EXHIBIT (k)(4)
FORM OF COLLATERAL AGREEMENT
Among
[ ]
As Pledgor,
THE BANK OF NEW YORK, As Collateral Agent
and
DECS TRUST IX
Dated as of
February 8, 2002
The following Table of Contents has been inserted for convenience of
reference only and does not constitute a part of the Collateral Agreement.
TABLE OF CONTENTS
SECTION
1. THE SECURITY INTERESTS.................................................1
2. DEFINITIONS............................................................2
3. REPRESENTATIONS AND WARRANTIES OF THE PLEDGOR..........................6
4. REPRESENTATIONS AND WARRANTIES OF THE COLLATERAL AGENT.................7
5. CERTAIN COVENANTS OF THE PLEDGOR.......................................8
6. ADMINISTRATION OF THE COLLATERAL AND VALUATION OF THE SECURITIES.......9
7. INCOME AND VOTING RIGHTS ON COLLATERAL................................14
8. REMEDIES UPON EVENTS OF DEFAULT.......................................15
9. THE COLLATERAL AGENT..................................................17
10. MISCELLANEOUS.........................................................20
11. TERMINATION OF COLLATERAL AGREEMENT...................................21
12. NO PERSONAL LIABILITY OF TRUSTEES.....................................21
Exhibit A - Certificate for Substituted Collateral
Exhibit B - Certificate for Additional Government Securities
Exhibit C - Certificate for Additional Collateral
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COLLATERAL AGREEMENT
THIS COLLATERAL AGREEMENT (the "AGREEMENT"), dated as of February 8,
2002, among [ ] an individual, (the "PLEDGOR"), The Bank of New York,
a New York banking corporation, as collateral agent (the "COLLATERAL AGENT")
hereunder for the benefit of DECS Trust IX, a statutory business trust organized
under the Business Trust Act of the State of Delaware (such trust and the
trustees thereof acting in their capacity as such being referred to herein as
the "TRUST"), and the Trust;
W I T N E S S E T H:
WHEREAS, pursuant to the Forward Purchase Agreement (the "FORWARD
PURCHASE AGREEMENT"), dated as of the date hereof, between Pledgor and the
Trust, the Pledgor has agreed to deliver and the Trust has agreed to acquire
XxXxxxxxx & Co. Inc. common stock, or the cash value thereof, $.01 par value, of
(the "COMPANY"), subject to the terms and conditions of the Forward Purchase
Agreement; and
NOW, THEREFORE, to secure the performance by the Pledgor of its
obligations the Seller under the Forward Purchase Agreement and to secure the
observance and performance of the covenants and agreements contained herein and
in the Forward Purchase Agreement, the parties hereto agree as follows:
1. The Security Interests.
In order to secure the observance and performance of the covenants,
agreements and obligations contained herein and in the Forward Purchase
Agreement:
(a) SECURITY INTERESTS. The Pledgor hereby grants and pledges unto
the Collateral Agent, as agent of and for the benefit of the Trust, a security
interest in and to, and a lien upon and right of set-off against, all of
Pledgor's right, title and interest in and to (i) the Pledged Items described in
paragraphs (b), (c) and (d); (ii) all additions to and substitutions for such
Pledged Items; (iii) (subject to the remittance of certain payments upon
satisfaction of the conditions specified in Section 7(a) hereof) all income,
proceeds and collections received or to be received, or derived or to be
derived, now or any time hereafter from or in connection with the Pledged Items
(whether such proceeds arise before or after the commencement of any proceeding
under any applicable bankruptcy, insolvency or other similar law, by or against
the Pledgor with respect to the Pledgor); and (iv) all powers and rights now
owned or hereafter acquired under or with respect to the Pledged Items (such
Pledged Items, additions, substitutions, income, proceeds, collections, powers
and rights being herein collectively called the "COLLATERAL"). The Collateral
Agent shall have all of the rights, remedies and recourses with respect to the
Collateral afforded a secured party by the New York Uniform Commercial Code, in
addition to, and not in limitation of, the other rights, remedies and recourses
afforded to the Collateral Agent by this Agreement.
(b) FIRM PAYMENT DATE. At the Firm Payment Date, the Pledgor shall
deliver to the Collateral Agent in pledge hereunder one or more certificates in
registered form representing in the aggregate [ ] shares of Common Stock,
indorsed in blank or in the name
of the Collateral Agent for the benefit of the Trust (together with all
signature guarantees and other documents necessary to permit the Collateral
Agent to effect the re-registration of such Common Stock without further action
by the Pledgor) or, if such Common Stock is not issuable in certificated form
but is held in book entry form by The Depository Trust Company, the Pledgor
shall transfer such number of shares of Common Stock to an account of the
Collateral Agent or to an account (other than an account of the Pledgor)
designated by the Collateral Agent with The Depository Trust Company.
(c) OPTION CLOSING DATE. Effective upon and subject to the receipt
by the Pledgor of the Additional Purchase Price, at the Option Closing Date, the
Pledgor shall deliver to the Collateral Agent in pledge hereunder one or more
certificates in registered form representing in the aggregate a number of shares
of Common Stock equal to the Additional Share Base Amount, indorsed in blank or
in the name of the Collateral Agent for the benefit of the Trust (together with
all signature guarantees and other documents necessary to permit the Collateral
Agent to effect the re-registration of such Common Stock without further action
by the Pledgor) or, if such Common Stock is not issuable in certificated form
but is held in book entry form by The Depository Trust Company, the Pledgor
shall transfer such number of shares of Common Stock to an account of the
Collateral Agent or to an account (other than an account of the Pledgor)
designated by the Collateral Agent with The Depository Trust Company.
(d) EXTENSION OF EXCHANGE DATE. Prior to, or simultaneously with an
election to extend the Exchange Date pursuant to Section 1.3(f) of the Forward
Purchase Agreement, the Pledgor shall deliver to the Collateral Agent in pledge
hereunder Additional Government Securities meeting the requirements of Section
1.3(f) of the Forward Purchase Agreement.
(e) REREGISTRATION. Immediately following the Firm Payment Date and
any Option Closing Date, the Collateral Agent shall cause all certificates for
Common Stock delivered pursuant to Section 1(b) or 1(c) above to be
re-registered on the books of the transfer agent for the Common Stock into the
name of the Collateral Agent or its nominee, and shall thereafter maintain them
in such form until the termination of this Collateral Agreement; PROVIDED,
HOWEVER, that at any time following the Firm Payment Date and any Option Closing
Date, the Collateral Agent may cause any such certificates for the Common Stock
to be deposited with The Depositary Trust Company and thereafter hold such
certificates in book entry form in an account (other than an account of the
Pledgor) designated by the Collateral Agent.
2. Definitions.
Capitalized terms used and not otherwise defined herein shall have
the meanings ascribed to them in the Forward Purchase Agreement. Capitalized
terms used herein shall have the meanings as follows:
"ADDITIONAL GOVERNMENT SECURITIES" means collateral that must be
pledged to the Collateral Agent in connection with the an election to extend the
Exchange Date and, consisting of U.S. Government Securities which through the
scheduled payment of principal and interest in accordance with their terms will
provide, not later than one Business Day before the extended Exchange Date,
money in an amount not less than the Extension Amount.
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"AUTHORIZED REPRESENTATIVE" of the Pledgor means any trustee,
officer or other representative as to whom Pledgor shall have delivered notice
to the Collateral Agent that such trustee or other representative is authorized
to act hereunder on behalf of Pledgor.
"BUSINESS DAY" means any day except a Saturday, Sunday or other day
on which banking institutions in New York City are authorized or obligated by
law or regulation to close or a day on which the New York Stock Exchange, Inc.
is closed.
"CASH DELIVERY OBLIGATIONS" means, at any time (A) if no Adjustment
Event shall have occurred prior to such time, zero, and (B) from and after the
occurrence of any Adjustment Event, (i) the Firm Share Base Amount PLUS the
Additional Share Base Amount (if any) MULTIPLIED BY (ii) the Transaction Value
of any property other than Reported Securities received by the Pledgor in such
Adjustment Event, multiplied successively by each number by which the Exchange
Rate shall have been multiplied on or prior to the Adjustment Event pursuant to
the adjustments provided for under Section 6.1 of the Forward Purchase
Agreement.
"COLLATERAL" has the meaning specified in Section 1(a).
"COLLATERAL AGENT" means the financial institution identified as
such in the preliminary paragraph hereof, or any successor appointed in
accordance with Section 9.
"COLLATERAL AGREEMENT" means this Collateral Agreement and any
exhibits hereto.
"COLLATERAL EVENT OF DEFAULT" has the meaning specified in Section
6(e).
"COLLATERAL REQUIREMENT" means, as of any date and with respect to:
(i) any Common Stock, 100%; (ii) any Reported Securities, 100%; (iii) any cash
or U.S. Government Securities pledged in respect of Cash Delivery Obligations,
105%; (iv) any other cash or U.S. Government Securities (other than Additional
Government Securities), 150%, provided that upon and after any failure to cure
an Insufficiency Determination by 4:00 p.m. New York City time on the Business
Day following telephonic notice of such Insufficiency Determination as described
in Section 6(e), which insufficiency shall be continuing on such Business Day,
the Collateral Requirement relating to any cash or U.S. Government Securities
(other than (i) Additional Government Securities and (ii) cash or U.S.
Government Securities pledged in respect of Cash Delivery Obligations) shall be
200%; and (v) any Additional Government Securities, 100%. The portion of any
pledged cash or U.S. Government Securities that shall be deemed at any time to
be in respect of Cash Delivery Obligations shall be as provided in Section 6(e).
"COMMON STOCK" has the meaning specified in the Forward Purchase
Agreement.
"DELIVERY DATE" has the meaning specified in Section 8(a).
"ELIGIBLE COLLATERAL" means (i) Common Stock, (ii) U.S. Government
Securities, (iii) cash, (iv) from and after an election to extend the Exchange
Date pursuant to Section 1.3(f) of the Forward Purchase Agreement, Additional
Government Securities, and (v) from and after any Adjustment Event, Reported
Securities, provided, in each case, that (A) the Pledgor has good and marketable
title thereto, free of all Liens (other than the Liens created by this
Collateral Agreement) and Transfer Restrictions except as contemplated by
Section 3(e) and (B) the
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Collateral Agent has a valid, first priority perfected security interest therein
and first lien thereon, and provided further that to the extent the number of
shares of Common Stock or Reported Securities pledged hereunder exceeds at any
time the Maximum Deliverable Number thereof, such excess shares shall not be
Eligible Collateral.
"EVENT OF DEFAULT" means the occurrence of: (i) an event described
in Article VII of the Forward Purchase Agreement, (ii) a Collateral Event of
Default, (iii) a failure by Pledgor to have caused the Collateral to meet the
requirements described in Section 5(d), (iv) if an Adjustment Event shall have
occurred prior to the Exchange Date, failure by Pledgor to cause to be delivered
to the Trust on the Exchange Date the consideration then required to be
delivered pursuant to Section 6.2 of the Forward Purchase Agreement or (v) if
the Cash Delivery Option shall have been exercised pursuant to Section 1.3(d) of
the Forward Purchase Agreement, a failure by the Pledgor to deliver cash on the
Exchange Date in the amount required under Section 1.3(d) of the Forward
Purchase Agreement.
"INELIGIBLE COLLATERAL" means Collateral that does not constitute
"Eligible Collateral".
"INSUFFICIENCY DETERMINATION" has the meaning specified in Section
6(e).
"LIEN" means any lien, mortgage, security interest, pledge, charge
or encumbrance of any kind.
"MARKET VALUE" means, as of any date: (a) with respect to any Common
Stock (except as otherwise provided in Section 6(e)(2)), the Closing Price of
the Common Stock on such date; (b) with respect to any U.S. Government Security,
(x)(i) the average unit bid price for such security on the Trading Day prior to
such date as published in the New York edition of The Wall Street Journal or The
New York Times or, if not so published, (ii) the lower bid price quoted (which
quotation shall be evidenced in writing) on such date (or if such date is not a
Trading Day, on the preceding Trading Day) by either of two nationally
recognized dealers making a market in such security which are members of the
National Association of Securities Dealers, Inc. MULTIPLIED BY (y) the number of
such units comprised in the outstanding principal amount of such U.S. Government
Security; and (c) with respect to any unit of Reported Securities, the Closing
Price thereof on such date; provided that the "Market Value" of any Ineligible
Collateral shall be zero.
"MAXIMUM DELIVERABLE NUMBER" means, on any date, with respect to the
Common Stock, the product of the Firm Share Base Amount PLUS the Additional
Share Base Amount (if any), multiplied successively by each number by Which the
Exchange Rate shall have been multiplied on or prior to such date pursuant to
the adjustments provided for under Article VI of the Forward Purchase Agreement.
The Maximum Deliverable Number of Reported Securities means, on any date, (i)
the Firm Share Base Amount plus the Additional Share Base Amount (if any)
MULTIPLIED BY (ii) the number of Reported Securities received by the Pledgor in
the Adjustment Event for each share of Common Stock, multiplied successively by
each number by which the Exchange Rate shall have been multiplied on or prior to
such date and after the date of such Adjustment Event pursuant to the
adjustments provided for under Article VI of the Forward Purchase Agreement.
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"PERSON" means an individual, a corporation, a partnership, an
association, a limited liability company, a trust or any other entity or
organization, including a government or political subdivision or an agency or
instrumentality thereof.
"PLEDGE VALUE" means, as of any date and with respect to any
particular type of Collateral, an amount equal to the aggregate Market Value of
such Collateral DIVIDED BY the Collateral Requirement for such Collateral.
"PLEDGE VALUE REQUIREMENT" means, as of any date, (a) the aggregate
Market Value on such date of the Maximum Deliverable Number of shares of Common
Stock or, from and after an Adjustment Event, Reported Securities, on such date
PLUS (b) from and after an Adjustment Event, the Cash Delivery Obligations PLUS
(c) from and after the extension of the Exchange Date pursuant to Section 1.3(f)
of the Forward Purchase Agreement, the aggregate Market Value on such date of
the Additional Government Securities.
"PLEDGED ITEMS" means, as of any date, any and all securities and
instruments delivered by the Pledgor to be held by the Collateral Agent under
this Collateral Agreement as Collateral, whether Eligible Collateral or
Ineligible Collateral.
"PRIOR COLLATERAL" has the meaning specified in Section 6(b)(1).
"RESPONSIBLE OFFICER" means, when used with respect to the
Collateral Agent, any vice president, assistant vice president, assistant
treasurer or assistant secretary located in the division or department of the
Collateral Agent responsible for performing the obligations of the Collateral
Agent under this Collateral Agreement, or in any other division or department of
the Collateral Agent performing operations substantially equivalent to those
performed by such division or department pursuant hereto, or any other officer
of the Collateral Agent or any successor Collateral Agent customarily performing
functions similar to those performed by any of the aforesaid officers, and also
means, with respect to any matter relating to this Collateral Agreement or the
Collateral, any other officer to whom such matter is referred because of his
knowledge of and familiarity with the particular subject.
"TRANSFER RESTRICTION" means, with respect to any item of
Collateral, any condition to or restriction on the ability of the holder thereof
to sell, assign or otherwise transfer such item of Collateral to the Trust or to
enforce the provisions thereof or of any document related thereto whether set
forth in such item of Collateral itself or in any document related thereto,
including, without limitation, (i) any requirement that any sale, assignment or
other transfer or enforcement of such item of Collateral be consented to or
approved by any Person, including, without limitation, the issuer thereof or any
other obligor thereon, (ii) any limitations on the type or status, financial or
otherwise, of any purchaser, pledgee, assignee or transferee of such item of
Collateral, (iii) any requirement of the delivery of any certificate, consent,
agreement, opinion of counsel, notice or any other document of any Person to the
issuer of, any other obligor on or any registrar or transfer agent for, such
item of Collateral, prior to the sale, pledge, assignment or other transfer or
enforcement of such item of Collateral and (iv) any registration or
qualification requirement for such item of Collateral pursuant to any federal or
state securities law; PROVIDED that the required delivery of any assignment from
the seller,
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pledgor, assignor or transferor of such item of Collateral, together with any
evidence of the corporate or other authority of such Person, shall not
constitute a "Transfer Restriction."
"TRUSTEE" or "TRUSTEES" means any trustee or trustees of the Trust
identified on the signature pages hereto, or any successor as such trustee or
trustees.
"UCC" means the Uniform Commercial Code as in effect in the State of
New York.
"U.S. GOVERNMENT SECURITIES" means direct obligations of the United
States of America that mature on a date that is one year or less from the date
such obligations are pledged hereunder, but in any event prior to the Exchange
Date (or the extended Exchange Date in the case of Additional Government
Securities pledged in connection with an extension of the Exchange Date pursuant
to Section 1.3(f) of the Forward Purchase Agreement).
3. Representations and Warranties of the Pledgor.
The Pledgor hereby represents and warrants to the Collateral Agent
and the Trust that:
(a) POWER. The Pledgor has full power and authority to execute
and deliver this Collateral Agreement and to perform and observe the
provisions hereof;
(b) NON-CONTRAVENTION. The execution, delivery and performance
by the Pledgor of this Collateral Agreement do not and will not violate,
contravene or constitute a default under any provision of applicable law
or regulation or of any material agreement, judgment, injunction, order,
decree or other instrument binding upon the Pledgor. The Pledgor is not in
default under any material agreement by which the Collateral may be bound
and no litigation, arbitration or administrative proceedings are current
or pending, which default, litigation, arbitration or administrative
proceedings are material to the Collateral in the context of this
Collateral Agreement.
(c) BINDING EFFECT. This Collateral Agreement constitutes a
valid and binding agreement of the Pledgor enforceable against the Pledgor
in accordance with its terms except as such enforceability may be limited
by applicable bankruptcy, insolvency and similar laws affecting creditors'
rights generally and by general equitable principles.
(d) SOLVENCY. The Pledgor is presently solvent and able to
pay, and paying its debts as they become due, and anticipates that it will
continue to be able to pay its debts as they become due for the
foreseeable future.
(e) NO TRANSFER RESTRICTIONS. Except for any legend with
respect to restrictions pursuant to applicable federal and state
securities laws on transfer of the Common Stock pledged by the Pledgor
hereunder which appears on the certificates representing such Common Stock
(and which (A) will not be applicable to the delivery of any such Common
Stock to the Trust pursuant to the Forward Purchase Agreement and this
Agreement or to the delivery of any such Common Stock by the Trust to the
holders of DECS pursuant to the DECS and (B) will be removed at the
request of the Collateral
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Agent to the transfer agent for the Common Stock prior to any such
delivery to the holders of DECS) and is delivered by the Collateral Agent
to the Trust on the Exchange Date or in connection with the occurrence of
an Event of Default), no Transfer Restrictions exist with respect to or
otherwise apply to the assignment of, or transfer by the Pledgor of
possession of, any items of Collateral to the Collateral Agent hereunder,
or the subsequent sale or transfer of such items of Collateral by the
Collateral Agent pursuant to the terms hereof.
(f) TITLE TO COLLATERAL; PERFECTED SECURITY INTEREST. The
Pledgor has good and marketable title to the Pledged Items, free of all
Liens (other than the Lien created by this Collateral Agreement) and
Transfer Restrictions (except for any restrictions as contemplated in
Section 3(e) hereof). Upon delivery or transfer of the Pledged Items as
described in paragraph (b), (c) and (d) of Section 1 to the Collateral
Agent hereunder, the Collateral Agent will obtain a valid and, to the
extent that perfection can be obtained under the UCC, first priority
perfected security interest in such Pledged Items subject to no other
Lien. None of the Collateral is or shall be pledged by the Pledgor as
collateral for any other purpose.
4. REPRESENTATIONS AND WARRANTIES OF THE COLLATERAL AGENT.
The Collateral Agent represents and warrants to the Pledgor and the
Trust that:
(a) CORPORATE EXISTENCE AND POWER. The Collateral Agent is a
banking corporation, duly incorporated, validly existing and in good
standing under the laws of the jurisdiction of its incorporation, and has
all corporate powers and all material governmental licenses,
authorizations, consents and approvals required to enter into, and perform
its obligations under, this Collateral Agreement.
(b) AUTHORIZATION AND NON-CONTRAVENTION. The execution,
delivery and performance by the Collateral Agent of this Collateral
Agreement have been duly authorized by all necessary corporate action on
the part of the Collateral Agent (no action by the shareholders of the
Collateral Agent being required) and do not and will not violate,
contravene or constitute a default under any provision of applicable law
or regulation or of the charter or by-laws of the Collateral Agent or of
any material agreement, judgment, injunction, order, decree or other
instrument binding upon the Collateral Agent.
(c) BINDING EFFECT. This Collateral Agreement constitutes a
valid and binding agreement of the Collateral Agent enforceable against
the Collateral Agent in accordance with its terms.
5. CERTAIN COVENANTS OF THE PLEDGOR.
The Pledgor agrees that, so long as any of its obligations under the
Forward Purchase Agreement remain outstanding:
(a) TITLE TO COLLATERAL. The Pledgor shall, subject to the
terms of this Agreement, at all times hereafter have good title to the
Collateral pledged hereunder, free
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of all Liens (other than the Liens created by this Collateral Agreement)
and Transfer Restrictions (except for those permitted by Section 3(e)
hereof), and, subject to the terms of this Collateral Agreement, will at
all times hereafter have good, right and lawful authority to assign,
transfer and pledge such Collateral and all such additions thereto and
substitutions therefor under this Collateral Agreement.
(b) PLEDGE VALUE REQUIREMENT. The Pledgor shall cause the
aggregate Pledge Value of the Collateral to be equal to or greater than
the Pledge Value Requirement at all times, and shall pledge additional
Collateral in the manner described in Section 6(d) as necessary to cause
such requirement to be met.
(c) PLEDGE UPON ADJUSTMENT EVENT. Upon the occurrence of an
Adjustment Event, the Pledgor shall immediately cause to be delivered to
the Collateral Agent, in the manner provided in Section 6(d): (i) U.S.
Government (other than cash) having an aggregate Market Value at least
equal to 105% of the Cash Delivery Obligations, if any, or at Pledgor's
election, U.S. dollars in an amount equal to at least 100% of the Cash
Delivery Obligations, if any; and (ii) Reported Securities in an amount at
least equal to the Maximum Deliverable Number thereof (if any), or, at
Pledgor's election, cash or U.S. Government Securities having an aggregate
Market Value at least equal to 150% of such Maximum Deliverable Number of
Reported Securities; in each case to be held as substitute or additional
Collateral hereunder.
(d) COMPOSITION OF PLEDGED ITEMS. Notwithstanding Pledgor's
right to substitute Collateral pursuant to Section 6(b), the Pledgor shall
cause the Collateral to include, on the Exchange Date, unless the Cash
Delivery Option shall have been exercised, a number of shares of Common
Stock (and/or, if an Adjustment Event shall have occurred, Reported
Securities) at least equal to the number of shares of Common Stock
(and/or, if an Adjustment Event shall have occurred, Reported Securities)
required to be delivered under the Forward Purchase Agreement on the
Exchange Date. If the Exchange Date shall have been extended pursuant to
Section 1.3(f) of the Forward Purchase Agreement, the Pledgor shall cause
Collateral for Pledgor's obligations to deliver the Extension Amount to
consist entirely of Additional Government Securities.
(e) FURTHER ASSURANCES. The Pledgor shall, at its expense and
in such manner and form as the Trust or the Collateral Agent may
reasonably require, give, execute, deliver, file and record any financing
statement, notice, instrument, document, agreement or other papers that
may be necessary in order to create, preserve, perfect, substantiate or
validate any security interest granted pursuant hereto or to enable the
Collateral Agent to exercise and enforce its rights and the rights of the
Trust hereunder with respect to such security interest. To the extent
permitted by applicable law, the Pledgor hereby authorizes the Collateral
Agent to execute and file, in the name of the Pledgor or otherwise,
Uniform Commercial Code financing or continuation statements (which may be
carbon, photographic, photostatic or other reproductions of this Agreement
or of a financing statement relating to this Agreement) which the
Collateral Agent may reasonably deem necessary or appropriate to further
perfect, or maintain the perfection of the security interests granted
hereby.
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(f) The Pledgor shall not consolidate with or merge with or
into, or transfer all or substantially of its assets to, any other Person
unless:
(i) either (x) the Pledgor shall be the resulting or surviving
entity or (y) such other Person is an entity organized and existing
under the laws of the United States, a State thereof or the District
of Columbia, such other Person expressly assumes by supplemental
agreement executed and delivered to the Trust, in form satisfactory
to counsel to the Trust, all the obligations of the Pledgor under
the Underwriting Agreement, Collateral Agreement, the Reimbursement
Agreement, and this Agreement (in which case all such obligations of
the Pledgor shall terminate); and
(ii) the Pledgor shall deliver to the Trust prior to the
proposed transaction an Officer's Certificate and an Opinion of
Counsel, each of which shall state that such consolidation, merger
or transfer and such supplemental agreement comply with this Section
5(f) and that all conditions precedent herein provided for relating
to such transaction have been complied with.
Upon any consolidation or merger, or any transfer of all or
substantially all of the assets of the Pledgor in accordance with this
Section 5(f), the successor entity formed by such consolidation or into
which the Pledgor is merged or to which such transfer is made shall
succeed to, and be substituted for, and may exercise every right and power
of the Pledgor under this Agreement with the same effect as if such
successor entity had been named as the Pledgor herein, and the predecessor
entity, shall be relieved of any further obligation under this Agreement.
6. ADMINISTRATION OF THE COLLATERAL AND VALUATION OF THE
SECURITIES.
(a) VALUATION OF COLLATERAL. The Collateral Agent shall determine on
each Business Day whether the Pledge Value is at least equal to the Pledge Value
Requirement and whether an Insufficiency Determination or Collateral Event of
Default shall have occurred and, from and after any substitution of cash or U.S.
Government Securities for pledged Common Stock or Reported Securities pursuant
to paragraph (b) of this Section 6, shall determine the Pledge Value on each
Business Day and shall provide written notice of the Pledge Value to the
Pledgor.
(b) SUBSTITUTION OF COLLATERAL. The Pledgor may substitute
Collateral in accordance with the following provisions:
(1) Unless an Event of Default or a failure by the Pledgor to
meet any of its obligations under Section 5(b) or (c) hereof has occurred
and is continuing, the Pledgor shall have the right at any time and from
time to time to deposit Eligible Collateral with the Collateral Agent in
substitution for Pledged Items previously deposited hereunder ("PRIOR
COLLATERAL") and to obtain the release from the Lien hereof of such Prior
Collateral.
(2) If the Pledgor wishes to deposit Eligible Collateral with
the Collateral Agent in substitution for Prior Collateral, the Pledgor
shall (i) give written
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notice to the Collateral Agent identifying the Prior Collateral to be
released from the Lien hereof, and (ii) deliver to the Collateral Agent
concurrently with such Eligible Collateral a certificate of the Pledgor
substantially in the form of Exhibit A hereto and dated the date of such
delivery, (A) identifying the items of Eligible Collateral being
substituted for the Prior Collateral and the Prior Collateral that is to
be transferred to the Pledgor and (B) certifying that the representations
and warranties contained in such Exhibit A hereto are true and correct on
and as of the date thereof. The Pledgor hereby covenants and agrees to
take all actions required under Section 6(d) and any other actions
necessary to create for the benefit of the Collateral Agent a valid, first
priority perfected security interest in, and a first lien upon, such
Eligible Collateral deposited with the Collateral Agent in substitution
for Prior Collateral.
(3) No such substitution shall be made unless and until the
Collateral Agent shall have determined that the aggregate Pledge Value of
all of the Collateral at the time of such proposed substitution, after
giving effect to the proposed substitution, shall at least equal the
Pledge Value Requirement.
(c) ADDITIONAL COLLATERAL. The Pledgor may pledge additional
Collateral (excluding Additional Government Securities) hereunder at any time
and may pledge Additional Government Securities hereunder at any time prior to
or simultaneously with an election to extend the Exchange Date pursuant to
Section 1.3(f) of the Forward Purchase Agreement. Concurrently with the delivery
of any additional Eligible Collateral, the Pledgor shall deliver in the case of
Eligible Collateral consisting of Additional Government Securities, a
certificate of the Pledgor substantially in the form of Exhibit B hereto, or in
the case of all other Eligible Collateral, a certificate of the Pledgor
substantially in the form of Exhibit C hereto and dated the date of such
delivery, in each case (A) identifying the additional items of Eligible
Collateral being pledged and (B) certifying that with respect to such items of
additional Eligible Collateral the representations and warranties contained in
such Exhibit B or Exhibit C, as the case may be, hereto are true and correct on
and as of the date thereof. The Pledgor hereby covenants and agrees to take all
actions required under Section 6(d) and any other actions necessary to create
for the benefit of the Collateral Agent a valid, first priority perfected
security interest in, and a first lien upon, such additional Eligible
Collateral.
(d) DELIVERY OF COLLATERAL. The Pledgor shall deliver all Collateral
to the Collateral Agent in accordance with the following provisions:
(1) PLEDGED COMMON STOCK. In the case of Collateral consisting
of Common Stock, by delivery of certificates evidencing such Common Stock,
indorsed in blank (together with all signature guarantees and any other
documents necessary to permit the Collateral Agent to effect the
re-registration thereof without further action by the Pledgor) or
registered in the name of the Collateral Agent or its nominee or, if such
Common Stock is held in book entry form by The Depository Trust Company,
by transfer to an account of the Collateral Agent or to an account (other
than an account of the Pledgor) designated by the Collateral Agent with
The Depository Trust Company;
(2) PLEDGED GOVERNMENT SECURITIES. In the case of Collateral
consisting of U.S. Government Securities or Additional Government
Securities, by
10
transfer thereof through the Book Entry System of the Federal Reserve
System to the account of the Collateral Agent or to an account (other than
an account of the Pledgor) designated by the Collateral Agent; and
(3) PLEDGED CASH. In the case of Collateral consisting of
cash, by wire transfer in immediately available funds to the account of
the Collateral Agent or to an account (other than an account of the
Pledgor) designated by the Collateral Agent and over which the Collateral
Agent has sole control.
(4) PLEDGED REPORTED SECURITIES. In the case of Collateral
consisting of Reported Securities, by delivery of certificates evidencing
such Reported Securities, indorsed in blank (together with all signature
guarantees and other documents necessary to permit the Collateral Agent to
effect the re-registration thereof without further action by the Pledgor)
or registered in the name of the Collateral Agent or its nominee or, if
such Reported Securities are not issuable in certificated form but are
held in book entry form by The Depository Trust Company, by transfer to an
account of the Collateral Agent or to an account (other than an account of
the Pledgor) designated by the Collateral Agent with The Depository Trust
Company.
Upon delivery of any Pledged Item under this Collateral Agreement,
the Collateral Agent shall examine such Pledged Item and any certificates
delivered pursuant to Sections 6(b), 6(c), 6(d)(3) or otherwise pursuant to the
terms hereof in connection therewith to determine that they comply as to form
with the requirements for Eligible Collateral. Immediately following the
delivery to the Collateral Agent of any Collateral in the form of certificates
indorsed in blank, the Collateral Agent shall cause all such certificates to be
re-registered on the books of the applicable transfer agent into the name of the
Collateral Agent or its nominee, and shall thereafter maintain all such
Collateral in such form until the termination of this Agreement; PROVIDED,
HOWEVER, that at any time following such delivery to the Collateral Agent, the
Collateral Agent may cause any such certificates to be deposited with The
Depository Trust Company and thereafter hold such certificates in book entry
form in an account (other than an account of Pledgor) designated by the
Collateral Agent. The Pledgor hereby designates the Collateral Agent as the
person in whose name any Collateral held in book entry form in the Federal
Reserve System shall be recorded.
(e) INSUFFICIENCY DETERMINATION.
(1) If on any Business Day the Collateral Agent determines
that the aggregate Pledge Value of the Collateral is less than the Pledge
Value Requirement (any such determination, an "INSUFFICIENCY
DETERMINATION"), the Collateral Agent shall, by telephone call to an
Authorized Representative of the Pledgor followed by a written
confirmation of such call, promptly notify the Pledgor of such
determination and of the amount of the insufficiency.
(2) If, by 4:00 p.m., New York City time on the Business Day
following the day on which telephonic notice shall have been given
pursuant to the preceding paragraph (e)(1), the Pledgor shall have failed
to deliver, in the manner set forth in paragraphs (c) and (d) of this
Section 6, sufficient additional Eligible Collateral
11
so that, after giving effect to such delivery (and taking into account
that Common Stock and Reported Securities in excess of the Maximum
Deliverable Number thereof shall not constitute Eligible Collateral), the
aggregate Pledge Value of the Collateral, as of such Business Day, is at
least equal to the Pledge Value Requirement, then (x) the Collateral
Requirement with respect to any cash or U.S. Government Securities pledged
hereunder (other than in respect of Cash Delivery Obligations) shall be
increased from 150% to 200%, and (y) unless a Collateral Event of Default
shall have occurred and be continuing, the Collateral Agent shall:
(i) commence sales, in the manner described in
paragraph (3) below, of such portion of the Collateral consisting of
cash or U.S. Government Securities as may be required to be sold in
order to generate proceeds sufficient to purchase Common Stock
and/or, after an Adjustment Event, Reported Securities, as described
in the following clause (ii); and
(ii) commence purchases, in the manner described
in paragraph (3) below, of Common Stock and/or, after an Adjustment
Event, Reported Securities, in an amount sufficient to cause the
aggregate Pledge Value of the Collateral to be at least equal to the
Pledge Value Requirement.
Notwithstanding the foregoing, the Collateral Agent shall
discontinue sales and purchases pursuant to the preceding clauses (i) and
(ii), respectively, if at any time a Collateral Event of Default shall
have occurred and be continuing. The Collateral Agent shall determine the
Market Value and the Pledge Value of the Collateral after each purchase of
Common Stock or Reported Securities pursuant to the preceding clause (ii)
in order to determine whether the Pledge Value Requirement is met and
whether a Collateral Event of Default has occurred. Solely for purposes of
such calculation, the Market Value of the Common Stock or Reported
Securities shall be the most recent sales price as reported in the
composite transactions for the principal securities exchange on which the
Common Stock or Reported Securities, as the case may be, are then listed
or, if such securities are not so listed, the last quoted ask price for
such securities in the over-the-counter market as reported by The NASDAQ
National Market or, if not so reported, by the National Quotation Bureau
or a similar organization.
A "COLLATERAL EVENT OF DEFAULT" shall mean, at any time, the
occurrence of any of the following: (A) failure of the aggregate Market
Value of the Collateral to equal or exceed the Pledge Value Requirement;
(B) failure of the Market Value of any cash and U.S. Government Securities
pledged at such time (not including any (i) Additional Government
Securities or (ii) cash and U.S. Government Securities pledged in respect
of Cash Delivery Obligations at such time) to have an aggregate Market
Value of at least 105% of the Market Value of a number of shares of Common
Stock (or, from and after any Adjustment Event, Reported Securities) equal
to (x) the Maximum Deliverable Number thereof MINUS (y) the number thereof
pledged as Collateral hereunder at such time; or (C) from and after any
Adjustment Event, failure of the U.S. Government Securities pledged in
respect of Cash Delivery Obligations to have an aggregate Market Value at
least equal to 105% of the Cash Delivery Obligations at such time or, in
the case of cash pledged in respect of Cash Delivery Obligations, failure
of such cash to be at least
12
equal to the Cash Delivery Obligations at such time, if, in the case of a
failure described in this clause (C), such failure shall continue to be in
effect at 4:00 p.m., New York City time, on the Business Day following the
day on which telephonic notice in respect thereof shall have been given
pursuant to paragraph (e)(1) above. For purposes of this Agreement, the
portion of any pledged cash and U.S. Government Securities that shall be
deemed to be in respect of Cash Delivery Obligations at any time shall be
a portion having a Market Value equal to 105% of the Cash Delivery
Obligations at such time (or, if less, the aggregate Market Value of all
cash and U.S. Government Securities pledged at such time). To the extent
that any pledged cash and U.S. Government Securities have a Market Value
exceeding 105%, the U.S. Government Securities shall be applied to satisfy
the 105% requirement in the first instance.
(3) Collateral sold and Common Stock or shares of Reported
Securities purchased by the Collateral Agent pursuant to the preceding
paragraphs (e)(2)(i) and (ii) may be sold and purchased on any securities
exchange or in any over-the-counter market or in any private purchase
transaction, and at such price or prices, in each case as the Collateral
Agent may deem satisfactory. The Pledgor covenants and agrees that it will
execute and deliver such documents and take such other action as the
Collateral Agent deems necessary or advisable in order that any such sales
and purchases may be made in compliance with law.
(f) RELEASE OF EXCESS COLLATERAL. If on any Business Day the
Collateral Agent determines that the aggregate Pledge Value of the Pledgor's
Eligible Collateral exceeds the Pledge Value Requirement and no Event of Default
or failure by the Pledgor to meet any of its obligations under Sections 5 or 6
hereof has occurred and is continuing, the Pledgor may obtain the release from
the Lien hereof of any Collateral having an aggregate Pledge Value on such
Business Day less than or equal to such excess, upon delivery to the Collateral
Agent of a written notice from an Authorized Representative of the Pledgor
indicating the items of Collateral to be released. Such Collateral shall be
released only after the Collateral Agent shall have determined that the
aggregate Pledge Value of all of the Collateral remaining after such release as
determined on such Business Day is at least equal to the Pledge Value
Requirement.
(g) DELIVERY OF FORWARD PURCHASE AGREEMENT CONSIDERATION. On the
Exchange Date, unless the Cash Delivery Option shall have been exercised, the
Collateral Agent shall deliver to the Trust Common Stock (or, if an Adjustment
Event shall have occurred, Reported Securities) then held by it hereunder
representing the number of shares of Common Stock (or, if an Adjustment Event
shall have occurred, Reported Securities) then required to be delivered under
the Forward Purchase Agreement. Upon such delivery, the Trust shall hold such
Common Stock or Reported Securities, as the case may be, absolutely and free
from any claim or right whatsoever.
(h) INVESTMENT OF CASH COLLATERAL. The Collateral Agent shall invest
any cash received by it pursuant to Section 6.2 of the Forward Purchase
Agreement in direct obligations of the United States of America maturing on or
before the Exchange Date.
7. INCOME AND VOTING RIGHTS ON COLLATERAL.
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(a) Unless an Event of Default or failure by the Pledgor to meet any
of Pledgor's obligations under Section 5(b) or (c) hereof has occurred and is
continuing, the Pledgor shall be entitled to receive for Pledgor's own account
all dividends, interest and, if any, principal and premium relating to all of
the Collateral, unless the payment thereof to the Pledgor would reduce the
aggregate Pledge Value of the Collateral below the Pledge Value Requirement. The
Collateral Agent agrees to remit to the Pledgor on the Business Day received or
the first Business Day thereafter all such payments received by it. If an Event
of Default or failure by the Pledgor to meet any of its obligations under
Section 5(b) or (c) hereof has occurred and is continuing, all such payments
made or accrued after and during the continuance of such Event of Default or
failure shall be retained by the Collateral Agent, and any such payments which
are received by the Pledgor shall be received in trust for the benefit of the
Trust, shall be segregated from other funds of the Pledgor and shall forthwith
be paid over to the Collateral Agent. Any such payments so retained by, or paid
over to, the Collateral Agent shall be held by the Collateral Agent as
Collateral hereunder. If any such Event of Default or failure is no longer
continuing, then the Collateral Agent shall remit any such payments that are so
retained by, or paid to it, on the first Business Day after the Collateral Agent
shall have received notice from the Trust that such Event of Default or failure
is no longer continuing, unless the payment thereof to the Pledgor would reduce
the aggregate Pledge Value of the Collateral below the Pledge Value Requirement.
(b) Unless an Event of Default has occurred and is continuing, the
Pledgor shall have the right, from time to time, to vote and to give all
approvals, consents, ratifications and waivers with respect to the Collateral
(including all shares of Common Stock), and the Collateral Agent shall promptly
deliver to the Pledgor such proxies, powers of attorney, consents, ratifications
and waivers in respect of any of the Collateral which is registered in the name
of the Collateral Agent or its nominee and shall further deliver such documents
and instruments as shall be specified in a written request by the Pledgor.
If an Event of Default shall have occurred and be continuing, (i)
the Collateral Agent shall have the right to the extent permitted by law, and
the Pledgor shall take all such action as may be necessary or appropriate to
give effect to such right, to vote and to give all approvals, consents,
ratifications and waivers, and take any other action with respect to any or all
of the Collateral with the same force and effect as if the Collateral Agent were
the absolute and sole owner thereof and (ii) the Collateral Agent shall
immediately cause all certificates for Common Stock delivered hereunder to be
re-registered on the books of the transfer agent for the Common Stock into the
name of the Collateral Agent or its nominee.
8. REMEDIES UPON EVENTS OF DEFAULT.
(a) If any Event of Default shall have occurred and be continuing,
the Collateral Agent may exercise on behalf of the Trust all the rights of a
secured party under the UCC (whether or not in effect in the jurisdiction where
such rights are exercised) and, in addition, without being required to give any
notice, except as herein provided or as may be required by mandatory provisions
of law, shall: (i) deliver all Collateral consisting of Common Stock or Reported
Securities (but not, in either case, in excess of the number of shares thereof
deliverable under the Forward Purchase Agreement at such time) to the Trust on
the date of the notice delivered to the Collateral Agent pursuant to the last
paragraph of Article VII of the
14
Forward Purchase Agreement relating to such Event of Default (or, in the case of
an Event of Default described in clause (iii), (iv) or (v) of the definition
thereof in this Agreement, on the Exchange Date) (in either case, the "DELIVERY
DATE"), whereupon the Trust shall hold such Common Stock or Reported Securities
absolutely free from any claim or right of whatsoever kind, including any equity
or right of redemption of the Pledgor which may be waived, and the Pledgor, to
the extent permitted by law, hereby specifically waives all rights of
redemption, stay or appraisal which Pledgor has or may have under any law now
existing or hereafter adopted; and (ii) if such delivery shall be insufficient
to satisfy in full all of the obligations of Pledgor under the Forward Purchase
Agreement, sell all of the remaining Collateral, or such lesser portion thereof
as may be necessary to generate proceeds sufficient to satisfy in full all of
the obligations of Pledgor under the Forward Purchase Agreement, at public or
private sale or at any broker's board or on any securities exchange, for cash,
upon credit or for future delivery, and at such price or prices as the
Collateral Agent may deem satisfactory. The Pledgor covenants and agrees to
execute and deliver such documents and take such other action as the Collateral
Agent deems necessary or advisable in order that any such sale may be made in
compliance with law. Upon any such sale the Collateral Agent shall have the
right to deliver, assign and transfer to the purchaser thereof the Collateral so
sold. Each purchaser at any such sale shall hold the Collateral so sold
absolutely and free from any claim or right of whatsoever kind, including any
equity or right of redemption of the Pledgor which may be waived, and the
Pledgor, to the extent permitted by law, hereby specifically waives all rights
of redemption, stay or appraisal which Pledgor has or may have under any law now
existing or hereafter adopted. The notice (if any) of such sale required by
Article 9 of the UCC shall (1) in case of a public sale, state the time and
place fixed for such sale, (2) in case of sale at a broker's board or on a
securities exchange, state the board or exchange at which such sale is to be
made and the day on which the Collateral, or the portion thereof so being sold,
will first be offered for sale at such board or exchange, and (3) in the case of
a private sale, state the day after which such sale may be consummated. Any such
public sale shall be held at such time or times within ordinary business hours
and at such place or places as the Collateral Agent may fix in the notice of
such sale. At any such sale the Collateral may be sold in one lot as an entirety
or in separate parcels, as the Collateral Agent may determine. The Collateral
Agent shall not be obligated to make any such sale pursuant to any such notice.
The Collateral Agent may, without notice or publication, adjourn any public or
private sale or cause the same to be adjourned from time to time by announcement
at the time and place fixed for the sale, and such sale may be made at any time
or place to which the same may be so adjourned. In case of any sale of all or
any part of the Collateral on credit or for future delivery, the Collateral so
sold may be retained by the Collateral Agent until the selling price is paid by
the purchaser thereof, but the Collateral Agent shall not incur any liability in
case of the failure of such purchaser to take up and pay for the Collateral so
sold and, in case of any such failure, such Collateral may again be sold upon
like notice. The Collateral Agent, instead of exercising the power of sale
herein conferred upon it, may proceed by a suit or suits at law or in equity to
foreclose the security interests and sell the Collateral, or any portion
thereof, under a judgment or decree of a court or courts of competent
jurisdiction.
(b) POWER OF ATTORNEY. The Collateral Agent is hereby irrevocably
appointed the true and lawful attorney of the Pledgor with full power and
authority, in the name and stead of the Pledgor, to do all of the following: (i)
upon any delivery or sale of all or any part of any Collateral made either under
the power of delivery or sale given hereunder or under judgment or decree in any
judicial proceedings for foreclosure or otherwise for the enforcement of this
15
Collateral Agreement, to make all necessary deeds, bills of sale and instruments
of assignment, transfer or conveyance of the property thus delivered or sold;
(ii) upon the occurrence of an Adjustment Event while any shares of Common Stock
are Pledged Items, to take any necessary actions with respect to such shares of
Common Stock to cause the Pledged Items to conform to the requirements of this
Agreement following the occurrence of the Adjustment Event, including, without
limitation, the tender of shares of Common Stock and the sale of property (other
than Reported Securities) received in respect of Common Stock. The grant of the
foregoing power of attorney shall not be deemed to be a grant of a power of
attorney to vote or grant proxies with respect to any shares of Common Stock,
except as provided in Section 7(b). For such purposes the Collateral Agent may
execute all necessary documents and instruments. This power of attorney shall be
deemed coupled with an interest, and the Pledgor hereby ratifies and confirms
all that its attorneys acting under such power, or such attorneys' successors or
agents, shall lawfully do so by virtue of this Collateral Agreement. If so
requested by the Collateral Agent, by the Trustees or by any purchaser of the
Collateral or a portion thereof, the Pledgor shall further ratify and confirm
any such delivery or sale by executing and delivering to the Collateral Agent,
to the Trustees or to such purchaser or purchasers at the expense of the Pledgor
all proper deeds, bills of sale, instruments of assignment, conveyance of
transfer and releases as may be designated in any such request. The Pledgor's
obligations and authorizations hereunder shall not be terminated by operation of
law or the occurrence of any event whatsoever, including the death or disability
of the Pledgor, or the occurrence of any other event.
(c) APPLICATION OF COLLATERAL AND PROCEEDS. In the case of an Event
of Default, the Collateral Agent may proceed to realize upon the security
interest in the Collateral against any one or more of the types of Collateral,
at any one time, as the Collateral Agent shall determine in its sole discretion
subject to the foregoing provisions of this Section 8. The proceeds of any sale
of, or other realization upon, or other receipt from, any of the Collateral
remaining after delivery to the Trust pursuant to Section 8(a) shall be applied
by the Collateral Agent in the following order of priorities:
(1) first, to the payment to the Trust of an amount equal to: (A) the
aggregate Market Value of a number of shares of Common Stock equal
to (1) the number of shares of Common Stock required to be delivered
under the Forward Purchase Agreement on the Delivery Date MINUS (2)
the number of shares of Common Stock delivered by the Collateral
Agent to the Trust on the Delivery Date as described above; or (B)
from and after an Adjustment Event, the sum of (1) the Cash Delivery
Obligations on the Delivery Date plus (2) the aggregate Market Value
on the Delivery Date of a number of Reported Securities (and, if
applicable, shares of Common Stock) equal to (x) the number thereof
required to be delivered on the Delivery Date under Section 6.2 of
the Forward Purchase Agreement MINUS (y) the number thereof
delivered by the Collateral Agent to the Trust on the Delivery Date
as described above; and/or (C) if the Cash Delivery Option shall
have been exercised, the amount of cash required to be delivered
under Section 1.3(d) of the Forward Purchase Agreement MINUS the
amount of cash so delivered; and (D) if the Exchange Date shall have
been extended pursuant to Section 1.3(f) of the Forward Purchase
Agreement, the amount of cash required to be delivered under said
Section 1.3(f) (or, if the Exchange Date
16
shall have been accelerated pursuant to Section 1.3(g) thereof, the
amount of cash deliverable pursuant to said Section 1.3(g));
(2) second, to the payment to the Collateral Agent of the expenses of
such sale or other realization, including reasonable compensation to
the Collateral Agent and its agents and counsel, and all expenses,
liabilities and advances incurred or made by the Collateral Agent in
connection therewith, including brokerage fees in connection with
the sale by the Collateral Agent of any Pledged Item; and
(3) finally, if all of the obligations of the Pledgor hereunder and
under the Forward Purchase Agreement have been fully discharged or
sufficient funds have been set aside by the Collateral Agent at the
request of the Pledgor for the discharge thereof, any remaining
proceeds shall be released to the Pledgor.
9. THE COLLATERAL AGENT.
The Collateral Agent accepts its duties and responsibilities
hereunder as agent for the Trust, on and subject to the following terms and
conditions:
(a) PERFORMANCE OF DUTIES; FORCE MAJEURE. The Collateral Agent
undertakes to perform such duties and only such duties as are expressly set
forth herein and, beyond the exercise of reasonable care in the performance of
such duties, no implied covenants or obligations shall be read into this
Collateral Agreement against the Collateral Agent. No provision hereof shall be
construed to relieve the Collateral Agent from liability for its own grossly
negligent action, grossly negligent failure to act or its own willful
misconduct, subject to the following:
(1) The Collateral Agent may consult with counsel, and the
advice or opinion of such counsel shall be full and complete authorization
and protection in respect of an action taken or suffered hereunder in good
faith and in accordance with such advice or opinion of counsel.
(2) The Collateral Agent shall not be liable with respect to
any action taken, suffered or omitted by it in good faith (i) reasonably
believed by it to be authorized or within the discretion or rights or
powers conferred on it by this Collateral Agreement or (ii) in accordance
with any direction or request of the Trustees.
(3) The Collateral Agent shall not be liable for any error of
judgment made in good faith by any of its officers, unless the Collateral
Agent was grossly negligent in ascertaining the pertinent facts.
(4) The Collateral Agent shall not be liable for any claims,
losses, liabilities, damages or expenses (including attorneys' fees and
expenses) due to forces beyond the reasonable control of the Collateral
Agent, including without limitation strikes, work stoppages, acts of war
or terrorism, insurrection, revolution, nuclear or natural catastrophes or
acts of God, and interruptions, loss or malfunctions of utilities,
communications or computer (software and hardware) services; provided that
this provision shall not protect the Collateral Agent against any
liability to which it would
17
otherwise be subject by reason of willful misfeasance, bad faith or gross
negligence in the performance of its duties or by reason of its reckless
disregard of its obligations and duties hereunder.
(5) In the absence of bad faith on its part, the Collateral
Agent may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any note, notice,
resolution, consent, certificate, affidavit, letter, telegram, teletype
message, statement, order or other document believed by it to be genuine
and correct and to have been signed or sent by the proper Person or
Persons.
(6) No provision of this Collateral Agreement shall require
the Collateral Agent to expend or risk its own funds or otherwise incur
any financial liability in the performance of any of its duties hereunder,
or in the exercise of any of its rights or powers, if it shall have
reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it.
(7) The Collateral Agent may perform any duties hereunder
either directly or by or through agents or attorneys, and the Collateral
Agent shall not be responsible for any willful misconduct or gross
negligence on the part of any agent or attorney appointed with due care by
it hereunder. In furtherance thereof, any subsidiary owned or controlled
by the Collateral Agent, or its successors, as agent for the Collateral
Agent, may perform any or all of the duties of the Collateral Agent
relating to the valuation of securities and other instruments constituting
Collateral hereunder.
(8) In no event shall the Collateral Agent be personally
liable for any taxes or other governmental charges imposed upon or in
respect of (i) the collateral or (ii) the income or other distributions
thereon.
(9) Unless and until the Collateral Agent shall have received
notice from the Pledgor, or unless and until a Responsible Officer of the
Collateral Agent shall have actual knowledge to the contrary, the
Collateral Agent shall be entitled to deem and treat all Collateral
delivered to it hereunder as Eligible Collateral hereunder, provided that
the Collateral Agent has carried out the duties specified in Section 6
with respect to such Collateral at the time of delivery thereof.
The Collateral Agent shall not be responsible for the correctness of
the recitals and statements herein which are made by the Pledgor or for any
statement or certificate delivered by the Pledgor pursuant hereto. Except as
specifically provided herein, the Collateral Agent shall not be responsible for
the validity, sufficiency, collectibility or marketability of any Collateral
given to or held by it hereunder or for the validity or sufficiency of the
Forward Purchase Agreement or the Lien on the Collateral purported to be created
hereby.
(b) KNOWLEDGE. The Collateral Agent shall not be deemed to have
knowledge of any Event of Default (except a Collateral Event of Default), unless
and until a Responsible Officer of the Collateral Agent shall have actual
knowledge thereof or shall have received written notice thereof.
18
(c) MERGER. Any corporation or association into which the Collateral
Agent may be converted or merged, or with which it may be consolidated, or to
which it may sell or transfer its agency business and assets as a whole or
substantially as a whole, or any corporation or association resulting from any
such conversion, sale, merger, consolidation or transfer to which it is a party,
shall, subject to the prior written consent of the Trust, be and become a
successor Collateral Agent hereunder and vested with all of the title to the
Collateral and all of the powers, discretions, immunities, privileges and other
matters as was its predecessor without, except as provided above, the execution
or filing of any instrument or any further act, deed or conveyance on the part
of any of the parties hereto, anything herein to the contrary notwithstanding.
(d) RESIGNATION. The Collateral Agent and any successor Collateral
Agent may at any time resign by giving 30 days' written notice by registered or
certified mail to the Pledgor and notice to the Trust in accordance with the
provisions of Section 10(d) hereof. Such resignation shall take effect upon the
appointment of a successor Collateral Agent by the Trust.
(e) REMOVAL. The Collateral Agent may be removed at any time by an
instrument or concurrent instruments in writing delivered to the Collateral
Agent and to the Pledgor and signed by the Trust.
(f) APPOINTMENT OF SUCCESSOR. (1) If the Collateral Agent hereunder
shall resign or be removed, or be dissolved or shall be in the course of
dissolution or liquidation or otherwise become incapable of action hereunder, or
if it shall be taken under the control of any public officer or officers or of a
receiver appointed by a court, a successor may be appointed by the Trust by an
instrument or concurrent instruments in writing signed by the Trust or by its
attorneys in fact fully authorized, a copy of such instrument or concurrent
instruments shall be sent by registered mail to the Pledgor.
(2) Every such temporary or permanent successor Collateral Agent
appointed pursuant to the provisions hereof shall be a trust company or bank in
good standing, having a reported capital and surplus of not less than
$100,000,000 and capable of holding the Collateral in the State of New York, if
there be such an institution willing, qualified and able to accept the duties of
the Collateral Agent hereunder upon customary terms.
(g) ACCEPTANCE BY SUCCESSOR. Every temporary or permanent successor
Collateral Agent appointed hereunder shall execute, acknowledge and deliver to
its predecessor and also to the Pledgor an instrument in writing accepting such
appointment hereunder, whereupon such successor, without any further act, deed
or conveyance, shall become fully vested with all the estates, properties,
rights, powers, duties and obligations of its predecessors. Such predecessor
shall, nevertheless, on the written request of its successor or the Pledgor,
execute and deliver an instrument transferring to such successor all the
estates, properties, rights and powers of such predecessor hereunder. Every
predecessor Collateral Agent shall deliver all Collateral held by it as the
Collateral Agent hereunder to its successor. Should any instrument in writing
from the Pledgor be reasonably required by a successor Collateral Agent for more
fully and certainly vesting in such successor the estates, properties, rights,
powers, duties and obligations hereby vested or intended to be vested in the
predecessor, any and all such
19
instruments in writing shall, at the request of the temporary or permanent
successor Collateral Agent, be forthwith executed, acknowledged and delivered by
the Pledgor.
10. MISCELLANEOUS.
(a) BENEFIT OF AGREEMENT; SUCCESSORS AND ASSIGNS. Whenever any of
the parties hereto is referred to, such reference shall be deemed to include the
successors and assigns of such party. All the covenants and agreements herein
contained by or on behalf of the Pledgor and the Collateral Agent shall bind,
and inure to the benefit of, their respective successors and assigns whether so
expressed or not, and shall be enforceable by and inure to the benefit of the
Trust and its successors and assigns.
(b) SEPARABILITY. To the extent permitted by law, the
unenforceability or invalidity of any provision or provisions of this Collateral
Agreement shall not render any other provision or provisions herein contained
unenforceable or invalid.
(c) AMENDMENTS AND WAIVERS. Any term, covenant, agreement or
condition of this Collateral Agreement may be amended or compliance therewith
may be waived (either generally or in a particular instance and either
retrospectively or prospectively) but only by a writing signed by the Collateral
Agent, the Pledgor and the Trust.
(d) NOTICES.
(1) Any notice provided for herein, unless otherwise
specified, shall be in writing (including transmittals by telex or
telecopier) and shall be given to a party at the address set forth
opposite such party's name on the signature pages hereto or at such other
address as may be designated by notice duly given in accordance with this
Section 10(d) to each other party hereto.
(2) Each such notice given pursuant to paragraph (1) shall be
effective (i) if sent by certified mail (return receipt requested), 72
hours after being deposited in the United States mail, postage prepaid;
(ii) if given by telex or telecopier, when such telex or telecopied notice
is transmitted; or (iii) if given by any other means, when delivered at
the address specified in this Section 10(d).
(e) GOVERNING LAW. This Collateral Agreement shall in all respects
be construed in accordance with and governed by the laws of the State of New
York; PROVIDED that as to Pledged Items located in any jurisdiction other than
the State of New York, the Collateral Agent on behalf of the Trust shall have
all of the rights to which a secured party is entitled under the laws of such
other jurisdiction.
(f) COUNTERPARTS. This Collateral Agreement may be executed,
acknowledged and delivered in any number of counterparts and such counterparts
taken together shall constitute one and the same instrument.
(g) APPLICATION OF BANKRUPTCY CODE. The parties hereto acknowledge
and agree that the Collateral Agent is a "financial institution" within the
meaning of Section 101(22) of the Bankruptcy Code and is acting as agent and
custodian for the Trust in connection with the
20
Forward Purchase Agreement and that the Trust is a "customer" of the Collateral
Agent within the meaning of said Section 101(22).
(h) WAIVER OF JURY TRIAL. TO THE EXTENT PERMITTED BY APPLICABLE LAW,
THE PARTIES HERETO HEREBY WAIVE AND COVENANT THAT THEY WILL NOT ASSERT (WHETHER
AS PLAINTIFF, DEFENDANT OR OTHERWISE) ANY RIGHT TO TRIAL BY JURY IN ANY FORUM IN
RESPECT OF ANY ISSUE, CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING OUT OF OR
BASED UPON THIS AGREEMENT OR THE SUBJECT MATTER HEREOF, IN EACH CASE WHETHER NOW
EXISTING OR HEREAFTER ARISING OR WHETHER IN CONTRACT OR TORT OR OTHERWISE. EACH
PARTY HERETO ACKNOWLEDGES THAT IT OR HE HAS BEEN INFORMED BY THE OTHER PARTY
HERETO THAT THE PROVISIONS OF THIS SECTION CONSTITUTE A MATERIAL INDUCEMENT UPON
WHICH SUCH OTHER PARTY HERETO HAS RELIED, IS RELYING AND WILL RELY IN ENTERING
INTO THIS AGREEMENT AND ANY DOCUMENT RELATED THERETO. EACH PARTY HERETO MAY FILE
AN ORIGINAL COUNTERPART OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF
THE CONSENT OF THE OTHER PARTY HERETO TO THE WAIVER OF ITS RIGHTS TO TRIAL BY
JURY.
11. TERMINATION OF COLLATERAL AGREEMENT.
This Collateral Agreement and the rights hereby granted by the
Pledgor in the Collateral shall cease, terminate and be void upon fulfillment of
all of the obligations of the Pledgor under the Forward Purchase Agreement, and
the Pledgor shall have no further liability hereunder upon such termination. Any
Collateral remaining at the time of such termination shall be fully released and
discharged from the Lien hereof and delivered to the Pledgor by the Collateral
Agent, all at the expense of the Pledgor.
12. NO PERSONAL LIABILITY OF TRUSTEES.
By executing this Collateral Agreement none of the Trustees
assumes any personal liability hereunder
21
Exhibit A
to
Collateral Agreement
CERTIFICATE FOR SUBSTITUTED COLLATERAL
The undersigned, _____________ (the "PLEDGOR"), hereby certifies, pursuant to
Section 6(b) of the Collateral Agreement dated as of February 8, 2002 among the
Pledgor, The Bank of New York, as Collateral Agent, and DECS Trust IX (the
"COLLATERAL AGREEMENT"; terms defined in the Collateral Agreement being used
herein as defined therein), that:
1. The Pledgor is delivering the following securities to the
Collateral Agent to be held by the Collateral Agent as substituted Collateral
(the "SUBSTITUTED COLLATERAL"):
2. The Pledgor requests that the Collateral Agent transfer to the
Pledgor the following Prior Collateral, pursuant to Section 6(b) of the
Collateral Agreement:
3. The Pledgor hereby represents and warrants to the Collateral
Agent and the Trust that:
(a) CONSENTS TO TRANSFER. No Transfer Restrictions
exist with respect to or otherwise apply to the assignment of, or
transfer by the Pledgor of possession of, any items of Substituted
Collateral to the Collateral Agent under the Collateral Agreement,
or the subsequent sale or transfer of such items of Substituted
Collateral by the Collateral Agent pursuant to the terms of the
Collateral Agreement.
(b) TITLE TO COLLATERAL; PERFECTED SECURITY
INTEREST. The Pledgor has good and marketable title to the
Substituted Collateral, free of all Liens (other than the Lien
created by the Collateral Agreement) and Transfer Restrictions. Upon
delivery of the Collateral to the Collateral Agent, the Collateral
Agent will obtain a valid, first priority perfected security
interest in, and a first lien upon, such Substituted Collateral
subject to no other Lien. None of such Substituted Collateral is or
shall be pledged by the Pledgor as collateral for any other purpose.
This Certificate may be relied upon by the Trust as fully and to the
same extent as if this Certificate had been specifically addressed to the Trust.
A-1
IN WITNESS WHEREOF, the undersigned has executed this Certificate
this _____ day of February, 2002.
_________________________________
Name:
Title:
A-2
Exhibit B
to
Collateral Agreement
CERTIFICATE FOR ADDITIONAL GOVERNMENT SECURITIES
The undersigned, __________________ (the "PLEDGOR"), hereby
certifies, pursuant to Section 6(c) of the Collateral Agreement, dated as of
February 8, 2002, among the Pledgor, The Bank of New York, as Collateral Agent,
and DECS Trust IX (the "COLLATERAL AGREEMENT"; terms defined in the Collateral
Agreement being used herein as defined therein), that:
1. The Pledgor is delivering the following securities to the
Collateral Agent to be held by the Collateral Agent as Collateral deliverable in
connection with an extension of the Exchange Date in accordance with Section
1.3(f) of the Forward Purchase Agreement (the "ADDITIONAL GOVERNMENT
SECURITIES"):
2. The Pledgor hereby represents and warrants to the Collateral
Agent that:
(a) CONSENTS TO TRANSFER. No Transfer Restrictions exist with
respect to or otherwise apply to the assignment of, or transfer by the
Pledgor of possession of, any items of Additional Government Securities to
the Collateral Agent under the Collateral Agreement, or the subsequent
sale or transfer of such items of Additional Government Securities by the
Collateral Agent pursuant to the terms of the Collateral Agreement.
(b) TITLE TO COLLATERAL; PERFECTED SECURITY INTEREST. The
Pledgor has good and marketable title to the Additional Government
Securities, free of all Liens (other than the Lien created by the
Collateral Agreement) and Transfer Restrictions. Upon delivery of the
Collateral to the Collateral Agent, the Collateral Agent will obtain a
valid, first priority perfected security interest in, and a first lien
upon, such Additional Government Securities subject to no other Lien. None
of such Additional Government Securities is or shall be pledged by the
Pledgor as collateral for any other purpose.
This Certificate may be relied upon by the Trust as fully and to the
same extent as if this Certificate had been specifically addressed to the Trust.
B-1
IN WITNESS WHEREOF, the undersigned has executed this Certificate
this _____ day of February, 2002.
---------------------------------
Name:
Title:
B-2
Exhibit C
to
Collateral Agreement
CERTIFICATE FOR ADDITIONAL COLLATERAL
The undersigned, __________________ (the "PLEDGOR"), hereby
certifies, pursuant to Section 6(c) of the Collateral Agreement, dated as of
February 8, 2002, among the Pledgor, The Bank of New York, as Collateral Agent,
and DECS Trust IX (the "COLLATERAL AGREEMENT"; terms defined in the Collateral
Agreement being used herein as defined therein), that:
1. The Pledgor is delivering the following securities to the
Collateral Agent to be held by the Collateral Agent as additional Collateral
(the "ADDITIONAL COLLATERAL"):
2. The Pledgor hereby represents and warrants to the Collateral
Agent that:
(a) CONSENTS TO TRANSFER. No Transfer Restrictions exist with
respect to or otherwise apply to the assignment of, or transfer by the
Pledgor of possession of, any items of Additional Collateral to the
Collateral Agent under the Collateral Agreement, or the subsequent sale or
transfer of such items of Additional Collateral by the Collateral Agent
pursuant to the terms of the Collateral Agreement.
(b) TITLE TO COLLATERAL; PERFECTED SECURITY INTEREST. The
Pledgor has good and marketable title to the Additional Collateral, free
of all Liens (other than the Lien created by the Collateral Agreement) and
Transfer Restrictions. Upon delivery of the Collateral to the Collateral
Agent, the Collateral Agent will obtain a valid, first priority perfected
security interest in, and a first lien upon, such additional Collateral
subject to no other Lien. None of such Additional Collateral is or shall
be pledged by the Pledgor as collateral for any other purpose.
This Certificate may be relied upon by the Trust as fully and to the
same extent as if this Certificate had been specifically addressed to the Trust.
C-1
IN WITNESS WHEREOF, the undersigned has executed this Certificate
this _____ day of February, 2002.
---------------------------------
Name:
Title:
C-2
