressed or not.
Section 1.9 Separability Clause.
In case any provision in this Agreement or in the Securities shall be
invalid, illegal or unenforceable, then, to the extent permitted by law, the
validity, legality and enforceability of the remaining provisions hereof and
thereof shall not in any way be affected or impaired thereby.
Section 1.10 Benefits of Agreement.
Nothing in this Agreement or in the Securities, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder and, to the extent provided hereby, the Holders, any benefits or any
legal or equitable right, remedy or claim under this Agreement. The Holders
from time to time shall be beneficiaries of this Agreement and shall be bound by
all of the applicable terms and conditions hereof and of the Securities
evidenced by their Certificates by their acceptance of delivery of such
Certificates.
Section 1.11 Governing Law.
THIS AGREEMENT AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
Section 1.12 Legal Holidays.
In any case where any Purchase Contract Settlement Date shall not be a
Business Day, then (notwithstanding any other provision of this Agreement, the
Income PRIDES Certificates or the Growth PRIDES Certificates), the Purchase
Contracts shall not be performed on such date, but the Purchase Contracts shall
be performed on the immediately following Business Day with the same force and
effect as if performed on the Purchase Contract Settlement Date.
18
Section 1.13 Counterparts.
This Agreement may be executed in any number of counterparts by the
parties hereto on separate counterparts, each of which, when so executed and
delivered, shall be deemed an original, but all such counterparts shall together
constitute one and the same instrument.
Section 1.14 Inspection of Agreement.
A copy of this Agreement shall be available at all reasonable times
during normal business hours at the Corporate Trust Office for inspection by any
Holder.
ARTICLE II
CERTIFICATE FORMS
Section 2.1 Forms of Certificates Generally.
The Income PRIDES Certificates (including the form of Purchase
Contract forming part of the Income PRIDES 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 which the Income PRIDES are listed or any depositary
therefor, or as may, consistently herewith, be determined by the officers of the
Company executing such Income PRIDES Certificates, as evidenced by their
execution of the Income PRIDES Certificates.
The definitive Income PRIDES Certificates shall be printed,
lithographed or engraved on steel engraved borders or may be produced in any
other manner, all as determined by the officers of the Company executing such
Income PRIDES Certificates, consistent with the provisions of this Agreement, as
evidenced by their execution thereof.
The Growth PRIDES Certificates (including the form of Purchase
Contract forming part of the Growth PRIDES evidenced thereby) shall be in
substantially the form set forth in Exhibit B 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 Growth PRIDES are listed or any depositary
therefor, or as may, consistently herewith, be determined by the officers of the
Company executing such Growth PRIDES Certificates, as evidenced by their
execution of the Growth PRIDES Certificates.
The definitive Growth PRIDES Certificates shall be printed,
lithographed or engraved on steel engraved borders or may be produced in any
other manner, all as determined by the officers of the Company executing such
Growth PRIDES Certificates, consistent with the provisions of this Agreement, as
evidenced by their execution thereof.
Every Global Certificate authenticated, executed on behalf of the
Holders and delivered hereunder shall bear a legend in substantially the
following form:
19
THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT (AS HEREINAFTER DEFINED) AND IS REGISTERED
IN THE NAME OF THE CLEARING AGENCY OR A NOMINEE THEREOF. THIS
CERTIFICATE MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A CERTIFICATE
REGISTERED, AND NO TRANSFER OF THIS CERTIFICATE IN WHOLE OR IN PART
MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH CLEARING
AGENCY OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES
DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT.
Section 2.2 Form of Agent's Certificate of Authentication.
The form of the Agent's certificate of authentication of the Income
PRIDES shall be in substantially the form set forth on the form of the Income
PRIDES Certificates.
The form of the Agent's certificate of authentication of the Growth
PRIDES shall be in substantially the form set forth on the form of the Growth
PRIDES Certificates.
ARTICLE III
THE SECURITIES
Section 3.1 Title and Terms; Denominations.
The aggregate number of Income PRIDES and Growth PRIDES evidenced by
Certificates authenticated, executed on behalf of the Holders and delivered
hereunder is limited to 28,000,000 (or 32,200,000 if the Underwriters'
overallotment option is exercised in full) except for Certificates
authenticated, executed and delivered upon registration of transfer of, in
exchange for, or in lieu of, other Certificates pursuant to Section 3.4, 3.5,
3.9, 3.10, 3.13, 3.14, 5.10 or 8.5.
The Certificates shall be issuable only in registered form and only in
denominations of a single Income PRIDES or Growth PRIDES and any integral
multiple thereof.
Section 3.2 Rights and Obligations Evidenced by the Certificates.
Each Income PRIDES Certificate shall evidence the number of Income
PRIDES specified therein, with each such Income PRIDES representing the
ownership by the Holder thereof of a beneficial interest in a Note or the
Applicable Ownership Interest of the Treasury Portfolio, as the case may be,
subject to the Pledge of such Note or the Applicable Ownership Interest of the
Treasury Portfolio, as the case may be, by such Holder pursuant to the Pledge
Agreement, and the rights and obligations of the Holder thereof and the Company
under one Purchase Contract. The Agent as attorney-in-fact for, and on behalf
of, the Holder of each Income PRIDES shall pledge, pursuant to the Pledge
Agreement, the Note or the Applicable Ownership Interest of the Treasury
Portfolio, as the case may be, forming a part of such Income PRIDES, to the
Collateral Agent and grant to the Collateral Agent a security interest in the
right, title, and interest of such Holder in such Note or the Applicable
Ownership Interest of the
20
Treasury Portfolio, as the case may be, for the benefit of the Company, to
secure the obligation of the Holder under each Purchase Contract to purchase the
Common Stock of the Company.
Each Growth PRIDES Certificate shall evidence the number of Growth
PRIDES specified therein, with each such Growth PRIDES representing the
ownership by the Holder thereof of a 1/20, or 5.0%, undivided beneficial
interest in a Treasury Security with a principal amount at maturity equal to
$1,000, subject to the Pledge of such Treasury Security by such Holder pursuant
to the Pledge Agreement, and the rights and obligations of the Holder thereof
and the Company under one Purchase Contract. The Agent as attorney-in-fact for,
and on behalf of, the Holder of each Growth PRIDES shall pledge, pursuant to the
Pledge Agreement, the Treasury Security to the Collateral Agent and grant to the
Collateral Agent a security interest in the right, title and interest of such
Holder in such Treasury Security, for the benefit of the Company, to secure the
obligation of the Holder under each Purchase Contract to purchase the Common
Stock of the Company.
Section 3.3 Execution, Authentication, Delivery and Dating.
Subject to the provisions of Sections 3.13 and 3.14 hereof, upon the
execution and delivery of this Agreement, and at any time and from time to time
thereafter, the Company may deliver Certificates executed by the Company to the
Agent for authentication, execution on behalf of the Holders and delivery,
together with its Issuer Order for authentication of such Certificates, and the
Agent in accordance with such Issuer Order shall authenticate, execute on behalf
of the Holders and deliver such Certificates.
The Certificates shall be executed on behalf of the Company by its
Chairman of the Board, its President or one of its Vice Presidents and its
Treasurer or one of its Assistant Treasurers or its Secretary or one of its
Assistant Secretaries. The signature of any of these officers on the
Certificates may be manual or facsimile.
Certificates bearing the manual or facsimile signatures of individuals
who were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Certificates or did not
hold such offices at the date of such Certificates.
No Purchase Contract evidenced by a Certificate shall be valid until
such Certificate has been executed on behalf of the Holder by the manual
signature of an authorized signatory of the Agent, as such Holder's attorney-in-
fact. Such signature by an authorized signatory of the Agent shall be
conclusive evidence that the Holder of such Certificate has entered into the
Purchase Contracts evidenced by such Certificate.
Each Certificate shall be dated the date of its authentication.
No Certificate shall be entitled to any benefit under this Agreement
or be valid or obligatory for any purpose unless there appears on such
Certificate a certificate of authentication substantially in the form provided
for herein executed by an authorized signatory of the Agent by manual signature,
and such certificate upon any Certificate shall be conclusive evidence, and the
only evidence, that such Certificate has been duly authenticated and delivered
hereunder.
21
Section 3.4 Temporary Certificates.
Pending the preparation of definitive Certificates, the Company shall
execute and deliver to the Agent, and the Agent shall authenticate, execute on
behalf of the Holders, and deliver, in lieu of such definitive Certificates,
temporary Certificates that are in substantially the form set forth in Exhibit A
or Exhibit B hereto, as the case may be, with such letters, numbers or other
marks of identification or designation and such legends or endorsements printed,
lithographed or engraved thereon as may be required by the rules of any
securities exchange on which the Income PRIDES or Growth PRIDES are listed, or
as may, consistently herewith, be determined by the officers of the Company
executing such Certificates, as evidenced by their execution of the
Certificates.
If temporary Certificates are issued, the Company will cause
definitive Certificates to be prepared without unreasonable delay. After the
preparation of definitive Certificates, the temporary Certificates shall be
exchangeable for definitive Certificates upon surrender of the temporary
Certificates at the Corporate Trust Office or the New York office, at the
expense of the Company and without charge to the Holder. Upon surrender for
cancellation of any one or more temporary Certificates, the Company shall
execute and deliver to the Agent, and the Agent shall authenticate, execute on
behalf of the Holder, and deliver in exchange therefor, one or more definitive
Certificates of like tenor and denominations and evidencing a like number of
Income PRIDES or Growth PRIDES, as the case may be, as the temporary Certificate
or Certificates so surrendered. Until so exchanged, the temporary Certificates
shall in all respects evidence the same benefits and the same obligations with
respect to the Income PRIDES or Growth PRIDES, as the case may be, evidenced
thereby as definitive Certificates.
Section 3.5 Registration; Registration of Transfer and Exchange.
The Agent shall keep at the Corporate Trust Office a Register (the
"Income PRIDES Register") in which, subject to such reasonable regulations as it
may prescribe, the Agent shall provide for the registration of Income PRIDES
Certificates and of transfers of Income PRIDES Certificates (the Agent, in such
capacity, the "Income PRIDES Registrar") and a Register (the "Growth PRIDES
Register") in which, subject to such reasonable regulations as it may prescribe,
the Agent shall provide for the registration of Growth PRIDES Certificates and
of transfers of Growth PRIDES Certificates (the Agent, in such capacity, the
"Growth PRIDES Registrar").
Upon surrender for registration of transfer of any Certificate at the
Corporate Trust Office or the New York Office, the Company shall execute and
deliver to the Agent, and the Agent shall authenticate, execute on behalf of the
designated transferee or transferees, and deliver, in the name of the designated
transferee or transferees, one or more new Certificates of any authorized
denominations, like tenor, and evidencing a like number of Income PRIDES or
Growth PRIDES, as the case may be.
At the option of the Holder, Certificates may be exchanged for other
Certificates, of any authorized denominations and evidencing a like number of
Income PRIDES or Growth PRIDES, as the case may be, upon surrender of the
Certificates to be exchanged at the Corporate Trust Office or the New York
Office. Whenever any Certificates are so surrendered for
22
exchange, the Company shall execute and deliver to the Agent, and the Agent
shall authenticate, execute on behalf of the Holder, and deliver the
Certificates that the Holder making the exchange is entitled to receive.
All Certificates issued upon any registration of transfer or exchange
of a Certificate shall evidence the ownership of the same number of Income
PRIDES or Growth PRIDES, as the case may be, and be entitled to the same
benefits and subject to the same obligations, under this Agreement as the Income
PRIDES or Growth PRIDES, as the case may be, evidenced by the Certificate
surrendered upon such registration of transfer or exchange.
Every Certificate presented or surrendered for registration of
transfer or for exchange shall (if so required by the Agent) be duly endorsed,
or be accompanied by a written instrument of transfer in form satisfactory to
the Company and the Agent duly executed, by the Holder thereof or its attorney
duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of a Certificate, but the Company and the Agent may require payment
from the Holder of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration of transfer or
exchange of Certificates, other than any exchanges pursuant to Sections 3.4,
3.6, 3.9 and 8.5 not involving any transfer.
Notwithstanding the foregoing, the Company shall not be obligated to
execute and deliver to the Agent, and the Agent shall not be obligated to
authenticate, execute on behalf of the Holder and deliver, any Certificate
presented or surrendered for registration of transfer or for exchange on or
after the Business Day immediately preceding the earlier of the Purchase
Contract Settlement Date or the Termination Date. In lieu of delivery of a new
Certificate, upon satisfaction of the applicable conditions specified above in
this Section and receipt of appropriate registration or transfer instructions
from such Holder, the Agent shall (i) if the Purchase Contract 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
Certificate (together with any cash or other property to which the Holder is
entitled), or (ii) if a Termination Event shall have occurred prior to the
Purchase Contract Settlement Date, transfer the Notes, the appropriate
Applicable Ownership Interest of the Treasury Portfolio or the Treasury
Securities, as the case may be, evidenced thereby, in each case subject to the
applicable conditions and in accordance with the applicable provisions of
Article Five hereof.
Section 3.6 Book-Entry Interests.
The Certificates, on original issuance, will be issued in the form of
one or more fully registered Global Certificates, to be delivered to the
Depositary by, or on behalf of, the Company. Such Global Certificate shall
initially be registered on the books and records of the Company in the name of
Cede & Co., the nominee of the Depositary, and no Beneficial Owner will receive
a definitive Certificate representing such Beneficial Owner's interest in such
Global Certificate, except as provided in Section 3.9. The Agent shall enter
into an agreement with the Depositary if so requested by the Company. Unless
and until definitive, fully registered Certificates have been issued to
Beneficial Owners pursuant to Section 3.9:
23
(a) the provisions of this Section 3.6 shall be in full force and
effect;
(b) the Company shall be entitled to deal with the Clearing Agency
for all purposes of this Agreement (including receiving approvals, votes or
consents hereunder) as the Holder of the Securities and the sole holder of the
Global Certificate(s) and shall have no obligation to the Beneficial Owners;
(c) to the extent that the provisions of this Section 3.6 conflict
with any other provisions of this Agreement, the provisions of this Section 3.6
shall control; and
(d) the rights of the Beneficial Owners shall be exercised only
through the Clearing Agency and shall be limited to those established by law and
agreements between such Beneficial Owners and the Clearing Agency and/or the
Clearing Agency Participants. The Clearing Agency will make book entry transfers
among Clearing Agency Participants.
Section 3.7 Notices to Holders.
Whenever a notice or other communication to the Holders is required to
be given under this Agreement, the Company or the Company's agent shall give
such notices and communications to the Holders and, with respect to any
Securities registered in the name of a Clearing Agency or the nominee of a
Clearing Agency, the Company or the Company's agent shall, except as set forth
herein, have no obligations to the Beneficial Owners.
Section 3.8 Appointment of Successor Clearing Agency.
If any Clearing Agency elects to discontinue its services as
securities depositary with respect to the Securities, the Company may, in its
sole discretion, appoint a successor Clearing Agency with respect to the
Securities.
Section 3.9 Definitive Certificates.
If (i) a Clearing Agency elects to discontinue its services as
securities depositary with respect to the Securities and a successor Clearing
Agency is not appointed within 90 days after such discontinuance pursuant to
Section 3.8, (ii) the Company elects to terminate the book-entry system through
the Clearing Agency with respect to the Securities, or (iii) there shall have
occurred and be continuing a default by the Company in respect of its
obligations under one or more Purchase Contracts, or one or more Notes, then
upon surrender of the Global Certificates representing the Book-Entry Interests
with respect to the Securities by the Clearing Agency, accompanied by
registration instructions, the Company shall cause definitive Certificates to be
delivered to Beneficial Owners in accordance with the instructions of the
Clearing Agency.
Section 3.10 Mutilated, Destroyed, Lost and Stolen Certificates.
If any mutilated Certificate is surrendered to the Agent, the Company
shall execute and deliver to the Agent, and the Agent shall authenticate,
execute on behalf of the Holder, and deliver in exchange therefor, a new
Certificate at the cost of the Holder, evidencing the same number of Income
PRIDES or Growth PRIDES, as the case may be, and bearing a Certificate number
not contemporaneously outstanding.
24
If there shall be delivered to the Company and the Agent (i) evidence
to their satisfaction of the destruction, loss or theft of any Certificate, and
(ii) such security or indemnity at the cost of the Holder as may be required by
them to hold each of them and any agent of any of them harmless, then, in the
absence of notice to the Company or the Agent that such Certificate has been
acquired by a protected purchaser, the Company shall execute and deliver to the
Agent, and the Agent shall authenticate, execute on behalf of the Holder, and
deliver to the Holder, in lieu of any such destroyed, lost or stolen
Certificate, a new Certificate, evidencing the same number of Income PRIDES or
Growth PRIDES, as the case may be, and bearing a Certificate 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
Certificate on or after the Business Day immediately preceding the earlier of
the Purchase Contract Settlement Date or the Termination Date. In lieu of
delivery of a new Certificate, upon satisfaction of the applicable conditions
specified above in this Section and receipt of appropriate registration or
transfer instructions from such Holder, the Agent shall (i) if the Purchase
Contract 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 Certificate (together with any cash or other property to which
the Holder is entitled), or (ii) if a Termination Event shall have occurred
prior to the Purchase Contract Settlement Date, transfer the Notes, the
appropriate Applicable Ownership Interest of the Treasury Portfolio or the
Treasury Securities, as the case may be, evidenced thereby, in each case subject
to the applicable conditions and in accordance with the applicable provisions of
Article Five hereof.
Upon the issuance of any new Certificate under this Section, the
Company and the Agent may require the payment by the Holder of a sum sufficient
to cover any tax or other governmental charge that may be imposed in relation
thereto and any other expenses (including the reasonable fees and expenses of
the Agent) connected therewith.
Every new Certificate issued pursuant to this Section in lieu of any
destroyed, lost or stolen Certificate shall constitute an original additional
contractual obligation of the Company and of the Holder in respect of the
Security evidenced thereby, whether or not the destroyed, lost or stolen
Certificate (and the Securities evidenced thereby) 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 Certificates delivered hereunder.
The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Certificates.
Section 3.11 Persons Deemed Owners.
Prior to due presentment of a Certificate for registration of
transfer, the Company and the Agent, and any agent of the Company or the Agent,
may treat the Person in whose name such Certificate is registered as the owner
of the Income PRIDES or Growth PRIDES evidenced thereby, for the purpose of
receiving interest on the Notes or on the maturing quarterly interest
25
strips of the Treasury Portfolio, as applicable, performance of the Purchase
Contracts and for all other purposes whatsoever, whether or not any interest on
the Notes shall be overdue and notwithstanding any notice to the contrary, and
neither the Company nor the Agent, nor any agent of the Company or the Agent,
shall be affected by notice to the contrary.
Notwithstanding the foregoing, with respect to any Global Certificate,
nothing herein shall prevent the Company, the Agent or any agent of the Company
or the Agent, from giving effect to any written certification, proxy or other
authorization furnished by any Clearing Agency (or its nominee), as a Holder,
with respect to such Global Certificate or impair, as between such Clearing
Agency and owners of beneficial interests in such Global Certificate, the
operation of customary practices governing the exercise of rights of such
Clearing Agency (or its nominee) as Holder of such Global Certificate.
Section 3.12 Cancellation.
All Certificates surrendered for delivery of shares of Common Stock on
or after the Purchase Contract Settlement Date, upon the transfer of Notes, the
appropriate Applicable Ownership Interest of the Treasury Portfolio or Treasury
Securities, as the case may be, after the occurrence of a Termination Event or
pursuant to an Early Settlement, or upon the registration of a transfer or
exchange of a Security, or a Collateral Substitution or the re-establishment of
an Income PRIDES or Growth PRIDES shall, if surrendered to any Person other than
the Agent, be delivered to the Agent and, if not already cancelled, shall be
promptly cancelled by it. The Company may at any time deliver to the Agent for
cancellation any Certificates previously authenticated, executed and delivered
hereunder which the Company may have acquired in any manner whatsoever, and all
Certificates so delivered shall, upon Issuer Order, be promptly cancelled by the
Agent. No Certificates shall be authenticated, executed on behalf of the Holder
and delivered in lieu of or in exchange for any Certificates cancelled as
provided in this Section, except as expressly permitted by this Agreement. All
cancelled Certificates held by the Agent shall upon written request be returned
to the Company.
If the Company or any Affiliate of the Company shall acquire any
Certificate, such acquisition shall not operate as a cancellation of such
Certificate unless and until such Certificate is delivered to the Agent
cancelled or for cancellation.
Section 3.13 Establishment of Growth PRIDES.
A Holder may separate the Notes or the appropriate Applicable
Ownership Interest of the Treasury Portfolio, as applicable, from the related
Purchase Contracts in respect of an Income PRIDES by substituting for such Notes
or the appropriate Applicable Ownership Interest of the Treasury Portfolio, as
the case may be, Treasury Securities in an aggregate principal amount of such
Notes or the appropriate Applicable Ownership Interest (as specified in clause
(A) of the definition of such term) of the Treasury Portfolio, as applicable (a
"Collateral Substitution"), at any time from and after the date of this
Agreement and on or prior to the fifth Business Day immediately preceding the
Purchase Contract Settlement Date in the case of the Notes and on or prior to
the second Business Day immediately preceding the Purchase Contract Settlement
Date in the case of the appropriate Applicable Ownership Interest of the
Treasury Portfolio, in each case by (a) depositing with the Collateral Agent
Treasury Securities having an
26
aggregate principal amount at maturity equal to the aggregate principal amount
of the Notes comprising part of such Income PRIDES or the appropriate Applicable
Ownership Interest (as specified in clause (A) of the definition of such term)
of the Treasury Portfolio comprising part of such Income PRIDES, as the case may
be, and (b) transferring the related Income PRIDES to the Agent accompanied by a
notice to the Agent, substantially in the form of Exhibit D hereto, stating that
the Holder has transferred the relevant amount of Treasury Securities to the
Collateral Agent and requesting that the Agent instruct the Collateral Agent to
release the Notes or the appropriate Applicable Ownership Interest of the
Treasury Portfolio, as the case may be, underlying such Income PRIDES, whereupon
the Agent shall promptly give such instruction to the Collateral Agent,
substantially in the form of Exhibit C hereto. Upon receipt of the Treasury
Securities described in clause (a) above and the instruction described in clause
(b) above, in accordance with the terms of the Pledge Agreement, the Collateral
Agent will release to the Agent, on behalf of the Holder, Notes or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the case
may be, having the appropriate aggregate principal amount in the case of such
Notes or the appropriate Applicable Ownership Interest of the Treasury
Portfolio, as the case may be, from the Pledge, free and clear of the Company's
security interest therein, and upon receipt thereof the Agent shall promptly:
(i) cancel the related Income PRIDES;
(ii) transfer the Notes or the appropriate Applicable Ownership
Interest of the Treasury Portfolio, as the case may be, to the Holder; and
(iii) authenticate, execute on behalf of such Holder and deliver a
Growth PRIDES Certificate executed by the Company in accordance with
Section 3.3 evidencing the same number of Purchase Contracts as were
evidenced by the cancelled Income PRIDES.
Holders who elect to separate the Notes or the appropriate Applicable
Ownership Interest of the Treasury Portfolio, as the case may be, from the
related Purchase Contract and to substitute Treasury Securities for such Notes
or the appropriate Applicable Ownership Interest of the Treasury Portfolio, as
the case may be, shall be responsible for any fees or expenses payable to the
Collateral Agent for its services as Collateral Agent in respect of the
substitution, and the Company shall not be responsible for any such fees or
expenses.
Holders may make Collateral Substitutions (i) only in integral
multiples of 20 Income PRIDES if Treasury Securities are being substituted for
by the Notes, or (ii) only in integral multiples of 32,000 Income PRIDES if
Treasury Securities are being substituted for appropriate Applicable Ownership
Interest of the Treasury Portfolio.
In the event a Holder making a Collateral Substitution pursuant to
this Section 3.13 fails to effect a book-entry transfer of the Income PRIDES or
fails to deliver an Income PRIDES Certificate(s) to the Agent after depositing
Treasury Securities with the Collateral Agent, the Notes or the appropriate
Applicable Ownership Interest of the Treasury Portfolio, as the case may be,
constituting a part of such Income PRIDES, and any interest on such Note or the
Applicable Ownership Interest of the Treasury Portfolio, as the case may be,
shall be held in the name of the Agent or its nominee in trust for the benefit
of such Holder, until such Income
27
PRIDES are so transferred or the Income PRIDES Certificate is so delivered, as
the case may be, or, with respect to an Income PRIDES Certificate, such Holder
provides evidence satisfactory to the Company and the Agent that such Income
PRIDES Certificate has been destroyed, lost or stolen, together with any
indemnity that may be required by the Agent and the Company.
Except as described in this Section 3.13, for so long as the Purchase
Contract underlying an Income PRIDES remains in effect, such Income PRIDES shall
not be separable into its constituent parts, and the rights and obligations of
the Holder in respect of the Notes or the appropriate Applicable Ownership
Interest of the Treasury Portfolio, as the case may be, and Purchase Contract
comprising such Income PRIDES may be acquired, and may be transferred and
exchanged, only as an Income PRIDES.
Section 3.14 Reestablishment of Income PRIDES.
A Holder of a Growth PRIDES may recreate Income PRIDES at any time (i)
on or prior to the fifth Business Day immediately preceding the Purchase
Contract Settlement Date, if a Tax Event Redemption or a Successful Initial
Remarketing has not occurred, and (ii) on or prior to the second Business Day
immediately preceding the Purchase Contract Settlement Date, if a Tax Event
Redemption or a Successful Initial Remarketing has occurred and an Applicable
Ownership Interest in the Treasury Portfolio has become a component of the
Income PRIDES, in each case by (a) depositing with the Collateral Agent Notes or
the appropriate Applicable Ownership Interest of the Treasury Portfolio, as the
case may be, having an aggregate principal amount in the case of the Notes, or
an appropriate Applicable Ownership Interest (as defined in clause (A) of the
definition of such term) of the Treasury Portfolio, as the case may be, equal to
the aggregate principal amount of the Treasury Securities comprising part of the
Growth PRIDES and (b) transferring the related Growth PRIDES to the Agent
accompanied by a notice to the Agent, substantially in the form of Exhibit D
hereto, stating that the Holder has transferred the relevant amount of Notes or
the appropriate Applicable Ownership Interest of the Treasury Portfolio, as the
case may be, to the Collateral Agent and requesting that the Agent instruct the
Collateral Agent to release the Treasury Securities underlying such Growth
PRIDES, whereupon the Agent shall promptly give such instruction to the
Collateral Agent, substantially in the form of Exhibit C hereto. Upon receipt
of the Notes or the appropriate Applicable Ownership Interest of the Treasury
Portfolio, as the case may be, described in clause (a) above and the instruction
described in clause (b) above, in accordance with the terms of the Pledge
Agreement, the Collateral Agent will release to the Agent, on behalf of the
Holder, the Treasury Securities having a corresponding aggregate principal
amount from the Pledge, free and clear of the Company's security interest
therein, and upon receipt thereof the Agent shall promptly:
(i) cancel the related Growth PRIDES;
(ii) transfer the Treasury Securities to the Holder; and
(iii) authenticate, execute on behalf of such Holder and deliver an
Income PRIDES Certificate executed by the Company in accordance with
Section 3.3 evidencing the same number of Purchase Contracts as were
evidenced by the cancelled Growth PRIDES.
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Holders of Growth PRIDES may reestablish Income PRIDES in integral
multiples of 20 Growth PRIDES for the same multiple of 20 Income PRIDES if a Tax
Event Redemption or a Successful Initial Remarketing has not occurred, and in
integral multiples of 32,000 Growth PRIDES for 32,000 Income PRIDES if a Tax
Event Redemption or a Successful Initial Remarketing has occurred.
In the event a Holder re-establishing Income PRIDES pursuant to this
Section 3.14 fails to effect a book-entry transfer of the Growth PRIDES or fails
to deliver a Growth PRIDES Certificate(s) to the Agent after depositing Notes or
the appropriate Applicable Ownership Interest of the Treasury Portfolio, as the
case may be, with the Collateral Agent, the Treasury Securities constituting a
part of such Growth PRIDES shall be held in the name of the Agent or its nominee
in trust for the benefit of such Holder, until such Growth PRIDES are so
transferred or the Growth PRIDES Certificate is so delivered, as the case may
be, or, with respect to a Growth PRIDES Certificate, such Holder provides
evidence satisfactory to the Company and the Agent that such Growth PRIDES
Certificate has been destroyed, lost or stolen, together with any indemnity that
may be required by the Agent and the Company.
Except as provided in this Section 3.14, for so long as the Purchase
Contract underlying a Growth PRIDES remains in effect, such Growth PRIDES shall
not be separable into its constituent parts and the rights and obligations of
the Holder of such Growth PRIDES in respect of the Treasury Security and
Purchase Contract comprising such Growth PRIDES may be acquired, and may be
transferred and exchanged, only as a Growth PRIDES.
Section 3.15 Transfer of Collateral upon Occurrence of Termination
Event.
Upon the occurrence of a Termination Event and the transfer to the
Agent of the Notes, the appropriate Applicable Ownership Interest of the
Treasury Portfolio or the Treasury Securities, as the case may be, underlying
the Income PRIDES and the Growth PRIDES pursuant to the terms of the Pledge
Agreement, the Agent shall request transfer instructions with respect to such
Notes or the appropriate Applicable Ownership Interest of the Treasury Portfolio
or Treasury Securities, as the case may be, from each Holder by written request
mailed to such Holder at its address as it appears in the Income PRIDES Register
or the Growth PRIDES Register, as the case may be. Upon book-entry transfer of
the Income PRIDES or Growth PRIDES or delivery of an Income PRIDES Certificate
or a Growth PRIDES Certificate to the Agent with such transfer instructions, the
Agent shall transfer the Notes, the Applicable Ownership Interest of the
Treasury Portfolio or Treasury Securities, as the case may be, underlying such
Income PRIDES or Growth PRIDES, as the case may be, to such Holder by book-entry
transfer, or other appropriate procedures, in accordance with such instructions;
provided, however, that, to the extent that a Holder of Income PRIDES or Growth
PRIDES would otherwise be entitled to receive less than $1,000 principal amount
at maturity of the Treasury Portfolio or the Treasury Securities, the Agent
shall dispose of such securities for cash, and transfer the appropriate amount
of such cash to such Holder in accordance with such Holder's instructions. In
the event a Holder of Income PRIDES or Growth PRIDES fails to effect such
transfer or delivery, the Notes, the appropriate Applicable Ownership Interest
of the Treasury Portfolio or Treasury Securities, as the case may be, underlying
such Income PRIDES or Growth PRIDES, as the case may be, and any distributions
thereon, shall be held in the name of the Agent or its nominee in trust for the
benefit of such Holder, until such Income PRIDES or
29
Growth PRIDES are transferred or the Income PRIDES Certificate or Growth PRIDES
Certificate is surrendered or such Holder provides satisfactory evidence that
such Income PRIDES Certificate or Growth PRIDES Certificate has been destroyed,
lost or stolen, together with any indemnity that may be required by the Agent
and the Company.
Section 3.16 No Consent to Assumption.
Each Holder of a Security, by acceptance thereof, shall be deemed
expressly to have withheld any consent to the assumption under Section 365 of
the Bankruptcy Code or otherwise, of the Purchase Contract by the Company,
receiver, liquidator or a person or entity performing similar functions, its
trustee in the event that the Company becomes the debtor under the Bankruptcy
Code or subject to other similar state or federal law providing for
reorganization or liquidation.
Section 3.17 CUSIP Numbers.
The Company in issuing the Securities may use "CUSIP" numbers (if then
generally in use), and, if so, the Agent shall use "CUSIP" numbers in notices of
redemption as a convenience to Holders; provided that any such notice may state
that no representation is made as to the correctness of such numbers either as
printed on the Securities or as contained in any notice of a redemption and that
reliance may be placed only on the other identification numbers printed on the
Securities, and any such redemption shall not be affected by any defect in or
omission of such numbers. The Company will promptly notify the Agent of any
changes in the "CUSIP" numbers.
ARTICLE IV
THE NOTES
Section 4.1 Interest and Other Payments; Rights to Payments Preserved;
Rate Reset; Notice.
Interest on any Note or on the appropriate Applicable Ownership
Interest in the Treasury Portfolio, as the case may be, which is made 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 Income PRIDES Certificate (or one or more Predecessor Income
PRIDES Certificates) of which such Note or the appropriate Applicable Ownership
Interest of the Treasury Portfolio, as the case may be, is a part is registered
at the close of business on the Record Date for such Payment Date.
Each Income PRIDES Certificate evidencing Notes delivered under this
Agreement upon registration of transfer of or in exchange for or in lieu of any
other Income PRIDES Certificate shall carry the rights to accrued and unpaid
interest, and other amounts that are to accrue, which were or will be carried by
the Notes underlying such other Income PRIDES Certificate.
In the case of any Income PRIDES with respect to which Cash Settlement
of the underlying Purchase Contract is effected on the Business Day immediately
preceding the
30
Purchase Contract Settlement Date pursuant to prior notice, or with respect to
which Early Settlement of the underlying Purchase Contract is effected on an
Early Settlement Date, or with respect to which a Collateral Substitution is
effected, in each case on a date that is after any Record Date and on or prior
to the next succeeding Payment Date, interest on the Notes or distributions on
the appropriate Applicable Ownership Interest of the Treasury Portfolio, as the
case may be, underlying such Income PRIDES otherwise payable on such Payment
Date shall be payable on such Payment Date notwithstanding such Cash Settlement
or Early Settlement or Collateral Substitution, and such distributions shall,
subject to receipt thereof by the Agent, be payable to the Person in whose name
the Income PRIDES Certificate (or one or more Predecessor Certificates) was
registered at the close of business on the Record Date. Except as otherwise
expressly provided in the immediately preceding sentence, in the case of any
Income PRIDES with respect to which Cash Settlement or Early Settlement of the
underlying Purchase Contract is effected on the Business Day immediately
preceding the Purchase Contract Settlement Date or an Early Settlement Date, as
the case may be, or with respect to which a Collateral Substitution has been
effected, distributions on the related Notes or on the appropriate Applicable
Ownership Interest of the Treasury Portfolio, as the case may be, that would
otherwise be payable after the Purchase Contract Settlement Date or Early
Settlement Date shall not be payable hereunder to the Holder of such Income
PRIDES; provided, however, that to the extent that such Holder continues to hold
the separated Notes that formerly comprised a part of such Holder's Income
PRIDES, such Holder shall be entitled to receive any payments
made on such separated Notes.
The applicable Coupon Rate on the Notes on and after May 17, 2004 will
be reset on the Initial Remarketing Date to the applicable Reset Rate (such
Reset Rate to be in effect on and after May 17, 2004), except in the event of a
Failed Initial Remarketing. In the event of a Failed Initial Remarketing, the
applicable Coupon Rate on the Notes outstanding on and after the Purchase
Contract Settlement Date will be reset on the Secondary Remarketing Date to the
applicable Reset Rate (such Reset Rate to be in effect on and after the Purchase
Contract Settlement Date). On the applicable Reset Announcement Date, the Reset
Spread and the Two-Year Benchmark Treasury or Two and One-Quarter Benchmark
Treasury, as applicable, to be used to determine the Reset Rate will be
announced by the Company. On the Business Day immediately following the Reset
Announcement Date, the Holders of Notes will be notified of such Reset Spread
and Two-Year Benchmark Treasury or Two and One-Quarter Benchmark Treasury, as
applicable, by the Company. Such notice shall be sufficiently given to Holders
of Notes if published in an Authorized Newspaper in The City of New York.
Not later than seven calendar days nor more than fifteen calendar days
prior to the Reset Announcement Date, the Company will notify DTC or its nominee
(or any successor Clearing Agency or its nominee) by first-class mail, postage
prepaid, to notify the Beneficial Owners or Clearing Agency Participants holding
Income PRIDES or Growth PRIDES of such Reset Announcement Date and, in the case
of a Secondary Remarketing, the procedures to be followed by Holders of Income
PRIDES who intend to settle their obligation under the Purchase Contract with
separate cash on the Purchase Contract Settlement Date.
31
Section 4.2 Notice and Voting.
Under the terms of the Pledge Agreement, the Agent will be entitled to
exercise the voting and any other consensual rights pertaining to the Notes
pledged with the Collateral Agent but only to the extent instructed by the
Holders as described below. Upon receipt of notice of any meeting at which
holders of Notes are entitled to vote or upon any solicitation of consents,
waivers or proxies of holders of Notes, the Agent shall, as soon as practicable
thereafter, mail to the Holders of Income PRIDES a notice (a) containing such
information as is contained in the notice or solicitation, (b) stating that each
Holder on the record date set by the Agent therefor (which, to the extent
possible, shall be the same date as the record date for determining the holders
of Notes entitled to vote) shall be entitled to instruct the Agent as to the
exercise of the voting rights pertaining to the Notes underlying their Income
PRIDES and (c) stating the manner in which such instructions may be given. Upon
the written request of the Holders of Income PRIDES on such record date, the
Agent shall endeavor insofar as practicable to vote or cause to be voted, in
accordance with the instructions set forth in such requests, the maximum number
of Notes as to which any particular voting instructions are received. In the
absence of specific instructions from the Holder of an Income PRIDES, the Agent
shall abstain from voting the Notes underlying such Income PRIDES. The Company
hereby agrees, if applicable, to solicit Holders of Income PRIDES to timely
instruct the Agent in order to enable the Agent to vote such Notes.
Section 4.3 Tax Event Redemption.
Upon the occurrence of a Tax Event Redemption prior to May 17, 2004,
or in the event of a Failed Initial Remarketing, prior to the Purchase Contract
Settlement Date, pursuant to the terms of the Pledge Agreement, the Collateral
Agent will apply, out of the aggregate Redemption Price for the Notes that are
components of Income PRIDES, an amount equal to the aggregate Redemption Amount
for the Notes that are components of Income PRIDES to purchase on behalf of the
Holders of Income PRIDES the Treasury Portfolio and promptly remit the remaining
portion of such Redemption Price to the Agent for payment to the Holders of such
Income PRIDES. The Treasury Portfolio will be substituted for the pledged
Notes, and will be held by the Collateral Agent in accordance with the terms of
the Pledge Agreement to secure the obligation of each Holder of an Income PRIDES
to purchase the Common Stock of the Company under the Purchase Contract
constituting a part of such Income PRIDES. Following the occurrence of a Tax
Event Redemption prior to May 17, 2004, or, in the event of a Failed Initial
Remarketing, prior to the Purchase Contract Settlement Date, the Holders of
Income PRIDES and the Collateral Agent shall have such security interests,
rights and obligations with respect to the Treasury Portfolio as the Holder of
Income PRIDES and the Collateral Agent had in respect of the Notes, as the case
may be, subject to the Pledge thereof as provided in Sections 2, 3, 4, 5 and 6
of the Pledge Agreement, and any reference herein or in the Certificates to the
Note shall be deemed to be a reference to such Treasury Portfolio and any
reference herein or in the Certificates to interest on the Notes shall be deemed
to be a reference to corresponding distributions on the Treasury Portfolio. The
Company may cause to be made in any Income PRIDES Certificates thereafter to be
issued such change in phraseology and form (but not in substance) as may be
appropriate to reflect the substitution of the Treasury Portfolio for Notes as
collateral.
32
Section 4.4 CUSIP Numbers.
The Company in issuing the Notes may use "CUSIP" numbers (if then
generally in use), and, if so, the Indenture Trustee shall use "CUSIP" numbers
in notices of redemption as a convenience to Holders; provided that any such
notice may state that no representation is made as to the correctness of such
numbers either as printed on the Notes or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed on the Notes, and any such redemption shall not be affected by
any defect in or omission of such numbers. The Company will promptly notify the
Indenture Trustee and the Agent of any changes in the "CUSIP" numbers.
ARTICLE V
THE PURCHASE CONTRACTS
Section 5.1 Purchase of Shares of Common Stock.
Each Purchase Contract shall, unless an Early Settlement has occurred
in accordance with Section 5.10 hereof, obligate the Holder of the related
Security to purchase, and the Company to sell, on the Purchase Contract
Settlement Date at a price equal to the Stated Amount (the "Purchase Price"), a
number of newly issued shares of Common Stock equal to the Settlement Rate
unless, on or prior to the Purchase Contract Settlement Date, there shall have
occurred a Termination Event 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 equal to or greater than $_____ (the
"Threshold Appreciation Price"), _____ shares of Common Stock per Purchase
Contract, (b) if the Applicable Market Value is less than the Threshold
Appreciation Price but is greater than $______, the number of shares of Common
Stock per Purchase Contract equal to the Stated Amount divided by the Applicable
Market Value and (c) if the Applicable Market Value is less than or equal to
$_______, _______ shares of Common Stock per Purchase Contract, in each case
subject to adjustment as provided in Section 5.7 (and in each case rounded
upward or downward to the nearest 1/10,000th of a share). As provided in
Section 5.11, no fractional shares of Common Stock will be issued upon
settlement of Purchase Contracts.
The "Applicable Market Value" means the average of the Closing Price
per share of Common Stock on each of the 20 consecutive Trading Days ending on
the third Trading Day immediately preceding the Purchase Contract Settlement
Date or, for purposes of determining cash payable in lieu of fractional shares
in connection with an Early Settlement, the third Trading Day immediately
preceding the relevant Early Settlement Date.
The "Closing Price" of the Common Stock on any date of determination
means the closing sale price (or, if no closing sale 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 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 National Market or, if the Common
Stock is not
33
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 an Income PRIDES or a Growth PRIDES, by its acceptance
thereof, irrevocably authorizes the Agent to enter into and perform the related
Purchase Contract on its behalf as its attorney-in-fact (including the execution
of Certificates on behalf of such Holder), agrees to be bound by the terms and
provisions thereof, covenants and agrees to perform its obligations under such
Purchase Contracts, and consents to the provisions hereof, irrevocably
authorizes the Agent as its attorney-in-fact to enter into and perform the
Pledge Agreement on its behalf as its attorney-in-fact, and consents to and
agrees to be bound by the Pledge of the Notes, the Treasury Portfolio or the
Treasury Securities pursuant to the Pledge Agreement; provided that upon a
Termination Event, the rights of the Holder of such Security under the Purchase
Contract may be enforced without regard to any other rights or obligations.
Each Holder of an Income PRIDES or a Growth PRIDES, by its acceptance thereof,
further covenants and agrees that, to the extent and in the manner provided in
Section 5.5 and the Pledge Agreement, but subject to the terms thereof, Proceeds
of the Treasury Securities, the Notes or the Treasury Portfolio, as applicable,
on the Purchase Contract 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
Proceeds.
Upon registration of transfer of a Certificate, the transferee shall
be bound (without the necessity of any other action on the part of such
transferee), under the terms of this Agreement, the Purchase Contracts
underlying such Certificate and the Pledge Agreement and the transferor shall be
released from the obligations under this Agreement, the Purchase Contracts
underlying the Certificates so transferred and the Pledge Agreement. The
Company covenants and agrees, and each Holder of a Certificate, by its
acceptance thereof, likewise covenants and agrees, to be bound by the provisions
of this paragraph.
Section 5.2 Contract Adjustment Payments.
(a) Subject to Section 5.3 herein, the Company shall pay, on each
Payment Date, the Contract Adjustment Payments, if any, payable in respect of
each Purchase Contract to the Person in whose name a Certificate (or one or more
Predecessor Certificates) is registered at the close of business on the Record
Date next preceding such Payment Date in such coin or currency of the United
States as at the time of payment shall be legal tender for payments. The
Contract Adjustment Payments, if any, will be payable at the New York Office
maintained for that purpose or, at the option of the Company, by check mailed to
the address of the Person entitled thereto at such Person's address as it
appears on the Income PRIDES Register or the
34
Growth PRIDES Register or by wire transfer to the account designated by a prior
written notice by such Person.
Upon the occurrence of a Termination Event, the Company's obligation
to pay Contract Adjustment Payments (including any accrued Deferred Contract
Adjustment Payments), if any, shall cease.
Each Certificate delivered under this Agreement upon registration of
transfer of or in exchange for or in lieu of (including as a result of a
Collateral Substitution or the re-establishment of an Income PRIDES) any other
Certificate shall carry the rights to Contract Adjustment Payments, if any,
accrued and unpaid, and to accrue Contract Adjustment Payments, if any, which
were carried by the Purchase Contracts underlying such other Certificates.
Subject to Section 5.10, in the case of any Security with respect to
which Early Settlement of the underlying Purchase Contract is effected on an
Early Settlement Date, or in respect of which Cash Settlement of the underlying
Purchase Contract is effected on the Business Day immediately preceding the
Purchase Contract Settlement Date, or with respect to which a Collateral
Substitution or an establishment or re-establishment of Income PRIDES pursuant
to Section 3.14 is effected, in each case on a date that is after any Record
Date and on or prior to the next succeeding Payment Date, Contract Adjustment
Payments on the Purchase Contracts underlying such Securities otherwise payable
on such Payment Date shall be payable on such Payment Date notwithstanding such
Cash Settlement, Early Settlement, Collateral Substitution or establishment or
re-establishment of Income PRIDES, and such Contract Adjustment Payments shall
be paid to the Person in whose name the Certificate evidencing such Security (or
one or more Predecessor Certificates) is registered at the close of business on
such Record Date. Except as otherwise expressly provided in the immediately
preceding sentence, in the case of any Security with respect to which Cash
Settlement or Early Settlement of the underlying Purchase Contract is effected
on the Business Day immediately preceding the Purchase Contract Settlement Date
or on an Early Settlement Date, as the case may be, or with respect to which a
Collateral Substitution or an establishment or re- establishment of Income
PRIDES has been effected, Contract Adjustment Payments, if any, that would
otherwise be payable after the Purchase Contract Settlement Date or Early
Settlement Date, Collateral Substitution or such establishment or
reestablishment with respect to such Purchase Contract shall not be payable.
(b) The Company's obligations with respect to Contract Adjustment
Payments, if any, will be subordinated and junior in right of payment to the
Company's obligations under any Senior Indebtedness.
(c) In the event (x) of any payment by, or distribution of assets of,
the Company of any kind or character, whether in cash, property or securities,
to creditors upon any dissolution, winding-up, liquidation or reorganization of
the Company, whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, or (y) subject to the provisions of
Subsection 5.2(e) below, that (i) a default shall have occurred and be
continuing with respect to the payment of principal, interest or any other
monetary amounts due and payable on any Senior Indebtedness and such default
shall have continued beyond the period of grace, if any, specified in the
instrument evidencing such Senior Indebtedness (and the Agent shall have
received written notice thereof from the Company or one or more holders of
Senior Indebtedness
35
or their representative or representatives or the trustee or trustees under any
indenture pursuant to which any such Senior Indebtedness may have been issued),
or (ii) the maturity of any Senior Indebtedness shall have been accelerated
because of a default in respect of such Senior Indebtedness (and the Agent shall
have received written notice thereof from the Company or one or more holders of
Senior Indebtedness or their representative or representatives or the trustee or
trustees under any indenture pursuant to which any such Senior Indebtedness may
have been issued), then:
(i) the holders of all Senior Indebtedness shall first be entitled
to receive, in the case of clause (x) above, payment of all amounts due or
to become due upon all Senior Indebtedness and, in the case of subclauses
(i) and (ii) of clause (y) above, payment of all amounts due thereon, or
provision shall be made for such payment in money or money's worth, before
the Holders of any of the Securities are entitled to receive any Contract
Adjustment Payments on the Purchase Contracts underlying the Securities;
(ii) any payment by, or distribution of assets of, the Company of any
kind or character, whether in cash, property or securities, to which the
Holders of any of the Securities would be entitled except for the
provisions of Subsections 5.2(b) through (n), including any such payment or
distribution which may be payable or deliverable by reason of the payment
of any other indebtedness of the Company being subordinated to the payment
of such Contract Adjustment Payments on the Purchase Contracts underlying
the Securities, shall be paid or delivered by the Person making such
payment or distribution, whether a trustee in bankruptcy, a receiver or
liquidating trustee or otherwise, directly to the holders of such Senior
Indebtedness or their representative or representatives or to the trustee
or trustees under any indenture under which any instruments evidencing any
of such Senior Indebtedness may have been issued, ratably according to the
aggregate amounts remaining unpaid on account of such Senior Indebtedness
held or represented by each, to the extent necessary to make payment in
full of all Senior Indebtedness remaining unpaid after giving effect to any
concurrent payment or distribution (or provision therefor) to the holders
of such Senior Indebtedness, before any payment or distribution is made of
such Contract Adjustment Payments to the Holders of such Securities; and
(iii) in the event that, notwithstanding the foregoing, any payment
by, or distribution of assets of, the Company of any kind or character,
whether in cash, property or securities, including any such payment or
distribution which may be payable or deliverable by reason of the payment
of any other indebtedness of the Company being subordinated to the payment
of Contract Adjustment Payments on the Purchase Contracts underlying the
Securities, shall be received by the Agent or the Holders of any of the
Securities when such payment or distribution is prohibited pursuant to
Subsections 5.2(b) through (n), such payment or distribution shall be paid
over to the holders of such Senior Indebtedness or their representative or
representatives or to the trustee or trustees under any indenture pursuant
to which any instruments evidencing any such Senior Indebtedness may have
been issued, ratably as aforesaid, for application to the payment of all
Senior Indebtedness remaining unpaid until all such Senior Indebtedness
shall have
36
been paid in full, after giving effect to any concurrent payment or
distribution (or provision therefor) to the holders of such Senior
Indebtedness.
(d) For purposes of Subsections 5.2(b) through (n), the words "cash,
property or securities" shall not be deemed to include shares of stock of the
Company as reorganized or readjusted, or securities of the Company or any other
Person provided for by a plan of reorganization or readjustment, the payment of
which is subordinated at least to the extent provided in Subsections 5.2(b)
through (n) with respect to such Contract Adjustment Payments on the Securities
to the payment of all Senior Indebtedness which may at the time be outstanding;
provided that (i) the indebtedness or guarantee of indebtedness, as the case may
be, that constitutes Senior Indebtedness is assumed by the Person, if any,
resulting from any such reorganization or readjustment, and (ii) the rights of
the holders of the Senior Indebtedness are not, without the consent of each such
holder adversely affected thereby, altered by such reorganization or
readjustment;
(e) Any failure by the Company to make any payment on or perform any
other obligation under Senior Indebtedness, other than any indebtedness incurred
by the Company or assumed or guaranteed, directly or indirectly, by the Company
for money borrowed (or any deferral, renewal, extension or refunding thereof) or
any indebtedness or obligation as to which the provisions of Subsections 5.2(b)
through (d) shall have been waived by the Company in the instrument or
instruments by which the Company incurred, assumed, guaranteed or otherwise
created such indebtedness or obligation, shall not be deemed a default or event
of default if (i) the Company shall be disputing its obligation to make such
payment or perform such obligation and (ii) either (A) no final judgment
relating to such dispute shall have been issued against the Company which is in
full force and effect and is not subject to further review, including a judgment
that has become final by reason of the expiration of the time within which a
party may seek further appeal or review, and (B) in the event a judgment that is
subject to further review or appeal has been issued, the Company shall in good
faith be prosecuting an appeal or other proceeding for review and a stay of
execution shall have been obtained pending such appeal or review.
(f) Subject to the payment in full of all Senior Indebtedness, the
Holders of the Securities shall be subrogated (equally and ratably with the
holders of all obligations of the Company which by their express terms are
subordinated to Senior Indebtedness of the Company to the same extent as payment
of the Contract Adjustment Payments in respect of the Purchase Contracts
underlying the Securities is subordinated and which are entitled to like rights
of subrogation) to the rights of the holders of Senior Indebtedness to receive
payments or distributions of cash, property or securities of the Company
applicable to the Senior Indebtedness until all such Contract Adjustment
Payments owing on the Securities shall be paid in full, and as between the
Company, its creditors other than holders of such Senior Indebtedness and the
Holders, no such payment or distribution made to the holders of Senior
Indebtedness by virtue of Subsections 5.2(b) through (n) that otherwise would
have been made to the Holders shall be deemed to be a payment by the Company on
account of such Senior Indebtedness, it being understood that the provisions of
Subsections 5.2(b) through (n) are and are intended solely for the purpose of
defining the relative rights of the Holders, on the one hand, and the holders of
Senior Indebtedness, on the other hand.
37
(g) Nothing contained in Subsections 5.2(b) through (n) or elsewhere
in this Agreement or in the Securities is intended to or shall impair, as among
the Company, its creditors other than the holders of Senior Indebtedness and the
Holders, the obligation of the Company, which is absolute and unconditional, to
pay to the Holders such Contract Adjustment Payments on the Securities as and
when the same shall become due and payable in accordance with their terms, or is
intended to or shall affect the relative rights of the Holders and creditors of
the Company other than the holders of Senior Indebtedness, nor shall anything
herein or therein prevent the Agent or any Holder from exercising all remedies
otherwise permitted by applicable law upon default under this Agreement, subject
to the rights, if any, under these Subsections 5.2(b) through (n), of the
holders of Senior Indebtedness in respect of cash, property or securities of the
Company received upon the exercise of any such remedy.
(h) Upon payment or distribution of assets of the Company referred to
in these Subsections 5.2(b) through (n), the Agent and the Holders shall be
entitled to rely upon any order or decree made by any court of competent
jurisdiction in which any such dissolution, winding up, liquidation or
reorganization proceeding affecting the affairs of the Company is pending or
upon a certificate of the trustee in bankruptcy, receiver, assignee for the
benefit of creditors, liquidating trustee or agent or other person making any
payment or distribution, delivered to the Agent or to the Holders, for the
purpose of ascertaining the Persons entitled to participate in such payment or
distribution, the holders of the Senior Indebtedness and other indebtedness of
the Company, the amount thereof or payable thereon, the amount or amounts paid
or distributed thereon and all other facts pertinent thereto or to these
Subsections 5.2(b) through (n).
(i) The Agent shall be entitled to rely on the delivery to it of a
written notice by a Person representing himself to be a holder of Senior
Indebtedness (or a trustee or representative on behalf of such holder) to
establish that such notice has been given by a holder of Senior Indebtedness or
a trustee or representative on behalf of any such holder or holders. In the
event that the Agent determines in good faith that further evidence is required
with respect to the right of any Person as a holder of Senior Indebtedness to
participate in any payment or distribution pursuant to Subsections 5.2(b)
through (n), the Agent may request such Person to furnish evidence to the
reasonable satisfaction of the Agent as to the amount of Senior Indebtedness
held by such Person, the extent to which such Person is entitled to participate
in such payment or distribution and any other facts pertinent to the rights of
such Person under Subsections 5.2(b) through (n), and, if such evidence is not
furnished, the Agent may defer payment to such Person pending judicial
determination as to the right of such Person to receive such payment.
(j) Nothing contained in Subsections 5.2(b) through (n) shall affect
the obligations of the Company to make, or prevent the Company from making,
payment of the Contract Adjustment Payments, except as otherwise provided in
these Subsections 5.2(b) through (n).
(k) Each Holder of Securities, by his acceptance thereof, authorizes
and directs the Agent on his, her or its behalf to take such action as may be
necessary or appropriate to effectuate the subordination provided in Subsections
5.2(b) through (n) and appoints the Agent his, her or its attorney-in-fact, as
the case may be, for any and all such purposes.
38
(l) The Company shall give prompt written notice to the Agent of any
fact known to the Company that would prohibit the making of any payment of
moneys to or by the Agent in respect of the Securities pursuant to the
provisions of this Section. Notwithstanding the provisions of Subsections 5.2(b)
through (e) or any other provisions of this Agreement, the Agent shall not be
charged with knowledge of the existence of any facts that would prohibit the
making of any payment of moneys to or by the Agent, or the taking of any other
action by the Agent, unless and until the Agent shall have received written
notice thereof mailed or delivered to the Agent at its Institutional Trust
Services department from the Company, any Holder, any paying agent or the holder
or representative of any Senior Indebtedness; provided that if at least two
Business Days prior to the date upon which by the terms hereof any such moneys
may become payable for any purpose, the Agent shall not have received with
respect to such moneys the notice provided for in this Section, then, anything
herein contained to the contrary notwithstanding, the Agent shall have full
power and authority to receive such moneys and to apply the same to the purpose
for which they were received and shall not be affected by any notice to the
contrary that may be received by it within two Business Days prior to or on or
after such date.
(m) The Agent in its individual capacity shall be entitled to all the
rights set forth in this Section with respect to any Senior Indebtedness at the
time held by it, to the same extent as any other holder of Senior Indebtedness
and nothing in this Agreement shall deprive the Agent of any of its rights as
such holder.
(n) No right of any present or future holder of any Senior
Indebtedness to enforce the subordination herein shall at any time or in any way
be prejudiced or impaired by any act or failure to act on the part of the
Company or by any noncompliance by the Company with the terms, provisions and
covenants of this Agreement, regardless of any knowledge thereof which any such
holder may have or be otherwise charged with.
(o) Nothing in this Section 5.2 shall apply to claims of, or payments
to, the Agent under or pursuant to Section 7.7.
With respect to the holders of Senior Indebtedness, (i) the duties and
obligations of the Agent shall be determined solely by the express provisions of
this Agreement; (ii) the Agent shall not be liable except for the performance of
such duties and obligations as are specifically set forth in this Agreement;
(iii) no implied covenants or obligations shall be read into this Agreement
against the Agent; and (iv) the Agent shall not be deemed to be a fiduciary as
to such holders.
Section 5.3 Deferral of Payment Dates For Contract Adjustment
Payments.
The Company shall have the right, at any time prior to the Purchase
Contract Settlement Date, to defer the payment of any or all of the Contract
Adjustment Payments otherwise payable on any Payment Date, but only if the
Company shall give the Holders and the Agent written notice of its election to
defer 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 Adjustment Payments to the NYSE or
other applicable self-regulatory
39
organization or to Holders of the Securities, but in any event not less than one
Business Day prior to such Record Date. Any Contract Adjustment Payments so
deferred shall, to the extent permitted by law, bear additional Contract
Adjustment Payments thereon at the rate of __% [equal to rate on Notes plus rate
of Contract Adjustment Payments] per year (computed on the basis of a 360 day
year of twelve 30 day months), compounding on each succeeding Payment Date,
until paid in full (such deferred installments of Contract Adjustment Payments,
if any, together with the additional Contract Adjustment Payments accrued
thereon, being referred to herein as the "Deferred Contract Adjustment
Payments"). Deferred Contract Adjustment Payments, if any, shall be due on the
next succeeding Payment Date except to the extent that payment is deferred
pursuant to this Section. No Contract Adjustment Payments may be deferred to a
date that is after the Purchase Contract Settlement Date and no such deferral
period may end other than on a Payment Date. If the Purchase Contracts are
terminated upon the occurrence of a Termination Event, the Holder's right to
receive Contract Adjustment Payments, if any, and Deferred Contract Adjustment
Payments will terminate.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments on the Purchase Contracts until a Payment Date prior to the
Purchase Contract Settlement Date, then all Deferred Contract Adjustment
Payments, if any, shall be payable to the registered Holders as of the close of
business on the Record Date immediately preceding such Payment Date.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments on the Purchase Contracts until the Purchase Contract
Settlement Date, each Holder will receive on the Purchase Contract Settlement
Date in lieu of a cash payment a number of shares of Common Stock (in addition
to a number of shares of Common Stock equal to the Settlement Rate) equal to (x)
the aggregate amount of Deferred Contract Adjustment Payments payable to such
Holder divided by (y) the Applicable Market Value.
No fractional shares of Common Stock will be issued by the Company
with respect to the payment of Deferred Contract Adjustment Payments on the
Purchase Contract Settlement Date. In lieu of fractional shares otherwise
issuable with respect to such payment of Deferred Contract Adjustment Payments,
the Holder will be entitled to receive an amount in cash as provided in Section
5.11.
In the event the Company exercises its option to defer the payment of
Contract Adjustment Payments then, until the Deferred Contract Adjustment
Payments have been paid, the Company shall not, and shall not permit its
Subsidiaries to, declare or pay dividends on, make distributions with respect
to, or redeem, purchase or acquire, or make a liquidation payment with respect
to, any of the Company's capital stock other than:
(i) purchases, redemptions or acquisitions of shares of capital
stock of the Company in connection with any employment contract, benefit
plan or other similar arrangement with or for the benefit of employees,
officers or directors or a stock purchase or dividend reinvestment plan, or
the satisfaction by the Company of its obligations pursuant to any contract
or security outstanding on the date the Company exercises its right to
defer the Contract Adjustment Payments;
40
(ii) as a result of a reclassification of the Company's capital stock
or the exchange or conversion of one class or series of the Company's
capital stock for another class or series of the Company's capital stock;
(iii) the purchase of fractional interests in shares of the Company's
capital stock pursuant to the conversion or exchange provisions of such
capital stock or the security being converted or exchanged;
(iv) dividends or distributions in capital stock of the Company (or
rights to acquire capital stock) or repurchases, acquisitions or
redemptions of capital stock in exchange for or out of the net cash
proceeds of the sale of the Company's capital stock (or securities
convertible into or exchangeable for shares of the Company's capital
stock);
(v) redemptions, exchanges or repurchases of any rights outstanding
under a shareholder rights plan or the declaration or payment thereunder of
a dividend or distribution of or with respect to rights in the future; or
(vi) mandatory sinking fund payments with respect to any series of
preferred stock of the Company; provided that the aggregate stated value of
all such series outstanding at the time of such payment does not exceed 5%
of the aggregate of (1) the total principal amount of all then outstanding
bonds or other securities representing secured indebtedness issued or
assumed by the Company and (2) the Company's capital and surplus to be
stated on the Company's books of account after giving effect to such
payment; provided however that any moneys deposited in to any sinking fund
and not in violation of this clause (vi) may thereafter be applied to the
purchase or redemption of such preferred stock or preferred stock A in
accordance with the terms of such sinking fund without regard to the
foregoing restrictions.
Section 5.4 Initial Remarketing.
Unless a Tax Event Redemption has occurred, the Company shall engage a
nationally recognized investment bank (the "Remarketing Agent") pursuant to the
Remarketing Agreement to sell the Notes (the "Initial Remarketing") on the third
Business Day immediately preceding May 17, 2004 (the "Initial Remarketing
Date"). In order to facilitate the remarketing, the Agent shall notify, by
10:00 a.m., New York City time, on the Business Day immediately preceding the
Initial Remarketing Date, the Remarketing Agent of the aggregate principal
amount of Notes to be remarketed. Concurrently, the Collateral Agent, pursuant
to the terms of the Pledge Agreement, will present for remarketing such Notes to
the Remarketing Agent. Upon receipt of such notice from the Agent and such
Notes from the Collateral Agent, the Remarketing Agent will, on the Initial
Remarketing Date, use its reasonable efforts to remarket such Notes on such date
at a price of approximately 100.5% (but not less than 100%) of the Treasury
Portfolio Purchase Price. If the Remarketing Agent is able to remarket the
Notes at a price equal to or greater than 100% of the Treasury Portfolio
Purchase Price (a "Successful Initial Remarketing"), the portion of the proceeds
from such Successful Initial Remarketing equal to the Treasury Portfolio
Purchase Price will be applied to purchase the Treasury Portfolio. In addition,
the Remarketing Agent may deduct as a remarketing fee ("Remarketing Fee") an
amount equal to 25 basis points (0.25%) of the Treasury Portfolio Purchase Price
from any amount of such proceeds
41
in excess of the Treasury Portfolio Purchase Price. Any proceeds in excess of
those required to pay the Treasury Portfolio Purchase Price and the Remarketing
Fee will be remitted to the Agent for payment to the Holders of the related
Income PRIDES. Income PRIDES Holders whose Notes are so remarketed will not
otherwise be responsible for the payment of any Remarketing Fee in connection
therewith. The Treasury Portfolio will be substituted for the Notes of Holders
of Income PRIDES and will be pledged to the Collateral Agent to secure the
Income PRIDES Holders' obligation to pay the Purchase Price for the Common Stock
under the related Purchase Contracts on the Purchase Contract Settlement Date.
Following the occurrence of a Successful Initial Remarketing, the Holders of
Income PRIDES and the Collateral Agent shall have such security interests,
rights and obligations with respect to the Treasury Portfolio as the Holder of
Income PRIDES and the Collateral Agent had in respect of the Notes, as the case
may be, subject to the Pledge thereof as provided in Sections 2, 3, 4, 5 and 6
of the Pledge Agreement, and any reference herein or in the Certificates to the
Notes shall be deemed to be a reference to such Treasury Portfolio and any
reference herein or in the Certificates to interest on the Notes shall be deemed
to be a reference to corresponding distributions on the Treasury Portfolio. The
Company may cause to be made in any Income PRIDES Certificates thereafter to be
issued such change in phraseology and form (but not in substance) as may be
appropriate to reflect the substitution of the Treasury Portfolio for Notes as
collateral.
If, in spite of using its reasonable efforts, the Remarketing Agent
cannot remarket the related Notes (other than to the Company) of such Holders of
Income PRIDES at a price not less than 100% of the Treasury Portfolio Purchase
Price, the remarketing will be deemed to have failed (a "Failed Initial
Remarketing"). The Company will cause a notice of a Failed Initial Remarketing
to be published on the second Business Day immediately preceding May 17, 2004 in
a daily newspaper in the English language of general circulation in The City of
New York, which is expected to be The Wall Street Journal.
Section 5.5 Payment of Purchase Price.
(a) (i) Unless a Tax Event Redemption, Successful Initial
Remarketing, Termination Event or Early Settlement has occurred, each Holder of
an Income PRIDES may pay in cash ("Cash Settlement") the Purchase Price for the
shares of Common Stock to be purchased pursuant to a Purchase Contract if such
Holder notifies the Agent by use of a notice in substantially the form of
Exhibit E hereto of its intention to make a Cash Settlement. Such notice shall
be made on or prior to 5:00 p.m., New York City time, on the fifth Business Day
immediately preceding the Purchase Contract Settlement Date. The Agent shall
promptly notify the Collateral Agent of the receipt of such a notice from a
Holder intending to make a Cash Settlement.
(ii) A Holder of an Income PRIDES who has so notified the Agent of
its intention to make a Cash Settlement is required to pay the Purchase
Price to the Collateral Agent prior to 11:00 a.m., New York City time, on
the Business Day immediately preceding the Purchase Contract Settlement
Date in lawful money of the United States by certified or cashiers' check
or wire transfer, in each case payable to or upon the order of the Company.
Any cash received by the Collateral Agent will be invested promptly by the
Collateral Agent in Permitted Investments and paid to the Company on the
Purchase Contract Settlement Date in settlement of the Purchase
42
Contract in accordance with the terms of this Agreement and the Pledge
Agreement. Any funds received by the Collateral Agent in respect of the
investment earnings from the investment in such Permitted Investments, will
be distributed to the Agent when received for payment to the Holder.
(iii) If a Holder of an Income PRIDES fails to notify the Agent of its
intention to make a Cash Settlement in accordance with paragraph (a)(i)
above, such failure shall constitute an event of default and the Holder
shall be deemed to have consented to the disposition of the pledged Notes
pursuant to the Secondary Remarketing as described in paragraph (b) below.
If a Holder of an Income PRIDES does notify the Agent as provided in
paragraph (a)(i) above of its intention to pay the Purchase Price in cash,
but fails to make such payment as required by paragraph (a)(ii) above, such
failure shall also constitute a default; however, the Notes of such a
Holder will not be remarketed but instead the Collateral Agent, for the
benefit of the Company, will exercise its rights as a secured party with
respect to such Notes, including but not limited to those rights specified
in paragraph (c) below.
(b) Unless a Tax Event Redemption or a Successful Initial
Remarketing has occurred, the Notes of Income PRIDES Holders who have not
notified the Agent of their intention to effect a Cash Settlement as provided in
paragraph (a)(i) above will be sold by the Remarketing Agent (the "Secondary
Remarketing") on the third Business Day immediately preceding the Purchase
Contract Settlement Date (the "Secondary Remarketing Date"). The Agent shall
notify, by 10:00 a.m., New York City time, on the Business Day immediately
preceding the Secondary Remarketing Date, the Remarketing Agent of the aggregate
principal amount of Notes to be remarketed. Concurrently, the Collateral Agent,
pursuant to the terms of the Pledge Agreement, will present for remarketing such
Notes to the Remarketing Agent. Upon receipt of such notice from the Agent and
such Notes from the Collateral Agent, the Remarketing Agent will, on the
Secondary Remarketing Date, use its reasonable efforts to remarket such Notes on
such date at a price of approximately 100.5% (but not less than 100%) of the
aggregate principal amount of such Notes. If the Remarketing Agent is able to
remarket the Notes at a price equal to or greater than 100% of the aggregate
principal amount of Notes (a "Successful Secondary Remarketing"), the
Remarketing Agent will remit the entire amount of the proceeds from such
Successful Secondary Remarketing to the Collateral Agent; provided, however,
that the Remarketing Agent may deduct as the Remarketing Fee an amount equal to
25 basis points (0.25%) of the aggregate principal amount of the remarketed
Notes from any amount of the proceeds of a Successful Secondary Remarketing in
excess of the aggregate principal amount of the remarketed Notes. The portion of
the proceeds equal to the aggregate principal amount of Notes will automatically
be applied by the Collateral Agent, in accordance with the Pledge Agreement, to
satisfy in full such Income PRIDES holders' obligations to pay the Purchase
Price for the Common Stock under the related Purchase Contracts on the Purchase
Contract Settlement Date. Any proceeds in excess of those required to pay the
Purchase Price and the Remarketing Fee will be remitted to the Agent for payment
to the Holders of the related Income PRIDES. Income PRIDES Holders whose Notes
are so remarketed will not otherwise be responsible for the payment of any
Remarketing Fee in connection therewith. If, in spite of using its reasonable
efforts, the Remarketing Agent cannot remarket the related Notes (other than to
the Company) of such Holders of Income PRIDES at a price not less than 100% of
the aggregate principal amount of the Notes, the remarketing will be deemed to
have failed (a "Failed Secondary Remarketing")
43
and in accordance with the terms of the Pledge Agreement the Collateral Agent
for the benefit of the Company will exercise its rights as a secured party with
respect to such Notes, including those actions specified in paragraph (c) below.
The Company will cause a notice of such Failed Secondary Remarketing to be
published on the second Business Day immediately preceding the Purchase Contract
Settlement Date in a daily newspaper in the English language of general
circulation in The City of New York, which is expected to be The Wall Street
Journal.
(c) With respect to any Notes beneficially owned by Holders who have
elected Cash Settlement but failed to deliver cash as required in (a)(ii) above,
or with respect to Notes which are subject to a Failed Secondary Remarketing,
the Collateral Agent for the benefit of the Company reserves all of its rights
as a secured party with respect thereto and, subject to applicable law and
paragraph (h) below, may, among other things, (i) retain the Notes in full
satisfaction of the Holders obligations under the Purchase Contracts or (ii)
sell the Notes in one or more public or private sales.
(d) Unless a Termination Event or an Early Settlement has occurred,
the Purchase Contract underlying each Growth PRIDES and, if a Tax Event
Redemption or a Successful Initial Remarketing has occurred, each Income PRIDES
will be settled with the Proceeds at maturity of the Treasury Security or the
Applicable Ownership Interest (as defined in clause (A) of the definition of
such term) of the Treasury Portfolio, as applicable. Upon receipt of such
Proceeds, the Collateral Agent will invest the Proceeds promptly in Permitted
Investments and pay the Proceeds to the Company on the Purchase Contract
Settlement Date in accordance with the terms of this Agreement and the Pledge
Agreement. Any such Proceeds received by the Collateral Agent in excess of the
Purchase Price and any funds received by the Collateral Agent in respect of the
investment earnings from the investment in such Permitted Investments will be
distributed to the Agent when received for payment to the Holders.
(e) Any distribution to Holders of excess funds and interest
described above, shall be payable at the New York Office maintained for that
purpose or, at the option of the Holder, by check mailed to the address of the
Person entitled thereto at such address as it appears on the Register.
(f) Unless a Holder settles the underlying Purchase Contract through
the Early Settlement in the manner described in Section 5.10, the Company shall
not be obligated to issue any shares of Common Stock in respect of a Purchase
Contract or deliver any certificate therefor to the Holder unless it shall have
received payment in full of the Purchase Price for the shares of Common Stock to
be purchased thereunder in the manner set forth in this Section 5.5.
(g) Upon Cash Settlement of any Purchase Contract, (i) the Collateral
Agent will in accordance with the terms of the Pledge Agreement cause the
pledged Notes underlying the relevant Security to be released from the Pledge by
the Collateral Agent free and clear of any security interest of the Company and
transferred to the Agent for delivery to the Holder thereof or its designee as
soon as practicable and (ii) subject to the receipt thereof from the Collateral
Agent, the Agent shall, by book-entry transfer, or other appropriate procedures,
in accordance with instructions provided by the Holder thereof, transfer such
Notes (or, if no such instructions are given to the Agent by the Holder, the
Agent shall hold such Notes and any distributions thereon in the name of the
Agent or its nominee in trust for the benefit of such Holder).
44
(h) The obligations of the Holders to pay the Purchase Price are non-
recourse obligations and are payable solely out of any Cash Settlement or the
Proceeds of any Collateral pledged to secure the obligations of the Holders and
in no event will Holders be liable for any deficiency between the Proceeds of
Collateral and the Purchase Price.
Section 5.6 Issuance of Shares of Common Stock.
Unless a Termination Event or an Early Settlement shall have occurred,
on the Purchase Contract 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
5.7(c), the Company shall issue and deposit with the Agent, for the benefit of
the Holders of the Outstanding Securities, one or more certificates representing
newly issued 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 for which both a record date
and payment date for such dividend or distribution has occurred on or after the
Purchase Contract Settlement Date, being hereinafter referred to as the
"Purchase Contract Settlement Fund") to which the Holders are entitled
hereunder. Subject to the foregoing, upon surrender of a Certificate to the
Agent on or after the Purchase Contract Settlement Date, together with
settlement instructions thereon duly completed and executed, the Holder of such
Certificate shall be entitled to receive in exchange therefor a certificate
representing that number of whole shares of Common Stock which 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 5.11 and any dividends or
distributions with respect to such shares constituting part of the Purchase
Contract Settlement Fund, but without any interest thereon, and the Certificate
so surrendered shall forthwith be cancelled. Such shares shall be registered in
the name of the Holder or the Holder's designee as specified in the settlement
instructions provided by the Holder to the Agent. 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 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
Certificate evidencing such Purchase Contract or has established to the
satisfaction of the Company that such tax either has been paid or is not
payable.
Section 5.7 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 the Common Stock in Common Stock, the Settlement Rate, as
in effect at the opening of business on the day following the date fixed
for the determination of stockholders entitled to receive such dividend or
other distribution shall be increased by dividing such Settlement Rate 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
45
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 any shares issuable in respect of any share 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 fixed for the determination
of stockholders entitled to receive such rights, options or warrants (other
than pursuant to a dividend reinvestment plan or share purchase 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 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 purposes of this paragraph (2), the number of shares of
Common Stock at any time outstanding shall not include shares held in the
treasury of the Company but shall include any shares issuable in respect of
any scrip certificates issued in lieu of fractions of shares of Common
Stock. The Company shall not issue any such rights, options or warrants in
respect of shares of Common Stock held in the treasury of the Company.
(3) In case outstanding shares of Common Stock shall be subdivided or
split into a greater number of shares of Common Stock, the Settlement Rate
in effect at the opening of business on the day following the day upon
which such subdivision or split becomes effective shall be proportionately
increased, and, conversely, in case outstanding shares of Common Stock
shall each be combined into a smaller number of shares of Common Stock, the
Settlement Rate in effect at the opening of business on the day following
the day upon which such combination becomes effective shall be
proportionately reduced, such increase or reduction, as the case may be, to
become effective immediately after the opening of business on the day
following the day upon which such subdivision, split or combination becomes
effective.
(4) In case the Company shall, by dividend or otherwise, distribute
to all holders of its Common Stock evidences of its indebtedness, shares of
capital stock, securities, cash or other property (but excluding any rights
or warrants referred to in
46
paragraph (2) of this Section, any dividend or distribution paid
exclusively in cash and any dividend or distribution referred to in
paragraph (1) of this Section), 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 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) on such date of the portion of the evidences of
indebtedness, shares of capital stock, securities, cash or other property
so distributed applicable to one share of Common Stock and the denominator
shall be such Current Market Price per share of the Common Stock, such
adjustment to become effective immediately prior to the opening of business
on the day following the date fixed for the determination of stockholders
entitled to receive such distribution. In any case in which this paragraph
(4) is applicable, paragraph (2) of this Section shall not be applicable.
(5) In case the Company shall, (I) by dividend or otherwise,
distribute to all holders of its Common Stock cash (excluding (i) regular
quarterly cash distributions, (ii) any cash that is distributed in a
Reorganization Event to which Section 5.6(c) applies or (iii) cash that is
distributed as part of a distribution referred to in paragraph (4) of this
Section) in an aggregate amount that, combined together with (II) the
aggregate amount of any other distributions to all holders of its Common
Stock made exclusively in cash within the 12 months preceding the date of
payment of such distribution and in respect of which no adjustment pursuant
to this paragraph (5) or paragraph (6) of this Section has been made and
(III) the aggregate of any cash plus the fair market value, as of the
expiration of the applicable tender or exchange offer referred to below (as
determined by the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution), of consideration payable
in respect of any tender or exchange offer (other than consideration
payable in respect of any odd-lot tender offer) by the Company or any of
its subsidiaries for all or any portion of the Common Stock concluded
within the 12 months preceding the date of payment of the distribution
described in clause (I) above and in respect of which no adjustment
pursuant to this paragraph (5) or paragraph (6) of this Section has been
made, exceeds 15% of the product of the Current Market Price per share of
the Common Stock on the date for the determination of holders of shares of
Common Stock entitled to receive such distribution times the number of
shares of Common Stock outstanding on such date, then, and in each such
case, immediately after the close of business on such date for
determination, the Settlement Rate 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 combined
amount distributed or payable in the transactions described in clauses (I),
(II) and (III) above and (y) the number of shares of Common Stock
outstanding on such date for determination and (ii) the denominator of
which shall be equal to the Current Market Price per share of the Common
Stock on such date for determination.
47
(6) In case (I) a tender or exchange offer made by the Company or any
Subsidiary of the Company for all or any portion of the Common Stock shall
expire and such tender or exchange offer (as amended upon the expiration
thereof) shall require the payment to stockholders (based on the acceptance
(up to any maximum specified in the terms of the tender or exchange offer)
of Purchased Shares) of an aggregate consideration having a fair market
value (as determined by the Board of Directors, whose determination shall
be conclusive and described in a Board Resolution) that combined together
with (II) the aggregate of the cash plus the fair market value (as
determined by the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution), as of the expiration of
such tender or exchange offer, of consideration payable in respect of any
other tender or exchange offer (other than consideration payable in respect
of any odd-lot tender offer) by the Company or any subsidiary of the
Company for all or any portion of the Common Stock expiring within the 12
months preceding the expiration of such tender or exchange offer and in
respect of which no adjustment pursuant to paragraph (5) of this Section or
this paragraph (6) has been made and (III) the aggregate amount of any
distributions (other than regular quarterly cash distributions) to all
holders of the Company's Common Stock made exclusively in cash within the
12 months preceding the expiration of such tender or exchange offer and in
respect of which no adjustment pursuant to paragraph (5) of this Section or
this paragraph (6) has been made, exceeds 15% of the product of the Current
Market Price per share of the Common Stock as of the last time (the
"Expiration Time") tenders could have been made pursuant to such tender or
exchange offer (as it may be amended) times the number of shares of Common
Stock outstanding (including any tendered shares) 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 the close of business as 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 as of the Expiration Time and (II) the number of shares of Common
Stock outstanding (including any tendered shares) as of the Expiration Time
less (B) the amount of cash plus the fair market value (determined as
aforesaid) of the aggregate consideration payable to stockholders based on
the transactions described in clauses (I), (II) and (III) above (assuming
in the case of clause (I) the acceptance, up to any maximum specified in
the terms of the tender or exchange offer, of Purchased Shares), and (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 5.7(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
48
determination" within the meaning of paragraph (4) of this Section), and
(b) a subdivision, split or combination, as the case may be, of the number
of shares of Common Stock outstanding immediately prior to such
reclassification into the number of shares of Common Stock outstanding
immediately thereafter (and the effective date of such reclassification
shall be deemed to be "the day upon which such subdivision or split becomes
effective" or "the day upon which such combination becomes effective", as
the case may be, and "the day upon which such subdivision, split or
combination becomes effective" within the meaning of paragraph (3) of this
Section).
(8) The "Current Market Price" per share of Common Stock on any day
means the average of the daily Closing Prices for the five consecutive
Trading Days selected by the Company commencing not more than 30 Trading
Days before, and ending not later than, the earlier of the day in question
and the day before the "ex date" with respect to the issuance or
distribution requiring such computation. For purposes of this paragraph,
the term "ex date", when used with respect to any issuance or distribution,
shall mean the first date on which the Common Stock trades 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 5.7(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 5.1 will apply on the
Purchase Contract Settlement Date. Such adjustment shall be made by
multiplying the Applicable Market Value by a fraction of which the
numerator shall be the Settlement Rate immediately after such adjustment
pursuant to paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of this
Section 5.7(a) and the denominator shall be the Settlement Rate immediately
before such adjustment; provided, however, that if such adjustment to the
Settlement Rate is required to be made pursuant to the occurrence of any of
the events contemplated by paragraph (1), (2), (3), (4), (5), (7) or (10)
of this Section 5.7(a) during the period taken into consideration for
determining the Applicable Market Value, appropriate and customary
adjustments shall be made to the Settlement Rate.
(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 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 Certain Recapitalization Transactions.
49
(1) If the Company completes a Recapitalization Transaction pursuant
to which some, but not all, of the shares of Common Stock outstanding
immediately prior to such transaction are exchanged for or converted,
changed or reclassified into other Common Equity Securities, then
thereafter each Holder of Securities will receive on the Purchase Contract
Settlement Date with respect to each Purchase Contract forming a part
thereof, at such Holder's election, either (i) shares of Common Stock at a
Settlement Rate equal to the Settlement Rate in effect immediately prior to
such Recapitalization Transaction as adjusted in accordance with subsection
(a) of this Section 5.7 (A) for any premium paid to holders of Common Stock
in such Recapitalization Transaction other than in the form of such other
Common Equity Securities representing a greater economic interest in the
Company than the shares of Common Stock in respect of which such Common
Equity Securities were issued (but without adjustment for any such premium
paid in the form of such other Common Equity Securities) and (B) for any
transactions or events occurring after such Recapitalization Transaction
that require an adjustment to the Settlement Rate under subsection (a) of
this Section 5.7 or (ii) shares of such other Common Equity Securities at a
Settlement Rate determined under Section 5.1 based on the Applicable Market
Value of such other Common Equity Securities and equal to the Settlement
Rate in effect immediately prior to such Recapitalization Transaction
multiplied by the number of such other Common Equity Securities issued in
respect of one share of Common Stock in such Recapitalization Transaction
and as adjusted in accordance with subsection (a) of this Section 5.7 (A)
for any premium paid to holders of Common Stock in such Recapitalization
Transaction other than in the form of such other Common Equity Securities
and (B) for any transactions or events occurring after such
Recapitalization Transaction that require an adjustment to the Settlement
Rate under subsection (a) of this Section 5.7, with the provisions of such
subsection applying to events relating to such other Common Equity
Securities to the same extent as they apply to events relating to the
Common Stock. In the event that any Recapitalization Transaction of the
type contemplated by this paragraph (1) occurs, the Company shall, at least
30 Business Days prior to the Purchase Contract Settlement Date, provide
each Holder with an election form pursuant to which the Holder may elect to
receive either Common Stock or the other Common Equity Securities upon
settlement of the Purchase Contracts as provided in this paragraph (1). Any
Holder for whom the Company has not received a completed election form on
or before the Business Day immediately preceding the Purchase Contract
Settlement Date will be deemed to have elected to receive Common Stock.
(2) If the Company completes a Recapitalization Transaction pursuant
to which all of the shares of Common Stock outstanding immediately prior to
such transaction are exchanged for or converted, changed or reclassified
into shares of other Common Equity Securities, then thereafter each Holder
of Securities will receive on the Purchase Contract Settlement Date with
respect to each Purchase Contract forming a part thereof only such other
Common Equity Securities at a Settlement Rate determined under Section 5.1
based on the Applicable Market Value of such other Common Equity Securities
and equal to the Settlement Rate in effect immediately prior to such
Recapitalization Transaction multiplied by the number of such other Common
Equity Securities issued in respect of one share of Common Stock in such
Recapitalization Transaction and as adjusted in accordance with subsection
(a) of this Section 5.7 (A) for
50
any premium paid to holders of Common Stock in such Recapitalization
Transaction other than in the form of such other Common Equity Securities
and (B) for any transactions or events occurring after such
Recapitalization Transaction that require an adjustment to the Settlement
Rate under subsection (a) of this Section 5.7, with the provisions of such
subsection applying to events relating to such other Common Equity
Securities to the same extent as they apply to events relating to the
Common Stock.
(c) Adjustment for Consolidation, Merger or Other Reorganization
Event. In the event of (i) any Recapitalization Transaction pursuant to which
all outstanding shares of Common Stock are exchanged for or converted, changed
or reclassified into cash, securities or other property not including Common
Equity Securities, (ii) 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), (iii) any sale, transfer,
lease or conveyance to another Person of the property of the Company as an
entirety or substantially as an entirety, (iv) any statutory exchange of
securities of the Company with another Person (other than in connection with a
merger or acquisition) or (v) any liquidation, dissolution or winding up of the
Company other than as a result of or after the occurrence of a Termination Event
(any such event, a "Reorganization Event"), the Settlement Rate will be adjusted
to provide that each Holder of Securities will receive on the Purchase Contract
Settlement Date with respect to each Purchase Contract forming a part thereof
(or upon any Early Settlement), the kind and amount of securities, cash and
other property receivable upon such Reorganization Event (without any interest
thereon, and without any right to dividends or distribution thereon which have a
record date that is prior to the Purchase Contract Settlement Date) by a Holder
of the number of shares of Common Stock issuable on account of each Purchase
Contract if the Purchase Contract 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 (any such Person, a "Constituent Person"), or an Affiliate of a
Constituent Person to the extent such Reorganization Event provides for
different treatment of Common Stock held by Affiliates of the Company and non-
affiliates and such Holder failed to exercise its rights of election, if any, as
to the kind or amount of securities, cash and other property receivable upon
such Reorganization Event (provided that if the kind or amount of securities,
cash and other property receivable upon such Reorganization Event is not the
same for each share of Common Stock held immediately prior to such
Reorganization Event by other than a Constituent Person or an Affiliate thereof
and in respect of which such rights of election shall not have been exercised
("non-electing share"), then for the purpose of this Section the kind and amount
of securities, cash and other property receivable upon such Reorganization Event
by each non-electing share shall be deemed to be the kind and amount so
receivable per share by the non-electing shares). In the event of such a
Reorganization Event described in clauses (ii)-(v) above, the Person formed by
such consolidation, merger or exchange or the Person which acquires or leases
the assets of the Company or, in the event of a liquidation or dissolution of
the Company, the Company or a liquidating trust created in connection therewith,
shall execute and deliver to the Agent an agreement supplemental hereto
providing that the Holders of each Outstanding Security shall have the rights
provided by this Section 5.7. Such supplemental agreement shall provide for
adjustments which, for events subsequent to the effective date of such
supplemental
51
agreement, shall be as nearly equivalent as may be practicable to the
adjustments provided for in this Section. In the event of a Reorganization Event
described in clause (i) above, the adjustment provisions of this Section shall
apply to the extent practicable to any securities issued in the Recapitalization
Transaction. The above provisions of this Section shall similarly apply to
successive Reorganization Events.
Section 5.8 Notice of Adjustments and Certain Other Events.
(a) Whenever the Settlement Rate is adjusted as herein provided, the
Company shall:
(i) forthwith compute the Settlement Rate in accordance with Section
5.7 and prepare and transmit to the Agent an Officer's Certificate setting
forth the Settlement Rate, the method of calculation thereof in reason able
detail, and the facts requiring such adjustment and upon which such
adjustment is based; and
(ii) within 10 Business Days following the occurrence of an event that
requires an adjustment to the Settlement Rate pursuant to Section 5.7 (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 deter mined 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 calculation of any such adjustment when made, or with
respect to the method employed in making the same. The Agent shall not be
accountable with respect to the validity or value (or the kind or amount) of any
shares of Common Stock, or of any securities or property, which may at the time
be issued or delivered with respect to any Purchase Contract; and the Agent
makes no representation with respect thereto. The Agent shall not be responsible
for any failure of the Company to issue, transfer or deliver any shares of
Common Stock pursuant to a Purchase Contract or to comply with any of the
duties, responsibilities or covenants of the Company contained in this Article.
Section 5.9 Termination Event; Notice.
The Purchase Contracts and all obligations and rights of the Company
and the Holders thereunder, including, without limitation, the rights and
obligations of Holders to purchase Common Stock, shall immediately and
automatically terminate, without the necessity of any notice or action by any
Holder, the Agent or the Company, if, on or prior to the Purchase Contract
Settlement Date, a Termination Event shall have occurred. Upon and after the
occurrence of a Termination Event, the Securities shall thereafter represent the
right to receive the Notes or the appropriate Applicable Ownership Interest of
the Treasury Portfolio, as the case may be, forming a part of such Securities in
the case of Income PRIDES, or Treasury Securities in the case of Growth PRIDES,
in accordance with the provisions of Section 4.3 of the Pledge Agreement;
provided, however, that, to the extent that a Holder of Income PRIDES or Growth
PRIDES would otherwise be entitled to receive less than $1,000 principal amount
at maturity of
52
the Treasury Portfolio or the Treasury Securities, the Agent shall dispose of
such securities for cash, and transfer the appropriate amount of such cash to
such Holder in accordance with such Holder's instructions. Upon the occurrence
of a Termination Event, the Company shall promptly but in no event later than
two Business Days thereafter give written notice to the Agent, the Collateral
Agent and to the Holders, at their addresses as they appear in the Register.
Section 5.10 Early Settlement.
(a) Subject to and upon compliance with the provisions of this
Section 5.10, at the option of the Holder thereof, Purchase Contracts underlying
Securities having an aggregate Stated Amount equal to $1,000 or an integral
multiple thereof may be settled early ("Early Settlement") in the case of Income
PRIDES (unless a Tax Event Redemption or a Successful Initial Remarketing has
occurred) on or prior to the fifth Business Day immediately preceding the
Purchase Contract Settlement Date and in the case of Growth PRIDES on or prior
to the second Business Day immediately preceding the Purchase Contract
Settlement Date, in each case, as provided herein; provided however, that if a
Tax Event Redemption or a Successful Initial Remarketing has occurred and the
Treasury Portfolio has become a component of the Income PRIDES, Purchase
Contracts underlying Income PRIDES may be settled early on or prior to the
second Business Day immediately preceding the Purchase Contract Settlement Date,
but only in an aggregate amount of ____ Income PRIDES or in an integral multiple
thereof. In order to exercise the right to effect Early Settlement with respect
to any Purchase Contracts, the Holder of the Certificate evidencing Securities
shall deliver such Certificate to the Agent at the Corporate Trust Office or the
New York Office duly endorsed for transfer to the Company or in blank with the
form of Election to Settle Early on the reverse thereof duly completed and
accompanied by payment (payable to the Company) in lawful money of the United
States by [certified or cashiers check or] wire transfer, in each case in
immediately available funds in an amount (the "Early Settlement Amount") equal
to the product of (i) the Stated Amount times (ii) the number of Purchase
Contracts with respect to which the Holder has elected to effect Early
Settlement. No payment or adjustment shall be made upon Early Settlement of any
Purchase Contract 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 and payment of any transfer or similar taxes payable by such
Holder in connection with the issuance of the related Common Stock to any Person
other than such Holder, the Company shall issue, and the Holder shall be
entitled to receive, _____ shares of newly issued Common Stock on account of
each Purchase Contract as to which Early Settlement is effected (the "Early
Settlement Rate"). The Early Settlement Rate shall be adjusted in the same
manner and at the same time as the Settlement Rate is adjusted. As promptly as
practicable after Early Settlement of Purchase Contracts in accordance with the
provisions of this Section 5.10, the Company shall issue and shall deliver to
the Agent at the Corporate Trust Office a certificate or
53
certificates for the full number of shares of Common Stock issuable upon such
Early Settlement together with payment in lieu of any fraction of a share, as
provided in Section 5.11.
(c) No later than the third Business Day after the applicable Early
Settlement Date, the Company shall cause (i) the shares of Common Stock issuable
upon Early Settlement of Purchase Contracts to be issued and delivered, and (ii)
the related Notes or the appropriate Applicable Ownership Interest of the
Treasury Portfolio, in the case of Income PRIDES, or the related Treasury
Securities, in the case of Growth PRIDES, to be released from the Pledge by the
Collateral Agent and transferred, in each case to the Agent for delivery to the
Holder thereof or its designee.
(d) Upon Early Settlement of any Purchase Contracts, and subject to
receipt of shares of Common Stock from the Company and the Notes, the
appropriate Applicable Ownership Interest of the Treasury Portfolio or Treasury
Securities, as the case may be, from the Collateral Agent, as applicable, the
Agent shall, in accordance with the instructions provided by the Holder thereof
on the applicable form of Election to Settle Early on the reverse of the
Certificate evidencing the related Securities, (i) transfer to the Holder the
Notes, Treasury Portfolio or Treasury Securities, as the case may be, forming a
part of such Securities, and (ii) deliver to the Holder a certificate or
certificates for the full number of shares of Common Stock issuable upon such
Early Settlement together with payment in lieu of any fraction of a share, as
provided in Section 5.11.
(e) In the event that Early Settlement is effected with respect to
Purchase Contracts underlying less than all the Securities evidenced by a
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 Certificate evidencing the Securities as to which
Early Settlement was not effected.
Section 5.11 No Fractional Shares.
No fractional shares or scrip representing fractional shares of Common
Stock shall be issued or delivered upon settlement on the Purchase Contract
Settlement Date or upon Early Settlement of any Purchase Contracts. If
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 shall be delivered upon settlement shall be computed on the basis of
the aggregate number of Purchase Contracts evidenced by the Certificates so
surrendered. Instead of any fractional share of Common Stock which would
otherwise be deliverable upon settlement of any Purchase Contracts on the
Purchase Contract 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 times the Applicable
Market Value. The Company shall provide the Agent from time to time with
sufficient funds to permit the Agent to make all cash payments required by this
Section 5.11 in a timely manner.
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Section 5.12 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 of any
exchange of or substitution for a Certificate evidencing a Security or any
issuance of a share of Common Stock in a name other than that of the registered
Holder of a Certificate surrendered in respect of the Securities 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
Certificates unless or until the Person or Persons requesting the transfer or
issuance thereof shall have paid to the Company the amount of such tax or shall
have established to the satisfaction of the Company that such tax has been paid
or that no such tax is due.
ARTICLE VI
REMEDIES
Section 6.1 Unconditional Right of Holders to Purchase Common Stock.
The Holder of any Income PRIDES or Growth PRIDES shall have the right,
which is absolute and unconditional, to purchase Common Stock pursuant to such
Purchase Contract and to institute suit for the enforcement of such right to
purchase Common Stock, and such right shall not be impaired without the consent
of such Holder.
Section 6.2 Restoration of Rights and Remedies.
If any Holder has instituted any proceeding to enforce any right or
remedy under this Agreement and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to such Holder, then
and in every such case, subject to any determination in such proceeding, the
Company and such Holder shall be restored severally and respectively to their
former positions hereunder and thereafter all rights and remedies of such Holder
shall continue as though no such proceeding had been instituted.
Section 6.3 Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Certificates in the last
paragraph of Section 3.10, no right or remedy herein conferred upon or reserved
to the Holders is intended to be exclusive of any other right or remedy, and
every right and remedy shall, to the extent permitted by law, be cumulative and
in addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
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Section 6.4 Delay or Omission Not Waiver.
No delay or omission of any Holder to exercise any right or remedy
upon a default shall impair any such right or remedy or constitute a waiver of
any such right. Every right and remedy given by this Article or by law to the
Holders may be exercised from time to time, and as often as may be deemed
expedient, by such Holders.
Section 6.5 Undertaking for Costs.
All parties to this Agreement agree, and each Holder of Income PRIDES
or Growth PRIDES, by its acceptance of such Income PRIDES or Growth PRIDES shall
be deemed to have agreed, that any court may in its discretion require, in any
suit for the enforcement of any right or remedy under this Agreement, or in any
suit against the Agent for any action taken, suffered or omitted by it as Agent,
the filing by any party litigant in such suit of an undertaking to pay the costs
of such suit, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys' fees, against any party litigant in such suit,
having due regard to the merits and good faith of the claims or defenses made by
such party litigant; provided that the provisions of this Section shall not
apply to any suit instituted by the Company, to any suit instituted by the
Agent, to any suit instituted by any Holder, or group of Holders, holding in the
aggregate more than 10% of the Outstanding Securities, or to any suit instituted
by any Holder for the enforcement of interest on any Notes on or after the
respective Payment Date therefor in respect of any Security held by such Holder,
or for enforcement of the right to purchase shares of Common Stock under the
Purchase Contracts constituting part of any Security held by such Holder.
Section 6.6 Waiver of Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants 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 VII
THE AGENT
Section 7.1 Certain Duties and Responsibilities.
(a) (1) The Agent undertakes to perform, with respect to the
Securities, such duties and only such duties as are specifically set forth in
this Agreement and the Pledge Agreement, and no implied covenants or obligations
shall be read into this Agreement against the Agent; and
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(2) The Agent may, with respect to the Securities, conclusively rely,
as to the truth of the statements and the correctness of the opinions
expressed therein, upon certificates or opinions furnished to the Agent and
conforming to the requirements of this Agreement, but in the case of any
certificates or opinions 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, but need not confirm or investigate the
accuracy of mathematical calculations stated therein.
(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 willful misconduct or bad faith, 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.
(c) Whether or not therein expressly so provided, every provision of
this Agreement relating to the conduct or affecting the liability of or
affording protection to the Agent shall be subject to the provisions of this
Section.
(d) The Agent is authorized to execute and deliver the Pledge
Agreement in its capacity as Agent.
Section 7.2 Notice of Default.
Within 30 days after the occurrence of any default by the Company
hereunder of which a Responsible Officer of the Agent has actual knowledge, the
Agent shall transmit by mail to the Company and the Holders of Securities, as
their names and addresses appear in the Register, notice of such default
hereunder, unless such default shall have been cured or waived.
Section 7.3 Certain Rights of Agent.
Subject to the provisions of Section 7.1:
(a) the Agent may 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;
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(b) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by an Officer's Certificate, Issuer Order or Issuer
Request, and any resolution of the Board of Directors of the Company may be
sufficiently evidenced by a Board Resolution;
(c) whenever in the administration of this Agreement the Agent shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Agent (unless other
evidence be herein specifically prescribed) may, in the absence of bad
faith on its part, rely upon an Officer's Certificate of the Company;
(d) the Agent may consult with counsel of its selection and the
advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by it hereunder in good faith and in reliance thereon;
(e) the Agent shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, Note, note, other evidence of indebtedness or other paper or
document, but the Agent, in its discretion, may make reasonable further
inquiry or investigation into such facts or matters related to the
execution, delivery and performance of the Purchase Contracts as it may see
fit, and, if the Agent shall determine to make such further inquiry or
investigation, it shall be given a reasonable opportunity to examine the
books, records and premises of the Company, personally or by agent or
attorney; and
(f) the Agent may execute any of the powers hereunder or perform any
duties hereunder either directly or by or through agents or attorneys or an
Affiliate and the Agent shall not be responsible for any misconduct or
negligence on the part of any agent or attorney or an Affiliate appointed
with due care by it hereunder.
Section 7.4 Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Certificates shall be taken
as the statements of the Company and the Agent assumes no responsibility for
their accuracy. The Agent makes no representations as to the validity or
sufficiency of either this Agreement or of the Securities, or of the Pledge
Agreement or the Pledge. The Agent shall not be accountable for the use or
application by the Company of the proceeds in respect of the Purchase Contracts.
Section 7.5 May Hold Securities.
Any Registrar or any other agent of the Company, or the Agent and its
Affiliates, in their individual or any other capacity, may become the owner or
pledgee of Securities and may otherwise deal with the Company, the Collateral
Agent or any other Person with the same rights it would have if it were not
Registrar or such other agent, or the Agent.
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Section 7.6 Money Held in Custody.
Money held by the Agent in custody hereunder need not be segregated
from the other funds except to the extent required by law or provided herein.
The Agent shall be under no obligation to invest or pay interest on any money
received by it hereunder except as otherwise expressly provided herein or as
otherwise agreed in writing with the Company.
Section 7.7 Compensation and Reimbursement.
The Company agrees:
(1) to pay to the Agent from time to time such compensation for all
services rendered by it hereunder as the parties shall agree from time to
time;
(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, willful
misconduct or bad faith; and
(3) to indemnify the Agent and any predecessor Agent for, and to hold
it harmless against, any loss, liability or expense, including taxes (other
than taxes based upon, measured by or determined by the income of the
Agent) incurred without negligence, willful misconduct 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.
The provisions of this Section shall survive the termination of this
Agreement.
Section 7.8 Corporate Agent Required; Eligibility.
There shall at all times be an Agent hereunder which shall be a
corporation organized and doing business under the laws of the United States of
America, any State thereof or the District of Columbia, authorized under such
laws to exercise corporate trust powers, having (or being a subsidiary of a bank
holding company having) a combined capital and surplus of at least $50,000,000,
subject to supervision or examination by Federal or State authority and having
an 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. The provisions of this Section shall survive the termination of
this Agreement.
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Section 7.9 Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Agent and no appointment of a
successor Agent pursuant to this Article shall become effective until the
acceptance of appointment by the successor Agent in accordance with the
applicable requirements of Section 7.10.
(b) The Agent may resign at any time by giving written notice thereof
to the Company 60 days prior to the effective date of such resignation. If the
instrument of acceptance by a successor Agent required by Section 7.10 shall not
have been delivered to the Agent within 30 days after the giving of such notice
of resignation, the resigning Agent may petition 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. If the instrument of acceptance by a successor Agent required by
Section 7.10 shall not have been delivered to the Agent within 30 days after the
giving of such notice of resignation, the resigning Agent may petition any court
of competent jurisdiction for the appointment of a successor Agent.
(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 7.8 and shall
fail to resign after written request therefor by the Company or by any such
Holder, or
(3) the Agent shall become incapable of acting or shall be ad judged
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 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 7.10. If no successor
Agent shall have been so appointed by the Company and accepted appointment in
the manner required by Section 7.10, any Holder who has been a bona fide Holder
of 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
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Agent by mailing written notice of such event by first-class mail, postage
prepaid, to all Holders as their names and addresses appear in the applicable
Register. Each notice shall include the name of the successor Agent and the
address of its Corporate Trust Office and New York Office, if any.
Section 7.10 Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor Agent, every
such successor Agent so appointed shall execute, acknowledge and deliver to the
Company and to the retiring Agent an instrument accepting such appointment, and
thereupon the resignation or removal of the retiring Agent shall become
effective and such successor Agent, without any further act, deed or conveyance,
shall become vested with all the rights, powers, agencies and duties of the
retiring Agent; but, on the request of the Company or the successor Agent, such
retiring Agent shall, upon payment of its charges, execute and deliver an
instrument transferring to such successor Agent all the rights, powers and
trusts of the retiring Agent and shall duly assign, transfer and deliver to such
successor Agent all property and money held by such retiring Agent hereunder.
(b) Upon request of any such successor Agent, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Agent all such rights, powers and agencies referred
to in paragraph (a) of this Section.
(c) No successor Agent shall accept its appointment unless at the
time of such acceptance such successor Agent shall be qualified and eligible
under this Article.
Section 7.11 Merger, Conversion, Consolidation or Succession to
Business.
Any corporation into which the Agent may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Agent shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Agent, shall be the successor of the Agent hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Certificates shall have been
authenticated and executed on behalf of the Holders, but not delivered, by the
Agent then in office, any successor by merger, conversion or consolidation to
such Agent may adopt such authentication and execution and deliver the
Certificates so authenticated and executed with the same effect as if such
successor Agent had itself authenticated and executed such Securities.
Section 7.12 Preservation of Information; Communications to Holders.
(a) The Agent shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders received by the Agent in its
capacity as 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
applicants desire to communicate with other Holders with respect
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to their rights under this Agreement or under the Securities and is accompanied
by a copy of the form of proxy or other communication which such applicants
propose to transmit, then the Agent shall mail to all the Holders copies of the
form of proxy or other communication which is specified in such request, with
reasonable promptness after a tender to the Agent of the materials to be mailed
and of payment, or provision for the payment, of the reasonable expenses of such
mailing.
Section 7.13 No Obligations of Agent.
Except to the extent otherwise provided in this Agreement, the Agent
assumes no obligations and shall not be subject to any liability under this
Agreement, the Pledge Agreement or any Purchase Contract in respect of the
obligations of the Holder of any Security thereunder. The Company agrees, and
each Holder of a Certificate, by his acceptance thereof, shall be deemed to have
agreed, that the Agent's execution of the Certificates on behalf of the Holders
shall be solely as agent and attorney-in-fact for the Holders, and that the
Agent shall have no obligation to perform such Purchase Contracts on behalf of
the Holders, except to the extent expressly provided in Article V hereof.
Section 7.14 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 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 written direction received from
the Company with respect to the application of such requirements to particular
payments or Holders or in other particular circumstances, and may for purposes
of this Agreement rely on any such direction in accordance with the provisions
of Section 7.1(a)(2) hereof.
(c) The Agent shall maintain all appropriate records documenting
compliance with such requirements, and shall make such records available, on
written request, to the Company or its authorized representative within a
reasonable period of time after receipt of such request.
ARTICLE VIII
SUPPLEMENTAL AGREEMENTS
Section 8.1 Supplemental Agreements Without Consent of Holders.
Without the consent of any Holders, the Company and the Agent, at any
time and from time to time, may enter into one or more agreements supplemental
hereto, in form satisfactory to the Company and the Agent, for any of the
following purposes:
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(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 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 5.7(c); 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 such action shall not adversely affect the
interests of the Holders.
Section 8.2 Supplemental Agreements with Consent of Holders.
With the consent of the Holders of not less than a majority of the
Outstanding Purchase Contracts voting together as one class, by Act of said
Holders delivered to the Company and the Agent, the Company, when authorized by
a Board Resolution, and the Agent may enter into an agreement or agreements
supplemental hereto for the purpose of modifying in any manner the terms of the
Purchase Contracts or the provisions of this Agreement or the rights of the
Holders in respect of the Securities (other than the Notes, which may be
modified only in accordance with the applicable provisions of the Indenture;
provided, however, that, except as contemplated herein, 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 the type of Collateral required to be
Pledged to secure a Holder's obligations under any Purchase Contract,
impair the right of the Holder of any Purchase Contract to receive
distributions on the related Collateral (except for the rights of Holders
of Income PRIDES to substitute the Treasury Securities for the pledged
Notes or the rights of holders of Growth PRIDES to substitute Notes for the
Pledged Treasury Securities) or otherwise adversely affect the Holder's
rights in or to such Collateral or adversely alter the rights in or to such
Collateral;
(3) impair the right to institute suit for the enforcement of any
Purchase Contract;
(4) reduce the number of shares of Common Stock (or the amount of any
other property) to be purchased pursuant to any Purchase Contract, increase
the price to purchase shares of Common Stock (or any other property) upon
settlement of any Purchase Contract, change the Purchase Contract
Settlement Date or otherwise adversely affect the Holder's rights under any
Purchase Contract; or
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(5) reduce the percentage of the outstanding Purchase Contracts the
consent of whose Holders is required for any such supplemental agreement;
provided, that if any amendment or proposal referred to above would adversely
affect only the Income PRIDES or the Growth PRIDES, then only the affected class
of Holder as of the record date for the Holders entitled to vote thereon will be
entitled to vote on such amendment or proposal, and such amendment or proposal
shall not be effective except with the consent of Holders of not less than a
majority of such class.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental agreement, but it shall
be sufficient if such Act shall approve the substance thereof.
Section 8.3 Execution of Supplemental Agreements.
In executing, or accepting the additional agencies created by, any
supplemental agreement permitted by this Article or the modifications thereby of
the agencies created by this Agreement, the Agent shall be entitled to receive
and (subject to Section 7.1) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental agreement is
authorized or permitted by this Agreement. The Agent may, but shall not be
obligated to, enter into any such supplemental agreement which affects the
Agent's own rights, duties or immunities under this Agreement or otherwise.
Section 8.4 Effect of Supplemental Agreements.
Upon the execution of any supplemental agreement under this Article,
this Agreement and the Securities shall be modified in accordance therewith, and
such supplemental agreement shall form a part of this Agreement for all
purposes; and every Holder of Certificates theretofore or thereafter
authenticated, executed on behalf of the Holders and delivered hereunder shall
be bound thereby.
Section 8.5 Reference to Supplemental Agreements.
Certificates authenticated, executed on behalf of the Holders and
delivered after the execution of any supplemental agreement pursuant to this
Article may, and shall if required by the Agent, bear a notation in form
approved by the Agent as to any matter provided for in such supplemental
agreement. If the Company shall so determine, new Certificates so modified as
to conform, in the opinion of the Agent and the Company, to any such
supplemental agreement may be prepared and executed by the Company and
authenticated, executed on behalf of the Holders and delivered by the Agent in
exchange for Outstanding Certificates.
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ARTICLE IX
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
Section 9.1 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, assign, transfer, lease or convey all or substantially all
of its properties and assets to any Person or group of affiliated Persons in one
transaction or a series of related transactions, unless (i) either the Company
shall be the continuing corporation, or the successor (if other than the
Company) shall be a corporation organized and existing under the laws of the
United States of America or a State thereof or the District of Columbia and such
corporation shall expressly assume all the obligations of the Company under the
Purchase Contracts, this Agreement, the Indenture, the Remarketing Agreement and
the Pledge Agreement by one or more supplemental agreements in form reasonably
satisfactory to the Agent and the Collateral Agent, executed and delivered to
the Agent and the Collateral Agent by such 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, assignment, transfer, lease or
conveyance, be in default of its payment obligations under this Agreement or the
Notes, or in default of its obligations to deliver Common Stock (or other
property) on the Purchase Contract Settlement Date or any Early Settlement Date,
or in material default in the performance of any other covenant hereunder or
under the Notes, the Indenture, the Remarketing Agreement, the Purchase
Contracts or the Pledge Agreement.
Section 9.2 Rights and Duties of Successor Corporation.
In case of any such consolidation, merger, sale, assignment, transfer,
lease or conveyance and upon any such assumption by a successor corporation in
accordance with Section 9.1, 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, and its predecessor shall, except in the case of a lease, be
released from its obligations under this Agreement. Such successor corporation
thereupon may cause to be signed, and may issue either in its own name or in the
name of Electronic Data Systems Corporation any or all of the 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 Certificates
which previously shall have been signed and delivered by the officers of the
Company to the Agent for authentication and execution, and any Certificate
evidencing Securities which such successor corporation thereafter shall cause to
be signed and delivered to the Agent for that purpose. All the Certificates so
issued shall in all respects have the same legal rank and benefit under this
Agreement as the Certificates theretofore or thereafter issued in accordance
with the terms of this Agreement as though all of such Certificates had been
issued at the date of the execution hereof.
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In case of any such consolidation, merger, sale, assignment, transfer,
lease or conveyance, such change in phraseology and form (but not in substance)
may be made in the Certificates evidencing Securities thereafter to be issued as
may be appropriate.
Section 9.3 Opinion of Counsel Given to Agent.
The Agent, subject to Sections 7.1 and 7.3, shall receive an Opinion
of Counsel as conclusive evidence that any such consolidation, merger, sale,
assignment, transfer, lease or conveyance, and any such assumption, complies
with the provisions of this Article and that all conditions precedent hereunder
to the consummation of any such consolidation, merger, sale, assignment,
transfer, lease or conveyance have been met.
ARTICLE X
COVENANTS
Section 10.1 Performance Under Purchase Contracts.
The Company covenants and agrees for the benefit of the Holders from
time to time of the 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 10.2 Maintenance of Office or Agency.
The Company will maintain or cause to be maintained in the Borough of
Manhattan, The City of New York an office or agency (a "New York Office")
Certificates may be presented or surrendered for payment and for acquisition of
shares of Common Stock (or other property) upon settlement of the Purchase
Contracts on the Purchase Contract Settlement Date or Early Settlement and for
transfer of Collateral upon occurrence of a Termination Event, where
Certificates may be surrendered for registration of transfer or exchange, for a
Collateral Substitution or re-establishment of an Income PRIDES 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 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 location of any such other office or agency.
66
The Company hereby designates the Borough of Manhattan, the City of
New York, as the places of payment for the Securities, and hereby appoints the
Agent, acting through its Corporate Trust Office in ____________________, as the
registrar, paying agent and transfer agent for the Income PRIDES and the Growth
PRIDES and for the other purposes contemplated by this Section 10.2.
Section 10.3 Company to Reserve Common Stock.
The Company shall at all times prior to the Purchase Contract
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 Certificates.
Section 10.4 Covenants as to Common Stock.
The Company covenants that all shares of Common Stock which may be
issued against tender of payment in respect of any Purchase Contract
constituting a part of the Outstanding Securities will, upon issuance, be duly
authorized, validly issued, fully paid and nonassessable. The Company shall
comply with all applicable securities laws regulating the offer, issuance and
delivery of shares of Common Stock upon settlement of Purchase Contracts and
will endeavor to list such shares on each national securities exchange or
automated quotation system on which the Common Stock is then listed.
67
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and year first above written.
ELECTRONIC DATA SYSTEMS
CORPORATION
By:
------------------------------
Name:
Title:
By:
------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK
as Purchase Contract Agent
By:
------------------------------
Name:
Title:
68
EXHIBIT A
(Form of Face of Income PRIDES Certificate)
[THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT (AS HEREINAFTER DEFINED) AND IS REGISTERED IN THE
NAME OF THE CLEARING AGENCY OR A NOMINEE THEREOF. THIS CERTIFICATE MAY NOT BE
EXCHANGED IN WHOLE OR IN PART FOR A CERTIFICATE REGISTERED, AND NO TRANSFER OF
THIS CERTIFICATE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY
PERSON OTHER THAN SUCH CLEARING AGENCY OR A NOMINEE THEREOF, EXCEPT IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY (55 XXXXX XXXXXX, XXX XXXX, XXX XXXX) TO THE
COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO., OR SUCH OTHER NAME
AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY,
AND ANY PAYMENT HEREON IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL SINCE THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
No. CUSIP No.
-----
Number of Income PRIDES
-------
---------------
* To be inserted in Global Certificates only.
A-1
__% Income PRIDES
This Income PRIDES Certificate certifies that ___________ is the
registered Holder of the number of Income PRIDES set forth above. Each Income
PRIDES represents (i) either (a) beneficial ownership by the Holder of $50
principal amount of Notes due 2006 (the "Note") of Electronic Data Systems
Corporation, a Delaware corporation, subject to the Pledge of such Note by such
Holder pursuant to the Pledge Agreement or (b) upon the occurrence of a Tax
Event Redemption prior to the Purchase Contract Settlement Date or a Successful
Initial Remarketing, the appropriate Applicable Ownership Interest of the
Treasury Portfolio, subject to the Pledge of such Applicable Ownership Interest
of the Treasury Portfolio by such Holder pursuant to the Pledge Agreement, and
(ii) the rights and obligations of the Holder under one Purchase Contract with
Electronic Data Systems Corporation, a Delaware corporation (the "Company,"
which term, as used herein, includes its successors pursuant to the Purchase
Contract Agreement). All capitalized terms used herein which are defined in the
Purchase Contract Agreement have the meaning set forth therein.
Pursuant to the Pledge Agreement, the Notes or the appropriate
Applicable Ownership Interest of the Treasury Portfolio, as the case may be,
constituting part of each Income PRIDES evidenced hereby have been pledged to
the Collateral Agent, for the benefit of the Company, to secure the obligations
of the Holder under the Purchase Contract comprising a portion of such Income
PRIDES.
The Pledge Agreement provides that all payments of principal on the
pledged Notes or the appropriate Applicable Ownership Interest (as specified in
clause (A) of the definition of such term) of the Treasury Portfolio, as the
case may be, or interest payments on any pledged Notes (as defined in the Pledge
Agreement) or the appropriate Applicable Ownership Interest (as specified in
clause (B) of the definition of such term) of the Treasury Portfolio, as the
case may be, constituting part of the Income PRIDES received by the Collateral
Agent shall be paid by the Collateral Agent by wire transfer in same day funds
(i) in the case of (A) interest payments with respect to pledged Notes or the
appropriate Applicable Ownership Interest (as specified in clause (B) of the
definition of such term) of the Treasury Portfolio, as the case may be, and (B)
any payments of principal or the appropriate Applicable Ownership Interest (as
specified in clause (A) of the definition of such terms) of the Treasury
Portfolio, as the case may be, with respect to any Notes or the appropriate
Applicable Ownership Interest of the Treasury Portfolio, as the case may be,
that have been released from the Pledge pursuant to the Pledge Agreement, to the
Agent to the account designated by the Agent, no later than 2:00 p.m., New York
City time, on the Business Day such payment is received by the Collateral Agent
(provided that in the event such payment is received by the Collateral Agent on
a day that is not a Business Day or after 12:30 p.m., New York City time, on a
Business Day, then such payment shall be made no later than 10:30 a.m., New York
City time, on the next succeeding Business Day) and (ii) in the case of payments
of principal on any pledged Notes or the appropriate Applicable
Ownership Interest (as specified in clause (A) of the definition of
such term) of the Treasury Portfolio that has not been released from the Pledge
pursuant to the Pledge Agreement, as the case may be, to the Company on the
Purchase Contract Settlement Date (as defined herein) in accordance with the
terms of the Pledge Agreement, in full satisfaction of the
A-2
respective obligations of the Holders of the Income PRIDES of which such pledged
Notes or the Treasury Portfolio, as the case may be, are a part under the
Purchase Contracts forming a part of such Income PRIDES. Interest on any Notes
or distributions on the appropriate Applicable Ownership Interest (as specified
in clause (B) of the definition of such term) of the Treasury Portfolio, as the
case may be, forming part of an Income PRIDES evidenced hereby which are payable
quarterly in arrears on February 17, May 17, November 17 and August 17, each
year, commencing August 17, 2001 (a "Payment Date"), shall, subject to receipt
thereof from the Collateral Agent, be paid to the Person in whose name this
Income PRIDES Certificate (or a Predecessor Income PRIDES Certificate) is
registered at the close of business on the Record Date for such Payment Date.
Each Purchase Contract evidenced hereby obligates the Holder of this
Income PRIDES Certificate to purchase, and the Company to sell, on August 17,
2004 (the "Purchase Contract Settlement Date"), at a price equal to $50 (the
"Stated Amount"), a number of newly issued shares of Common Stock, $0.1 par
value ("Common Stock"), of the Company equal to the Settlement Rate, unless on
or prior to the Purchase Contract Settlement Date there shall have occurred a
Termination Event or an Early Settlement with respect to the Income PRIDES 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
(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
Purchase Contract Settlement Date by application of (1) cash received from a
Holder or (2) payment received in respect of the Notes or the appropriate
Applicable Ownership Interest (as specified in clause (A) of the definition of
such term) of the Treasury Portfolio, as the case may be, pledged to secure the
obligations under such Purchase Contract of the Holder of the Income PRIDES of
which such Purchase Contract is a part.
Interest on the Notes or distributions on the appropriate Applicable
Ownership Interest (as specified in clause (B) of the definition of such term)
of the Treasury Portfolio, as the case may be, will be payable at the Corporate
Trust Office of the Agent and at the New York Office or, at the option of the
Company, by check mailed to the address of the Person entitled thereto as such
address appears on the Income PRIDES Register or by wire transfer to the account
designated by a prior written notice from such Person.
The Company shall pay on each Payment Date in respect of each Purchase
Contract forming part of an Income PRIDES evidenced hereby an amount (the
"Contract Adjustment Payments") equal to [__]% per year of the Stated Amount,
computed on the basis of a 360-day year of twelve 30 day months, 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
Adjustment Payments, if any, shall be payable to the Person in whose name this
Income PRIDES Certificate (or a Predecessor Income PRIDES Certificate) is
registered at the close of business on the Record Date for such Payment Date.
Contract Adjustment Payments, if any, will be payable at the Corporate
Trust Office of the Agent and at the New York Office or, at the option of the
Company, by check mailed to the address of the Person entitled thereto as such
address appears on the Income PRIDES Register.
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Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Agent by manual signature, this Income PRIDES 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.
A-4
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
ELECTRONIC DATA SYSTEMS
CORPORATION
By:
------------------------------
Name:
Title:
By:
------------------------------
Name:
Title:
HOLDER SPECIFIED ABOVE (as to
obligations of such Holder under the
Purchase Contracts evidenced hereby)
By:
------------------------------
not individually but solely as attorney-in-
fact of such Holder
By:
------------------------------
Name:
Title:
Dated:
A-5
AGENT'S CERTIFICATE OF AUTHENTICATION
This is one of the Income PRIDES Certificates referred to in the
within mentioned Purchase Contract Agreement.
By:
------------------------------
as Purchase Contract Agent
By:
------------------------------
Authorized Signatory
Dated:
A-6
(Form of Reverse of Income PRIDES Certificate)
Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of June __, 2001 (as may be supplemented from time
to time, the "Purchase Contract Agreement"), between the Company and The Chase
Manhattan Bank, as Purchase Contract Agent (including its successors thereunder,
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 Income PRIDES Certificates are, and are to be, executed and delivered. In
the case of any inconsistency between this Certificate and the terms of the
Purchase Contract Agreement, the terms of the Purchase Contract Agreement shall
prevail.
Each Purchase Contract evidenced hereby obligates the Holder of this
Income PRIDES Certificate to purchase, and the Company to sell, on the Purchase
Contract Settlement Date at a price equal to the Purchase Price, a number of
newly issued shares of Common Stock of the Company equal to the Settlement Rate,
unless, on or prior to the Purchase Contract 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 equal to or greater
than $______ (the "Threshold Appreciation Price"), ______ shares of Common Stock
per Purchase Contract, (b) if the Applicable Market Value is less than the
Threshold Appreciation Price but is greater than $_______, the number of shares
of Common Stock per Purchase Contract equal to the Stated Amount divided by the
Applicable Market Value and (c) if the Applicable Market Value is less than or
equal to $_______, _______ shares of Common Stock per Purchase Contract, in each
case subject to adjustment as provided in the Purchase Contract Agreement. No
fractional shares of Common Stock will be issued upon settlement of Purchase
Contracts, as provided in the Purchase Contract Agreement.
Each Purchase Contract evidenced hereby which is settled either
through Early Settlement or Cash Settlement shall obligate the Holder of the
related Income PRIDES to purchase at the Purchase Price, and the Company to
sell, a number of newly issued shares of Common Stock equal to the Early
Settlement Rate or the Settlement Rate, as applicable.
The "Applicable Market Value" means the average of the Closing Price
per share of Common Stock on each of the 20 consecutive Trading Days ending on
the third Trading Day immediately preceding the Purchase Contract Settlement
Date or, for purposes of determining cash payable in lieu of factional shares in
connection with an Early Settlement, the third Trading Day immediately preceding
the relevant Early 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 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, the last closing sales price on and as reported
by the Nasdaq National 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
A-7
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.
In accordance with the terms of the Purchase Contract Agreement, the
Holder of this Income PRIDES Certificate shall pay the Purchase Price for the
shares of Common Stock purchased pursuant to each Purchase Contract evidenced
hereby by effecting a Cash Settlement or an Early Settlement or from the
Proceeds of a remarketing of the related pledged Notes of such holders or of the
appropriate Applicable Ownership Interest of the Treasury Portfolio. Unless a
Tax Event Redemption or a Successful Initial Remarketing has occurred, a Holder
of Income PRIDES who does not elect to make an effective (1) Cash Settlement on
or prior to 5:00 p.m., New York City time, on the fifth Business Day immediately
preceding the Purchase Contract Settlement Date, or (2) Early Settlement on or
prior to 5:00 p.m. New York City time, on the fifth Business Day immediately
preceding the Purchase Contract Settlement Date, shall pay the Purchase Price
for the shares of Common Stock to be issued under the related Purchase Contract
from the Proceeds of the sale of the related pledged Notes held by the
Collateral Agent. Unless a Tax Event Redemption or a Successful Initial
Remarketing has occurred, such sale will be made by the Remarketing Agent
pursuant to the terms of the Remarketing Agreement and any supplemental
remarketing agreement executed in connection therewith between the parties
thereto, on the third Business Day immediately preceding the Purchase Contract
Settlement Date. If a Tax Event Redemption or a Successful Initial Remarketing
has occurred, a Holder of Income PRIDES who does not elect to make an effective
Early Settlement on or prior to 5:00 p.m. New York City time, on the second
Business Day immediately preceding the Purchase Contract Settlement Date shall
pay the Purchase Price with the Proceeds at maturity of the Applicable Ownership
Interest (as defined in clause (A) of the definition of such term) of the
Treasury Portfolio.
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.
Under the terms of the Pledge Agreement, the Agent will be entitled to
exercise the voting and any other consensual rights pertaining to the pledged
Notes. Upon receipt of notice of any meeting at which holders of Notes are
entitled to vote or upon the solicitation of consents, waivers or proxies of
holders of Notes, the Agent shall, as soon as practicable thereafter, mail to
the Income PRIDES holders a notice (a) containing such information as is
contained in the notice or solicitation, (b) stating that each Income PRIDES
holder on the record date set by the Agent therefor (which, to the extent
possible, shall be the same date as the record date for determining the holders
of Notes entitled to vote) shall be entitled to instruct the Agent as to the
exercise of the voting rights pertaining to the Notes constituting a part of
such holder's Income PRIDES and (c) stating the manner in which such
instructions may be given. Upon the
A-8
written request of the Income PRIDES Holders on such record date, the Agent
shall endeavor insofar as practicable to vote or cause to be voted, in
accordance with the instructions set forth in such requests, the maximum number
of Notes as to which any particular voting instructions are received. In the
absence of specific instructions from the Holder of an Income PRIDES, the Agent
shall abstain from voting the Notes evidenced by such Income PRIDES.
Upon the occurrence of a Tax Event Redemption prior to the Purchase
Contract Settlement Date, pursuant to the terms of the Pledge Agreement, the
Collateral Agent will apply, out of the aggregate Redemption Price for the Notes
that are components of Income PRIDES, an amount equal to the aggregate
Redemption Amount for the Notes that are components of Income PRIDES to purchase
on behalf of the Holders of Income PRIDES, the Treasury Portfolio and, after
deducting the Remarketing Fee to the extent permitted under the terms of the
Remarketing Agreement, promptly remit the remaining portion of such Redemption
Price to the Agent for payment to the Holders of such Income PRIDES.
Upon the occurrence of a Successful Initial Remarketing, pursuant to
the terms of the Remarketing Agreement, the Remarketing Agent will apply an
amount equal to the Treasury Portfolio Purchase Price to purchase on behalf of
the Holders of Income PRIDES, the Treasury Portfolio, and, after deducting the
Remarketing Fee to the extent permitted under the terms of the Remarketing
Agreement, promptly remit the remaining portion of such Proceeds of the
Successful Initial Remarketing to the Agent for payment to the Holders of such
Income PRIDES.
Following the occurrence of a Tax Event Redemption prior to the
Purchase Contract Settlement Date or following a Successful Initial Remarketing,
the Holders of Income PRIDES and the Collateral Agent shall have such security
interests, rights and obligations with respect to the Treasury Portfolio as the
Holder of Income PRIDES and the Collateral Agent had in respect of the Notes, as
the case may be, subject to the Pledge thereof as provided in Articles 2, 3, 4,
5 and 6 of the Pledge Agreement and any reference herein to the Notes shall be
deemed to be a reference to such Treasury Portfolio and any reference herein or
in the Certificates to interest on the Notes shall be deemed to be a reference
to corresponding distributions on the Treasury Portfolio.
The Income PRIDES Certificates are issuable only in registered form
and only in denominations of a single Income PRIDES and any integral multiple
thereof. The transfer of any Income PRIDES Certificate will be registered and
Income PRIDES Certificates may be exchanged as provided in the Purchase Contract
Agreement. The Income PRIDES 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. A Holder who elects to substitute
Treasury Securities for Notes or the appropriate Applicable Ownership Interest
of the Treasury Portfolio, thereby creating Growth PRIDES, shall be responsible
for any fees or expenses payable in connection therewith. Except as provided in
the Purchase Contract Agreement, for so long as the Purchase Contract underlying
an Income PRIDES remains in effect, such Income PRIDES shall not be separable
into its constituent parts, and the rights and obligations of the Holder of such
Income PRIDES in respect of Notes or the appropriate Applicable Ownership
Interest of the Treasury Portfolio, as the case may be, and the
A-9
Purchase Contract constituting such Income PRIDES may be transferred and
exchanged only as an Income PRIDES. A Holder of an Income PRIDES may create a
Growth PRIDES by delivering to the Collateral Agent Treasury Securities in an
aggregate principal amount equal to the aggregate principal amount of the
pledged Notes or the appropriate Applicable Ownership Interest (as specified in
clause (A) of the definition of such term) of the Treasury Portfolio, as the
case may be, in exchange for the release of such pledged Notes or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the case
may be, in accordance with the terms of the Purchase Contract Agreement and the
Pledge Agreement. From and after such Collateral Substitution, the Security for
which such pledged Treasury Securities secures the Holder's obligation under the
Purchase Contract shall be referred to as a "Growth PRIDES." A Holder may make
such Collateral Substitution only in integral multiples of 20 Income PRIDES for
20 Growth PRIDES; provided, however, that if a Tax Event Redemption or a
Successful Initial Remarketing has occurred and the Treasury Portfolio has
become a component of the Income PRIDES, a Holder may make such Collateral
Substitutions only in integral multiples of 32,000 Income PRIDES for 32,000
Growth PRIDES. Such Collateral Substitution may cause the equivalent aggregate
Stated Amount of this Certificate to be increased or decreased; provided,
however, the equivalent aggregate Stated Amount outstanding under this Income
PRIDES Certificate shall not exceed $____________. [All such adjustments to the
equivalent aggregate Stated Amount of this Income PRIDES Certificate shall be
duly recorded by placing an appropriate notation on the Schedule attached
hereto.]
A Holder of Growth PRIDES may recreate Income PRIDES by delivering to
the Collateral Agent Notes or the appropriate Applicable Ownership Interest of
the Treasury Portfolio, with an aggregate principal amount, in the case of such
Notes, or with the appropriate Applicable Ownership Interest (as specified in
clause (A) of the definition of such term) of the Treasury Portfolio, in the
case of such appropriate Applicable Ownership Interest of the Treasury
Portfolio, equal to the aggregate principal amount of the pledged Treasury
Securities in exchange for the release of such pledged Treasury Securities in
accordance with the terms of the Purchase Contract Agreement and the Pledge
Agreement. Any such recreation of an Income PRIDES may be effected only in
multiples of 20 Growth PRIDES for 20 Income PRIDES; provided, however, that if a
Tax Event Redemption or a Successful Initial Remarketing has occurred and the
Treasury Portfolio has become a component of the Income PRIDES, a Holder may
make such substitution only in integral multiples of 32,000 Growth PRIDES for
32,000 Income PRIDES.
Subject to the next succeeding paragraph, the Company shall pay, on
each Payment Date, the Contract Adjustment Payments, if any, payable in respect
of each Purchase Contract to the Person in whose name the Income PRIDES
Certificate evidencing such Purchase Contract is registered at the close of
business on the Record Date for such Payment Date. Contract Adjustment
Payments, if any, will be payable at the Corporate Trust Office of the Agent and
the New York Office 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
Income PRIDES Register or by wire transfer to the account designated by such
Person in writing.
The Company shall have the right, at any time prior to the Purchase
Contract Settlement Date, to defer the payment of any or all of the Contract
Adjustment Payments, if any, 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)
A-10
as provided in the Purchase Contract Agreement. Any Contract Adjustment
Payments, if any, so deferred shall, to the extent permitted by law, bear
additional Contract Adjustment Payments thereon at the rate of [__]% per year
(computed on the basis of a 360-day year of twelve 30 day months), compounding
on each succeeding Payment Date, until paid in full (such deferred installments
of Contract Adjustment Payments, if any, together with the additional Contract
Adjustment Payments accrued thereon, are referred to herein as the "Deferred
Contract Adjustment Payments"). Deferred Contract Adjustment Payments, if any,
shall be due on the next succeeding Payment Date except to the extent that
payment is deferred pursuant to the Purchase Contract Agreement. No Contract
Adjustment Payments, if any, may be deferred to a date that is after the
Purchase Contract Settlement Date and no such deferral period may end other than
on a Payment Date.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments, if any, on the Purchase Contracts until a Payment Date
prior to the Purchase Contract Settlement Date, then all Deferred Contract
Adjustment Payments, if any, shall be payable to the registered Holders as of
the close of business on the Record Date immediately preceding such Payment
Date.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments, if any, on the Purchase Contracts until the Purchase
Contract Settlement Date, the Holder of this Income PRIDES Certificate will
receive on the Purchase Contract Settlement Date, in lieu of a cash payment, a
number of shares of Common Stock (in addition to the number of shares of Common
Stock equal to the Settlement Rate) equal to (x) the aggregate amount of
Deferred Contract Adjustment Payments payable to the Holder of this Income
PRIDES Certificate divided by (y) the Applicable Market Value.
In the event the Company exercises its option to defer the payment of
Contract Adjustment Payments, if any, then, until the Deferred Contract
Adjustment Payments have been paid, the Company shall not declare or pay
dividends on, make distributions with respect to, or redeem, purchase or
acquire, or make a liquidation payment with respect to, any of its capital stock
other than: (i) purchases, redemptions or acquisitions of shares of capital
stock of the Company in connection with any employment contract, benefit plan or
other similar arrangement with or for the benefit of employees, officers or
directors or a stock purchase or dividend reinvestment plan, or the satisfaction
by the Company of its obligations pursuant to any contract or security
outstanding on the date of such event; (ii) as a result of a reclassification of
the Company's capital stock or the exchange or conversion of one class or series
of the Company's capital stock for another class or series of the Company's
capital stock; (iii) the purchase of fractional interests in shares of the
Company's capital stock pursuant to the conversion or exchange provisions of
such capital stock or the security being converted or exchanged; (iv) dividends
or distributions in capital stock of the Company (or rights to acquire capital
stock) or repurchases, acquisitions or redemptions of capital stock in
connection with the issuance or exchange of capital stock (or securities
convertible into or exchangeable for shares of our capital stock); (v)
redemptions, exchanges or repurchases of any rights outstanding under a
shareholder rights plan or the declaration or payment thereunder of a dividend
or distribution of or with respect to rights in the future); or (vi) mandatory
sinking fund payments with respect to any series of preferred stock or preferred
stock A of the Company; provided that the aggregate stated value of all such
series outstanding at the time of such payment does not exceed 5% of the
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aggregate of (1) the total principal amount of all then outstanding bonds or
other securities representing secured indebtedness issued or assumed by the
Company and (2) the Company's capital and surplus to be stated on the Company's
books of account after giving effect to such payment; provided however that any
moneys deposited into any sinking fund and not in violation of this clause (vi)
may thereafter be applied to the purchase or redemption of such preferred stock
or preferred stock A in accordance with the terms of such sinking fund without
regard to the foregoing restrictions.
The Purchase Contracts and all 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 Contract Adjustment
Payments, if any, or any Deferred Contract Adjustment Payments, and the rights
and obligations of Holders to purchase Common Stock, shall immediately and
automatically terminate, without the necessity of any notice or action by any
Holder, the Agent or the Company, if, on or prior to the Purchase Contract
Settlement Date, a Termination Event shall have occurred. Upon the occurrence of
a Termination Event, the Company shall promptly but in no event later than two
Business Days thereafter give written notice to the Agent, the Collateral Agent
and to the Holders, at their addresses as they appear in the Income PRIDES
Register. Upon and after the occurrence of a Termination Event, the Collateral
Agent shall release the Notes or the appropriate Applicable Ownership Interest
of the Treasury Portfolio, as the case may be, from the Pledge in accordance
with the provisions of the Pledge Agreement.
Subject to and upon compliance with the provisions of the Purchase
Contract Agreement, at the option of the Holders thereof, Purchase Contracts
underlying Securities having an aggregate Stated Amount equal to $1,000 or an
integral multiple thereof may be settled early ("Early Settlement") as provided
in the Purchase Contract Agreement; provided, however, that if a Tax Event
Redemption or a Successful Initial Remarketing has occurred and the Treasury
Portfolio has become a component of the Income PRIDES, Holders may early settle
Income PRIDES only in integral multiples of 32,000 Income PRIDES. In order to
exercise the right to effect Early Settlement with respect to any Purchase
Contracts evidenced by this Income PRIDES Certificate, the Holder of this Income
PRIDES Certificate shall deliver this Income PRIDES Certificate to the Agent at
the Corporate Trust Office or the New York Office duly endorsed for transfer to
the Company or in blank with the form of Election to Settle Early set forth
below duly completed and accompanied by payment in lawful money of the United
States by [certified or cashiers check or] wire transfer, in each case in
immediately available funds payable to the Company in an amount (the "Early
Settlement Amount") equal to (i) the product of (A) the Stated Amount times (B)
the number of Purchase Contracts with respect to which the Holder has elected to
effect Early Settlement plus (ii) if such delivery is made with respect to any
Purchase Contracts during the period from the close of business on any Record
Date next preceding any Payment Date to the opening of business on such Payment
Date, an amount equal to the Contract Adjustment Payments, if any, payable on
such Payment Date with respect to such Purchase Contracts; provided that no
payment shall be required pursuant to clause (ii) of this sentence if the
Company shall have elected to defer the Contract Adjustment Payments which would
otherwise be payable on such Payment Date. Upon Early Settlement of Purchase
Contracts by a Holder of the related Securities, the pledged Notes or the
appropriate Applicable Ownership Interest of the Treasury Portfolio underlying
such Securities shall be released from the Pledge as provided in the Pledge
Agreement and the Holder shall be entitled to receive a
A-12
number of shares of Common Stock on account of each Purchase Contract forming
part of an Income PRIDES as to which Early Settlement is effected equal to the
Early Settlement Rate; provided, however, that upon the Early Settlement of the
Purchase Contracts, the Holder of such related Securities will forfeit the right
to receive any Deferred Contract Adjustment Payments and any future Contract
Adjustment Payments, except to the extent that the Early Settlement Date is
after the close of business on a Record Date and prior to the opening of
business on the corresponding Payment Date. The Early Settlement Rate shall
initially be equal to __________ shares of Common Stock 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.
Upon registration of transfer of this Income PRIDES Certificate in
accordance with the Purchase Contract Agreement, 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, the Pledge
Agreement and the Purchase Contracts evidenced hereby and the transferor shall
be released from the obligations under the Purchase Contract Agreement, the
Pledge Agreement and the Purchase Contracts evidenced by this Income PRIDES
Certificate. The Company covenants and agrees, and the Holder, by its acceptance
hereof, likewise covenants and agrees, to be bound by the provisions of this
paragraph.
The Holder of this Income PRIDES Certificate, by its acceptance
hereof, authorizes the Agent to enter into and perform the related Purchase
Contracts forming part of the Income PRIDES evidenced hereby on his behalf as
his attorney-in-fact, expressly withholds any consent to the assumption (i.e.,
affirmance) of the Purchase Contracts by the Company or its trustee in the event
that the Company becomes the subject of a case under the Bankruptcy Code, agrees
to be bound by the terms and provisions thereof, covenants and agrees to perform
its obligations under such Purchase Contracts, consents to the provisions of the
Purchase Contract Agreement, authorizes the Agent to enter into and perform the
Pledge Agreement on its behalf as its attorney-in-fact, and consents to the
Pledge of the Notes or the appropriate Applicable Ownership Interest of the
Treasury Portfolio, as the case may be, underlying this Income PRIDES
Certificate pursuant to the Pledge Agreement and to all other provisions of 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, Proceeds of the pledged Notes or
the appropriate Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) of the Treasury Portfolio on the Purchase Contract
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 Proceeds.
Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of a majority of the
Purchase Contracts then outstanding.
The Purchase Contracts shall for all purposes be governed by, and
construed in accordance with, the laws of the State of New York, without regard
to principles of conflicts of laws.
A-13
The Company, the Agent and its Affiliates and any agent of the Company
or the Agent may treat the Person in whose name this Income PRIDES Certificate
is registered as the owner of the Income PRIDES evidenced hereby for the purpose
of receiving payments of interest payable quarterly on the Notes or on the
maturing quarterly interest strips of the Treasury Portfolio, as applicable,
receiving payments of Contract Adjustment Payments, if any, and any Deferred
Contract Adjustment Payments, 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.
A-14
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
UNIF GIFT MIN ACT - __________Custodian__________
(cust) (minor)
Under Uniform Gifts to Minors Act
_________________________________
(State)
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and not
as tenants in common
Additional abbreviations may also be used though not in the above list.
-------------------------------------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto_______________________________________________________________
_______________________________________________________________________________
(Please insert Social Security or Taxpayer I.D. or other Identifying Number of
Assignee)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please Print or Type Name and Address Including Postal Zip Code of Assignee)
the within Income PRIDES Certificates and all rights thereunder, hereby
irrevocably constituting and appointing
________________________________________________________________________________
attorney to transfer said Income PRIDES Certificates on the books of Electronic
Data Systems Corporation with full power of substitution in the premises.
Dated:
----------------- ----------------------------------------------
Signature
A-15
NOTICE: The signature to this assignment
must correspond with the name as it
appears upon the face of the within
Income PRIDES Certificates in every
particular, without alteration or
enlargement or any change whatsoever.
Signature Guarantee:
________________________________
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
A-16
SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for shares of Common
Stock deliverable upon settlement on or after the Purchase Contract Settlement
Date of the Purchase Contracts underlying the number of Income PRIDES evidenced
by this Income PRIDES Certificate be registered in the name of, and delivered,
together with a check in payment for any fractional share, to the undersigned at
the address indicated below unless a different name and address have been
indicated below. If shares are to be registered in the name of a Person other
than the undersigned, the undersigned will pay any transfer tax payable incident
thereto.
Dated:
----------------- --------------------------------
Signature
Signature Guarantee:
-----------
(if assigned to another person)
Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Registrar, which requirements include membership
or participation in the Security Transfer Agent Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
If shares are to be registered in the name of and delivered to a Person other
than the Holder, please (i) print such Person's name and address REGISTERED
HOLDER and (ii) provide a guarantee of your signature: Please print name and
address of Registered Holder:
------------------------------ ------------------------------
Name Name
------------------------------ ------------------------------
Address Address
------------------------------ ------------------------------
Social Security or other
Taxpayer Identification
Number, if any
------------------------------
A-17
ELECTION TO SETTLE EARLY
The undersigned Holder of this Income PRIDES 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 Income PRIDES evidenced by this Income PRIDES
Certificate specified below. The option to effect Early Settlement may be
exercised only with respect to Purchase Contracts underlying Income PRIDES with
an aggregate Stated Amount equal to $1,000 or an integral multiple thereof;
provided, however, that if a Tax Event Redemption or a Successful Initial
Remarketing has occurred and the Treasury Portfolio has become a component of
the Income PRIDES, Holders may early settle Income PRIDES only in integral
multiples of 32,000 Income PRIDES. 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 Income PRIDES Certificate representing any Income
PRIDES 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 Notes or
the appropriate Applicable Ownership Interest of the Treasury Portfolio, as the
case may be, deliverable upon such Early Settlement will be transferred in
accordance with the transfer instructions set forth below. If shares are to be
registered in the name of a Person other than the undersigned, the undersigned
will pay any transfer tax payable incident thereto.
Dated:
----------------- ------------------------------
Signature
Signature Guarantee
(if assigned to another person):
---------------------------
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
Number of Securities evidenced hereby as to which Early Settlement of
the related Purchase Contracts is being elected:
If shares of Common Stock or Income PRIDES Certificates are to be
registered in the name of and delivered to and pledged Notes, or an
Applicable Ownership Interest in the Treasury Portfolio, as the case
may be, are to be transferred to a Person other than the Holder,
please (i) print such Person's name and address and (ii) provide a
guarantee of your signature:
A-18
------------------------------
Name
------------------------------
Address
------------------------------
------------------------------
------------------------------
------------------------------
REGISTERED HOLDER
Please print name and address of Registered Holder:
------------------------------
Name
------------------------------
Address
------------------------------
------------------------------
------------------------------
------------------------------
Social Security or other
Taxpayer Identification
Number, if any
------------------------------
Transfer Instructions for pledged Notes, or the Applicable Ownership Interest in
the Treasury Portfolio, as the case may be, Transferable Upon Early Settlement
or a Termination Event:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
A-19
[TO BE ATTACHED TO GLOBAL CERTIFICATES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The following increases or decreases in this Global Certificate have
been made:
Amount of Amount of Stated Amount of this Signature of authorized
decrease in Stated increase in Stated Global Certificate signatory of Purchase
Amount of the Global Amount of the Global following such decrease Contract Agent or
Date Certificate Certificate or increase Securities Custodian
-----------------------------------------------------------------------------------------------------------------------------
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A-20
EXHIBIT B
(Form of Face of Growth PRIDES Certificate)
[THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT (AS HEREINAFTER DEFINED) AND IS REGISTERED IN THE
NAME OF THE CLEARING AGENCY OR A NOMINEE THEREOF. THIS CERTIFICATE MAY NOT BE
EXCHANGED IN WHOLE OR IN PART FOR A CERTIFICATE REGISTERED, AND NO TRANSFER OF
THIS CERTIFICATE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY
PERSON OTHER THAN SUCH CLEARING AGENCY OR A NOMINEE THEREOF, EXCEPT IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY (55 XXXXX XXXXXX, XXX XXXX, XXX XXXX) TO THE
COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO., OR SUCH OTHER NAME
AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY,
AND ANY PAYMENT HEREON IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL SINCE THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]*
No. CUSIP No.
-----
Number of Growth PRIDES
-------
---------------
* To be inserted in Global Certificates only.
B-1
____ % Growth PRIDES
This Growth PRIDES Certificate certifies that __________ is the
registered Holder of the number of Growth PRIDES set forth above. Each Growth
PRIDES represents (i) a 1/20, or 5.0%, undivided beneficial ownership interest
in a Treasury Security having a principal amount at maturity equal to $1,000,
subject to the Pledge of such Treasury Security by such Holder pursuant to the
Pledge Agreement, and (ii) the rights and obligations of the Holder under one
Purchase Contract with Electronic Data Systems Corporation, a Delaware
corporation (the "Company," which term, as used herein, includes its successors
pursuant to the Purchase Contract Agreement). All capitalized terms used herein
which are defined in the Purchase Contract Agreement have the meaning set forth
therein.
Pursuant to the Pledge Agreement, the Treasury Securities constituting
part of each Growth PRIDES evidenced hereby have been pledged to the Collateral
Agent, for the benefit of the Company, to secure the obligations of the Holder
under the Purchase Contract comprising a portion of such Growth PRIDES.
The Pledge Agreement provides that all payments of the principal of
any Treasury Securities received by the Collateral Agent shall be paid by the
Collateral Agent by wire transfer in same day funds (i) in the case of any
principal payments with respect to any Treasury Securities that have been
released from the Pledge pursuant to the Pledge Agreement, to the Holders of the
applicable Growth PRIDES to the accounts designated by them in writing for such
purpose no later than 2:00 p.m., New York City time, on the Business Day such
payment is received by the Collateral Agent (provided that in the event such
payment is received by the Collateral Agent on a day that is not a Business Day
or after 12:30 p.m., New York City time, on a Business Day, then such payment
shall be made no later than 10:30 a.m., New York City time, on the next
succeeding Business Day), and (ii) in the case of the principal of any pledged
Treasury Securities, to the Company on the Purchase Contract Settlement Date (as
defined herein) in accordance with the terms of the Pledge Agreement, in full
satisfaction of the respective obligations of the Holders of the Growth PRIDES
of which such pledged Treasury Securities are a part under the Purchase
Contracts forming a part of such Growth PRIDES.
Each Purchase Contract evidenced hereby obligates the Holder of this
Growth PRIDES Certificate to purchase, and the Company to sell, on August 17,
2004 (the "Purchase Contract Settlement Date"), at a price equal to $50 (the
"Stated Amount"), a number of newly issued shares of Common Stock, par value
$0.1 ("Common Stock"), of the Company equal to the Settlement Rate, unless on or
prior to the Purchase Contract Settlement Date there shall have occurred a
Termination Event or an Early Settlement with respect to the Growth PRIDES 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
(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
Purchase Contract Settlement Date by application of the Proceeds from the
Treasury Securities pledged to secure the obligations under such Purchase
Contract in accordance with the terms of the Pledge Agreement.
The Company shall pay on each Payment Date in respect of each Purchase
Contract forming part of a Growth PRIDES evidenced hereby an amount (the
"Contract
B-2
Adjustment Payments") equal to __% per year of the Stated Amount, computed on
the basis of a 360-day year of twelve 30 day months, subject to deferral at the
option of the Company as provided in the Purchase Contract Agreement and more
fully described on the reverse hereof. Such Contract Adjustment Payments, if
any, shall be payable to the Person in whose name this Growth PRIDES Certificate
(or a Predecessor Growth PRIDES Certificate) is registered at the close of
business on the Record Date for such Payment Date.
Contract Adjustment Payments, if any, will be payable at the Corporate
Trust Office of the Agent and at the New York Office or, at the option of the
Company, by check mailed to the address of the Person entitled thereto as such
address appears on the Growth PRIDES Register or by wire transfer to the account
designated by such Person by prior written notice.
Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Agent by manual signature, this Growth PRIDES 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.
B-3
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
ELECTRONIC DATA SYSTEMS
CORPORATION
By:
------------------------------
Name:
Title:
By:
------------------------------
Name:
Title:
HOLDER SPECIFIED ABOVE (as to
obligations of such Holder under the
Purchase Contracts)
By: not individually
---------
but solely as attorney-in-fact of such Holder
By:
------------------------------
Name:
Title:
Dated:
B-4
AGENT'S CERTIFICATE OF AUTHENTICATION
This is one of the Growth PRIDES referred to in the within-mentioned
Purchase Contract Agreement.
By:
------------------------------
as Purchase Contract Agent
By:
------------------------------
Authorized Signatory
B-5
(Form of Reverse of
Growth PRIDES Certificate)
Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of June __, 2001 (as may be supplemented from time
to time, the "Purchase Contract Agreement"), between the Company and The Chase
Manhattan Bank, as Purchase Contract Agent (including its successors thereunder,
herein called the "Agent"), to which the 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 Growth PRIDES Certificates are, and are to be, executed and delivered. In
the case of any inconsistency between this Certificate and the terms of the
Purchase Contract Agreement, the terms of the Purchase Contract Agreement shall
prevail.
Each Purchase Contract evidenced hereby obligates the Holder of this
Growth PRIDES Certificate to purchase, and the Company to sell, on the Purchase
Contract Settlement Date at the Purchase Price, a number of newly issued shares
of Common Stock of the Company equal to the Settlement Rate, unless, on or prior
to the Purchase Contract 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 equal to or greater than $______
(the "Threshold Appreciation Price"), _______ shares of Common Stock per
Purchase Contract, (b) if the Applicable Market Value is less than the Threshold
Appreciation Price but is greater than $______, the number of shares of Common
Stock per Purchase Contract equal to the Stated Amount divided by the Applicable
Market Value and (c) if the Applicable Market Value is less than or equal to
$______, ______ shares of Common Stock per Purchase Contract, in each case
subject to adjustment as provided in the Purchase Contract Agreement. No
fractional shares of Common Stock will be issued upon settlement of Purchase
Contracts, as provided in the Purchase Contract Agreement.
Each Purchase Contract evidenced hereby which is settled through Early
Settlement shall obligate the Holder of the related Growth PRIDES to purchase at
the Purchase Price, and the Company to sell, a number of newly issued shares of
Common Stock equal to the Early Settlement Rate.
The "Applicable Market Value" means the average of the Closing Price
per share of Common Stock on each of the 20 consecutive Trading Days ending on
the third Trading Day immediately preceding the Purchase Contract Settlement
Date or, for purposes of determining cash payable in lieu of fractional shares
in connection with an Early Settlement, the third Trading Day immediately
preceding the relevant Early Settlement Date. The "Closing Price" of the Common
Stock on any date of determination means the closing sale price (or, if no
closing sale 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
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, the last closing sales
price on and as reported as reported by the Nasdaq National Market or, if the
Common Stock is not so
B-6
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.
In accordance with the terms of the Purchase Contract Agreement, the
Holder of this Growth PRIDES Certificate shall pay the Purchase Price for the
shares of Common Stock purchased pursuant to each Purchase Contract evidenced
hereby by effecting either an Early Settlement of each such Purchase Contract or
by applying a principal amount of the pledged Treasury Securities underlying
such Holder's Growth PRIDES equal to the Stated Amount to the purchase of the
Common Stock. A Holder of Growth PRIDES who does not elect, on or prior to 5:00
p.m., New York City time, on the second Business Day immediately preceding the
Purchase Contract Settlement Date, to make an Early Settlement, shall pay the
Purchase Price for the shares of Common Stock to be issued on the related
Purchase Contract by applying a principal amount of the pledged Treasury
Securities as aforesaid.
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.
The Growth PRIDES Certificates are issuable only in registered form
and only in denominations of a single Growth PRIDES and any integral multiple
thereof. The transfer of any Growth PRIDES Certificate will be registered and
Growth PRIDES Certificates may be exchanged as provided in the Purchase Contract
Agreement. The Growth PRIDES 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. A Holder who elects to substitute Notes
or the appropriate Applicable Ownership Interest of the Treasury Portfolio, as
the case may be, for Treasury Securities, thereby recreating Income PRIDES,
shall be responsible for any fees or expenses payable in connection therewith.
Except as provided in the Purchase Contract Agreement, for so long as the
Purchase Contract underlying a Growth PRIDES remains in effect, such Growth
PRIDES shall not be separable into its constituent parts, and the rights and
obligations of the Holder of such Growth PRIDES in respect of the Treasury
Security and the Purchase Contract constituting such Growth PRIDES may be
transferred and exchanged only as a Growth PRIDES. A Holder of Growth PRIDES
may recreate Income PRIDES by delivering to the Collateral Agent Notes or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, with an
aggregate principal amount, in the case of such Notes, or with the appropriate
Applicable Ownership Interest (as specified in clause (A) of the definition of
such term) of the Treasury Portfolio, in the case of such appropriate Applicable
Ownership Interest of the Treasury Portfolio, equal to the aggregate
B-7
principal amount of the pledged Treasury Securities in exchange for the release
of such pledged Treasury Securities in accordance with the terms of the Purchase
Contract Agreement and the Pledge Agreement. From and after such substitution,
the Security for which such pledged Notes or appropriate Applicable Ownership
Interest of the Treasury Portfolio, as the case may be, secures the Holder's
obligation under the Purchase Contract shall be referred to as an "Income
PRIDES." A Holder may make such a substitution only in integral multiples of 20
Growth PRIDES for 40 Income PRIDES; provided, however, that if a Tax Event
Redemption or a Successful Initial Remarketing has occurred and the Treasury
Portfolio has become a component of the Income PRIDES, a Holder may make such
substitution only in integral multiples of _____ Growth PRIDES for 32,000 Income
PRIDES. Such substitution may cause the equivalent aggregate Stated Amount of
this Certificate to be increased or decreased; provided, however, the equivalent
aggregate Stated Amount outstanding under this Growth PRIDES Certificate shall
not exceed $___________. [All such adjustments to the equivalent aggregate
Stated Amount of this Growth PRIDES Certificate shall be duly recorded by
placing an appropriate notation on the Schedule attached hereto.]
A Holder of an Income PRIDES may create a Growth PRIDES by delivering
to the Collateral Agent Treasury Securities in an aggregate principal amount of
the pledged Notes or the appropriate Applicable Ownership Interest (as specified
in clause (A) of the definition of such term) of the Treasury Portfolio, as the
case may be, in exchange for the release of such pledged Notes or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the case
may be, in accordance with the terms of the Purchase Contract Agreement and the
Pledge Agreement. Any such creation of a Growth PRIDES may be effected only in
multiples of 20 Income PRIDES for 40 Growth PRIDES; provided, however, if a Tax
Event Redemption or a Successful Initial Remarketing has occurred and the
Treasury Portfolio has become a component of the Income PRIDES, a Holder may
make such Collateral Substitution only in integral multiples of 32,000 Income
PRIDES for 32,000 Growth PRIDES.
Subject to the next succeeding paragraph, the Company shall pay, on
each Payment Date, the Contract Adjustment Payments, if any, payable in respect
of each Purchase Contract to the Person in whose name the Growth PRIDES
Certificate evidencing such Purchase Contract is registered at the close of
business on the Record Date for such Payment Date. Contract Adjustment Payments,
if any, will be payable at the Corporate Trust Office of the Agent and the New
York Office 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 Growth PRIDES
Register.
The Company shall have the right, at any time prior to the Purchase
Contract Settlement Date, to defer the payment of any or all of the Contract
Adjustment Payments, if any, 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 Adjustment Payments, if any, so
deferred shall, to the extent permitted by law, bear additional Contract
Adjustment Payments thereon at the rate of [7]% per year (computed on the basis
of a 360-day year of twelve 30 day months), compounding on each succeeding
Payment Date, until paid in full (such deferred installments of Contract
Adjustment Payments, if any, together with the additional Contract Adjustment
Payments accrued thereon, are referred to herein as the "Deferred Contract
Adjustment Payments"). Deferred Contract Adjustment Payments, if any, shall be
due on the
B-8
next succeeding Payment Date except to the extent that payment is deferred
pursuant to the Purchase Contract Agreement. No Contract Adjustment Payments, if
any, may be deferred to a date that is after the Purchase Contract Settlement
Date and no such deferral period may end other than on a Payment Date.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments, if any, on the Purchase Contracts until a Payment Date
prior to the Purchase Contract Settlement Date, then all Deferred Contract
Adjustment Payments, if any, shall be payable to the registered Holders as of
the close of business on the Record Date immediately preceding such Payment
Date.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments, if any, on the Purchase Contracts until the Purchase
Contract Settlement Date, the Holder of this Growth PRIDES Certificate will
receive on the Purchase Contract Settlement Date, in lieu of a cash payment, a
number of shares of Common Stock (in addition to the number of shares of Common
Stock equal to the Settlement Rate) equal to (x) the aggregate amount of
Deferred Contract Adjustment Payments payable to the Holder of this Growth
PRIDES Certificate divided by (y) the Applicable Market Value.
In the event the Company exercises its option to defer the payment of
Contract Adjustment Payments, if any, then, until the Deferred Contract
Adjustment Payments have been paid, the Company shall not declare or pay
dividends on, make distributions with respect to, or redeem, purchase or
acquire, or make a liquidation payment with respect to, any of its capital stock
other than: (i) purchases, redemptions or acquisitions of shares of capital
stock of the Company in connection with any employment contract, benefit plan or
other similar arrangement with or for the benefit of employees, officers or
directors or a stock purchase or dividend reinvestment plan, or the satisfaction
by the Company of its obligations pursuant to any contract or security
outstanding on the date of such event; (ii) as a result of a reclassification of
the Company's capital stock or the exchange or conversion of one class or series
of the Company's capital stock for another class or series of the Company's
capital stock; (iii) the purchase of fractional interests in shares of the
Company's capital stock pursuant to the conversion or exchange provisions of
such capital stock or the security being converted or exchanged; (iv) dividends
or distributions in capital stock of the Company (or rights to acquire capital
stock) or repurchases, acquisitions or redemptions of capital stock in
connection with the issuance or exchange of capital stock (or securities
convertible into or exchangeable for shares of our capital stock); (v)
redemptions, exchanges or repurchases of any rights outstanding under a
shareholder rights plan or the declaration or payment thereunder of a dividend
or distribution of or with respect to rights in the future); or (vi) mandatory
sinking fund payments with respect to any series of preferred stock or preferred
stock A of the Company; provided that the aggregate stated value of all such
series outstanding at the time of such payment does not exceed 5% of the
aggregate of (1) the total principal amount of all then outstanding bonds or
other securities representing secured indebtedness issued or assumed by the
Company and (2) the Company's capital and surplus to be stated on the Company's
books of account after giving effect to such payment; provided however that any
moneys deposited into any sinking fund and not in violation of this clause (vi)
may thereafter be applied to the purchase or redemption of such preferred stock
or preferred stock A in accordance with the terms of such sinking fund without
regard to the foregoing restrictions.
B-9
The Purchase Contracts and all 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 Contract Adjustment
Payments, if any, or any Deferred Contract Adjustment Payments, and the rights
and obligations of Holders to purchase Common Stock shall immediately and
automatically terminate, without the necessity of any notice or action by any
Holder, the Agent or the Company, if, on or prior to the Purchase Contract
Settlement Date, a Termination Event shall have occurred. Upon the occurrence of
a Termination Event, the Company shall promptly but in no event later than two
Business Days thereafter give written notice to the Agent, the Collateral Agent
and to the Holders, at their addresses as they appear in the Growth PRIDES
Register. Upon and after the occurrence of a Termination Event, the Collateral
Agent shall release the Treasury Securities from the Pledge in accordance with
the provisions of the Pledge Agreement.
Subject to and upon compliance with the provisions of the Purchase
Contract Agreement, at the option of the Holders thereof, Purchase Contracts
underlying Securities having an aggregate Stated Amount equal to $1,000 or an
integral multiple thereof may be settled early ("Early Settlement") as provided
in the Purchase Contract Agreement. In order to exercise the right to effect
Early Settlement with respect to any Purchase Contracts evidenced by this Growth
PRIDES Certificate, the Holder of this Growth PRIDES Certificate shall deliver
this Growth PRIDES Certificate to the Agent at the Corporate Trust Office or the
New York Office duly endorsed for transfer to the Company or in blank with the
form of Election to Settle Early set forth below duly completed and accompanied
by payment in lawful money of the United States by [certified or cashiers check
or] wire transfer, in each case in immediately available funds payable to the
Company in an amount (the "Early Settlement Amount") equal to (i) the product of
(A) the Stated Amount times (B) the number of Purchase Contracts with respect to
which the Holder has elected to effect Early Settlement plus (ii) if such
delivery is made with respect to any Purchase Contracts during the period from
the close of business on any Record Date next preceding any Payment Date to the
opening of business on such Payment Date, an amount equal to the Contract
Adjustment Payments, if any, payable on such Payment Date with respect to such
Purchase Contracts; provided that no payment shall be required pursuant to
clause (ii) of this sentence if the Company shall have elected to defer the
Contract Adjustment Payments which would otherwise be payable on such Payment
Date. Upon Early Settlement of Purchase Contracts by a Holder of the related
Securities, the pledged Treasury Securities underlying such Securities shall be
released from the Pledge as provided in the Pledge Agreement and the Holder
shall be entitled to receive a number of shares of Common Stock on account of
each Purchase Contract forming part of a Growth PRIDES as to which Early
Settlement is effected equal to the Early Settlement Rate; provided, however,
that upon the Early Settlement of the Purchase Contracts, the Holder of such
related Securities will forfeit the right to receive any Deferred Contract
Adjustment Payments and any future Contract Adjustment Payments, except to the
extent that the Early Settlement Date is after the close of business on a Record
Date and prior to the opening of business on the corresponding Payment Date.
The Early Settlement Rate shall initially be equal to _______ shares of Common
Stock 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.
Upon registration of transfer of this Growth PRIDES Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee, except as
B-10
may be required by the Agent pursuant to the Purchase Contract Agreement) under
the terms of the Purchase Contract Agreement, the Pledge Agreement and the
Purchase Contracts evidenced hereby and the transferor shall be released from
the obligations under the Purchase Contract Agreement, the Pledge Agreement and
the Purchase Contracts evidenced by this Growth PRIDES 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 Growth PRIDES Certificate, by its acceptance
hereof, authorizes the Agent to enter into and perform the related Purchase
Contracts forming part of the Growth PRIDES evidenced hereby on his behalf as
its attorney-in-fact, expressly withholds any consent to the assumption (i.e.,
affirmance) of the Purchase Contracts by the Company or its trustee in the event
that the Company becomes the subject of a case under the Bankruptcy Code, agrees
to be bound by the terms and provisions thereof, covenants and agrees to perform
its obligations under such Purchase Contracts, consents to the provisions of the
Purchase Contract Agreement, authorizes the Agent to enter into and perform the
Pledge Agreement on its behalf as its attorney-in-fact, and consents to the
Pledge of the Treasury Securities underlying this Growth PRIDES Certificate
pursuant to the Pledge Agreement and to all other provisions of 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, Proceeds of the pledged Treasury Securities on
the Purchase Contract 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
Proceeds.
Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of a majority of the
Purchase Contracts then outstanding.
The Purchase Contracts shall for all purposes be governed by, and
construed in accordance with, the laws of the State of New York, without regard
to principles of conflicts of laws.
The Company, the Agent and its Affiliates and any agent of the Company
or the Agent may treat the Person in whose name this Growth PRIDES Certificate
is registered as the owner of the Growth PRIDES evidenced hereby for the purpose
of receiving payments on the Treasury Securities, receiving payments of Contract
Adjustment Payments, if any, and any Deferred Contract Adjustment Payments,
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.
B-11
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
UNIF GIFT MIN ACT - __________Custodian__________
(cust) (minor)
Under Uniform Gifts to Minors Act
-------------------------------------------
(State)
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and not
as tenants in common
Additional abbreviations may also be used though not in the above list.
------------------------------------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
---------------------------------------------------------------
--------------------------------------------------------------------------------
(Please insert Social Security or Taxpayer I.D. or other Identifying Number of
Assignee)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Please Print or Type Name and Address Including Postal Zip Code of Assignee)
the within Income PRIDES Certificates and all rights thereunder, hereby
irrevocably constituting and appointing
--------------------------------------------------------------------------------
attorney to transfer said Income PRIDES Certificates on the books of Electronic
Data Systems Corporation with full power of substitution in the premises.
Dated:
----------------- ------------------------------
Signature
B-12
NOTICE: The signature to this assignment
must correspond with the name as it
appears upon the face of the within
Income PRIDES Certificates in every
particular, without alteration or
enlargement or any change whatsoever.
Signature Guarantee:
------------------------------
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
B-13
SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for shares of Common
Stock deliverable upon settlement on or after the Purchase Contract Settlement
Date of the Purchase Contracts underlying the number of Growth PRIDES evidenced
by this Growth PRIDES Certificate be registered in the name of, and delivered,
together with a check in payment for any fractional share, to the undersigned at
the address indicated below unless a different name and address have been
indicated below. If shares are to be registered in the name of a Person other
than the undersigned, the undersigned will pay any transfer tax payable incident
thereto.
Dated:
----------------- ------------------------------
Signature
Signature Guarantee:
-----------
(if assigned to another person)
Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Registrar, which requirements include membership
or participation in the Security Transfer Agent Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
If shares are to be registered in the name of and delivered to a Person other
than the Holder, please (i) print such Person's name and address and (ii)
provide a guarantee of your signature:
--------------------------------------------------------------------------------
Name
--------------------------------------------------------------------------------
Address
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Social Security or other
Taxpayer Identification
Number, if any
------------------------------------------------------------------
REGISTERED HOLDER
Please print name and address of Registered Holder:
--------------------------------------------------------------------------------
Name
B-14
--------------------------------------------------------------------------------
Address
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
ELECTION TO SETTLE EARLY
The undersigned Holder of this Growth PRIDES 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 Growth PRIDES evidenced by this Growth PRIDES
Certificate specified below. The option to effect Early Settlement may be
exercised only with respect to Purchase Contracts underlying Growth PRIDES with
an aggregate Stated Amount equal to $1,000 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
Growth PRIDES Certificate representing any Growth PRIDES 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 Treasury Securities deliverable upon such
Early Settlement will be transferred in accordance with the transfer
instructions set forth below. If shares are to be registered in the name of a
Person other than the undersigned, the undersigned will pay any transfer or
similar tax payable incident thereto.
Dated:
---------------- ------------------------------
Signature
Signature Guarantee:
------------------------------
(if assigned to another person)
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
Number of Securities evidenced hereby as to which Early Settlement of
the related Purchase Contracts is being elected:
If shares of Common Stock or Growth PRIDES Certificates are to be registered in
the name of and delivered to and pledged Treasury Securities are to be
transferred to a Person other than the Holder, please (i) print such Person's
name and address and (ii) provide a guarantee of your signature:
B-15
--------------------------------------------------------------------------------
Name
--------------------------------------------------------------------------------
Address
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Social Security or other
Taxpayer Identification
Number, if any
------------------------------------------------------------------
Please print name and address of Registered Holder:
--------------------------------------------------------------------------------
Name
--------------------------------------------------------------------------------
Address
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Transfer Instructions for pledged Treasury Securities Transferable Upon Early
Settlement or a Termination Event:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
B-16
[TO BE ATTACHED TO GLOBAL CERTIFICATES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The following increases or decreases in this Global
Certificate have been made:
Stated Amount of this Signature of authorized
Amount of decrease in Amount of increase in Global Certificate Signatory of Purchase
Stated Amount of the Stated Amount of the following such decrease Contract Agent or
Date Global Certificates Global Certificates or increase Securities Custodian
B-17
EXHIBIT C
INSTRUCTION FROM PURCHASE CONTRACT AGENT
TO COLLATERAL AGENT
[Collateral Agent Address]
Re: Feline PRIDES of Electronic Data Systems Corporation (the
"Company")
We hereby notify you in accordance with Section [4.1] [4.2] of the
Pledge Agreement, dated as of June __, 2001, (the "Pledge Agreement") among the
Company, yourselves, as Collateral Agent, Custodial Agent and Securities
Intermediary and ourselves, as Purchase Contract Agent and as attorney-in-fact
for the holders of [Income PRIDES] [Growth PRIDES] from time to time, that the
holder of the Securities listed below (the "Holder") has elected to substitute
[$_____ aggregate principal amount of Treasury Securities] [$_______ aggregate
principal amount of Notes or the appropriate Applicable Ownership Interest of
the Treasury Portfolio, as the case may be,] in exchange for an equal Value of
[Pledged Notes or the appropriate Applicable Ownership Interest of the Treasury
Portfolio, as the case may be,] [Pledged Treasury Securities] held by you in
accordance with the Pledge Agreement and has delivered to us a notice stating
that the Holder has Transferred [Treasury Securities] [Notes or the appropriate
Applicable Ownership Interest of the Treasury Portfolio, as the case may be,] to
you, as Collateral Agent. We hereby instruct you, upon receipt of such [Pledged
Treasury Securities] [Pledged Notes or the appropriate Applicable Ownership
Interest of the Treasury Portfolio, as the case may be,], and upon the payment
by such Holder of any applicable fees, to release the [Notes or the appropriate
Applicable Owner ship Interest of the Treasury Portfolio, as the case may be,]
[Treasury Securities] related to such [Income PRIDES] [Growth PRIDES] to us in
accordance with the Holder's instructions. Capitalized terms used herein but
not defined shall have the meaning set forth in the Pledge Agreement.
Date:
------------- ---------------------------------
By:
----------------------
Name:
Title:
Signature Guarantee:
-------------
Please print name and address of Registered Holder electing to substitute
[Treasury Securities] [Notes or the appropriate Applicable Ownership Interest of
the Treasury Portfolio, as the case may be,] for the [Pledged Notes or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the case
may be,] [Pledged Treasury Securities]:
------------------------------ -------------------------------------
Name Social Security or other Taxpayer
Identification Number, if any
------------------------------
Address
------------------------------
------------------------------
C-1
EXHIBIT D
INSTRUCTION TO PURCHASE CONTRACT AGENT
[Purchase Contract Agent Address]
Re: Feline PRIDES of Electronic Data Systems Corporation (the
"Company")
The undersigned Holder hereby notifies you that it has delivered to
, as Collateral Agent, [$_______ aggregate principal amount of Treasury
Securities] [$ aggregate principal amount of Notes or the appropriate
Applicable Ownership Interest of the Treasury Portfolio, as the case may be,] in
exchange for an equal Value of [Pledged Notes or the appropriate Applicable
Ownership Interest of the Treasury Portfolio, as the case may be,] [Pledged
Treasury Securities] held by the Collateral Agent, in accordance with Section
[4.1], [4.2] of the Pledge Agreement, dated June __, 2001 (the "Pledge
Agreement"), between you, the Company and the Collateral Agent. The undersigned
Holder has paid the Collateral Agent all applicable fees relating to such
exchange. The undersigned Holder hereby instructs you to instruct the
Collateral Agent to release to you on behalf of the undersigned Holder the
[Pledged Notes or the appropriate Applicable Ownership Interest of the Treasury
Portfolio] [Pledged Treasury Securities] related to such [Income PRIDES] [Growth
PRIDES]. Capitalized terms used herein but not defined shall have the meaning
set forth in the Pledge Agreement.
Dated:
------------- ----------------------------------------
Signature
Signature Guarantee:
-------------
Please print name and address of Registered Holder:
------------------------------ -----------------------------------------
Name Social Security or other Taxpayer
Identification Number, if any
------------------------------
Address
------------------------------
------------------------------
D-1
EXHIBIT E
NOTICE TO SETTLE BY SEPARATE CASH
[Purchase Contract Agent Address]
Re: Feline PRIDES of Electronic Data Systems Corporation (the
"Company")
The undersigned Holder hereby irrevocably notifies you in accordance
with Section 5.4 of the Purchase Contract Agreement dated as of June __, 2001
among the Company and yourselves, as Purchase Contract Agent and as Attorney-in-
Fact for the Holders of the Purchase Contracts, that such Holder has elected to
pay to the Collateral Agent, on or prior to 11:00 a.m. New York City time, on
the Business Day immediately preceding the Purchase Contract Settlement Date,
(in lawful money of the United States by [certified or cashiers check or] wire
transfer, in each case in immediately available funds), $_________ as the
Purchase Price for the shares of Common Stock issuable to such Holder by the
Company under the related Purchase Contract on the Purchase Contract Settlement
Date. The undersigned Holder hereby instructs you to notify promptly the
Collateral Agent of the undersigned Holders election to make such cash
settlement with respect to the Purchase Contracts related to such Holder's
[Income PRIDES] [Growth PRIDES].
Dated:
------------- ----------------------------------------
Signature
Signature Guarantee:
--------------
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
Please print name and address of Registered Holder:
------------------------------ ----------------------------------------
Name Social Security or other Taxpayer
Identification Number, if any
------------------------------
Address
------------------------------
------------------------------
E-1
