EXHIBIT 4
FORM OF NOTE
THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE HEREINAFTER
REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A NOMINEE
THEREOF. UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN
CERTIFICATED FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE
DEPOSITORY TRUST COMPANY (THE "DEPOSITORY") TO A NOMINEE OF THE DEPOSITORY OR
BY THE DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE
OF SUCH SUCCESSOR DEPOSITORY. UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY, TO THE COMPANY OR ITS AGENT FOR REGISTRATION
OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE
& CO., HAS AN INTEREST HEREIN.
REGISTERED CUSIP No.: 00000X000 PRINCIPAL AMOUNT
No. 1 $110,000,000
XXXXXXX XXXXX & CO., INC.
MEDIUM-TERM NOTE, SERIES C
100% Minimum Return Protected Bear USDX(R) Notes, due June 17, 2008
(the "Notes")
XXXXXXX XXXXX & CO., INC., a Delaware corporation (hereinafter
referred to as the "Company," which term includes any successor corporation
under the Indenture hereinafter referred to), for value received, hereby
promises to pay to CEDE & CO., or registered assigns, the principal amount of
the Notes plus a Supplemental Redemption Amount (as defined below) or a
payment of interest on June 17, 2008 (the "Stated Maturity Date") and to pay
interest on the principal amount hereof, in accordance with the terms below,
in such coin or currency of the United States of America as at the time of
payment is legal tender for public and private debts.
Payment on the Stated Maturity Date
On the Stated Maturity Date, a Holder shall receive the Principal
Amount plus either a Supplemental Redemption Amount or a payment of interest.
If the Ending Value (as defined below) is less than the Starting Value (as
defined below), a Holder will receive the Principal Amount plus the
Supplemental Redemption Amount, calculated as described below. If the Ending
Value equals or exceeds the Starting Value, a Holder shall receive the
Principal Amount plus an interest payment equal to 2.85% of the Principal
Amount, as described below.
As used herein, the "Calculation Agent" is Xxxxxxx Xxxxx Capital
Services, Inc. All determinations made by the Calculation Agent, absent a
manifest error, shall be conclusive for all purposes and binding on the
Company and the Holders and beneficial owners of this Note.
Supplemental Redemption Amount
The "Supplemental Redemption Amount" shall be determined by the
Calculation Agent and shall equal:
( Starting Value - Ending Value )
Principal Amount x ( ----------------------------- )
( Starting Value )
provided, however, that in no event shall the Supplemental Redemption Amount
be less than zero.
The "Starting Value" equals 85.15.
The "Ending Value" shall be determined by the Calculation Agent and
will equal the level of the U.S. Dollar Index (the "Index") at approximately
10 a.m. EST on the Valuation Date, as determined by the Calculation Agent.
The "Valuation Date" shall be the seventh scheduled Index Business
Day (as defined below) prior to the Stated Maturity Date of the Notes or, if
such day is not an Index Business Day, the next succeeding Index Business Day;
provided, however, that if an Index Business Day does not occur by the third
succeeding scheduled Index Business Day, the Calculation Agent shall determine
the Ending Value on that date in a manner that, in its judgment, is reasonable
under the circumstances.
An "Index Business Day" means a day on which the New York Stock
Exchange (the "NYSE"), the American Stock Exchange (the "AMEX") and The Nasdaq
Stock Market (the "Nasdaq") are open for trading and the Index or any
successor index is calculated and published (as of approximately 10 a.m. EST).
Interest
If the level of the Index is equal to or above the Starting Value on
June 8, 2007, the first anniversary of the issuance of the Notes (the
"Observation Date"), a Holder shall receive an interest payment on June 19,
2007, the seventh Index Business Day after the scheduled Observation Date
equal to 2.85% of the Principal Amount; provided, however, that if such
anniversary day is not an Index Business Day, then the Observation Date shall
be the next succeeding Index Business Day; and provided further, however that
if an Index Business Day has not occurred by the third succeeding scheduled
Index Business Day, then such date shall be the Observation Date and the
Calculation Agent shall determine the level of the Index on that date in a
manner that, in its judgment, is reasonable under the circumstances.
Interest shall be paid on each interest payment date to the persons
in whose names the Notes are registered at the close of business on the
scheduled Observation Date or Valuation Date preceding the relevant interest
payment date, whether or not it is a Business Day.
2
A "Business Day" means any day other than a Saturday or Sunday that
is neither a legal holiday nor a day on which banking institutions in the City
of New York are authorized or required by law, regulation or executive order
to close and those banks are open for dealing in a foreign exchange and
foreign currency deposits.
Payment of the Supplemental Redemption Amount and interest in respect
of this Note due on the Stated Maturity Date, as the case may be, will be made
in immediately available funds upon presentation and surrender of this Note at
the office or agency maintained by the Company for that purpose in the Borough
of Manhattan, The City of New York. Payment of interest due on any Interest
Payment Date other than the Stated Maturity Date will be made at the
aforementioned office or agency maintained by the Company or, at the option of
the Company, by check mailed to the address of the person entitled thereto as
such address shall appear in the Security Register maintained by the Trustee
on the Record Date; provided, however, that a Holder of U.S.$10,000,000 or
more in aggregate principal amount of Notes (whether having identical or
different terms and provisions) will be entitled to receive interest payments
on such Interest Payment Date by wire transfer of immediately available funds
if such Holder has delivered appropriate wire transfer instructions in writing
to the Trustee not less than 15 calendar days prior to such Interest Payment
Date. Any such wire transfer instructions received by the Trustee shall remain
in effect until revoked by such Xxxxxx.
If any Interest Payment Date or the Stated Maturity Date of this Note
falls on a day that is not a Business Day, the required payment of the
principal, Supplemental Redemption Amount and/or interest shall be made on the
next succeeding Business Day and no additional interest shall accrue as a
result of such delayed payment with respect to the payment for the period from
and after such Interest Payment Date or the Stated Maturity Date, as the case
may be, to the date of such payment on the next succeeding Business Day.
Adjustments to the Index
If at any time the New York Board of Trade (the "Index Publisher")
makes a material change in the formula for or the method of calculating the
Index or in any other way materially modifies the Index so that the Index does
not, in the opinion of the Calculation Agent, fairly represent the level of
the Index had those changes or modifications not been made, then, from and
after that time, the Calculation Agent shall, at the close of business in New
York, New York, on each date that the level of the Index is to be calculated,
make any adjustments as, in the good faith judgment of the Calculation Agent,
may be necessary in order to arrive at a calculation of a level of an index
comparable to the Index as if those changes or modifications had not been
made, and calculate the level with reference to the Index, as so adjusted.
Discontinuance of the Index
If the Index Publisher discontinues publication of the Index and
the Index Publisher or another entity publishes a successor or substitute
index that the Calculation Agent determines, in its sole discretion, to be
comparable to the Index (a "Successor Index"), then, upon the Calculation
Agent's notification of that determination to the Trustee and the Company, the
Calculation Agent shall substitute the Successor Index as calculated by the
Index Publisher or any other entity for the Index and calculate the value of
the Index as described above. Upon any selection by the Calculation Agent of a
successor index, the Company shall cause notice to be given to holders of the
Notes.
3
In the event that the Index Publisher discontinues publication of
the Index and:
o the Calculation Agent does not select a Successor Index; or
o the successor index is not published on the Observation Date
or the Valuation Date,
the Calculation Agent shall compute a substitute level for the
Index in accordance with the procedures last used to calculate the Index
before any discontinuance. If a Successor Index is selected or the Calculation
Agent calculates a level as a substitute for the Index as described below, the
Successor Index or level shall be used as a substitute for the Index for all
purposes. If the Calculation Agent calculates a level as a substitute for the
Index, the Index level shall be computed by the Calculation Agent using the
foreign exchange rates for each currency most recently included in the Index
based on the values displayed on Bloomberg page FXC at approximately 10:00
a.m. EST, on the relevant date. If this page is not available, then each
exchange rate shall be the rate the Calculation Agent, in its sole discretion,
determines to be fair and reasonable under the circumstances at approximately
10:00 a.m. EST, on the relevant date.
If the Index Publisher discontinues publication of the Index and
the Calculation Agent determines that no Successor Index is available at that
time, then on each Business Day (as defined below) until the earlier to occur
of:
o the determination of the Ending Value; and
o a determination by the Calculation Agent that a successor
index is available,
the Calculation Agent shall determine the value that would be used in
computing the Supplemental Redemption Amount as described in the preceding
paragraph as if that day were the Observation Date or the Valuation Date. The
Calculation Agent shall cause notice of each value to be published not less
often than once each month in The Wall Street Journal or another newspaper of
general circulation and arrange for information with respect to these values
to be made available by telephone.
General
All percentages resulting from any calculation on the Notes shall be
rounded to the nearest one hundred-thousandth of a percentage point, with five
one-millionths of a percentage point rounded upwards. For example, 9.876545%
(or .09876545) would be rounded to 9.87655% (or .0987655). All dollar amounts
used in or resulting from any calculation shall be rounded to the nearest cent
with one-half cent being rounded upward.
Unless the Certificate of Authentication hereon has been executed by
the Trustee by manual signature, this Note shall not be entitled to any
benefit under the Indenture or be valid or obligatory for any purpose.
This Note is one of a duly authorized issue of Securities
(hereinafter called the "Securities") of the Company designated as its
Medium-Term Notes, Series C. The Securities are issued and to be issued under
an indenture (the "Indenture") dated as of April 1, 1983, as amended and
restated, between the Company and JPMorgan Chase Bank, N.A. (herein called
4
the "Trustee", which term includes any successor Trustee under the Indenture),
to which Indenture and all indentures supplemental thereto reference is hereby
made for a statement of the respective rights, limitations of rights, duties and
immunities thereunder of the Company, the Trustee and the Holders of the Notes
and the terms upon which the Notes are to be authenticated and delivered.
The Notes are issuable only in registered form without coupons in
denominations of $10 and integral multiples thereof. As provided in the
Indenture and subject to certain limitations therein set forth, the Notes are
exchangeable for a like aggregate principal amount of Notes as requested by
the Holder surrendering the same. If (x) the Depository is at any time
unwilling or unable to continue as depository and a successor depository is
not appointed by the Company within 60 days, (y) the Company executes and
delivers to the Trustee a Company Order to the effect that this Note shall be
exchangeable or (z) an Event of Default has occurred and is continuing with
respect to the Notes, this Note shall be exchangeable for Notes in definitive
form of like tenor and of an equal aggregate principal amount, in authorized
denominations. Such definitive Notes shall be registered in such name or names
as the Depository shall instruct the Trustee. If definitive Notes are so
delivered, the Company may make such changes to the form of this Note as are
necessary or appropriate to allow for the issuance of such definitive Notes.
This Note is not subject to any sinking fund.
In case an Event of Default (as defined in the Indenture) with respect
to any Notes shall have occurred and be continuing, the amount payable to a
holder of a Note upon any acceleration permitted by the Notes, with respect to
each $10 original public offering price per unit, will be equal to the $10
original public offering price plus an amount calculated as though the date of
acceleration were the Valuation Date. If the level of the Ending Value
calculated as of the date of acceleration would be less than the Starting
Value, the amount so payable will equal the Supplemental Redemption Amount
calculated as described above. If the level of the Ending Value calculated as
of the date of acceleration will be equal to or greater than the Starting
Value, the amount so payable shall equal an interest payment calculated using
the interest rate applicable to the Notes calculated using the actual of days
from and including the issue date of the Notes or, if later, the 2007 interest
payment date, to but excluding the date of acceleration.
In case of default in payment of this Global Note, whether at the
Stated Maturity Date or upon acceleration, from and after such date this
Global Note shall bear interest, payable upon demand of the Holders thereof,
at the then current Federal Funds Rate (the "Default Rate") reset daily, to
the extent that such payment of interest shall be legally enforceable on the
unpaid amount due and payable on such date in accordance with the terms of
this Global Note to the date payment of such amount has been made or duly
provided for.
"Federal Funds Rate" means:
(1) the rate with respect to a particular interest determination date for
United States dollar federal funds as published in H.15(519) under the
caption "Federal Funds (Effective)" and displayed on Moneyline Telerate or
any successor service on page 120 or any other page as may replace page
120 on that service ("Moneyline Telerate Page 120"), or
(2) if the rate referred to in clause (1) does not appear on Moneyline
Telerate Page 120 or is not published by 3:00 P.M., New York City time, on
the related calculation date, the rate with respect to a particular
interest determination date for United States dollar federal
5
funds as published in H.15 Daily Update, or other recognized electronic
source used for the purpose of displaying the applicable rate, under the
caption "Federal Funds (Effective)", or
(3) if the rate referred to in clause (2) is not published by 3:00 P.M.,
New York City time, on the related calculation date, the rate with respect
to a particular interest determination date calculated by the Calculation
Agent as the arithmetic mean of the rates for the last transaction in
overnight United States dollar federal funds arranged by three leading
brokers of United States dollar federal funds transactions in The City of
New York, which may include the agent or its affiliates, selected by the
Calculation Agent prior to 9:00 A.M., New York City time, on the Business
Day following that interest determination date, or
(4) if the brokers selected by the Calculation Agent are not quoting as
mentioned in clause (3), the Federal Funds Rate for the Business Day
preceding the particular interest determination date.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with the
consent of the Holders of 66 2/3% in aggregate original public offering price or
principal amount, as the case may be, of the Securities at any time Outstanding
of each series affected thereby. Holders of specified percentages in aggregate
original public offering price or principal amount, as the case may be, of the
Securities of each series at the time Outstanding, on behalf of the Holders of
all the Securities of each series, to waive compliance by the Company with
certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Note shall be conclusive and binding upon such Holder and upon all future
Holders of this Note and of any Note issued upon the registration of transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
consent or waiver is made upon this Note.
No reference herein to the Indenture and no provision of this Note or of
the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the Principal Amount, Supplemental Redemption
Amount and interest on this Note at the time, place and rate, and in the coin or
currency, herein prescribed.
As provided in the Indenture and subject to certain limitations set forth
therein and herein, the transfer of this Note may be registered on the Security
Register of the Company, upon surrender of this Note for registration of
transfer at the office or agency of the Company in the Borough of Manhattan, The
City of New York, duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Company duly executed by, the Holder hereof
or by his attorney duly authorized in writing, and thereupon one or more new
Notes of authorized denominations and for the same aggregate principal amount,
shall be issued to the designated transferee or transferees.
No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Note for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this
6
Note is registered as the owner hereof for all purposes, whether or not this
Note be overdue, and neither the Company, the Trustee nor any such agent shall
be affected by notice to the contrary.
The Company and each Holder or beneficial owner by acceptance hereof
hereby agree to characterize and treat this Note for all tax purposes as a debt
instrument that is subject to U.S. Treasury Regulation section 1.1275-4(b)
governing contingent payment debt instruments, and, where required, the Company
shall file information returns with the Internal Revenue Service in accordance
with this characterization and tax treatment, in the absence of any change or
clarification in the law, by regulation or otherwise, requiring a different
characterization and tax treatment of the Notes.
The Indenture and the Notes shall be governed by and construed in
accordance with the laws of the State of New York.
All terms used in this Note which are defined in the Indenture but not in
this Note shall have the meanings assigned to them in the Indenture.
7
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed, manually or in facsimile, and an imprint or facsimile of its corporate
seal to be imprinted hereon.
Dated: June 8, 2006
XXXXXXX XXXXX & CO., INC.
By:____________________________
Xxxx Xxxxxxx
Assistant Treasurer
[FACSIMILE OF SEAL] Attest:
By:____________________________
Xxxxxx X. Xxxxxxxxxxxx
Secretary
CERTIFICATE OF AUTHENTICATION
This is one of the Securities
of the series designated
therein referred to in the
within-mentioned Indenture.
JPMORGAN CHASE BANK, N.A.,
as Trustee
By:_______________________
Authorized Officer
