Exhibit 4.3
STB DRAFT
February 11, 1999
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NIPSCO INDUSTRIES, INC.
AND
THE CHASE MANHATTAN BANK,
As Purchase Contract Agent
PURCHASE CONTRACT AGREEMENT
Dated as of February 16, 1999
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TABLE OF CONTENTS
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RECITALS .......................................................1
ARTICLE I
Definitions and Other Provisions of General Applications
Section 1.1. Definitions.....................................................1
Section 1.2. Compliance Certificates and Opinions...........................11
Section 1.3. Form of Documents Delivered to Agent...........................12
Section 1.4. Acts of Holders; Record Dates..................................12
Section 1.5. Notices........................................................13
Section 1.6. Notice to Holders; Waiver......................................15
Section 1.7. Effect of Headings and Table of Contents.......................15
Section 1.8. Successors and Assigns.........................................15
Section 1.9. Separability Clause............................................15
Section 1.10. Benefits of Agreement..........................................15
Section 1.11. Governing Law..................................................16
Section 1.12. Legal Holidays.................................................16
Section 1.13. Counterparts...................................................16
Section 1.14. Inspection of Agreement........................................16
ARTICLE II
Certificate Forms
Section 2.1. Forms of Certificates Generally................................16
Section 2.2. Form of Agent's Certificate of Authentication..................18
ARTICLE III
The Securities
Section 3.1. Amount; Form and Denominations.................................18
Section 3.2. Rights and Obligations Evidenced by the Certificates...........18
Section 3.3. Execution, Authentication, Delivery and Dating.................19
Section 3.4. Temporary Certificates.........................................20
Section 3.5. Registration; Registration of Transfer and Exchange............20
Section 3.6. Book-Entry Interests...........................................21
Section 3.7. Notices to Holders.............................................22
Section 3.8. Appointment of Successor Clearing Agency.......................22
Section 3.9. Definitive Certificates........................................22
Section 3.10. Mutilated, Destroyed, Lost and Stolen Certificates.............23
Section 3.11. Persons Deemed Owners..........................................24
Section 3.12. Cancellation...................................................24
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Section 3.13. Substitution of Securities.....................................25
Section 3.14. Reestablishment of Corporate PIES..............................26
Section 3.15. Transfer of Collateral upon Occurrence of Termination Event....28
Section 3.16. No Consent to Assumption.......................................28
ARTICLE IV
The Preferred Securities
Section 4.1. Payment of Distribution; Rights to Distributions Preserved;
Distribution Rate Reset; Notice................................29
Section 4.2. Notice and Voting..............................................30
Section 4.3. Distribution of Debentures; Tax Event Redemption...............30
ARTICLE V
The Purchase Contracts
Section 5.1. Purchase of Shares of Common Stock.............................32
Section 5.2. Contract Adjustment Payments...................................33
Section 5.3. ...............................................................34
Section 5.4. Payment of Purchase Price......................................34
Section 5.5. Issuance of Shares of Common Stock.............................37
Section 5.6. Adjustment of Settlement Rate..................................38
Section 5.7. Notice of Adjustments and Certain Other Events.................43
Section 5.8. Termination Event; Notice......................................43
Section 5.9. Early Settlement...............................................44
Section 5.10. No Fractional Shares...........................................45
Section 5.11. Charges and Taxes..............................................46
ARTICLE VI
Remedies
Section 6.1. Unconditional Right of Holders to Receive Contract Adjustment
Payments and to Purchase Common Stock..........................46
Section 6.2. Restoration of Rights and Remedies.............................46
Section 6.3. Rights and Remedies Cumulative.................................47
Section 6.4. Delay or Omission Not Waiver...................................47
Section 6.5. Undertaking for Costs..........................................47
Section 6.6. Waiver of Stay or Extension Laws...............................47
ARTICLE VII
The Agent
Section 7.1. Certain Duties and Responsibilities............................48
Section 7.2. Notice of Default..............................................49
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Section 7.3. Certain Rights of Agent........................................49
Section 7.4. Not Responsible for Recitals or Issuance of Securities.........50
Section 7.5. May Hold Securities............................................50
Section 7.6. Money Held in Custody..........................................50
Section 7.7. Compensation and Reimbursement.................................50
Section 7.8. Corporate Agent Required; Eligibility..........................51
Section 7.9. Resignation and Removal; Appointment of Successor..............51
Section 7.10. Acceptance of Appointment by Successor.........................52
Section 7.11. Merger, Conversion, Consolidation or Succession to Business....52
Section 7.12. Preservation of Information; Communications to Holders.........53
Section 7.13. No Obligations of Agent........................................53
Section 7.14. Tax Compliance.................................................53
ARTICLE VIII
Supplemental Agreements
Section 8.1. Supplemental Agreements Without Consent of Holders.............54
Section 8.2. Supplemental Agreements With Consent of Holders................54
Section 8.3. Execution of Supplemental Agreements...........................56
Section 8.4. Effect of Supplemental Agreements..............................56
Section 8.5. Reference to Supplemental Agreements...........................56
ARTICLE IX
Consolidation, Merger, Sale or Conveyance
Section 9.1. Covenant Not to Merge, Consolidate, Sell or Convey Property
Except Under Certain Conditions................................56
Section 9.2. Rights and Duties of Successor Corporation.....................57
Section 9.3. Opinion of Counsel Given to Agent..............................57
ARTICLE X
Covenants
Section 10.1. Performance Under Purchase Contracts...........................57
Section 10.2. Maintenance of Office or Agency................................57
Section 10.3. Company to Reserve Common Stock................................58
Section 10.4. Covenants as to Common Stock...................................58
Section 10.5. Statements of Officers of the Company as to Default............58
Section 10.6. ERISA..........................................................59
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EXHIBIT A Form of Corporate PIES Certificate
EXHIBIT B Form of Treasury PIES Certificate
EXHIBIT C Instruction to Purchase Contract Agent
EXHIBIT D Notice from Purchase Contract Agent to Holders (Transfer of
Collateral upon Occurrence of a Termination Event)
EXHIBIT E Notice to Settle by Separate Cash
EXHIBIT F Notice from Purchase Contract Agent to Collateral Agent and
Indenture Trustee (Payment of Purchase Contract Settlement
Price)
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PURCHASE CONTRACT AGREEMENT, dated as of February 16, 1999, between
NIPSCO INDUSTRIES, INC., an Indiana corporation (the "Company"), and THE CHASE
MANHATTAN BANK, a New York banking 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.
W I T N E S S E T H :
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually agreed as follows:
ARTICLE 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, Exhibit or other subdivision;
(d) the following terms have the meanings given to them in the
Declaration: (i) Applicable Ownership Interest; (ii) Applicable Principal
Amount; (iii) Authorized Newspaper; (iv) Guarantee; (v) Primary Treasury Dealer;
(vi) Quotation Agent; (vii) Redemption Amount; (viii) Redemption Price; (ix)
Remarketing; (x) Reset Rate; (xi) Tax Event; (xii) Tax Event Redemption; (xiii)
Tax Event Redemption Date; (xiv) Two-Year Benchmark Treasury Rate; (xv) Treasury
Portfolio; and (xvi) Treasury Portfolio Purchase Price; and
(e) the following terms have the meanings given to them in this Section
1.1(e):
"Act," when used with respect to any Holder, has the meaning specified in
Section 1.4.
"Adjusted Contract Adjustment Payment Rate," with respect to any Reset
Transaction, means the rate per annum that is the arithmetic average of the
rates quoted by two Reference Dealers selected by the Company or its successor
as the rate at which Contract Adjustment Payments should accrue so that the fair
market value, expressed in dollars, of a Corporate PIES immediately after the
later of (i) public announcement of such Reset Transaction or (ii) public
announcement of a change in dividend policy in connection with such Reset
Transaction will equal the average Trading Price of a Corporate PIES for the 20
Trading Days immediately preceding the date of public announcement of such Reset
Transaction; provided that the Adjusted Contract Adjustment Payment Rate shall
not be less than 1.85% per annum.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Agent" means the Person named as the "Agent" in the first paragraph of
this instrument until a successor Agent shall have become such pursuant to the
applicable provisions of this Agreement, and thereafter "Agent" shall mean 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.
"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 Global Certificate, a Person
who is the beneficial owner of such Book-Entry Interest as reflected on the
books of the Clearing Agency or on the books of a Person maintaining an account
with such Clearing Agency (directly as a
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Clearing Agency Participant or as an indirect participant, in each case in
accordance with the rules of such Clearing Agency).
"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 or Sunday or a day on
which banking institutions in The City of New York are authorized or required by
law or executive order to remain closed or a day on which the Indenture Trustee,
or the principal office of the Property Trustee under the Declaration, is closed
for business; provided that for purposes of the second paragraph of Section 1.12
only, the term "Business Day" shall also be deemed to exclude any day on which
trading on the New York Stock Exchange, Inc. is closed or suspended.
"Cash Settlement" has the meaning set forth in Section 5.4(a)(i).
"Certificate" means a Corporate PIES Certificate or a Treasury PIES
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.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collateral" has the meaning specified in the Pledge Agreement.
"Collateral Account" has the meaning specified in the Pledge Agreement.
"Collateral Agent" means The First National Bank of Chicago, as Collateral
Agent under the Pledge Agreement until a successor Collateral Agent shall have
become such pursuant to the
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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 Stock" means the Common Shares, without 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 provision of this Agreement, and thereafter "Company" shall mean such
successor.
"Contract Adjustment Payments" means, (a) if a Reset Transaction has not
occurred, the fee payable by the Company in respect of each Purchase Contract,
equal to 5.9% per annum of the Stated Amount, or (b) following the occurrence of
a Reset Transaction, the Adjusted Contract Adjustment Payment Rate related to
such Reset Transaction until any succeeding Reset Transaction shall occur,
computed (i) for any full quarterly period on the basis of a 360-day year of
twelve 30-day months and (ii) for any period shorter than a full quarterly
period for which such payments are calculated, on the basis of a 30-day month
and, for periods of less than a month, the actual number of days elapsed per
30-day month.
"Corporate PIES" means the collective rights and obligations of a Holder
of a Corporate PIES Certificate in respect of a Preferred Security, the
Debentures 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; provided that the appropriate Applicable
Ownership Interest (as specified in clause (B) of the definition of such term)
of the Treasury Portfolio shall not be subject to the Pledge.
"Corporate PIES Certificate" means a certificate evidencing the rights and
obligations of a Holder in respect of the number of Corporate PIES specified on
such certificate.
"Corporate PIES Register" and "Corporate PIES Registrar" have the
respective meanings specified in Section 3.5.
"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 000 Xxxx 00xx Xx.,
Xxx Xxxx, Xxx Xxxx, 00000 Attention: Corporate Trust Group.
"Coupon Rate" means the percentage rate per annum at which each Debenture
will bear interest initially.
"Current Market Price" has the meaning specified in Section 5.6(a)(8).
"Debentures" means the series of debentures to be issued by the Finance
Subsidiary under the Indenture and held by the Property Trustee.
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"Declaration" means the Amended and Restated Declaration of Trust of
NIPSCO Capital Trust I, dated as of February 16, 1999, among the Finance
Subsidiary, as the sponsor, the trustees named therein and the holders from time
to time of undivided beneficial interests in the assets of the Trust.
"Depositary" means DTC until another Clearing Agency becomes its
successor.
"Dividend Yield," on any security for any period, means the dividends paid
or proposed to be paid pursuant to an announced dividend policy on such security
for such period divided by, if with respect to dividends paid on such security,
the average Closing Price of such security during such period and, if with
respect to dividends so proposed to be paid on such security, the Closing Price
of such security on the effective date of the related Reset Transaction.
"DTC" means The Depository Trust Company, the initial Clearing Agency.
"Early Settlement" has the meaning specified in Section 5.9(a).
"Early Settlement Amount" has the meaning specified in Section 5.9(a).
"Early Settlement Date" has the meaning specified in Section 5.9(a).
"Early Settlement Rate" has the meaning specified in Section 5.9(b).
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"Exchange Act" means the Securities Exchange Act of 1934 and any statute
successor thereto, in each case as amended from time to time, and the rules and
regulations promulgated thereunder.
"Expiration Date" has the meaning specified in Section 1.4.
"Expiration Time" has the meaning specified in Section 5.6(a)(6).
"Finance Subsidiary" means NIPSCO Capital Markets, Inc., an Indiana
corporation, until a successor shall have become such pursuant to the Indenture,
and thereafter "Finance Subsidiary" shall mean such successor.
"Global Certificate" means a Certificate that evidences all or part of the
Securities and is registered in the name of a Clearing Agency or a nominee
thereof.
"Holder," when used with respect to a Security, means the Person in whose
name the Security evidenced by a Corporate PIES Certificate and/or a Treasury
PIES Certificate is registered in the related Corporate PIES Register and/or the
Treasury PIES Register, as the case may be; provided, however, that in
determining whether the Holders of the requisite number of Corporate PIES and/or
Treasury PIES have voted on any matter, then for the purpose of such
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determination only (and not for any other purpose hereunder), if the Security
remains in the form of one or more Global Certificates and if the Clearing
Agency which is the holder of such Global Certificate has sent an omnibus proxy
assigning voting rights to the Clearing Agency Participants to whose accounts
the Securities are credited on the record date, the term "Holder" shall mean
such Clearing Agency Participant acting at the direction of the Beneficial
Owners.
"Indenture" means the Indenture, dated as of February 14, 1997, between
the Finance Subsidiary, the Company and the Indenture Trustee, as amended and
supplemented (including any provisions of the TIA that are deemed incorporated
therein), pursuant to which the Debentures are to be issued.
"Indenture Trustee" means The Chase Manhattan Bank, a New York banking
corporation, as trustee under the Indenture, or any successor thereto.
"Issuer Order" or "Issuer Request" means a written request or order signed
in the name of the Company by its Chairman of the Board, its President or one of
its Vice Presidents, and by its Treasurer, an Assistant Treasurer, its Secretary
or an Assistant Secretary, and delivered to the Agent.
"NYSE" has the meaning specified in Section 5.1.
"Officers' Certificate" means a certificate signed by the Chairman of the
Board, its President or one of its Vice Presidents, and by the Treasurer, an
Assistant Treasurer, the Secretary or an Assistant Secretary, of the Company,
and delivered to the Agent. Any Officers' Certificate delivered with respect to
compliance with a condition or covenant provided for in this Agreement shall
include:
(a) a statement that each officer signing the Officers' Certificate has
read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Officers' Certificate;
(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such officer
to express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(d) a statement as to whether, in the opinion of each such officer, such
condition or covenant has been complied with.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company (and who may be an employee of the Company), and who
shall be reasonably acceptable to the Agent. An opinion of counsel may rely on
certificates as to matters of fact.
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"Outstanding Securities," with respect to any Corporate PIES or Treasury
PIES, means, as of the date of determination, all Corporate PIES or Treasury
PIES evidenced by Certificates theretofore authenticated, executed and delivered
under this Agreement, except:
(i) If a Termination Event has occurred, (A) Treasury PIES and (B)
Corporate PIES for which the underlying Preferred Securities or Debentures
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 Corporate PIES;
(ii) Corporate PIES and Treasury PIES 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) Corporate PIES and Treasury PIES evidenced by Certificates in
exchange for or in lieu of which other Certificates have been
authenticated, executed on behalf of the Holder and delivered pursuant to
this Agreement, other than any such Certificate in respect of which there
shall have been presented to the Agent proof satisfactory to it that such
Certificate is held by a bona fide purchaser in whose hands the Corporate
PIES or Treasury PIES evidenced by such Certificate are valid obligations
of the Company;
provided, however, that in determining whether the Holders of the requisite
number of the Corporate PIES or Treasury PIES have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Corporate PIES or
Treasury PIES owned by the Company or any Affiliate of the Company shall be
disregarded and deemed not to be Outstanding Securities, except that, in
determining whether the Agent shall be protected in relying upon any such
request, demand, authorization, direction, notice, consent or waiver, only
Corporate PIES or Treasury PIES which a Responsible Officer of the Agent knows
to be so owned shall be so disregarded. Corporate PIES or Treasury PIES 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 Corporate PIES or Treasury PIES and that the
pledgee is not the Company or any Affiliate of the Company.
"Payment Date" means each February 19, May 19, August 19 and November 19,
commencing May 19, 1999.
"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 organization or government or any
agency or political subdivision thereof or any other entity of whatever nature.
"PIES" means the collective reference to the Corporate PIES and the
Treasury PIES.
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"Plan" means employee benefit plans that are subject to ERISA, plans and
individual retirement accounts that are subject to Section 4975 of the Code and
entities whose assets are considered assets of such plans.
"Pledge" means the pledge under the Pledge Agreement of the Preferred
Securities, the Debentures, the Treasury Securities or the appropriate
Applicable Ownership Interest (as specified in clause (A) of the definition of
such term) of the Treasury Portfolio, 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, the Securities
Intermediary and the Agent, on its own behalf and as attorney-in-fact for the
Holders from time to time of the Securities.
"Pledged Preferred Securities" has the meaning set forth in the Pledge
Agreement.
"Pledged Debentures" has the meaning set forth in the Pledge Agreement.
"Predecessor Certificate" means a Predecessor Corporate PIES Certificate
or a Predecessor Treasury PIES Certificate.
"Predecessor Corporate PIES Certificate" of any particular Corporate PIES
Certificate means every previous Corporate PIES Certificate evidencing all or a
portion of the rights and obligations of the Company and the Holder under the
Corporate PIES evidenced thereby; and, for the purposes of this definition, any
Corporate PIES Certificate authenticated and delivered under Section 3.10 in
exchange for or in lieu of a mutilated, destroyed, lost or stolen Corporate PIES
Certificate shall be deemed to evidence the same rights and obligations of the
Company and the Holder as the mutilated, destroyed, lost or stolen Corporate
PIES Certificate.
"Predecessor Treasury PIES Certificate" of any particular Treasury PIES
Certificate means every previous Treasury PIES Certificate evidencing all or a
portion of the rights and obligations of the Company and the Holder under the
Treasury PIES evidenced thereby; and, for the purposes of this definition, any
Treasury PIES Certificate authenticated and delivered under Section 3.10 in
exchange for or in lieu of a mutilated, destroyed, lost or stolen Treasury PIES
Certificate shall be deemed to evidence the same rights and obligations of the
Company and the Holder as the mutilated, destroyed, lost or stolen Treasury PIES
Certificate.
"Preferred Securities" means the Preferred Securities of the Trust, each
having a stated liquidation amount of $50, representing preferred undivided
beneficial interests in the assets of the Trust.
"Proceeds" has the meaning set forth in Section 1 of the Pledge Agreement.
"Property Trustee" means The Chase Manhattan Bank, as property trustee
under the Declaration, or any successor thereto that is a financial institution
unaffiliated with the Company.
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"Purchase Contract," when used with respect to any Security, means the
contract forming a part of such Security and obligating the Company to (i) sell
and the Holder of such Security to purchase Common Stock and (ii) pay the Holder
Contract Adjustment Payments, if any, on the terms and subject to the conditions
set forth in Article Five hereof.
"Purchase Contract Settlement Date" means February 19, 2003.
"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 5.6(a)(6).
"Record Date" for the Contract Adjustment Payments payable on any Payment
Date means, as to any Global Certificate, the Business Day next preceding such
Payment Date, and as to any other Certificate, a day selected by the Company
which shall be more than one Business Day but less than 60 Business Days prior
to such Payment Date.
"Reference Dealer" means a dealer engaged in the trading of convertible
securities.
"Register" means the Corporate PIES Register and the Treasury PIES
Register.
"Registrar" means the Corporate PIES Registrar and the Treasury PIES
Registrar.
"Remarketing Agent" has the meaning specified in Section 5.4(b).
"Remarketing Agreement" means the Remarketing Agreement dated as of
February 16, 1999 by and between the Company, the Finance Subsidiary, the Trust
and the Remarketing Agent.
"Reorganization Event" has the meaning specified in Section 5.6(b).
"Reset Transaction" means a merger, consolidation or statutory share
exchange to which the Person that is the issuer of the common stock for which
the Purchase Contracts are then to be settled is a party, a sale of all or
substantially all assets of such Person, a recapitalization of such common stock
or a distribution described in Section 5.6(a)(4) by such Person, after the
effective date of which the Purchase Contracts are then to be settled for shares
of a Person (i) the common stock of which had a Dividend Yield for the four
fiscal quarters immediately preceding the public announcement thereof which was,
or (ii) that announces a dividend policy prior to the effective date thereof
which policy, if implemented, would result in a Dividend Yield on such common
stock for the next four fiscal quarters which would be, more than 250 basis
points higher than the Dividend Yield on the common stock for which the Purchase
Contracts are to be settled prior to such effective date for the four fiscal
quarters immediately preceding such public announcement.
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"Responsible Officer," when used with respect to the Agent, means any
officer of the Agent assigned by the Agent to administer its corporate trust
matters.
"Security" means a Corporate PIES or a Treasury PIES.
"Security Intermediary" means The First National Bank of Chicago, as
Securities Intermediary under the Pledge Agreement until a successor Securities
Intermediary shall have become such pursuant to the applicable provisions of the
Pledge Agreement, and thereafter "Securities Intermediary" shall mean such
successor.
"Settlement Rate" has the meaning specified in Section 5.1.
"Stated Amount" means $50.
"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 Code, adjudicating the Company to be insolvent, or approving as
properly filed a petition seeking reorganization or liquidation of the Company
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) 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 from time to time,
or any successor legislation.
"Trading Day" has the meaning specified in Section 5.1.
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"Trading Price" of a security on any date of determination means (i) the
closing sale price (or, if no closing price is reported, the last reported sale
price) of a security (regular way) on the NYSE on such date, (ii) if such
security is not listed for trading on the NYSE on any such date, the closing
sale price as reported in the composite transactions for the principal United
States securities exchange on which such security is so listed, (iii) if such
security is not so listed on a United States national or regional securities
exchange, the closing sale price as reported by the NASDAQ Stock Market, Inc.,
(iv) if such security is not so reported, the price quoted by Interactive Data
Corporation for such security or, if Interactive Data Corporation is not quoting
such price, a similar quotation service selected by the Company, (v) if such
security is not so quoted, the average of the mid-point of the last bid and ask
prices for such security from at least two dealers recognized as market-makers
for such security, or (vi) if such security is not so quoted, the average of the
last bid and ask prices for such security from a Reference Dealer.
"Treasury Security" means zero-coupon U.S. Treasury Securities (Cusip
Number ________) which are the principal strip of the __% U. S. Treasury
Securities which mature on February 15, 2003.
"Treasury PIES" means, following the substitution of one or more Treasury
Securities for Preferred Securities, Debentures or for the Applicable Ownership
Interest (as specified in clause (A) of the definition of such term) of the
Treasury Portfolio, as the case may be, as collateral to secure a holder's
obligations under a Purchase Contract, the collective rights and obligations of
a Holder of a Treasury PIES Certificate in respect of such Treasury Securities,
subject in each case to the Pledge thereof, and the related Purchase Contract.
"Treasury PIES Certificate" means a certificate evidencing the rights and
obligations of a Holder in respect of the number of Treasury PIES specified on
such certificate.
"Treasury PIES Register" and "Treasury PIES Registrar" have the respective
meanings specified in Section 3.5.
"Trust" means NIPSCO Capital Trust I, a statutory business trust formed
under the laws of the State of Delaware, or any successor thereto by merger or
consolidation.
"Underwriting Agreement" means the Underwriting Agreement dated February
9, 1999 among the Company, the Trust, the Finance Subsidiary and Xxxxxx Brothers
Inc., Xxxxxxx, Sachs & Co. and Xxxxxx Xxxxxxx & Co. Incorporated.
"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 in
accordance with any provision of this Agreement, the Company shall furnish to
the Agent an Officers' Certificate stating that all
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conditions precedent, if any, provided for in this Agreement relating to the
proposed action have been complied with and, if requested by the Agent, an
Opinion of Counsel stating that, in the opinion of such counsel, all such
conditions precedent, if any, have been complied with, except that in the case
of any such application or request as to which the furnishing of such documents
is specifically required by any provision of this Agreement relating to such
particular application or request, no additional certificate or opinion need be
furnished.
Every certificate or opinion with respect to compliance with a condition
or covenant provided for in this Agreement shall include:
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, he or
she has made such examination or investigation as is necessary to enable
such individual to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, 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 an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or Opinion of Counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
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Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Agreement, they may, but need not, be consolidated and
form one instrument.
Section 1.4. Acts of Holders; Record Dates.
(a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Agreement to be given or taken by Holders may
be embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Holders in person or by an agent duly appointed in writing;
and, except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments are delivered to the Agent and,
where it is hereby expressly required, to the Company. Such instrument or
instruments (and the action embodied therein and evidenced thereby) are herein
sometimes referred to as the "Act" of the Holders signing such instrument or
instruments. Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any purpose of this Agreement
and (subject to Section 7.1) conclusive in favor of the Agent and the Company,
if made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved in any manner which the Agent deems
sufficient.
(c) The ownership of Securities shall be proved by the Corporate PIES
Register or the Treasury PIES 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 Corporate PIES and the Outstanding Treasury PIES, 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 Corporate PIES or the Treasury
PIES, 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 be of no effect), and nothing in this
paragraph shall be construed to render ineffective any action taken
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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 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 notice or communication is duly given if in writing and delivered in
Person or mailed by first class mail (registered or certified, return receipt
requested), telecopier (with receipt confirmed) or overnight air courier
guaranteeing next day delivery, to the others' address; provided that notice
shall be deemed given to the Agent only upon receipt thereof:
If to the Agent:
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: 000-000-0000
Attention: Corporate Trust Group
If to the Company:
NIPSCO Industries, Inc.
000 Xxxx 00xx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxx 00000
Telecopier No.:
Attention:
If to the Collateral Agent:
The First National Bank of Chicago
0 Xxxxx Xxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
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Telecopier No.: 000-000-0000
Attention: Corporate Trust Administration Department
If to the Property Trustee:
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: 000-000-0000
Attention: Corporate Trust Group
If to the Indenture Trustee:
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: 000-000-0000
Attention: Corporate Trust Group
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 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.
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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, 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
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 Payment Date shall not be a Business Day, then
(notwithstanding any other provision of this Agreement or the Corporate PIES
Certificates or the Treasury PIES Certificates) payment of the Contract
Adjustment Payments, if any, shall not be made on such date, but such payments
shall be made on the next succeeding Business Day with the same force and effect
as if made on such Payment Date, provided that no interest shall accrue or be
payable by the Company or any Holder for the period from and after any such
Payment Date, except that, if such next succeeding Business Day is in the next
succeeding calendar year, such payment shall be made on the immediately
preceding Business Day with the same force and effect as if made on such Payment
Date.
In any case where any Purchase Contract Settlement Date shall not be a
Business Day, then (notwithstanding any other provision of this Agreement, the
Corporate PIES Certificates or the Treasury PIES Certificates) 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.
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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
or Beneficial Owner.
ARTICLE II
Certificate Forms
Section 2.1. Forms of Certificates Generally.
The Corporate PIES Certificates (including the form of Purchase Contract
forming part of the Corporate PIES 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 Corporate PIES are listed or any depositary
therefor, or as may, consistently herewith, be determined by the officers of the
Company executing such Corporate PIES Certificates, as evidenced by their
execution of the Corporate PIES Certificates.
The definitive Corporate PIES Certificates shall be printed, lithographed
or engraved on steel engraved borders or may be produced in any other manner,
all as determined by the officers of the Company executing the Corporate PIES
evidenced by such Corporate PIES Certificates, consistent with the provisions of
this Agreement, as evidenced by their execution thereof.
The Treasury PIES Certificates (including the form of Purchase Contracts
forming part of the Treasury PIES 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 Treasury PIES may be listed or any depositary
therefor, or as may, consistently herewith, be determined by the officers of the
Company executing such Treasury PIES Certificates, as evidenced by their
execution of the Treasury PIES Certificates.
The definitive Treasury PIES Certificates shall be printed, lithographed
or engraved on steel engraved borders or may be produced in any other manner,
all as determined by the officers of the Company executing the Treasury PIES
evidenced by such Treasury PIES Certificates, consistent with the provisions of
this Agreement, as evidenced by their execution thereof.
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Every Global Certificate authenticated, executed on behalf of the Holders
and delivered hereunder shall bear a legend in substantially the following form:
"THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN
THE NAME OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE
"DEPOSITARY"), OR A NOMINEE OF THE DEPOSITARY. THIS CERTIFICATE IS
EXCHANGEABLE FOR CERTIFICATES REGISTERED IN THE NAME OF A PERSON OTHER
THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES
DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT AND NO TRANSFER OF THIS
CERTIFICATE (OTHER THAN A TRANSFER OF THIS CERTIFICATE AS A WHOLE BY THE
DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE
DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE
REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REQUESTED IN THE NAME OF CEDE & CO. OR SUCH OTHER
NAME AS REGISTERED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND
ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN."
Section 2.2. Form of Agent's Certificate of Authentication.
The form of the Agent's certificate of authentication of the Corporate
PIES shall be in substantially the form set forth on the form of the Corporate
PIES Certificates.
The form of the Agent's certificate of authentication of the Treasury PIES
shall be in substantially the form set forth on the form of the Treasury PIES
Certificates.
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ARTICLE III
The Securities
Section 3.1. Amount; Form and Denominations.
The aggregate number of Securities evidenced by Certificates
authenticated, executed on behalf of the Holders and delivered hereunder is
limited to 6,900,000 except for Certificates authenticated, executed and
delivered upon registration of transfer of, in exchange for, or in lieu of,
other Certificates pursuant to Section 3.4, 3.5, 3.10, 3.13, 3.14, 5.9 or 8.5.
The Certificates shall be issuable only in registered form and only in
denominations of a single Corporate PIES or Treasury PIES and any integral
multiple thereof.
Section 3.2. Rights and Obligations Evidenced by the Certificates.
Each Corporate PIES Certificate shall evidence the number of Corporate
PIES specified therein, with each such Corporate PIES representing the ownership
by the Holder thereof of a beneficial interest in a Preferred Security, a
Debenture or the Applicable Ownership Interest of the Treasury Portfolio, as the
case may be, subject to the Pledge of such Preferred Security, such Debenture or
the Applicable Ownership Interest (as specified in clause (A) of the definition
of such term) 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 Corporate PIES shall
pledge, pursuant to the Pledge Agreement, the Preferred Security, the Debenture
or the Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) of the Treasury Portfolio, as the case may be, forming
a part of such Corporate PIES, to the Collateral Agent and grant to the
Collateral Agent a security interest in the right, title and interest of such
Holder in such Preferred Security, such Debenture or the Applicable Ownership
Interest (as specified in clause (A) of the definition of such term) of the
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. Prior to the purchase of shares of Common Stock
under each Purchase Contract, such Purchase Contracts shall not entitle the
Holder of a Corporate PIES Certificate to any of the rights of a holder of
shares of Common Stock, including, without limitation, the right to vote or
receive any dividends or other payments or to consent or to receive notice as a
stockholder in respect of the meetings of stockholders or for the election of
directors of the Company or for any other matter, or any other rights whatsoever
as a stockholder of the Company.
Each Treasury PIES Certificate shall evidence the number of Treasury PIES
specified therein, with each such Treasury PIES representing the ownership by
the Holder thereof of a 1/20 undivided beneficial interest in a Treasury
Security with a principal amount 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
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Purchase Contract. Prior to the purchase, if any, of shares of Common Stock
under each Purchase Contract, such Purchase Contract shall not entitle the
Holder of a Treasury PIES Certificate to any of the rights of a holder of shares
of Common Stock, including, without limitation, the right to vote or receive any
dividends or other payments or to consent or to receive notice as a stockholder
in respect of the meetings of stockholders or for the election of directors of
the Company or for any other matter, or any other rights whatsoever as a
stockholder 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. 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.
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 which are in substantially the form set
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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 Corporate PIES or Treasury PIES
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, 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 Corporate PIES or Treasury PIES, 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 Corporate PIES or Treasury
PIES, 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
"Corporate PIES Register") in which, subject to such reasonable regulations as
it may prescribe, the Agent shall provide for the registration of Corporate PIES
Certificates and of transfers of Corporate PIES Certificates (the Agent, in such
capacity, the "Corporate PIES Registrar") and a register (the "Treasury PIES
Register") in which, subject to such reasonable regulations as it may prescribe,
the Agent shall provide for the registration of the Treasury PIES Certificates
and transfers of Treasury PIES Certificates (the Agent, in such capacity, the
"Treasury PIES Registrar").
Upon surrender for registration of transfer of any Certificate at the
Corporate Trust Office, the Company shall execute and deliver to the Agent, and
the Agent shall authenticate, execute on behalf of the designated transferee or
transferees, and deliver, in the name of the designated transferee or
transferees, one or more new Certificates of any authorized denominations, like
tenor, and evidencing a like number of Corporate PIES or Treasury PIES, 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
Corporate PIES or Treasury PIES, as the case may be, upon surrender of the
Certificates to be exchanged at the Corporate Trust Office. Whenever any
Certificates are so surrendered for exchange, the Company shall execute and
deliver to the Agent, and the Agent shall authenticate, execute on behalf of the
Holder, and deliver the Certificates which the Holder making the exchange is
entitled to receive.
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All Certificates issued upon any registration of transfer or exchange of a
Certificate shall evidence the ownership of the same number of Corporate PIES or
Treasury PIES, as the case may be, and be entitled to the same benefits and
subject to the same obligations, under this Agreement as the Corporate PIES or
Treasury PIES, 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 3.6 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 in
exchange for any other 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 other Certificate or (ii) if a Termination Event
shall have occurred prior to the Purchase Contract Settlement Date, transfer the
Preferred Securities, the Debentures, the Applicable Ownership Interest (as
specified in clause (A) of the definition of such term) 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:
(a) the provisions of this Section 3.6 shall be in full force and effect;
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(b) the Company shall be entitled to deal with the Clearing Agency for all
purposes of this Agreement (including the payment of Contract Adjustment
Payments, if any, and 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.
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 or
(ii) there shall have occurred and be continuing a default by the Company in
respect of its obligations under one or more Purchase Contracts, then upon
surrender of the Global Certificates representing 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. The Company shall not be liable for any
delay in delivery of such instructions and may conclusively rely on and shall be
protected in relying on, such instructions.
Section 3.10. Mutilated, Destroyed, Lost and Stolen Certificates.
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, evidencing the same number of Corporate PIES or Treasury PIES, as
the case may be, and bearing a Certificate number not contemporaneously
outstanding.
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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 as may be required by them to hold each of them
and any agent of any of them harmless, then, in the absence of notice to the
Company or the Agent that such Certificate has been acquired by a bona fide
purchaser, the Company shall execute and deliver to the Agent, and the Agent
shall authenticate, execute on behalf of the Holder, and deliver to the Holder,
in lieu of any such destroyed, lost or stolen Certificate, a new Certificate,
evidencing the same number of Corporate PIES or Treasury PIES, 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, or (ii) if a Termination Event shall have
occurred prior to the Purchase Contract Settlement Date, transfer the Preferred
Securities, the Debentures, the appropriate Applicable Ownership Interest (as
specified in clause (A) of the definition of such term) 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 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
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Certificate is registered as the owner of the Corporate PIES or Treasury PIES
evidenced thereby, for the purpose of receiving distributions on the Preferred
Securities, the Debentures, or on the maturing quarterly interest strips of the
Treasury Portfolio, as applicable, receiving payments of Contract Adjustment
Payments, performance of the Purchase Contracts and for all other purposes
whatsoever, whether or not any distributions on the Preferred Securities, the
Debentures, Treasury Portfolio or the Contract Adjustment Payments payable in
respect of the Purchase Contracts constituting a part of the Corporate PIES or
Treasury PIES evidenced thereby shall be overdue and notwithstanding any notice
to the contrary, and neither the Company nor the Agent, nor any agent of the
Company or the Agent, shall be affected by notice to the contrary.
Notwithstanding the foregoing, with respect to any Global 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 Preferred
Securities, Debentures, the appropriate Applicable Ownership Interest (as
specified in clause (A) of the definition of such term) 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 a Corporate PIES 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
be destroyed by the Agent unless otherwise directed by Issuer Order.
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. Substitution of Securities.
A Holder may separate the Preferred Securities, the Debentures or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as
applicable, from the related Purchase Contracts in respect of a Corporate PIES
by substituting for such Preferred Securities,
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Debentures or the appropriate Applicable Ownership Interest of the Treasury
Portfolio, as the case may be, Treasury Securities in an aggregate principal
amount equal to the aggregate liquidation amount of such Preferred Securities,
the aggregate principal amount of such Debentures 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 seventh
Business Day immediately preceding the Purchase Contract Settlement Date in the
case of the Preferred Securities and the Debentures 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 (as specified in
clause (A) of the definition of such term) of the Treasury Portfolio, in each
case by (a) depositing with the Securities Intermediary Treasury Securities
having an aggregate principal amount equal to the aggregate liquidation amount
of the Preferred Securities or the aggregate principal amount of the Debentures
comprising part of such Corporate PIES 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 Corporate PIES, as the case may be,
and (b) transferring the related Corporate PIES to the Agent accompanied by a
notice to the Agent, substantially in the form of Exhibit C hereto, stating that
the Holder has transferred the relevant amount of Treasury Securities to the
Securities Intermediary and requesting that the Agent instruct the Collateral
Agent to release the Preferred Securities, the Debentures 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, underlying such
Corporate PIES, whereupon the Agent shall promptly give such instruction to the
Collateral Agent, substantially in the form of Exhibit A to the Pledge
Agreement. 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 cause the Securities
Intermediary to release to the Agent, on behalf of the Holder, Preferred
Securities, Debentures 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, having a corresponding aggregate liquidation
amount of such Preferred Securities, aggregate principal amount of such
Debentures, 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, 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 Corporate PIES;
(ii) transfer the Preferred Securities, the Debentures 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
Treasury PIES Certificate executed by the Company in accordance with
Section 3.3 evidencing the same number of Purchase Contracts as were
evidenced by the cancelled Corporate PIES.
Holders who elect to separate the Preferred Securities, the Debentures or
the appropriate Applicable Ownership Interest of the Treasury Portfolio, as the
case may be, from the related
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Purchase Contract and to substitute Treasury Securities for such Preferred
Securities or Debentures 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, 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 Corporate PIES if Treasury Securities are being substituted for Preferred
Securities or Debentures, or (ii) only in integral multiples of 160,000
Corporate PIES if Treasury Securities are being substituted for the appropriate
Applicable Ownership Interest (as specified in clause (A) of the definition of
such term) 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 Corporate PIES or
fails to deliver a Corporate PIES Certificate(s) to the Agent after depositing
Treasury Securities with the Collateral Agent, the Preferred Securities, the
Debentures or the appropriate Applicable Ownership Interest of the Treasury
Portfolio, as the case may be, constituting a part of such Corporate PIES, and
any distributions on such Preferred Securities, Debentures 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 Corporate PIES is so transferred or the Corporate PIES Certificate is
so delivered, as the case may be, or, with respect to a Corporate PIES
Certificate, such Holder provides evidence satisfactory to the Company and the
Agent that such Corporate PIES 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 a Corporate PIES remains in effect, such Corporate PIES
shall not be separable into its constituent parts, and the rights and
obligations of the Holder in respect of the Preferred Securities, the Debentures
or the appropriate Applicable Ownership Interest of the Treasury Portfolio, as
the case may be, and the Purchase Contract comprising such Corporate PIES may be
acquired, and may be transferred and exchanged, only as a Corporate PIES.
Section 3.14. Reestablishment of Corporate PIES.
A Holder of a Treasury PIES may recreate Corporate PIES at any time (i) on
or prior to the seventh Business Day immediately preceding the Purchase Contract
Settlement Date, if a Tax Event Redemption 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 has occurred, in each case by (a)
depositing with the Securities Intermediary Preferred Securities, Debentures or
the appropriate Applicable Ownership Interest (as defined in clause (A) of the
definition of such term) of the Treasury Portfolio, as the case may be, having
an aggregate liquidation amount in the case of the Preferred Securities, an
aggregate principal amount in the case of the Debentures or an aggregate
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 at
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maturity of the Treasury Securities comprising part of the Treasury PIES and (b)
transferring the related Treasury PIES to the Agent accompanied by a notice to
the Agent, substantially in the form of Exhibit C hereto, stating that the
Holder has transferred the relevant amount of Preferred Securities, Debentures
or the appropriate Applicable Ownership Interest (as defined in clause (A) of
the definition of such term) of the Treasury Portfolio, as the case may be, to
the Securities Intermediary and requesting that the Agent instruct the
Collateral Agent to release the Treasury Securities underlying such Treasury
PIES, whereupon the Agent shall promptly give such instruction to the Collateral
Agent, substantially in the form of Exhibit C to the Pledge Agreement. Upon
receipt of the Preferred Securities, the Debentures or the appropriate
Applicable Ownership Interest (as defined in clause (A) of the definition of
such term) 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 cause the
Securities Intermediary to effect the release of the Treasury Securities having
a corresponding aggregate principal amount at maturity from the Pledge to the
Agent free and clear of the Company's security interest therein, and upon
receipt thereof the Agent shall promptly:
(i) cancel the related Treasury PIES;
(ii) transfer the Treasury Securities to the Holder; and
(iii) authenticate, execute on behalf of such Holder and deliver a
Corporate PIES Certificate executed by the Company in accordance with
Section 3.3 evidencing the same number of Purchase Contracts as were
evidenced by the cancelled Treasury PIES.
Holders who elect to recreate Corporate PIES 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 of Treasury PIES may reestablish Corporate PIES in integral
multiples of 20 Treasury PIES for 20 Corporate PIES if a Tax Event Redemption
has not occurred, and in integral multiples of 160,000 Treasury PIES for 160,000
Corporate PIES if a Tax Event Redemption has occurred.
Except as provided in this Section 3.14, for so long as the Purchase
Contract underlying a Treasury PIES remains in effect, such Treasury PIES shall
not be separable into its constituent parts and the rights and obligations of
the Holder of such Treasury PIES in respect of the 1/20 of a Treasury Security
and the Purchase Contract comprising such Treasury PIES may be acquired, and may
be transferred and exchanged, only as a Treasury PIES.
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 Preferred Securities, the Debentures, the appropriate Applicable
Ownership Interest of the Treasury Portfolio or the Treasury Securities, as the
case may be, underlying the Corporate PIES and the
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Treasury PIES pursuant to the terms of the Pledge Agreement, the Agent shall
request transfer instructions with respect to such Preferred Securities or
Debentures or the appropriate Applicable Ownership Interest of the Treasury
Portfolio or Treasury Securities, as the case may be, from each Holder by
written request, substantially in the form of Exhibit D hereto, mailed to such
Holder at its address as it appears in the Corporate PIES Register or the
Treasury PIES Register, as the case may be. Upon book-entry transfer of the
Corporate PIES or Treasury PIES or delivery of a Corporate PIES Certificate or
Treasury PIES Certificate to the Agent with such transfer instructions, the
Agent shall transfer the Preferred Securities, the Debentures, the appropriate
Applicable Ownership Interest of the Treasury Portfolio or Treasury Securities,
as the case may be, underlying such Corporate PIES or Treasury PIES, as the case
may be, to such Holder by book-entry transfer, or other appropriate procedures,
in accordance with such instructions. In the event a Holder of Corporate PIES or
Treasury PIES fails to effect such transfer or delivery, the Preferred
Securities, the Debentures, the appropriate Applicable Ownership Interest of the
Treasury Portfolio or Treasury Securities, as the case may be, underlying such
Corporate PIES or Treasury PIES, 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 the earlier of (a) such Corporate PIES or Treasury
PIES are transferred or the Corporate PIES Certificate or Treasury PIES
Certificate is surrendered or such Holder provides satisfactory evidence that
such Corporate PIES Certificate or Treasury PIES Certificate has been destroyed,
lost or stolen, together with any indemnity that may be required by the Agent
and the Company and (b) the expiration of the time period specified in the
abandoned property laws of the relevant State.
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 or its
trustee, receiver, liquidator or a person or entity performing similar functions
in the event that the Company becomes the debtor under the Bankruptcy Code or
subject to other similar state or federal law providing for reorganization or
liquidation.
ARTICLE IV
The Preferred Securities
Section 4.1. Payment of Distribution; Rights to Distributions Preserved;
Distribution Rate Reset; Notice.
A distribution on any Preferred Security, any Debenture or on the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the case
may be, which is paid on any Payment Date shall, subject to receipt thereof by
the Agent from the Collateral Agent as provided by the terms of the Pledge
Agreement, be paid to the Person in whose name the Corporate PIES Certificate
(or one or more Predecessor Corporate PIES Certificates) of which such Preferred
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Security, such Debenture 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 Corporate PIES Certificate evidencing Preferred Securities or
Debentures delivered under this Agreement upon registration of transfer of or in
exchange for or in lieu of any other Corporate PIES Certificate shall carry the
rights to distributions accrued and unpaid, and to accrue distributions, which
were carried by the Preferred Securities or Debentures or the appropriate
Applicable Ownership Interest of the Treasury Portfolio underlying such other
Corporate PIES Certificate.
In the case of any Corporate PIES with respect to which Cash Settlement of
the underlying Purchase Contract is effected on or prior to the fifth Business
Day immediately preceding the 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,
distributions on the Preferred Securities, the Debentures or on the appropriate
Applicable Ownership Interest of the Treasury Portfolio, as the case may be,
underlying such Corporate PIES 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
Corporate PIES Certificate (or one or more Predecessor Corporate PIES
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 Corporate PIES with respect to which Cash Settlement or Early
Settlement of the underlying Purchase Contract is effected on or prior to the
fifth 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
Preferred Securities or Debentures 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 Corporate PIES; provided,
however, that to the extent that such Holder continues to hold the separated
Preferred Securities or Debentures that formerly comprised a part of such
Holder's Corporate PIES, such Holder shall be entitled to receive the
distributions on such separated Preferred Securities or Debentures.
The applicable Coupon Rate on the Debentures on and after the Purchase
Contract Settlement Date shall be reset on the third Business Day immediately
preceding the Purchase Contract Settlement Date equal to the Reset Rate (such
Reset Rate to be in effect on and after the Purchase Contract Settlement Date).
Not later than 15 calendar days nor more than 30 calendar days prior to
the third Business Day immediately preceding the Purchase Contract Settlement
Date, the Company shall request DTC (or any successor Clearing Agency), to
notify the Beneficial Owners or Clearing Agency Participants holding Corporate
PIES or Treasury PIES of the procedures to be followed by
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Holders of Corporate PIES who intend to effect the settlement of their
obligations under the Purchase Contracts underlying such Corporate PIES with
separate cash on or prior to the fifth Business Day prior to the Purchase
Contract Settlement Date.
Section 4.2. Notice and Voting.
Under the terms of the Pledge Agreement, the Agent will be entitled to
exercise the voting and any other consensual rights pertaining to the Pledged
Preferred Securities or Pledged Debentures, as the case may be, but only to the
extent instructed in writing by the Holders as described below. Upon receipt of
notice of any meeting at which holders of Preferred Securities or Debentures are
entitled to vote or upon any solicitation of consents, waivers or proxies of
holders of Preferred Securities or Debentures, the Agent shall, as soon as
practicable thereafter, mail to the Holders of Corporate PIES 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 Preferred Securities or Debentures, as the case may be, entitled
to vote) shall be entitled to instruct the Agent as to the exercise of the
voting rights pertaining to such Preferred Securities or Debentures underlying
their Corporate PIES and (c) stating the manner in which such instructions may
be given. Upon the written request of the Holders of Corporate PIES on such
record date received by the Agent at least six days prior to such meeting, 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 Preferred Securities or Debentures, as the case may be, as to which any
particular voting instructions are received. In the absence of specific
instructions from the Holder of a Corporate PIES, the Agent shall abstain from
voting the Preferred Securities or Debentures underlying such Corporate PIES.
The Company hereby agrees, if applicable, to solicit Holders of Corporate PIES
to timely instruct the Agent in order to enable the Agent to vote such Preferred
Securities or Debentures and the Trust shall covenant to such effect in the
Declaration.
Section 4.3. Distribution of Debentures; Tax Event Redemption.
Upon the liquidation of the Trust in accordance with the Declaration, a
principal amount at maturity of Debentures constituting the assets of the Trust
and underlying the Preferred Securities equal to the aggregate liquidation
amount of the Pledged Preferred Securities shall be delivered to the Securities
Intermediary in exchange for the Pledged Preferred Securities. Thereafter, the
Debentures will be substituted for the Pledged Preferred Securities as the
Collateral, and will be held by the Securities Intermediary in the Collateral
Account in accordance with the terms of the Pledge Agreement to secure the
obligations of each Holder of a Corporate PIES to purchase the Common Stock of
the Company under the Purchase Contracts constituting a part of such Corporate
PIES. Following the liquidation of the Trust, the Holders and the Collateral
Agent shall have such security interests, rights and obligations with respect to
the Debentures as the Holders and the Collateral Agent had in respect of the
Preferred Securities subject to the Pledge thereof as provided in Articles II,
III, IV, V and VI of the Pledge Agreement. The Company may cause to be made in
any Corporate PIES Certificates thereafter to be issued such change in
phraseology and form (but not in substance) as may be appropriate to
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reflect the liquidation of the Trust and the substitution of Debentures for
Preferred Securities as Collateral.
Upon the occurrence of a Tax Event Redemption prior to the Purchase
Contract Settlement Date, the Redemption Price payable on the Tax Event
Redemption Date with respect to the Applicable Principal Amount shall be
deposited in the Collateral Account in exchange for the Pledged Preferred
Securities or the Pledged Debentures. Thereafter, pursuant to the terms of the
Pledge Agreement, the Collateral Agent shall cause the Securities Intermediary
to apply an amount equal to the Redemption Amount of such Redemption Price to
purchase on behalf of the Holders of Corporate PIES the Treasury Portfolio and
promptly remit the remaining portion of such Redemption Price, if any, to the
Agent for payment to the Holders of such Corporate PIES. The Applicable
Ownership Interest (as specified in clause (A) of the definition of such term)
of the Treasury Portfolio will be substituted as Collateral for the Pledged
Preferred Securities or the Pledged Debentures, 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 a Corporate PIES to purchase the Common Stock
of the Company under the Purchase Contract constituting a part of such Corporate
PIES. Following the occurrence of a Tax Event Redemption prior to the Purchase
Contract Settlement Date, the Holders of Corporate PIES and the Collateral Agent
shall have such security interest rights and obligations with respect to the
Applicable Ownership Interest (as specified in clause (A) of the definition of
such term) of the Treasury Portfolio as the Holders of Corporate PIES and the
Collateral Agent had in respect of the Preferred Securities or Debentures, as
the case may be, subject to the Pledge thereof as provided in Articles II, III,
IV, V, and VI of the Pledge Agreement, and any reference herein to the Preferred
Securities or the Debentures shall be deemed to be reference to such Treasury
Portfolio. The Company may cause to be made in any Corporate PIES Certificates
thereafter to be issued such change in phraseology and form (but not in
substance) as may be appropriate to reflect the liquidation of the Trust and the
substitution of the Applicable Ownership Interest (as specified in clause (A) of
the definition of such term) of the Treasury Portfolio for Preferred Securities
or Debentures as Collateral.
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 5.9 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 $31.0500 (the "Threshold
Appreciation Price"), 1.6103 shares of Common Stock per Purchase Contract, (b)
if the Applicable Market Value is less than the Threshold Appreciation
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Price, but is greater than $26.3125, the number of shares of Common Stock equal
to the Stated Amount divided by the Applicable Market Value and (c) if the
Applicable Market Value is less than or equal to $26.3125, 1.9002 share of
Common Stock per Purchase Contract, in each case subject to adjustment as
provided in Section 5.6 (and in each case rounded upward or downward to the
nearest 1/10,000th of a share). As provided in Section 5.10, 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 Trading Days ending on the third Trading
Day immediately preceding the Purchase Contract Settlement Date. The "Closing
Price" of the Common Stock on any date of determination means (i) 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,
(ii) if the Common Stock is not listed for trading on the NYSE on any such date,
the closing sale price as reported in the composite transactions for the
principal United States securities exchange on which the Common Stock is so
listed, (iii) if the Common Stock is not so listed on a United States national
or regional securities exchange, the closing sale price as reported by The
Nasdaq Stock Market, (iv) if the Common Stock is not so reported, the last
quoted bid price for the Common Stock in the over-the-counter market as reported
by the National Quotation Bureau or similar organization, or (v) if such bid
price is not available, the average of the mid-point of the last bid and ask
prices of the Common Stock on such date from at least three nationally
recognized independent investment banking firms retained for this purpose by the
Company. A "Trading Day" means a day on which the Common Stock (A) is not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (B) has
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of the Common Stock.
Each Holder of a Corporate PIES or a Treasury PIES, 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 this
Agreement and the Pledge Agreement on its behalf as its attorney-in-fact, and
consents to and agrees to be bound by the Pledge of the Preferred Securities,
the Debentures, the Applicable Ownership Interest (as specified in clause (A) of
the definition of such term) of 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 a
Corporate PIES or a Treasury PIES, by its acceptance thereof, further covenants
and agrees, that to the extent and in the manner provided in Section 5.4 and the
Pledge Agreement, but subject to the terms thereof, payments in respect of the
Preferred Securities or the Debentures or the Proceeds of the Treasury
Securities or the 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
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Agent to the Company in satisfaction of such Holder's obligations under such
Purchase Contract and such Holder shall acquire no right, title or interest in
such payments.
Upon registration of transfer of a Certificate, the transferee shall be
bound (without the necessity of any other action on the part of such transferee)
by 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.
The Company shall pay, on each Payment Date, the Contract Adjustment
Payments 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. The
Contract Adjustment Payments will be payable at the office of the Agent in The
City of New York maintained for that purpose or, at the option of the Company,
by check mailed to the address of the Person entitled thereto at such Person's
address as it appears on the Corporate PIES Register or Treasury PIES Register.
If any date on which Contract Adjustment Payments are to be made on the Purchase
Contracts related to the PIES is not a Business Day, then payment of the
Contract Adjustment Payments payable on such date will be made on the next day
that is a Business Day (and without any interest in respect of any such delay),
except that, if such Business Day is in the next calendar year, such payment
will be made on the preceding Business Day.
Upon the occurrence of a Termination Event, the Company's obligation to
pay Contract Adjustment Payments (including any accrued Contract Adjustment
Payments) 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 a Corporate PIES) any other
Certificate shall carry the rights to Contract Adjustment Payments accrued and
unpaid, and to accrue Contract Adjustment Payments, which were carried by the
Purchase Contracts underlying such other Certificates.
Subject to Section 5.9, in the case of any Security with respect to which
Early Settlement of the underlying Purchase Contract is effected on an Early
Settlement Date that is after any Record Date and on or prior to the next
succeeding Payment Date, Contract Adjustment Payments, if any, otherwise payable
on such Payment Date shall be payable on such Payment Date notwithstanding such
Early Settlement, 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 Early Settlement of
the underlying Purchase Contract is effected on an
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Early Settlement Date, Contract Adjustment Payments that would otherwise be
payable after the Early Settlement Date with respect to such Purchase Contract
shall not be payable.
Section 5.3. [Intentionally omitted].
Section 5.4. Payment of Purchase Price.
(a) (i) Unless a Tax Event Redemption has occurred or a Holder settles the
underlying Purchase Contract through the early delivery of cash to the Purchase
Contract Agent in the manner described in Section 5.9, each Holder of a
Corporate PIES who intends to pay in cash shall notify the Agent by use of a
notice in substantially the form of Exhibit E hereto of its intention to pay in
cash ("Cash Settlement") the Purchase Price for the shares of Common Stock to be
purchased pursuant to a Purchase Contract. Such notice shall be given prior to
5:00 p.m., New York City time, on the seventh Business Day immediately preceding
the Purchase Contract Settlement Date. Prior to 11:00 a.m., New York City time,
on the next succeeding Business Day, the Agent shall notify the Collateral Agent
and the Indenture Trustee of the receipt of such notices from Holders intending
to make a Cash Settlement.
(ii) A Holder of a Corporate PIES who has so notified the Agent of its
intention to make a Cash Settlement shall pay the Purchase Price to the
Securities Intermediary for deposit in the Collateral Account prior to 11:00
a.m., New York City time, on the fifth 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 payable to or upon the order of the Securities Intermediary. Any
cash received by the Collateral Agent shall be invested promptly by the
Securities Intermediary in Permitted Investments and paid to the Company on the
Purchase Contract Settlement Date in settlement of the Purchase Contract in
accordance with the terms of this Agreement and the Pledge Agreement. Any funds
received by the Securities Intermediary in respect of the investment earnings
from the investment in such Permitted Investments, shall be distributed to the
Agent when received for payment to the Holder of the related Corporate PIES.
(iii) If a Holder of a Corporate PIES fails to notify the Agent of its
intention to make a Cash Settlement in accordance with paragraph (a)(i) above,
or 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 Holder shall be deemed to have consented to the
disposition of the Pledged Preferred Securities or the Pledged Debentures
pursuant to the Remarketing as described in paragraph (b) below.
(iv) Promptly after 11:00 a.m., New York City time, on the fifth Business
Day preceding the Purchase Contract Settlement Date, the Agent, based on notices
received by the Agent pursuant to Section 5.4(a) hereof and notice from the
Securities Intermediary regarding cash received by it prior to such time, shall
notify the Collateral Agent and the Indenture Trustee of the number of Preferred
Securities or Debentures to be tendered for purchase in the Remarketing in a
notice substantially in the form of Exhibit F hereto.
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(b) In order to dispose of the Preferred Securities or Debentures, as the
case may be, of Corporate PIES Holders who have not notified the Agent of their
intention to effect a Cash Settlement as provided in paragraph (a)(i) above, or
who have so notified the Agent but fail to make such payment as required by
paragraph (a)(ii) above, the Company shall Xxxxxx Brothers, Inc. (the
"Remarketing Agent") pursuant to the Remarketing Agreement to sell such
Preferred Securities or Debentures. In order to facilitate the remarketing, the
Agent, based on the notices specified in Section 5.4(a)(iv), shall notify the
Remarketing Agent, promptly after 11:00 a.m., New York City time, on the fifth
Business Day immediately preceding the Purchase Contract Settlement Date, of the
aggregate number of Preferred Securities or Debentures that are a component of
Corporate PIES to be remarketed. Concurrently, the Collateral Agent, pursuant to
the terms of the Pledge Agreement, shall cause such Preferred Securities or
Debentures to be presented to the Remarketing Agent for remarketing. Upon
receipt of such notice from the Agent and such Preferred Securities or
Debentures, the Remarketing Agent shall, on the third Business Day immediately
preceding the Purchase Contract Settlement Date, use commercially reasonable
efforts to remarket such Preferred Securities or Debentures on such date at a
price of 100% of the aggregate stated liquidation amount of such Preferred
Securities or principal amount at maturity of such Debentures. The proceeds
equal thereto shall automatically be applied by the Collateral Agent, in
accordance with the Pledge Agreement, to satisfy in full such Corporate PIES
Holders' obligations to pay the Purchase Price for the Common Stock under the
related Purchase Contracts on the Purchase Contract Settlement Date. Corporate
PIES Holders whose Preferred Securities or Debentures are so remarketed shall
not be responsible for the payment of any remarketing fee in connection
therewith. If, in spite of using their reasonable efforts, the Remarketing Agent
cannot remarket the related Preferred Securities or Debentures of such Holders
of Corporate PIES at a price of 100% of the aggregate stated liquidation amount
of such Preferred Securities or principal amount at maturity of such Debentures,
the remarketing shall be deemed to have failed (a "Failed Remarketing") and in
accordance with the terms of the Pledge Agreement the Collateral Agent, for the
benefit of the Company, shall exercise its rights as a secured party with
respect to such Preferred Securities or Debentures, including those actions
specified in paragraph (c) below; provided, that if upon a Failed Remarketing
the Collateral Agent exercises such rights for the benefit of the Company with
respect to such Preferred Securities or Debentures, any accrued and unpaid
distributions on such Preferred Securities or Debentures shall become payable by
the Company to the Agent for payment to the Beneficial Owner of the Corporate
PIES to which such Preferred Securities or Debentures relate. The Company shall
cause a notice of such Failed 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 Preferred Securities or Debentures which are
subject to a Failed Remarketing, the Collateral Agent for the benefit of the
Company reserves all of its rights as a secured party with respect thereto and,
subject to applicable law and paragraph (g) below, may, among other things, (i)
retain the Preferred Securities or Debentures in full satisfaction of the
Holders' obligations under the Purchase Contracts or (ii) sell the Preferred
Securities or Debentures in one or more public or private sales.
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(d) (i) Unless a Holder of Treasury PIES or Corporate PIES (if a Tax Event
Redemption has occurred) settles the underlying Purchase Contract through the
early delivery of cash to the Purchase Contract Agent in the manner described in
Section 5.9, each Holder of a Treasury PIES or Corporate PIES (if a Tax Event
Redemption has occurred) who intends to pay in cash shall notify the Agent by
use of a notice in substantially the form of Exhibit E hereto of its intention
to pay in cash the Purchase Price for the shares of Common Stock to be purchased
pursuant to a Purchase Contract. Such notice shall be given on or prior to 5:00
p.m., New York City time, on the second Business Day immediately preceding the
Purchase Contract Settlement Date.
(ii) A Holder of a Treasury PIES or Corporate PIES (if a Tax Event
Redemption has occurred) who has so notified the Agent of its intention to make
a Cash Settlement in accordance with paragraph (d)(i) above shall pay the
Purchase Price to the Securities Intermediary for deposit in the Collateral
Account 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 payable to or upon the order of the Securities
Intermediary. Any cash received by the Collateral Agent shall be invested
promptly by the Securities Intermediary in Permitted Investments and paid to the
Company on the Purchase Contract Settlement Date in settlement of the Purchase
Contract in accordance with the terms of this Agreement and the Pledge
Agreement. Any funds received by the Securities Intermediary in respect of the
investment earnings from the investment in such Permitted Investments shall be
distributed to the Agent when received for payment to the Holder.
(iii) If a Holder of a Treasury PIES or a Holder of a Corporate PIES (if a
Tax Event Redemption has occurred) fails to notify the Agent of its intention to
make a Cash Settlement in accordance with paragraph (d)(i) above, or does notify
the Agent as provided in paragraph (d)(i) above of its intention to pay the
Purchase Price in cash, but fails to make such payment as required by paragraph
(d)(ii) above, then upon the maturity of the Pledged Treasury Securities 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, held by
the Securities Intermediary on the Business Day immediately prior to the
Purchase Contract Settlement Date, the principal amount of the Treasury
Securities 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, received by the Securities Intermediary shall be invested promptly
in Permitted Investments. On the Purchase Contract Settlement Date an amount
equal to the Purchase Price shall be remitted to the Company as payment thereof
without receiving any instructions from the Holder. In the event the sum of the
proceeds from the related Pledged Treasury Securities 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, and the investment
earnings earned from such investments is in excess of the aggregate Purchase
Price of the Purchase Contracts being settled thereby, the Collateral Agent
shall cause the Securities Intermediary to distribute such excess to the Agent
for the benefit of the Holder of the related Treasury PIES or Corporate PIES
when received.
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(e) Any distribution to Holders of excess funds and interest described
above shall be payable at the office of the Agent in The City of New York
maintained for that purpose or, at the option of the Holder, by check mailed to
the address of the Person entitled thereto at such address as it appears on the
Register.
(f) Upon Cash Settlement of any Purchase Contract, (i) the Collateral
Agent will in accordance with the terms of the Pledge Agreement cause the
Pledged Preferred Securities, the Pledged Debentures, the appropriate Applicable
Ownership Interest (as specified in clause (A) of the definition of such term)
of the Treasury Portfolio or the Pledged Treasury Securities, as the case may
be, underlying the relevant Security to be released from the Pledge 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, the Agent shall, by book-entry transfer, or
other appropriate procedures, in accordance with written instructions provided
by the Holder thereof, transfer such Preferred Securities or Debentures, the
appropriate Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) of the Treasury Portfolio or such Treasury Securities,
as the case may be (or, if no such instructions are given to the Agent by the
Holder, the Agent shall hold such Preferred Securities or Debentures or the
Applicable Ownership Interest (as specified in clause (A) of the definition of
such term) of the Treasury Portfolio or such Treasury Securities, as the case
may be, and any distribution thereon, in the name of the Agent or its nominee in
trust for the benefit of such Holder until the expiration of the time period
specified in the abandoned property laws of the relevant State).
(g) The obligations of the Holders to pay the Purchase Price are
non-recourse obligations and, except to the extent paid by Early Settlement or
Cash Settlement, are payable solely out of 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 the disposition of Collateral
and the Purchase Price.
Section 5.5. Issuance of Shares of Common Stock.
Unless a Termination Event or an Early Settlement shall have occurred,
subject to Section 5.6(b), the Company shall issue and deposit with the Agent,
for the benefit of the Holders of the Outstanding Securities, one or more
certificates representing the 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 a record date and payment date for such dividend or
distribution has occurred 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 5.10 and any
dividends or distributions with respect to such shares constituting part of the
Purchase Contract Settlement Fund, but without
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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 5.6. 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 in effect
at the opening of business on the day following the date fixed for the
determination of stockholders entitled to receive such dividend or other
distribution shall be increased by dividing such Settlement Rate by a fraction
of which the numerator shall be the number of shares of Common Stock outstanding
at the close of business on the date fixed for such determination and the
denominator shall be the sum of such number of shares and the total number of
shares constituting such dividend or other distribution, such increase to become
effective immediately after the opening of business on the day following the
date fixed for such determination. For the purposes of this paragraph (1), the
number of shares of Common Stock at any time outstanding shall not include
shares held in the treasury of the Company but shall include any shares issuable
in respect of any scrip certificates issued in lieu of fractions of shares of
Common Stock. The Company will not pay any dividend or make any distribution on
shares of Common Stock held in the treasury of the Company.
(2) 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), the Settlement Rate in effect at the opening of business on
the day following the date fixed for such determination shall be increased by
dividing such Settlement Rate by a fraction of which the numerator shall be the
number of shares of Common Stock outstanding at the close of business on the
date fixed for such determination plus the number of shares of Common Stock
which the aggregate of the offering price of the total number of shares of
Common Stock so offered for subscription or purchase would purchase at such
Current Market Price and the denominator shall be the number of shares of Common
Stock outstanding at the close of business on the date fixed for such
determination plus the number of shares of Common Stock so offered for
subscription or purchase, such increase to become effective immediately after
the opening of business on the day following the date fixed for such
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determination. For the purposes of this paragraph (2), the number of shares of
Common Stock at any time outstanding shall not include shares held in the
treasury of the Company but shall include any shares issuable in respect of any
scrip certificates issued in lieu of fractions of shares of Common Stock. The
Company shall not issue any such rights, options or warrants in respect of
shares of Common Stock held in the treasury of the Company.
(3) 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 or assets
(including securities, but excluding any rights or warrants referred to in
paragraph (2) of this Section, any dividend or distribution paid exclusively in
cash and any dividend or distribution referred to in paragraph (1) of this
Section), the Settlement Rate shall be adjusted so that the same shall equal the
rate determined by dividing the Settlement Rate in effect immediately prior to
the close of business on the date fixed for the determination of stockholders
entitled to receive such distribution by a fraction of which the numerator shall
be the Current Market Price per share of the Common Stock on the date fixed for
such determination less the then fair market value (as determined by the Board
of Directors, whose determination shall be conclusive and described in a Board
Resolution) of the portion of the assets or evidences of indebtedness so
distributed applicable to one share of Common Stock and the denominator shall be
such Current Market Price per share of the Common Stock, such adjustment to
become effective immediately prior to the opening of business on the day
following the date fixed for the determination of stockholders entitled to
receive such distribution. In any case in which this paragraph (4) is
applicable, paragraph (2) of this Section shall not be applicable.
(5) In case the Company shall, by dividend or otherwise, distribute
to all holders of its Common Stock (I) cash (excluding any cash that is
distributed in a Reorganization Event to which Section 5.6(b) applies or as part
of a distribution referred to in paragraph (4) of this Section) in an aggregate
amount that, combined together with the aggregate amount of any other
distributions to all holders of its Common Stock made exclusively in cash (other
than in connection with a Reorganization Event) within the 12 months preceding
the date of payment of such distribution and in respect of which no adjustment
pursuant to this paragraph (5) or paragraph (6) of this Section has been made
and (II) the aggregate of any cash plus the fair market value (as determined by
the Board of Directors, whose determination shall be conclusive and described in
a Board Resolution) of consideration payable in respect of any tender or
exchange offer by the Company or any of its subsidiaries for all or any portion
of the Common Stock concluded within the 12 months preceding the date of payment
of the distribution
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described in Clause (I) above and in respect of which no adjustment pursuant to
this paragraph (5) or paragraph (4) 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) and (II)
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.
(6) In case a tender or exchange offer made by the Company or any
subsidiary of the Company for all or any portion of the Common Stock shall
expire and such tender or exchange offer (as amended upon the expiration
thereof) shall require the payment to stockholders (based on the acceptance (up
to any maximum specified in the terms of the tender or exchange offer) of
Purchased Shares) of (I) 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 the
aggregate of the cash plus the fair market value (as determined by the Board of
Directors, whose determination shall be conclusive and described in a Board
Resolution), as of the expiration of such tender or exchange offer, of
consideration payable in respect of any other tender or exchange offer, by the
Company or any subsidiary of the Company for all or any portion of the Common
Stock expiring within the 12 months preceding the expiration of such tender or
exchange offer and in respect of which no adjustment pursuant to paragraph (5)
of this Section or this paragraph (6) has been made and (II) the aggregate
amount of any distributions to all holders of the Company's Common Stock made
exclusively in cash within 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 on the date of the Expiration Time by
a fraction (i) the numerator of which shall be equal to (A) the product of (I)
the Current Market Price per share of the Common Stock on the date of the
Expiration Time and (II) the number of shares of Common Stock outstanding
(including any tendered shares) on the Expiration Time less (B) the amount of
cash plus the fair market value (determined as aforesaid) of the aggregate
consideration payable to stockholders based on the transactions described in
clauses (I) and (II) above (assuming in the case of clause (I) the
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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 5.6(b) applies) shall be deemed to involve
(a) a distribution of such securities other than Common Stock to all holders of
Common Stock (and the effective date of such reclassification shall be deemed to
be "the date fixed for the determination of stockholders entitled to receive
such distribution" and the "date fixed for such determination" within the
meaning of paragraph (4) of this Section), and (b) a subdivision, 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 thereof; 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 5.6(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 5.6(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
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made pursuant to the occurrence of any of the events contemplated by paragraph
(1), (2), (3), (4), (5), (7) or (10) of this Section 5.6(a) during the period
taken into consideration for determining the Applicable Market Value,
appropriate and customary adjustments shall be made to the Settlement Rate.
(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 reason.
(b) Adjustment for Consolidation, Merger or Other Reorganization Event.
In the event of (i) any consolidation or merger of the Company with
or into another Person (other than a merger or consolidation in which the
Company is the continuing corporation and in which the Common Stock outstanding
immediately prior to the merger or consolidation is not exchanged for cash,
securities or other property of the Company or another corporation), (ii) any
sale, transfer, lease or conveyance to another Person of the property of the
Company as an entirety or substantially as an entirety, (iii) any statutory
exchange of securities of the Company with another Person (other than in
connection with a merger or acquisition) or (iv) any liquidation, dissolution or
winding up of the Company other than as a result of or after the occurrence of a
Termination Event (any such event, a "Reorganization Event"), the Settlement
Rate 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, 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 his rights of election, if
any, as to the kind or amount of securities, cash and other property receivable
upon such Reorganization Event (provided that if the kind or amount of
securities, cash and other property receivable upon such Reorganization Event is
not the same for each share of Common Stock held immediately prior to such
Reorganization Event by other than a Constituent Person or an Affiliate thereof
and in respect of which such rights of election shall not have been exercised
("non-electing share"), then for the purpose of this Section the kind and amount
of securities, cash and other property receivable upon such Reorganization Event
by each non-electing share shall be deemed to be the kind and amount so
receivable per share by a plurality of the non-electing shares). In the event of
such a Reorganization Event, the Person formed by such consolidation, merger or
exchange or the Person which acquires the assets of the Company or, in the event
of a liquidation or dissolution of the Company, the Company or a
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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 5.6(b). Such
supplemental agreement shall provide for adjustments which, for events
subsequent to the effective date of such supplemental agreement, shall be as
nearly equivalent as may be practicable to the adjustments provided for in this
Section. The above provisions of this Section shall similarly apply to
successive Reorganization Events.
Section 5.7. Notice of Adjustments and Certain Other Events.
(a) Whenever the Settlement Rate is adjusted as herein provided, the
Company shall:
(i) forthwith compute the adjusted Settlement Rate in accordance
with Section 5.6 and prepare and transmit to the Agent an Officers'
Certificate setting forth the Settlement Rate, the method of calculation
thereof in reasonable detail, and the facts requiring such adjustment and
upon which such adjustment is based; and
(ii) within 10 Business Days following the occurrence of an event
that requires an adjustment to the Settlement Rate pursuant to Section 5.6
(or if the Company is not aware of such occurrence, as soon as practicable
after becoming so aware), provide a written notice to the Holders of the
Securities of the occurrence of such event and a statement in reasonable
detail setting forth the method by which the adjustment to the Settlement
Rate was determined and setting forth the adjusted Settlement Rate.
(b) The Agent shall not at any time be under any duty or responsibility to
any Holder of Securities to determine whether any facts exist which may require
any adjustment of the Settlement Rate, or with respect to the nature or extent
or 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 5.8. Termination Event; Notice.
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 any Contract Adjustment
Payments, if the Company shall have such obligation, 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 and after the
occurrence of a Termination Event, the Securities shall thereafter represent the
right to receive the Preferred Securities or the
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Debentures 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
Corporate PIES, or Treasury Securities in the case of Treasury PIES, in
accordance with the provisions of Section 5.4 of the Pledge Agreement. Upon the
occurrence of a Termination Event, the Company shall promptly but in no event
later than two Business Days thereafter give written notice to the Agent, the
Collateral Agent and the Holders, at their addresses as they appear in the
Register.
Section 5.9. Early Settlement.
(a) Subject to and upon compliance with the provisions of this Section
5.9, at the option of the Holder thereof, Purchase Contracts underlying
Securities may be settled early ("Early Settlement") in the case of Corporate
PIES (unless a Tax Event Redemption has occurred) on or prior to the seventh
Business Day immediately preceding the Purchase Contract Settlement Date and in
the case of Treasury PIES on or prior to the second Business Day immediately
preceding the Purchase Contract Settlement Date, in each case, as provided
herein; and that if a Tax Event Redemption has occurred and the Treasury
Portfolio has become a component of the Corporate PIES, Purchase Contracts,
underlying Corporate PIES 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 $8,000,000 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 duly
endorsed for transfer to the Company or in blank with the form of Election to
Settle Early on the reverse thereof duly completed and accompanied by payment
(payable to the Company in immediately available funds) in an amount (the "Early
Settlement Amount") equal to (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 sum of (x) the Contract Adjustment Payments payable
on such Payment Date with respect to such Purchase Contracts plus (y) in the
case of a Corporate PIES Certificate, the distributions on the related Preferred
Securities or Debentures payable on such Payment Date. Except as provided in the
immediately preceding sentence and subject to the second to last paragraph of
Section 5.2, no payment or adjustment shall be made upon Early Settlement of any
Purchase Contract on account of any Contract Adjustment Payments accrued on such
Purchase Contract or on account of any dividends on the Common Stock issued upon
such Early Settlement. If the foregoing requirements are first satisfied with
respect to Purchase Contracts underlying any Securities at or prior to 5:00
p.m., New York City time, on a Business Day, such day shall be the "Early
Settlement Date" with respect to such Securities and if such requirements are
first satisfied after 5:00 p.m., New York City time, on a Business Day or on a
day that is not a Business Day, the "Early Settlement Date" with respect to such
Securities shall be the next succeeding Business Day.
(b) Upon Early Settlement of Purchase Contracts by a Holder of the related
Securities, the Company shall issue, and the Holder shall be entitled to
receive, 1.6103 shares of
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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.
(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, together
with payment in lieu of any fraction of a share, as provided in Section 5.10,
and (ii) the related Preferred Securities or Debentures or the appropriate
Applicable Ownership Interest (as specified in clause (A) of the definition of
such term) of the Treasury Portfolio, in the case of Corporate PIES, or the
related Treasury Securities, in the case of Treasury PIES, 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 Preferred Securities,
the Debentures, the appropriate Applicable Ownership Interest (as specified in
clause (A) of the definition of such term) of the Treasury Portfolio or Treasury
Securities, as the case may be, from the Securities Intermediary, 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
Preferred Securities, the Debentures, the Applicable Ownership Interest (as
specified in clause (A) of the definition of such term) of the 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
5.10.
(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 5.10. 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
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sufficient funds to permit the Agent to make all cash payments required by this
Section 5.10 in a timely manner.
Section 5.11. Charges and Taxes.
The Company 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.
ARTICLE VI
Remedies
Section 6.1. Unconditional Right of Holders to Receive Contract
Adjustment Payments and to Purchase Common Stock.
In the event that Contract Adjustment Payments shall constitute a
component of Corporate PIES or Treasury PIES, the Holder of any Corporate PIES
or Treasury PIES shall have the right, which is absolute and unconditional
(subject to the payment by a holder of Contract Adjustment Payments pursuant to
Section 5.9(a)), to receive payment of each installment of the Contract
Adjustment Payments with respect to the Purchase Contract constituting a part of
such Security on the respective Payment Date for such Security and to purchase
Common Stock pursuant to such Purchase Contract and, in each such case, to
institute suit for the enforcement of any such payment and right to purchase
Common Stock, and such rights shall not be impaired without the consent of such
Holder.
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.
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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.
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 Corporate PIES or
Treasury PIES, by its acceptance of such Corporate PIES or Treasury PIES 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 distributions on any Preferred Securities
or Contract Adjustment Payments, if any, on any Purchase Contract 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
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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
(2) in the absence of bad faith or negligence on its part, the Agent
may, with respect to the Securities, conclusively rely, as to the truth of
the statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Agent and conforming to the
requirements of this Agreement, but in the case of any certificates or
opinions which by any provision hereof are specifically required to be
furnished to the Agent, the Agent shall be under a duty to examine the
same to determine whether or not they conform to the requirements of this
Agreement.
(b) No provision of this Agreement shall be construed to relieve the Agent
from liability for its own negligent action, its own negligent failure to act,
or its own wilful misconduct, except that
(1) this Subsection shall not be construed to limit the effect of
Subsection (a) of this Section;
(2) the Agent shall not be liable for any error of judgment made in
good faith by a Responsible Officer, unless it shall be proved that the
Agent was negligent in ascertaining the pertinent facts; and
(3) no provision of this Agreement shall require the Agent to expend
or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder, or in the exercise of any of
its rights or powers, if adequate indemnity is not provided to it.
(c) Whether or not therein expressly so provided, every provision of this
Agreement relating to the conduct or affecting the liability of or affording
protection to the Agent shall be subject to the provisions of this Section.
(d) The Agent is authorized to execute and deliver the Pledge Agreement in
its capacity as Agent.
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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;
(b) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by an Officers' Certificate, Issuer Order or Issuer
Request, and any resolution of the Board of Directors 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 Officers' Certificate of the Company;
(d) the Agent may consult with counsel and the written advice of such
counsel or any Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it hereunder
in good faith and in reliance thereon;
(e) the Agent shall not be bound to make any investigation into the facts
or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document, but the Agent,
in its discretion, may make reasonable further inquiry or investigation 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.
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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.
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 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 reasonable compensation
for all services rendered by it hereunder;
(2) except as otherwise expressly provided for herein, to reimburse
the Agent upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Agent in accordance with any provision of
this Agreement (including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence or bad
faith; and
(3) to indemnify the Agent and any predecessor Agent for, and to
hold it harmless against, any loss, liability or expense incurred without
negligence or bad faith on its part, arising out of or in connection with
the acceptance or administration of its duties hereunder, including the
costs and expenses of defending itself against any claim or liability in
connection with the exercise or performance of any of its powers or duties
hereunder.
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Section 7.8. Corporate Agent Required; Eligibility.
There shall at all times be an Agent hereunder which shall be a
corporation organized and doing business under the laws of the United States of
America, any State thereof or the District of Columbia, authorized under such
laws to exercise corporate trust powers, having (or being a member of a bank
holding company having) a combined capital and surplus of at least $50,000,000,
subject to supervision or examination by Federal or State authority and having a
Corporate Trust Office in the Borough of Manhattan, The City of New York, if
there be such a corporation in the Borough of Manhattan, The City of New York,
qualified and eligible under this Article and willing to act on reasonable
terms. If such corporation publishes reports of condition at least annually,
pursuant to law or to the requirements of said supervising or examining
authority, then for the purposes of this Section, the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. If at
any time the Agent shall cease to be eligible in accordance with the provisions
of this Section, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article.
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.
(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 adjudged
a bankrupt or insolvent or a receiver of the Agent or of its property
shall be appointed or
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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 itself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Agent.
(f) The Company shall give, or shall cause such successor Agent to give,
notice of each resignation and each removal of the Agent and each appointment of
a successor Agent by mailing written notice of such event by first-class mail,
postage prepaid, to all Holders as their names and addresses appear in the
applicable Register. Each notice shall include the name of the successor Agent
and the address of its Corporate Trust Office.
Section 7.10. Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor Agent, every such
successor Agent so appointed shall execute, acknowledge and deliver to the
Company and to the retiring Agent an instrument accepting such appointment, and
thereupon the resignation or removal of the retiring Agent shall become
effective and such successor Agent, without any further act, deed or conveyance,
shall become vested with all the rights, powers, agencies 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.
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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, with
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 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 expressly 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 Five hereof.
Anything in this Agreement to the contrary notwithstanding, in no event shall
the Agent or its officers, employees or agents be liable under this Agreement to
any third party for indirect, special, punitive, or consequential loss or damage
of any kind whatsoever, including lost profits, whether or not the likelihood of
such loss or damage was known to the Agent, incurred without any act or deed
that is found to be attributable to gross negligence or willful misconduct on
the part of the Agent.
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Section 7.14. Tax Compliance.
(a) 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 execution or certification of any required
documentation and 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:
(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 5.6(b); or
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(5) except as provided for in Section 5.6, 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; provided, however, that, except as
contemplated herein, no such supplemental agreement shall, without the unanimous
consent of the Holders of each outstanding Purchase Contract affected thereby,
(1) change any Payment Date;
(2) change the amount or the type of Collateral required to be
Pledged to secure a Holder's obligations under the 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 Corporate PIES to substitute the Treasury Securities for the Pledged
Preferred Securities or Pledged Debentures or the Applicable Ownership
Interest of the Treasury Portfolio or the rights of holders of Treasury
PIES to substitute Preferred Securities, Debentures or the Applicable
Ownership Interest of the Treasury Portfolio 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) reduce any Contract Adjustment Payments or change any place
where, or the coin or currency in which, any Contract Adjustment Payment
is payable;
(4) impair the right to institute suit for the enforcement of any
Purchase Contract;
(5) reduce the number of shares of Common Stock to be purchased
pursuant to any Purchase Contract, increase the price to purchase shares
of Common Stock upon settlement of any Purchase Contract, change the
Purchase Contract Settlement Date or otherwise adversely affect the
Holder's rights under any Purchase Contract; or
(6) reduce the percentage of the outstanding Purchase Contracts the
consent of whose Holders is required for any such supplemental agreement;
-56-
provided that if any amendment or proposal referred to above would adversely
affect only the Corporate PIES or the Treasury PIES, 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; provided that the unanimous consent of the
Holders of each outstanding Purchase Contract of such class affected thereby
shall be required to approve any amendment or proposal specified in clauses
(1) - (6) above.
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 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.
-57-
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 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 in the
performance of any covenant or condition hereunder, under any of the Securities
or under 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. Such successor corporation thereupon may cause to be signed, and
may issue either in its own name or in the name of NIPSCO Industries, Inc., 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 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.
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.
-58-
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 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 in the Borough of Manhattan, The City of New
York an office or agency where Certificates may be presented or surrendered for
acquisition of shares of Common Stock 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 a Corporate PIES 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. The Company hereby
designates as the place of payment for the Securities the Corporate Trust Office
and appoints the Agent at its Corporate Trust Office as paying agent in such
city.
-59-
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.
Section 10.5. Statements of Officers of the Company as to Default.
The Company will deliver to the Agent, within 120 days after the end of
each fiscal year of the Company (which as of the date hereof is December 31)
ending after the date hereof, an Officers' Certificate (one of the signers of
which shall be the principal executive officer, principal financial officer or
principal accounting officer of the Company), stating whether or not to the best
knowledge of the signers thereof the Company is in default in the performance
and observance of any of the terms, provisions and conditions hereof, and if the
Company shall be in default, specifying all such defaults and the nature and
status thereof of which they may have knowledge.
Section 10.6. ERISA.
Each Holder from time to time of the Securities which is a Plan hereby
represents that its acquisition of the Corporate PIES and the holding of the
same satisfies the applicable fiduciary requirements of ERISA and that it is
entitled to exemption relief from the prohibited transaction provisions of ERISA
and the Code in accordance with one or more prohibited transaction exemptions or
otherwise will not result in a nonexempt prohibited transaction.
-60-
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
NIPSCO INDUSTRIES, INC.
By:
------------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK, as
Purchase Contract Agent
By:
------------------------------------
Name:
Title:
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EXHIBIT A
FACE OF CORPORATE PIES CERTIFICATE
"THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN THE
NAME OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE "DEPOSITARY"),
OR A NOMINEE OF THE DEPOSITARY. THIS CERTIFICATE IS EXCHANGEABLE FOR
CERTIFICATES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS
NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT
AGREEMENT AND NO TRANSFER OF THIS CERTIFICATE (OTHER THAN A TRANSFER OF THIS
CERTIFICATE AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A
NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY) MAY BE REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITARY 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 DEPOSITARY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN."
No. _______ Cusip No.______
Number of Corporate PIES ________
NIPSCO INDUSTRIES, INC.
NIPSCO CAPITAL TRUST I
Corporate PIES
This Corporate PIES Certificate certifies that Cede & Co. is the
registered Holder of the number of Corporate PIES set forth above. Each
Corporate PIES consists of (i) either (a) beneficial ownership by the Holder of
one Preferred Security (the "Preferred Security") of NIPSCO Capital Trust I, a
Delaware statutory business trust (the "Trust"), having a stated liquidation
amount of $50, subject to the Pledge of such Preferred Security 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, the appropriate
Applicable Ownership Interest of the Treasury Portfolio, subject to the Pledge
of such Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) 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 NIPSCO Industries, Inc., an Indiana corporation (the
"Company"). All capitalized
terms used herein which are defined in the Purchase Contract Agreement (as
defined on the reverse hereof) have the meaning set forth therein.
Pursuant to the Pledge Agreement, the Preferred Securities 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,
constituting part of each Corporate PIES 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 Corporate
PIES.
The Pledge Agreement provides that all payments of the liquidation amount
with respect to any of the Pledged Preferred Securities 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 cash distributions
on any Pledged Preferred Securities (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 Corporate PIES received by the Securities Intermediary
shall be paid by wire transfer in same day funds (i) in the case of (A) cash
distributions with respect to Pledged Preferred Securities 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 the liquidation amount with respect to any Preferred Securities 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, 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 Securities
Intermediary (provided that in the event such payment is received by the
Securities Intermediary 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 the liquidation amount with respect to any of
the Pledged Preferred Securities or the appropriate Applicable Ownership
Interest (as specified in clause (A) of the definition of such term) of the
Treasury Portfolio, to the Company on the Purchase Contract Settlement Date (as
described herein) in accordance with the terms of the Pledge Agreement, in full
satisfaction of the respective obligations of the Holders of the Corporate PIES
of which such Pledged Preferred Securities or the Applicable Ownership Interest
(as specified in clause (A) of the definition of such term) of the Treasury
Portfolio, as the case may be, are a part under the Purchase Contracts forming a
part of such Corporate PIES. Distributions on any Preferred Security 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, forming
part of a Corporate PIES evidenced hereby, which are payable quarterly in
arrears on February 19, May 19, August 19 and November 19 of each year,
commencing May 19, 1999 (a "Payment Date"), shall, subject to receipt thereof by
the Agent from the Securities Intermediary, be paid to the Person in whose name
this Corporate PIES Certificate (or a Predecessor Corporate PIES 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
Corporate PIES Certificate to purchase, and the Company to sell, on February 19,
2003 (the "Purchase Contract
A-2
Settlement Date"), at a price equal to $50 (the "Stated Amount"), a number of
Common Shares, without 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 Corporate PIES 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
separate cash or by application of payment received in respect of the
liquidation amount with respect to any Pledged Preferred Securities pursuant to
the Remarketing 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 Corporate PIES of which such Purchase Contract is a part.
The Company shall pay, on each Payment Date, in respect of each Purchase
Contract forming part of a Corporate PIES evidenced hereby an amount (the
"Contract Adjustment Payments") equal to (a) if a Reset Transaction has not
occurred, 1.85% per annum of the Stated Amount or (b) following the occurrence
of a Reset Transaction, the Adjusted Contract Adjustment Payment Rate related to
such Reset Transaction until any such succeeding Reset Transaction shall occur
(computed on the basis of (i) for any full quarterly period, a 360-day year of
twelve 30-day months and (ii) for any period shorter than a full quarterly
period, a 30-day month and for periods less than a month, the actual number of
days elapsed per 30-day period). Such Contract Adjustment Payments shall be
payable to the Person in whose name this Corporate PIES Certificate (or a
Predecessor Corporate PIES Certificate) is registered at the close of business
on the Record Date for such Payment Date.
Distributions on the Preferred Securities 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 Contract Adjustment Payments
will be payable at the office of the Agent in The City of New York or, at the
option of the Company, by check mailed to the address of the Person entitled
thereto as such address appears on the Corporate PIES Register.
Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Agent by manual signature, this Corporate PIES 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-3
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
NIPSCO INDUSTRIES, INC.
By:
------------------------------------
Name:
Title:
By:
------------------------------------
Name:
Title:
HOLDER SPECIFIED ABOVE (as to
obligations of such Holder under the
Purchase Contracts evidenced hereby)
By: THE CHASE MANHATTAN BANK, not
individually but solely as
Attorney-in-Fact of such Holder
By:
------------------------------------
Name:
Title:
Dated:
AGENT'S CERTIFICATE OF AUTHENTICATION
This is one of the Corporate PIES Certificates referred to in the within
mentioned Purchase Contract Agreement.
By: THE CHASE MANHATTAN BANK, as
Purchase Contract Agent
By:
------------------------------------
Authorized Officer
A-4
(FORM OF REVERSE OF CORPORATE PIES CERTIFICATE)
Each Purchase Contract evidenced hereby is governed by a Purchase Contract
Agreement, dated as of February 16, 1999 (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 hereunder,
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 Corporate
PIES Certificates are, and are to be, executed and delivered.
Each Purchase Contract evidenced hereby obligates the Holder of this
Corporate PIES Certificate 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 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 with respect to the Security of
which such Purchase Contract is a part or an Early Settlement shall have
occurred. The "Settlement Rate" is equal to (a) if the Applicable Market Value
(as defined below) is equal to or greater than $31.0500 (the "Threshold
Appreciation Price"), 1.6103 shares of Common Stock per Purchase Contract, (b)
if the Applicable Market Value is less than the Threshold Appreciation Price but
is greater than $26.3125, 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 Amount is less than or equal to $26.3125, 1.9002
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
Corporate PIES 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 Trading Days ending on the third Trading
Day immediately preceding the Purchase Contract Settlement Date or any
applicable Early Settlement Date. The "Closing Price" of the Common Stock on any
date of determination means (i) 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, (ii) if the Common Stock is not listed
for trading on the NYSE on any such date, the closing sale price as reported in
the composite transactions for the principal United States securities exchange
on which the Common Stock is so listed, (iii) if the Common Stock is not so
listed on a United States national or regional securities exchange, the closing
sale price as reported by The Nasdaq Stock Market, (iv) if the Common Stock is
not so reported, the last quoted bid price for the Common Stock in the
over-the-counter market as reported by the National Quotation Bureau or similar
organization, or
A-5
(v) if such bid price is not available, the average of the mid-point of the last
bid and ask prices of the Common Stock on such date from at least three
nationally recognized independent investment banking firms 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 Corporate PIES Certificate may 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 the Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) of the Treasury Portfolio or a remarketing of the
related Pledged Preferred Securities. A Holder of Corporate PIES who does not
effect, on or prior to 11:00 a.m. New York City time on the fifth Business Day
immediately preceding the Purchase Contract Settlement Date (or in the event a
Tax Event Redemption has occurred, the Business Day prior to the Purchase
Contract Settlement Date), an effective Cash Settlement or an Early Settlement,
shall pay the Purchase Price for the shares of Common Stock to be issued under
the related Purchase Contract from the proceeds of the Applicable Ownership
Interest (as specified in clause (A) of the definition of such term) of the
Treasury Portfolio or the sale of the related Pledged Preferred Securities held
by the Collateral Agent. Such sale will be made by the Remarketing Agent
pursuant to the terms of the Remarketing Agreement on the third Business Day
prior to the Purchase Contract Settlement Date. If, as provided in the Purchase
Contract Agreement, upon the occurrence of a Failed Remarketing the Collateral
Agent, for the benefit of the Company, exercises its rights as a secured
creditor with respect to the Pledged Preferred related to this Corporate PIES
certificate, any accrued and unpaid distributions on such Pledged Preferred
Securities will become payable by the Company to the holder of this Corporate
PIES Certificate in the manner provided for in the Purchase Contract Agreement.
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 of the aggregate purchase price for
the shares of Common Stock to be purchased thereunder in the manner herein set
forth.
Each Purchase Contract evidenced hereby and all obligations and rights of
the Company and the Holder thereunder shall terminate if a Termination Event
shall occur. Upon the occurrence of a Termination Event, the Company shall give
written notice to the Agent and to the Holders, at their addresses as they
appear in the Corporate PIES Register. Upon and after the occurrence of a
Termination Event, the Collateral Agent shall release the Pledged Preferred
Security or the appropriate Applicable Ownership Interest (as specified in
clause (A) of the definition of such term) of the Treasury Portfolio forming a
part of each Corporate PIES from the Pledge. A Corporate PIES shall thereafter
represent the right to receive the Preferred Security or the appropriate
Applicable Ownership Interest of the Treasury Portfolio forming a part of such
Corporate PIES in accordance with the terms of the Purchase Contract Agreement
and the Pledge Agreement.
A-6
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
Preferred Securities. Upon receipt of notice of any meeting at which holders of
Preferred Securities are entitled to vote or upon the solicitation of consents,
waivers or proxies of holders of Preferred Securities, the Agent shall, as soon
as practicable thereafter, mail to the Corporate PIES Holders a notice (a)
containing such information as is contained in the notice or solicitation, (b)
stating that each Corporate PIES 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 Preferred Securities entitled to vote) shall
be entitled to instruct the Agent as to the exercise of the voting rights
pertaining to the Preferred Securities constituting a part of such Holder's
Corporate PIES and (c) stating the manner in which such instructions may be
given. Upon the written request of the Corporate PIES 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 Preferred Securities as to which any particular voting
instructions are received. In the absence of specific instructions from the
Holder of a Corporate PIES, the Agent shall abstain from voting the Preferred
Security evidenced by such Corporate PIES.
Upon the liquidation of the Trust, a principal amount of the Debentures
constituting the assets of the Trust and underlying the Preferred Securities
equal to the aggregate liquidation amount of the Pledged Preferred Securities
shall be delivered to the Securities Intermediary in exchange for the Pledged
Preferred Securities. Thereafter, the Debentures shall be held by the Securities
Intermediary to secure the obligations of each Holder of Corporate PIES to
purchase shares of Common Stock under the Purchase Contracts constituting a part
of such Corporate PIES. Following the liquidation of the Trust, the Holders and
the Collateral Agent shall have such security interests, rights and obligations
with respect to the Debentures as the Holders and the Collateral Agent had in
respect of the Pledged Preferred Securities, any reference herein to the
Preferred Securities shall be deemed to be a reference to the Debentures and any
reference herein to the liquidation amount of the Preferred Securities shall be
deemed to be a reference to the principal amount of the Debentures.
Upon the occurrence of a Tax Event Redemption prior to the Purchase
Contract Settlement Date, the Redemption Price payable on the Tax Event
Redemption Date with respect to the Applicable Principal Amount of Debentures
shall be delivered to the Securities Intermediary in exchange for the Pledged
Preferred Securities. Thereafter, pursuant to the terms of the Pledge Agreement,
the Securities Intermediary will apply an amount equal to the Redemption Amount
of such Redemption Price to purchase, the Treasury Portfolio and promptly (a)
transfer the Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) of the Treasury Portfolio to the Collateral Account to
secure the obligations of each Holder of Corporate PIES to purchase shares of
Common Stock under the Purchase Contracts constituting a part of such Corporate
PIES, (b) transfer the Applicable Ownership Interest (as specified in clause (B)
of the definition of such term) of the Treasury Portfolio to the Agent for the
benefit of the Holders of such Corporate PIES and (iii) remit the remaining
portion of such Redemption Price to the Agent for payment to the Holders of such
Corporate PIES.
A-7
Following the occurrence of a Tax Event Redemption prior to the Purchase
Contract Settlement Date, the Holders of Corporate PIES and the Collateral Agent
shall have such security interest rights and obligations with respect to the
Applicable Ownership Interest (as specified in clause (A) of the definition of
such term) of the Treasury Portfolio as the Holder of Corporate PIES and the
Collateral Agent had in respect of the Preferred Securities or Debentures, as
the case may be, subject to the Pledge thereof as provided in Articles II, III,
IV, V and VI, of the Pledge Agreement and any reference herein to the Preferred
Securities shall be deemed to be a reference to such Treasury Portfolio.
The Corporate PIES Certificates are issuable only in registered form and
only in denominations of a single Corporate PIES and any integral multiple
thereof. The transfer of any Corporate PIES Certificate will be registered and
Corporate PIES Certificates may be exchanged as provided in the Purchase
Contract Agreement. The Corporate PIES 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 a Treasury Security for Preferred Securities or the appropriate
Applicable Ownership Interest of the Treasury Portfolio, thereby creating
Treasury PIES, 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 Corporate PIES remains in effect,
such Corporate PIES shall not be separable into its constituent parts, and the
rights and obligations of the Holder of such Corporate PIES in respect of the
Preferred Security or the appropriate Applicable Ownership Interest of the
Treasury Portfolio, as the case may be, and Purchase Contract constituting such
Corporate PIES may be transferred and exchanged only as a Corporate PIES. The
holder of a Corporate PIES may substitute for the Pledged Preferred Securities
or the appropriate Applicable Ownership Interest (as specified in clause (A) of
the definition of such term) of the Treasury Portfolio securing its obligation
under the related Purchase Contract Treasury Securities in an aggregate
principal amount equal to the aggregate liquidation amount of the Pledged
Preferred Securities or the appropriate Applicable Ownership Interest (as
specified in clause (A) of the definition of such term) of the Treasury
Portfolio 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 "Treasury PIES." A Holder may
make such Collateral Substitution only in integral multiples of 20 Corporate
PIES for 20 Treasury PIES; provided, however, that if a Tax Event Redemption has
occurred and the Treasury Portfolio has become a component of the Corporate
PIES, a Holder may make such Collateral Substitution only in integral multiples
of 160,000 Corporate PIES for 160,000 Treasury PIES. Such Collateral
Substitution may cause the equivalent aggregate principal amount of this
Certificate to be increased or decreased; provided, however, this Corporate PIES
Certificate shall not represent more than ____ Corporate PIES. All such
adjustments to the equivalent aggregate principal amount of this Corporate PIES
Certificate shall be duly recorded by placing an appropriate notation on the
Schedule attached hereto.
A-8
A Holder of Treasury PIES may recreate Corporate PIES by delivering to the
Securities Intermediary Preferred Securities or the appropriate Applicable
Ownership Interest (as specified in clause (A) of the definition of such term)
of the Treasury Portfolio, with an aggregate liquidation amount, in the case of
such Preferred Securities, 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 (as
specified in clause (A) of the definition of such term) 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.
The Company shall pay, on each Payment Date, the Contract Adjustment
Payments payable in respect of each Purchase Contract to the Person in whose
name the Corporate PIES Certificate evidencing such Purchase Contract is
registered at the close of business on the Record Date for such Payment Date.
Contract Adjustment Payments will be payable at the office of the Agent in The
City of New York or, at the option of the Company, by check mailed to the
address of the Person entitled thereto at such address as it appears on the
Corporate PIES Register.
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 any Contract Adjustment
Payments, 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 the Holders, at their addresses as they
appear in the Corporate PIES Register. Upon and after the occurrence of a
Termination Event, the Collateral Agent shall release the Preferred Securities
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, 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 Holder thereof, Purchase Contracts
underlying Securities may be settled early ("Early Settlement") as provided in
the Purchase Contract Agreement; provided, however, that if a Tax Event
Redemption has occurred and the Treasury Portfolio has become a component of the
Corporate PIES, Holders may settle early Corporate PIES only in integral
multiples of 160,000 Corporate PIES. In order to exercise the right to effect
Early Settlement with respect to any Purchase Contracts evidenced by this
Corporate PIES Certificate, the Holder of this Corporate PIES Certificate shall
deliver this Corporate PIES Certificate to the Agent at the Corporate Trust
Office duly endorsed for transfer to the Company or in blank with the form of
Election to Settle Early set forth below duly completed and accompanied by
payment in the form of immediately available funds payable to the order of 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
A-9
business on any Record Date for any Payment Date to the opening of business on
such Payment Date, an amount equal to the Contract Adjustment Payments payable
on such Payment Date with respect to such Purchase Contracts. Upon Early
Settlement of Purchase Contracts by a Holder of the related Securities, the
Pledged Preferred Securities or the appropriate Applicable Ownership Interest
(as specified in clause (A) of the definition of such term) 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
number of shares of Common Stock on account of each Purchase Contract forming
part of a Corporate PIES as to which Early Settlement is effected equal to the
Early Settlement Rate. The Early Settlement Rate shall initially be equal to
1.6103 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 Corporate PIES Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee, except as may be required by the Agent pursuant to the
Purchase Contract Agreement), under the terms of the Purchase Contract Agreement
and the Purchase Contracts evidenced hereby and the transferor shall be released
from the obligations under the Purchase Contracts evidenced by this Corporate
PIES 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 Corporate PIES Certificate, by its acceptance hereof,
authorizes the Agent to enter into and perform the related Purchase Contracts
forming part of the Corporate PIES evidenced hereby on its 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
his obligations under such Purchase Contracts, consents to the provisions of the
Purchase Contract Agreement, authorizes the Agent to enter into and perform the
Purchase Contract Agreement and the Pledge Agreement on its behalf as its
attorney-in-fact, and consents to the Pledge of the Preferred Securities 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,
underlying this Corporate PIES Certificate pursuant to the Pledge Agreement. The
Holder further covenants and agrees that, to the extent and in the manner
provided in the Purchase Contract Agreement and the Pledge Agreement, but
subject to the terms thereof, payments in respect to the aggregate liquidation
amount of the Pledged Preferred Securities 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 payments.
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.
A-10
The Purchase Contracts shall for all purposes be governed by, and
construed in accordance with, the laws of the State of New York.
The Company, the Agent and its Affiliates and any agent of the Company or
the Agent may treat the Person in whose name this Corporate PIES Certificate is
registered as the owner of the Corporate PIES evidenced hereby for the purpose
of receiving payments of distributions payable quarterly on the Preferred
Securities, receiving payments of 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-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 of ______________
___________________________________________________
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 Treasury PIES Certificates and all rights thereunder, hereby
irrevocably constituting and appointing ________________________________________
attorney to transfer said Treasury PIES Certificates on the books of [Name of
Company] with full power of substitution in the premises.
Dated:
--------------------- ------------------------------------------------
Signature
NOTICE: The signature to this assignment must
correspond with the name as it appears upon
the face of the within Corporate PIES
Certificates in every particular, without
alteration or enlargement or any change
whatsoever.
Signature Guarantee:
---------------------------------------
A-12
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 Corporate PIES evidenced
by this Corporate PIES Certificate be registered in the name of, and delivered,
together with a check in payment for any fractional share, to the undersigned at
the address indicated below unless a different name and address have been
indicated below. If shares are to be registered in the name of a Person other
than the undersigned, the undersigned will pay any transfer tax payable incident
thereto.
Dated:
------------------------- ----------------------------------------
Signature
Signature Guarantee:
--------------------
(if assigned to another person)
If shares are to be registered
in the name of and delivered to a REGISTERED HOLDER
Person other than the Holder,
please (i) print such Person's name
and address 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-13
ELECTION TO SETTLE EARLY
The undersigned Holder of this Corporate PIES 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 Corporate PIES evidenced by this Corporate
PIES Certificate specified below. 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 Corporate PIES Certificate representing any
Corporate PIES 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
Preferred Securities 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:
---------------------------------------
A-14
Number of Securities evidenced hereby as to which Early Settlement of the
related Purchase Contracts is being elected:
If shares of Common Stock or REGISTERED HOLDER
Corporate PIES Certificates are to
be registered in the name of and
delivered to and Pledged Preferred
Securities, or the Applicable
Ownership Interest of the Treasury
Portfolio, as the case may be, are
to be transferred to a Person other
than the Holder, please print such
Person's name and address:
Please print name and address of
Registered Holder:
------------------------------------- ----------------------------------------
Name Name
------------------------------------- ----------------------------------------
Address Address
------------------------------------- ----------------------------------------
------------------------------------- ----------------------------------------
------------------------------------- ----------------------------------------
Social Security or other
Taxpayer Identification ----------------------------------------
Number, if any
A-15
Transfer Instructions for Pledged Preferred Securities or the Applicable
Ownership Interest of the Treasury Portfolio, as the case may be, Transferable
Upon Early Settlement or a Termination Event:
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A-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:
================================================================================
Number of
Amount of Amount of PIES
decrease in increase in evidenced by
Number of Number of this Signature of
PIES PIES Global authorized
evidenced by evidenced by Certificate officer of
the the following such Trustee or
Global Global decrease or Securities
Date Certificate Certificate increase Custodian
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A-17
EXHIBIT B
FACE OF TREASURY PIES CERTIFICATE
"THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN THE
NAME OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE "DEPOSITARY"),
OR A NOMINEE OF THE DEPOSITARY. THIS CERTIFICATE IS EXCHANGEABLE FOR
CERTIFICATES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS
NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT
AGREEMENT AND NO TRANSFER OF THIS CERTIFICATE (OTHER THAN A TRANSFER OF THIS
CERTIFICATE AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A
NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY) MAY BE REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITARY 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 DEPOSITARY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN."
No. _____ Cusip No. ________
Number of Treasury PIES _________
NIPSCO INDUSTRIES, INC.
NIPSCO CAPITAL TRUST I
Treasury PIES
This Treasury PIES Certificate certifies that Cede & Co. is the registered
Holder of the number of Treasury PIES set forth above. Each Treasury PIES
consists of (i) a 1/20 undivided beneficial ownership interest of 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 NIPSCO Industries, Inc., an Indiana corporation (the "Company").
All capitalized terms used herein which are defined in the Purchase Contract
Agreement (as defined on the reverse hereof) have the meaning set forth therein.
Pursuant to the Pledge Agreement, the Treasury Securities constituting
part of each Treasury PIES 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 Treasury PIES.
Each Purchase Contract evidenced hereby obligates the Holder of this
Treasury PIES Certificate to purchase, and the Company, to sell, on February 19,
2003 (the "Purchase Contract Settlement Date"), at a price equal to $50 (the
"Stated Amount"), a number of Common Shares, without 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 Treasury PIES of which such Purchase
Contract is a part, all as provided in the Purchase Contract Agreement and more
fully described on the reverse hereof. The purchase price for the shares of
Common Stock purchased pursuant to each Purchase Contract evidenced hereby, if
not paid earlier, shall be paid on the 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 evidenced hereby an amount (the "Contract Adjustment Payments") equal
to (a) if a Reset Transaction has not occurred, 1.85% per annum of the Stated
Amount or (b) following the occurrence of a Reset Transaction, the Adjusted
Contract Adjustment Payment Rate related to such Reset Transaction until any
such succeeding Reset Transaction shall occur (computed on the basis of (i) for
any full quarterly period, a 360-day year of twelve 30-day months and (ii) for
any period shorter than a full quarterly period, a 30-day month and for periods
less than a month, the actual number of days elapsed per 30-day period), as the
case may be. Such Contract Adjustment Payments shall be payable to the Person in
whose name this Treasury PIES Certificate (or a Predecessor Treasury PIES
Certificate) is registered at the close of business on the Record Date for such
Payment Date.
Contract Adjustment Payments will be payable at the office of the Agent in
The City of New York or, at the option of the Company, by check mailed to the
address of the Person entitled thereto as such address appears on the Treasury
PIES Register.
Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Agent by manual signature, this Treasury PIES 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-2
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
NIPSCO INDUSTRIES, INC.
By:
------------------------------------
Name:
Title:
By:
------------------------------------
Name:
Title:
HOLDER SPECIFIED ABOVE (as to
obligations of such Holder under the
Purchase Contracts)
By: THE CHASE MANHATTAN BANK, not
individually but solely as
Attorney-in-Fact of such Holder
By:
------------------------------------
Name:
Title:
Dated:
B-3
AGENT'S CERTIFICATE OF AUTHENTICATION
This is one of the Treasury PIES referred to in the within-mentioned
Purchase Contract Agreement.
By: THE CHASE MANHATTAN BANK, as
Purchase Contract Agent
By:
------------------------------------
Authorized Officer
B-4
(REVERSE OF TREASURY PIES CERTIFICATE)
Each Purchase Contract evidenced hereby is governed by a Purchase Contract
Agreement, dated as of February 16, 1999 (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 Treasury PIES Certificates are, and are to be, executed and delivered.
Each Purchase Contract evidenced hereby obligates the Holder of this
Treasury PIES Certificate 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 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 with respect to the Security of
which such Purchase Contract is a part or an Early Settlement shall have
occurred. The "Settlement Rate" is equal to (a) if the Applicable Market Value
(as defined below) is equal to or greater than $31.0500 (the "Threshold
Appreciation Price"), 1.6103 shares of Common Stock per Purchase Contract, (b)
if the Applicable Market Value is less than the Threshold Appreciation Price but
is greater than $26.3125, 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 Amount is less than or equal to $26.3125, then
1.9002 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
Treasury PIES to purchase at the Purchase Price for cash, 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 Prices per
share of Common Stock on each of the 20 Trading Days ending on the third Trading
Day immediately preceding the Purchase Contract Settlement Date or any
applicable Early Settlement Date. The "Closing Price" of the Common Stock on any
date of determination means the (i) 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, (ii) if the Common Stock is not listed
for trading on the NYSE on any such date, the closing sale price as reported in
the composite transactions for the principal United States securities exchange
on which the Common Stock is so listed, (iii) if the Common Stock is not so
listed on a United States national or regional securities exchange, the closing
sale price as reported by The Nasdaq Stock Market, (iv) if the Common Stock is
not so reported, the last quoted bid price for the Common Stock in the
over-the-counter market as reported by the National Quotation Bureau or similar
organization, or (v) if such bid price is not available, the average of the
mid-point of the last bid and ask prices of the Common Stock on such date from
at least three nationally recognized independent
B-5
investment banking firms 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 Treasury PIES shall pay the Purchase Price for the shares of
Common Stock purchased pursuant to each Purchase Contract evidenced hereby
either by effecting a Cash Settlement or an Early Settlement of each such
Purchase Contract or by applying a principal amount of the Pledged Treasury
Securities underlying such Holder's Treasury PIES equal to the Stated Amount of
such Purchase Contract to the purchase of the Common Stock. A Holder of Treasury
PIES who does not effect, on or prior to 11:00 a.m. New York City time on the
Business Day immediately preceding the Purchase Contract Settlement Date, an
effective Cash Settlement or an Early Settlement, shall pay the Purchase Price
for the shares of Common Stock to be issued under the related Purchase Contract
from the proceeds of the Pledged Treasury Securities.
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 of the aggregate purchase price for
the shares of Common Stock to be purchased thereunder in the manner herein set
forth.
Each Purchase Contract evidenced hereby and all obligations and rights of
the Company and the Holder thereunder shall terminate if a Termination Event
shall occur. Upon the occurrence of a Termination Event, the Company shall give
written notice to the Agent and to the Holders, at their addresses as they
appear in the Treasury PIES Register. Upon and after the occurrence of a
Termination Event, the Collateral Agent shall release the Pledged Treasury
Securities (as defined in the Pledge Agreement) forming a part of each Treasury
PIES. A Treasury PIES shall thereafter represent the right to receive the
interest in the Treasury Security forming a part of such Treasury PIES, in
accordance with the terms of the Purchase Contract Agreement and the Pledge
Agreement.
The Treasury PIES Certificates are issuable only in registered form and
only in denominations of a single Treasury PIES and any integral multiple
thereof. The transfer of any Treasury PIES Certificate will be registered and
Treasury PIES Certificates may be exchanged as provided in the Purchase Contract
Agreement. The Treasury PIES 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 Preferred
Securities, Debentures or the appropriate Applicable Ownership Interest of the
Treasury Portfolio, as the case may be, for Treasury Securities, thereby
recreating Corporate PIES, shall be responsible for any fees or expenses
associated therewith. Except as provided in the Purchase Contract Agreement, for
so long as the Purchase Contract underlying a Treasury PIES remains in effect,
such Treasury PIES shall not be separable into its constituent parts, and the
rights and obligations of the Holder of such Treasury PIES in respect of
B-6
the Treasury Security and the Purchase Contract constituting such Treasury PIES
may be transferred and exchanged only as a Treasury PIES. A Holder of Treasury
PIES may recreate Corporate PIES by delivering to the Collateral Agent Preferred
Securities or the appropriate Applicable Ownership Interest (as specified in
clause (A) of the definition of such term) of the Treasury Portfolio, with a
liquidation amount, in the case of such Preferred Securities, with a principal
amount in the case of such Debentures, 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 (as specified in clause (A) of the definition of such term) of the
Treasury Portfolio, equal to the aggregate principal amount at maturity 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 Holder's Security
shall be referred to as an "Corporate PIES." Such substitution may cause the
equivalent aggregate principal amount of this Certificate to be increased or
decreased; provided, however, this Treasury PIES Certificate shall not represent
more than ____ Treasury PIES. All such adjustments to the equivalent aggregate
principal amount of this Treasury PIES Certificate shall be duly recorded by
placing an appropriate notation on the Schedule attached hereto.
A Holder of a Corporate PIES may recreate a Treasury PIES by delivering to
the Collateral Agent Treasury Securities in an aggregate principal amount equal
to the aggregate liquidation amount of the Pledged Preferred Securities, the
aggregate principal amount at maturity of the Pledged Debentures 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 Preferred Securities, Pledged
Debentures 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 accordance with the terms of the Purchase Contract Agreement and
the Pledge Agreement. Any such recreation of a Treasury PIES may be effected
only in multiples of 20 Corporate PIES for 20 Treasury PIES; provided, however,
if a Tax Event Redemption has occurred and the Treasury Portfolio has become a
component of the Corporate PIES, a Holder may recreate Corporate PIES in
integral multiples of 160,000 Corporate PIES for 160,000 Treasury PIES.
The Company shall pay, on each Payment Date, the Contact Adjustment
Payments payable in respect of each Purchase Contract to the Person in whose
name the Treasury PIES Certificate evidencing such Purchase Contract is
registered at the close of business on the Record Date for such Payment Date.
Contract Adjustment Payments will be payable at the office of the Agent in The
City of New York or, at the option of the Company, by check mailed to the
address of the Person entitled thereto at such address as it appears on the
Treasury PIES Register.
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, 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
B-7
Agent and the Holders, at their addresses as they appear in the Treasury PIES
Register. Upon 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 Holder thereof, Purchase Contracts
underlying Securities 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 Treasury
PIES the Holder of this Treasury PIES Certificate shall deliver this Treasury
PIES Certificate to the Agent at the Corporate Trust Office duly endorsed for
transfer to the Company or in blank with the form of Election to Settle Early
set forth below duly completed and accompanied by payment in the form of
immediately available funds payable to the order of the Company in an amount
(the "Early Settlement Amount") equal to (i) the product of (A) $50 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 for any Payment Date to the opening of business on such Payment Date, an
amount equal to the Contract Adjustment Payments payable, if any, on such
Payment Date with respect to such Purchase Contracts. 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 Treasury PIES as to which Early Settlement is effected equal to 1.6103
shares of Common Stock per Purchase Contract (the "Early Settlement Rate"). The
Early Settlement Rate shall be adjusted in the same manner and at the same time
as the Settlement Rate is adjusted as provided in the Purchase Contract
Agreement.
Upon registration of transfer of this Treasury PIES Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee, except as may be required by the Agent pursuant to the
Purchase Contract Agreement), under the terms of the Purchase Contract Agreement
and the Purchase Contracts evidenced hereby and the transferor shall be released
from the obligations under the Purchase Contracts evidenced by this Treasury
PIES 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 Treasury PIES Certificate, by its acceptance hereof,
authorizes the Agent to enter into and perform the related Purchase Contracts
forming part of the Treasury PIES evidenced hereby on its 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
Purchase Contract Agreement and the Pledge Agreement on its behalf as its
attorney-in-fact, and consents to the Pledge of the Treasury Securities
underlying this Treasury PIES Certificate pursuant to the Pledge Agreement. The
Holder further covenants and agrees, that, to the extent and in the manner
provided in the Purchase Contract
B-8
Agreement and the Pledge Agreement, but subject to the terms thereof, payments
in respect to the aggregate principal amount 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
payments.
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.
The Purchase Contracts shall for all purposes be governed by, and
construed in accordance with, the laws of the State of New York.
The Company, the Agent and its Affiliates and any agent of the Company or
the Agent may treat the Person in whose name this Treasury PIES Certificate is
registered as the owner of the Treasury PIES evidenced hereby for the purpose of
receiving payments of interest on the Treasury Securities, receiving payments of
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-9
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
UNIF GIFT MIN ACT - ---------------Custodian---------------
(cust) (minor)
Under Uniform Gifts to Minors Act of ______________
___________________________________________________
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 Treasury PIES Certificates and all rights thereunder, hereby
irrevocably constituting and appointing ________________________________________
attorney to transfer said Treasury PIES Certificates on the books of [Name of
Company] with full power of substitution in the premises.
Dated:
--------------------- ------------------------------------------------
Signature
NOTICE: The signature to this assignment must
correspond with the name as it appears upon
the face of the within Treasury PIES
Certificates in every particular, without
alteration or enlargement or any change
whatsoever.
Signature Guarantee:
---------------------------------------
B-10
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 Treasury PIES evidenced
by this Treasury PIES Certificate be registered in the name of, and delivered,
together with a check in payment for any fractional share, to the undersigned at
the address indicated below unless a different name and address have been
indicated below. If shares are to be registered in the name of a Person other
than the undersigned, the undersigned will pay any transfer tax payable incident
thereto.
Dated:
------------------------- ----------------------------------------
Signature
Signature Guarantee:
--------------------
(if assigned to another person)
If shares are to be registered
in the name of and delivered to a REGISTERED HOLDER
Person other than the Holder,
please (i) print such Person's name
and address 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
B-11
ELECTION TO SETTLE EARLY
The undersigned Holder of this Treasury PIES Certificate 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 Treasury PIES evidenced by this Treasury PIES
Certificate specified below. The option to effect Early Settlement may be
exercised only with respect to Purchase Contracts underlying Treasury PIES 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
Treasury PIES Certificate representing any Treasury PIES 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 tax
payable incident thereto.
Dated:
--------------------- ------------------------------------------------
Signature
Signature Guarantee:
---------------------------------------
B-12
Number of Securities evidenced hereby as to which Early Settlement of the
related Purchase Contracts is being elected:
If shares of Common Stock or REGISTERED HOLDER
Treasury PIES 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 print such Person's name
and address:
Please print name and address of
Registered Holder:
------------------------------------- ----------------------------------------
Name Name
------------------------------------- ----------------------------------------
Address Address
------------------------------------- ----------------------------------------
------------------------------------- ----------------------------------------
------------------------------------- ----------------------------------------
Social Security or other
Taxpayer Identification ----------------------------------------
Number, if any
Transfer Instructions for Pledged Treasury Securities Transferable Upon Early
Settlement or a Termination Event:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
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B-13
[TO BE ATTACHED TO GLOBAL CERTIFICATES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The following increases or decreases in this Global Certificate have been made:
================================================================================
Number of
Amount of Amount of PIES
decrease in increase in evidenced by
Number of Number of this Signature of
PIES PIES Global authorized
evidenced by evidenced by Certificate officer of
the the following such Trustee or
Global Global decrease or Securities
Date Certificate Certificate increase Custodian
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EXHIBIT C
INSTRUCTION TO PURCHASE CONTRACT AGENT
THE CHASE MANHATTAN BANK
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Group
Re: ________ PIES of NIPSCO Industries, Inc. (the
"Company") and NIPSCO Capital Trust I
The undersigned Holder hereby notifies you that it has delivered to The
First National Bank of Chicago, as Securities Intermediary, for credit to the
Collateral Account, $______ aggregate [principal] [liquidation] amount of
[Preferred Securities, Debentures 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,] [Treasury Securities] in exchange for
the [Pledged Preferred Securities, Pledged Debentures 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 Treasury
Securities] held in the Collateral Account, in accordance with the Pledge
Agreement, dated as of February 16, 1999 (the "Pledge Agreement"; unless
otherwise defined herein, terms defined in the Pledge Agreement are used herein
as defined therein), between you, the Company, the Collateral Agent and the
Securities Intermediary. The undersigned Holder has paid 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 Preferred Securities, Pledged Debentures 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 Treasury
Securities] related to such [Corporate PIES] [Treasury PIES].
Date:
--------------------- ------------------------------------------------
Signature
Signature Guarantee:
-------------------
Please print name and address of Registered Holder:
------------------------------------ ------------------------------------
Name Social Security or other Taxpayer
Identification Number, if any
Address
------------------------------------
------------------------------------
------------------------------------
C-2
EXHIBIT D
NOTICE FROM PURCHASE CONTRACT AGENT
TO HOLDERS
(Transfer of Collateral upon Occurrence of a Termination Event)
[HOLDER]
---------------------------
---------------------------
Attention:
Telecopy:
------------
Re: PIES of NIPSCO Industries, Inc. (the
"Company") and NIPSCO Capital Trust I
Please refer to the Purchase Contract Agreement, dated as of February 16,
1999 (the "Purchase Contract Agreement"; unless otherwise defined herein, terms
defined in the Purchase Contract Agreement are used herein as defined therein),
among the Company and the undersigned, as Purchase Contract Agent and as
attorney-in-fact for the holders of PIES from time to time.
We hereby notify you that a Termination Event has occurred and that [the
Preferred Securities] [the Debentures] [the appropriate Applicable Ownership
Interest (as specified in clause (A) of the definition of such term) of the
Treasury Portfolio] [the Treasury Securities] underlying your ownership interest
in _____ [Corporate PIES] [Treasury PIES] have been released and are being held
by us for your account pending receipt of transfer instructions with respect to
such [Preferred Securities] [Debentures] [appropriate Applicable Ownership
Interest (as specified in clause (A) of the definition of such term) of the
Treasury Portfolio] [Treasury Securities] (the "Released Securities").
Pursuant to Section 3.15 of the Purchase Contract Agreement, we hereby
request written transfer instructions with respect to the Released Securities.
Upon receipt of your instructions and upon transfer to us of your [Corporate
PIES] [Treasury PIES] effected through book-entry or by delivery to us of your
[Corporate PIES Certificate] [Treasury PIES Certificate], we shall transfer the
Released Securities by book-entry transfer, or other appropriate procedures, in
accordance with your instructions. In the event you fail to effect such transfer
or delivery, the Released Securities and any distributions thereon, shall be
held in our name, or a nominee in trust for your benefit, until such time as
such [Corporate PIES] [Treasury PIES] are transferred or your [Corporate PIES
Certificate] [Treasury PIES Certificate] is surrendered or satisfactory evidence
is provided that such your [Corporate PIES Certificate] [Treasury PIES
Certificate] has been destroyed, lost or stolen, together with any
indemnification that we or the Company may require.
D-1
Date: By: THE CHASE MANHATTAN BANK
----------------------
----------------------------------------
Name:
Title:
D-2
EXHIBIT E
NOTICE TO SETTLE BY SEPARATE CASH
THE CHASE MANHATTAN BANK
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, X.X. 00000
Attention: Corporate Trust Group
Re: ________ PIES of NIPSCO Industries, Inc. (the
"Company") and NIPSCO Capital Trust I
The undersigned Holder hereby irrevocably notifies you in accordance with
Section 5.4 of the Purchase Contract Agreement, dated as of February 16, 1999
(the "Purchase Contract Agreement"; unless otherwise defined herein, terms
defined in the Purchase Contract Agreement are used herein as defined therein),
between 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 Securities Intermediary for deposit in the Collateral
Account, on or prior to 11:00 a.m. New York City time, on the [fifth Business
Day] [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 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 [Corporate PIES] [Treasury PIES].
Date:
--------------------- ------------------------------------------------
Signature
Signature Guarantee:
-------------------
Please print name and address of Registered Holder:
EXHIBIT F
NOTICE FROM PURCHASE CONTRACT AGENT
TO COLLATERAL AGENT AND INDENTURE TRUSTEE
(Payment of Purchase Contract Settlement Price)
The First National Bank of Chicago
0 Xxxxx Xxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Corporate Trust Administration Department
Telecopy: 000-000-0000
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Corporate Trust Group
Telecopy: 000-000-0000
Re: PIES of NIPSCO Industries, Inc. (the
"Company") and NIPSCO Capital Trust I
Please refer to the Purchase Contract Agreement dated as of February 16,
1999 (the "Purchase Contract Agreement"; unless otherwise defined herein, terms
defined in the Purchase Contract Agreement are used herein as defined therein),
between the Company and the undersigned, as Purchase Contract Agent and as
attorney-in-fact for the holders of PIES from time to time.
In accordance with Section 5.4 of the Purchase Contract Agreement and,
based on instructions and Cash Settlements received from Holders of Corporate
PIES as of 11:00 a.m, [DATE (fifth Business Day immediately preceding the
Purchase Contract Settlement Date)], we hereby notify you that [_____ Preferred
Securities][____ Debentures] are to be tendered for purchase in the Remarketing.
Date: By: THE CHASE MANHATTAN BANK
--------------------
--------------------------------
Name:
Title:
F-1
