Exhibit 4.4
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THE PHOENIX COMPANIES, INC.
and
SUNTRUST BANK,
as Purchase Contract Agent
PURCHASE CONTRACT AGREEMENT
Dated as of December 20, 2002
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ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.01. Definitions...........................................................................1
SECTION 1.02. Compliance Certificates and Opinions.................................................15
SECTION 1.03. Form of Documents Delivered to Purchase Contract Agent...............................16
SECTION 1.04. Acts of Holders; Record Dates........................................................16
SECTION 1.05. Notices..............................................................................18
SECTION 1.06. Notice to Holders; Waiver............................................................19
SECTION 1.07. Effect of Headings and Table of Contents.............................................19
SECTION 1.08. Successors and Assigns...............................................................19
SECTION 1.09. Separability Clause..................................................................19
SECTION 1.10. Benefits of Agreement................................................................19
SECTION 1.11. Governing Law........................................................................20
SECTION 1.12. Legal Holidays.......................................................................20
SECTION 1.13. Counterparts.........................................................................20
SECTION 1.14. Inspection of Agreement..............................................................20
SECTION 1.15. Appointment of Financial Institution as Agent for the Company........................20
SECTION 1.16. No Waiver............................................................................21
ARTICLE 2
CERTIFICATE FORMS
SECTION 2.01. Forms of Certificates Generally......................................................21
SECTION 2.02. Form of Purchase Contract Agent's Certificate of Authentication......................22
ARTICLE 3
THE UNITS
SECTION 3.01. Amount; Form and Denominations.......................................................22
SECTION 3.02. Rights and Obligations Evidenced by the Certificates.................................22
SECTION 3.03. Execution, Authentication, Delivery and Dating.......................................23
SECTION 3.04. Temporary Certificates...............................................................24
SECTION 3.05. Registration; Registration of Transfer and Exchange..................................25
SECTION 3.06. Book-Entry Interests.................................................................26
SECTION 3.07. Notices to Holders...................................................................27
SECTION 3.08. Appointment of Successor Depositary..................................................27
SECTION 3.09. Definitive Certificates..............................................................27
SECTION 3.10. Mutilated, Destroyed, Lost and Stolen Certificates...................................28
SECTION 3.11. Persons Deemed Owners................................................................29
SECTION 3.12. Cancellation.........................................................................30
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SECTION 3.13. Creation of Treasury Units by Substitution of Treasury Securities....................30
SECTION 3.14. Recreation of Corporate Units........................................................32
SECTION 3.15. Transfer of Collateral upon Occurrence of Termination Event..........................34
SECTION 3.16. No Consent to Assumption.............................................................34
ARTICLE 4
THE NOTES AND APPLICABLE OWNERSHIP INTERESTS IN THE TREASURY PORTFOLIO
SECTION 4.01. Interest Payments; Rights to Interest Payments Preserved.............................35
SECTION 4.02. Notice and Voting....................................................................36
SECTION 4.03. Special Event Redemption.............................................................37
ARTICLE 5
THE PURCHASE CONTRACTS
SECTION 5.01. Purchase of Shares of Common Stock...................................................37
SECTION 5.02. Remarketing; Payment of Purchase Price...............................................40
SECTION 5.03. Issuance of Shares of Common Stock...................................................51
SECTION 5.04. Adjustment of Settlement Rate........................................................52
SECTION 5.05. Notice of Adjustments and Certain Other Events.......................................61
SECTION 5.06. Termination Event; Notice............................................................62
SECTION 5.07. Early Settlement.....................................................................62
SECTION 5.08. Intentionally Omitted................................................................65
SECTION 5.09. No Fractional Shares.................................................................65
SECTION 5.10. Charges and Taxes....................................................................66
SECTION 5.11. Contract Adjustment Payments.........................................................66
SECTION 5.12. Deferral of Contract Adjustment Payments.............................................71
ARTICLE 6
REMEDIES
SECTION 6.01. Unconditional Right of Holders to Receive Contract Adjustment Payments and to
Purchase Shares of Common Stock......................................................72
SECTION 6.02. Restoration of Rights and Remedies...................................................73
SECTION 6.03. Rights and Remedies Cumulative.......................................................73
SECTION 6.04. Delay or Omission Not Waiver.........................................................73
SECTION 6.05. Undertaking for Costs................................................................73
SECTION 6.06. Waiver of Stay or Extension Laws.....................................................74
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ARTICLE 7
THE PURCHASE CONTRACT AGENT
SECTION 7.01. Certain Duties and Responsibilities..................................................74
SECTION 7.02. Notice of Default....................................................................75
SECTION 7.03. Certain Rights of Purchase Contract Agent............................................75
SECTION 7.04. Not Responsible for Recitals or Issuance of Units....................................77
SECTION 7.06. Money Held in Custody................................................................78
SECTION 7.07. Compensation and Reimbursement.......................................................78
SECTION 7.08. Corporate Purchase Contract Agent Required; Eligibility..............................78
SECTION 7.09. Resignation and Removal; Appointment of Successor....................................79
SECTION 7.10. Acceptance of Appointment by Successor...............................................80
SECTION 7.11. Merger, Conversion, Consolidation or Succession to Business..........................81
SECTION 7.12. Preservation of Information; Communications to Holders...............................81
SECTION 7.13. No Obligations of Purchase Contract Agent............................................82
SECTION 7.14. Tax Compliance.......................................................................82
ARTICLE 8
SUPPLEMENTAL AGREEMENTS
SECTION 8.01. Supplemental Agreements Without Consent of Holders...................................83
SECTION 8.02. Supplemental Agreements with Consent of Holders......................................83
SECTION 8.03. Execution of Supplemental Agreements.................................................84
SECTION 8.04. Effect of Supplemental Agreements....................................................85
SECTION 8.05. Reference to Supplemental Agreements.................................................85
ARTICLE 9
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 9.01. Covenant Not to Consolidate, Merge, Convey, Transfer or Lease Property Except
under Certain Conditions.............................................................85
SECTION 9.02. Rights and Duties of Successor Corporation...........................................86
SECTION 9.03. Officers' Certificate and Opinion of Counsel Given to Purchase Contract Agent........86
ARTICLE 10
COVENANTS
SECTION 10.01. Performance under Purchase Contracts................................................87
SECTION 10.02. Maintenance of Office or Agency.....................................................87
SECTION 10.03. Company to Reserve Common Stock.....................................................87
SECTION 10.04. Covenants as to Common Stock........................................................88
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SECTION 10.05. Statements of Officers of the Company as to Default.................................88
SECTION 10.06. ERISA...............................................................................88
SECTION 10.07. Tax Treatment.......................................................................88
EXHIBITS
Exhibit A - Form of Corporate Units Certificate ..................................................A-1
Exhibit B - Form of Treasury Units Certificate ...................................................B-1
Exhibit C - Instruction to Purchase Contract Agent ...............................................C-1
Exhibit D - Notice from Purchase Contract Agent to Holders .......................................D-1
Exhibit E - Notice to Settle by Separate Cash ....................................................E-1
Exhibit F - Notice from Purchase Contract Agent to Collateral Agent ..............................F-1
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PURCHASE CONTRACT AGREEMENT, dated as of December 20, 2002, between THE
PHOENIX COMPANIES, INC., a Delaware corporation (the "COMPANY"), and SUNTRUST
BANK, a banking corporation with trust powers, duly organized and existing under
the laws of the State of Georgia, acting as purchase contract agent for the
Holders of Units (as defined herein) from time to time (the "PURCHASE CONTRACT
AGENT").
RECITALS
The Company has duly authorized the execution and delivery of this
Agreement and the Certificates evidencing the Units.
All things necessary to make the Purchase Contracts (as defined
herein), when the Certificates (as defined herein) are executed by the Company
and authenticated, executed on behalf of the Holders and delivered by the
Purchase Contract Agent, as provided in this Agreement, the valid obligations of
the Company, and to constitute these presents a valid agreement of the Company,
in accordance with its terms, have been done. For and in consideration of the
premises and the purchase of the Units by the Holders thereof, it is mutually
agreed as follows:
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.01. Definitions.
For all purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular, and nouns
and pronouns of the masculine gender include the feminine and neuter genders;
(b) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles in the United States;
(c) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular
Article, Section, Exhibit or other subdivision; and
(d) the following terms have the meanings given to them in this Section
1.01(d):
"ACCOUNTING EVENT" has the meaning set forth in Section [o] of the
Supplemental Indenture No. 1.
"ACT" has the meaning, with respect to any Holder, set forth in Section
1.04.
"ADJUSTED APPLICABLE MARKET VALUE" has the meaning set forth in Section
5.01.
"AFFILIATE" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"AGREEMENT" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more agreements
supplemental hereto entered into pursuant to the applicable provisions hereof.
"APPLICABLE MARKET VALUE" has the meaning set forth in Section 5.01.
"APPLICABLE OWNERSHIP INTEREST" shall mean, with respect to a Corporate
Unit and the Treasury Portfolio contained in a Corporate Unit, (i) a 2.5%
undivided beneficial ownership interest in $1,000 face amount of U.S. treasury
securities (or principal or interest strips thereof) included in such Treasury
Portfolio that mature on or prior to February 15, 2006, and (ii) (x) for the
scheduled Payment Date on the Notes that occurs on the Purchase Contract
Settlement Date, in the case of a Successful Remarketing prior to the Final
Remarketing Date, or (y) for each scheduled Payment Date on the Notes that
occurs after the Special Event Redemption Date to and including the Purchase
Contract Settlement Date, in the case of a Special Event Redemption, a [o]%
undivided beneficial ownership interest in $1,000 face amount of U.S. treasury
securities (or principal or interest strips thereof) included in such Treasury
Portfolio that mature on or prior to the business day immediately preceding such
scheduled Payment Date.
"APPLICABLE PRINCIPAL AMOUNT" means the aggregate principal amount of
the Notes that are components of Corporate Units.
"APPLICANTS" has the meaning set forth in Section 7.12(b).
"BANKRUPTCY CODE" means title 11 of the United States Code, or any
other law of the United States that from time to time provides a uniform system
of bankruptcy laws.
"BENEFICIAL OWNER" means, with respect to a Book-Entry Interest, a
Person who is the beneficial owner of such Book-Entry Interest as reflected on
the books of the Depositary or on the books of a Person maintaining an account
with such Depositary (directly as a Depositary
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Participant or as an indirect participant, in each case in accordance with the
rules of such Depositary).
"BOARD OF DIRECTORS" means the board of directors of the Company or a
duly authorized committee of that board.
"BOARD RESOLUTION" means one or more resolutions of the Board of
Directors, a copy of which has been certified by the Secretary or an Assistant
Secretary of the Company, to have been duly adopted by the Board of Directors
and to be in full force and effect on the date of such certification and
delivered to the Purchase Contract Agent.
"BOOK-ENTRY INTEREST" means a beneficial interest in a Global
Certificate, registered in the name of a Depositary or a nominee thereof,
ownership and transfers of which shall be maintained and made through book
entries by such Depositary as described in Section 3.06.
"BUSINESS DAY" or "BUSINESS DAY" means any day other than a Saturday or
Sunday or a day on which banking institutions or trust companies in New York
City, New York are authorized or required by applicable law to remain closed or
a day on which the Indenture Trustee or the Collateral Agent is closed for
business; provided that for purposes of the second paragraph of Section 1.12
only, the term "Business Day" shall also be deemed to exclude any day on which
DTC is closed.
"CASH MERGER" has the meaning set forth in Section 5.04(b)(2).
"CASH MERGER EARLY SETTLEMENT" has the meaning set forth in Section
5.04(b)(2).
"CASH MERGER EARLY SETTLEMENT DATE" has the meaning set forth in
Section 5.04(b)(2).
"CASH SETTLEMENT" has the meaning set forth in Section 5.02(c)(i).
"CERTIFICATE" means a Corporate Units Certificate or a Treasury Units
Certificate.
"CLOSING PRICE" has the meaning set forth in Section 5.01(a).
"CODE" means the Internal Revenue Code of 1986, as amended.
"COLLATERAL" has the meaning set forth in Section 1.01(d) of the Pledge
Agreement.
"COLLATERAL ACCOUNT" has the meaning set forth in Section 1.01(d) of
the Pledge Agreement.
"COLLATERAL AGENT" means SunTrust Bank, a banking corporation with
trust powers, duly organized and existing under the laws of the State of
Georgia, as Collateral Agent under the
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Pledge Agreement until a successor Collateral Agent shall have become such
pursuant to the applicable provisions of the Pledge Agreement, and thereafter
"Collateral Agent" shall mean the Person who is then the Collateral Agent
thereunder.
"COLLATERAL SUBSTITUTION" means (i) with respect to a Corporate Unit,
(x) the substitution for the Pledged Note included in such Corporate Unit by
Treasury Securities in an aggregate principal amount at maturity equal to the
aggregate principal amount of such Pledged Note, or (y) the substitution for the
Pledged Applicable Ownership Interest in the Treasury Portfolio included in such
Corporate Unit by Treasury Securities in an amount equal to such Pledged
Applicable Ownership Interest in the Treasury Portfolio, or (ii) with respect to
a Treasury Unit, (x) the substitution for the Pledged Treasury Securities
included in such Treasury Unit (if the Applicable Ownership Interest in the
Treasury Portfolio has not replaced the Note as a component of the Corporate
Unit) by Notes in an aggregate principal amount equal to the aggregate principal
amount at stated maturity of the Pledged Treasury Securities, or (y) the
substitution for the Pledged Treasury Securities included in such Treasury Unit
(if the Applicable Ownership Interest in the Treasury Portfolio has replaced the
Note as a component of the Corporate Unit), the appropriate Applicable Ownership
Interest in the Treasury Portfolio.
"COMMON STOCK" means the common stock, par value $0.01 per share, of
the Company.
"COMPANY" means the Person named as the "COMPANY" in the first
paragraph of this instrument until a successor shall have become such pursuant
to the applicable provision of this Agreement, and thereafter "COMPANY" shall
mean such successor.
"CONSTITUENT PERSON" has the meaning set forth in Section 5.04(b).
"CONTRACT ADJUSTMENT PAYMENTS" means the payments payable by the
Company on the Payment Dates in respect of each Purchase Contract, at a rate per
year of [o]% of the Stated Amount per Purchase Contract.
"CORPORATE TRUST OFFICE" means the office of the Purchase Contract
Agent at which, at any particular time, its corporate trust business shall be
principally administered, which office at the date hereof is located at 00 Xxxx
Xxxxx, 00xx Xxxxx, Xxxxxxx, Xxxxxxx 00000, Fax: [o], Attn: Corporate Trust
Office.
"CORPORATE UNIT" means the collective rights and obligations of a
Holder of a Corporate Units Certificate in respect of the Notes or an
appropriate Applicable Ownership Interest in the Treasury Portfolio, as the case
may be, subject in each case (except for the appropriate Applicable Ownership
Interest specified in clause (ii) of the definition of such term) to the Pledge
thereof, and the related Purchase Contract.
"CORPORATE UNITS CERTIFICATE" means a certificate evidencing the rights
and obligations of a Holder in respect of the number of Corporate Units
specified on such certificate.
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"COUPON RATE" means the percentage rate per annum at which each Note
will bear interest initially.
"CURRENT MARKET PRICE" has the meaning set forth in Section 5.04(a)(8).
"CUSTODIAL AGENT" means SunTrust Bank, a banking corporation with trust
powers, duly organized and existing under the laws of the State of Georgia, as
Custodial Agent under the Pledge Agreement until a successor Custodial Agent
shall have become such pursuant to the applicable provisions of the Pledge
Agreement, and thereafter "CUSTODIAL AGENT" shall mean the Person who is then
the Custodial Agent thereunder.
"DEFERRED CONTRACT ADJUSTMENT PAYMENTS" has the meaning provided in
Section 5.12.
"DEPOSITARY" means a clearing agency registered under Section 17A of
the Exchange Act that is designated to act as Depositary for the Units as
contemplated by Sections 3.06 and 3.08.
"DEPOSITARY PARTICIPANT" means a broker, dealer, bank, other financial
institution or other Person for whom from time to time the Depositary effects
book entry transfers and pledges of securities deposited with the Depositary.
"DTC" means The Depository Trust Company.
"EARLY SETTLEMENT" has the meaning set forth in Section 5.07.
"EARLY SETTLEMENT AMOUNT" has the meaning set forth in Section 5.07.
"EARLY SETTLEMENT DATE" has the meaning set forth in Section 5.07.
"EARLY SETTLEMENT RATE" has the meaning set forth in Section 5.07.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"EXCHANGE ACT" means the Securities Exchange Act of 1934 and any
statute successor thereto, in each case as amended from time to time, and the
rules and regulations promulgated thereunder.
"EXCHANGE PROPERTY" has the meaning set forth in Section 5.04(b).
"EXPIRATION DATE" has the meaning set forth in Section 1.04(e).
"EXPIRATION TIME" has the meaning set forth in Section 5.04(a)(6).
"FAILED FINAL REMARKETING" has the meaning set forth in Section
5.02(d).
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"FAILED INITIAL REMARKETING" has the meaning set forth in Section
5.02(a).
"FAILED REMARKETING" shall mean any of (i) a Failed Initial
Remarketing, (ii) a Failed Second Remarketing, (iii) a Failed Third Remarketing
or (iv) a Failed Final Remarketing.
"FAILED SECOND REMARKETING" has the meaning set forth in Section
5.02(b).
"FAILED THIRD REMARKETING" has the meaning set forth in Section
5.02(b).
"FINAL REMARKETING" has the meaning set forth in Section 5.02(d).
"FINAL REMARKETING DATE" means the third Business Day immediately
preceding the Purchase Contract Settlement Date.
"FINAL REMARKETING FEE" has the meaning set forth in Section 5.02(d).
"GLOBAL CERTIFICATE" means a Certificate that evidences all or part of
the Units and is registered in the name of the Depositary or a nominee thereof.
"HOLDER" means, with respect to a Unit, the Person in whose name the
Unit evidenced by a Certificate is registered in the Security Register;
provided, however, that solely for the purpose of determining whether the
Holders of the requisite number of Units have voted on any matter (and not for
any other purpose hereunder), if the Unit remains in the form of one or more
Global Certificates and if the Depositary that is the registered holder of such
Global Certificate has sent an omnibus proxy assigning voting rights to the
Depositary Participants to whose accounts the Units are credited on the record
date, the term "HOLDER" shall mean such Depositary Participant acting at the
direction of the Beneficial Owners.
"INDENTURE" means the Subordinated Indenture, dated as of December [o],
2002, between the Company and the Indenture Trustee (including any provisions of
the TIA that are deemed incorporated therein), as supplemented by Supplemental
Indenture No. 1 dated as of the date hereof, pursuant to which the Notes will be
issued.
"INDENTURE TRUSTEE" means SunTrust Bank, as trustee under the
Indenture, or any successor thereto.
"INITIAL REMARKETING" has the meaning set forth in Section 5.02(a).
"INITIAL REMARKETING DATE" means the third Business Day immediately
preceding November 16, 2005.
"ISSUER ORDER" or "ISSUER REQUEST" means a written order or request
signed in the name of the Company by (i) either its Chief Executive Officer, its
President or one of its Vice
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Presidents, and (ii) either its Corporate Secretary or one of its Assistant
Corporate Secretaries or its Treasurer or one of its Assistant Treasurers, and
delivered to the Purchase Contract Agent.
"NON-ELECTING SHARE" has the meaning set forth in Section 5.04(b).
"NOTES" means the series of notes designated the Notes due February 16,
2008 to be issued by the Company under the Indenture.
"NYSE" has the meaning set forth in Section 5.01.
"OFFICERS' CERTIFICATE" means a certificate signed by (i) either the
Company's Chief Executive Officer, its President or one of its Vice Presidents,
and (ii) either the Company's Corporate Secretary or one of its Assistant
Corporate Secretaries or its Treasurer or one of its Assistant Treasurers, and
delivered to the Purchase Contract Agent. Any Officers' Certificate delivered
with respect to compliance with a condition or covenant provided for in this
Agreement (other than the Officers' Certificate provided for in Section 10.05)
shall include:
(i) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the definitions
relating thereto;
(ii) a brief statement of the nature and scope of the
examination or investigation undertaken by each officer in rendering
the Officers' Certificate;
(iii) a statement that, in the opinion of each such officer,
each such officer has made such examination or investigation as is
necessary to enable such officer to express an informed opinion as to
whether or not such covenant or condition has been complied with; and
(iv) a statement as to whether, in the opinion of each such
officer, such condition or covenant has been complied with.
"OPINION OF COUNSEL" means a written opinion of counsel, who may be
counsel to the Company (and who may be an employee of the Company), and who
shall be reasonably acceptable to the Purchase Contract Agent. An opinion of
counsel may rely on certificates as to matters of fact.
"OUTSTANDING UNITS" means, with respect to any Unit and as of the date
of determination, all Units evidenced by Certificates theretofore authenticated,
executed and delivered under this Agreement, except:
(i) if a Termination Event has occurred, (x) Corporate Units
for which the underlying Notes or Applicable Ownership Interests in the
Treasury Portfolio have been
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theretofore deposited with the Purchase Contract Agent in trust for the
Holders of such Corporate Units and (y) Treasury Units;
(ii) Units evidenced by Certificates theretofore cancelled by
the Purchase Contract Agent or delivered to the Purchase Contract Agent
for cancellation or deemed cancelled pursuant to the provisions of this
Agreement; and
(iii) Units evidenced by Certificates in exchange for or in
lieu of which other Certificates have been authenticated, executed on
behalf of the Holder and delivered pursuant to this Agreement, other
than any such Certificate in respect of which there shall have been
presented to the Purchase Contract Agent proof satisfactory to it that
such Certificate is held by a protected purchaser in whose hands the
Units evidenced by such Certificate are valid obligations of the
Company;
provided, however, that in determining whether the Holders of the requisite
number of the Units have given any request, demand, authorization, direction,
notice, consent or waiver hereunder, Units owned by the Company or any Affiliate
of the Company shall be disregarded and deemed not to be Outstanding Units,
except that, in determining whether the Purchase Contract Agent shall be
authorized and protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Units that a
Responsible Officer of the Purchase Contract Agent actually knows to be so owned
shall be so disregarded. Units so owned that have been pledged in good faith may
be regarded as Outstanding Units if the pledgee establishes to the satisfaction
of the Purchase Contract Agent the pledgee's right so to act with respect to
such Units and that the pledgee is not the Company or any Affiliate of the
Company.
"PAYMENT DATE" means each February 16, May 16, August 16 and November
16 of each year, commencing February 16, 2003.
"PERMITTED INVESTMENTS" has the meaning set forth in Section 1.01(d) of
the Pledge Agreement.
"PERSON" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint-stock company, limited
liability company, trust, unincorporated organization or government or any
agency or political subdivision thereof or any other entity of whatever nature.
"PLAN" means an employee benefit plan that is subject to ERISA, a plan
or individual retirement account that is subject to Section 4975 of the Code or
any entity whose assets are considered assets of any such plan.
"PLEDGE" means the pledge under the Pledge Agreement of the Notes, the
Treasury Securities or the appropriate Applicable Ownership Interest (as
specified in clause (i) of the definition of such term) in the Treasury
Portfolio, as the case may be, in each case constituting a
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part of the Units (it being understood that the appropriate Applicable Ownership
Interest (as specified in clause (ii) of the definition of such term) in the
Treasury Portfolio shall not be subject to the Pledge).
"PLEDGE AGREEMENT" means the Pledge Agreement, dated as of December 20,
2002, among the Company, the Collateral Agent, the Custodial Agent, the
Securities Intermediary and the Purchase Contract Agent, on its own behalf and
as attorney-in-fact for the Holders from time to time of the Units, as amended
from time to time.
"PLEDGED APPLICABLE OWNERSHIP INTERESTS" has the meaning set forth in
Section 1.01(d) of the Pledge Agreement.
"PLEDGED NOTES" has the meaning set forth in Section 1.01(d) of the
Pledge Agreement.
"PLEDGED TREASURY SECURITIES" has the meaning set forth in Section
1.01(d) of the Pledge Agreement.
"PREDECESSOR CERTIFICATE" means a Predecessor Corporate Units
Certificate or a Predecessor Treasury Units Certificate.
"PREDECESSOR CORPORATE UNITS CERTIFICATE" of any particular Corporate
Units Certificate means every previous Corporate Units Certificate evidencing
all or a portion of the rights and obligations of the Company and the Holder
under the Corporate Units evidenced thereby; and, for the purposes of this
definition, any Corporate Units Certificate authenticated and delivered under
Section 3.10 in exchange for or in lieu of a mutilated, destroyed, lost or
stolen Corporate Units Certificate shall be deemed to evidence the same rights
and obligations of the Company and the Holder as the mutilated, destroyed, lost
or stolen Corporate Units Certificate.
"PREDECESSOR TREASURY UNITS CERTIFICATE" of any particular Treasury
Units Certificate means every previous Treasury Units Certificate evidencing all
or a portion of the rights and obligations of the Company and the Holder under
the Treasury Units evidenced thereby; and, for the purposes of this definition,
any Treasury Units Certificate authenticated and delivered under Section 3.10 in
exchange for or in lieu of a mutilated, destroyed, lost or stolen Treasury Units
Certificate shall be deemed to evidence the same rights and obligations of the
Company and the Holder as the mutilated, destroyed, lost or stolen Treasury
Units Certificate.
"PRIMARY TREASURY DEALER" shall mean a primary U.S. government
securities dealer.
"PROCEEDS" has the meaning set forth in Section 1.01(d) of the Pledge
Agreement.
"PRO RATA" shall mean pro rata to each Holder according to the
aggregate Stated Amount of the Units held by such Holder in relation to the
aggregate Stated Amount of all Units outstanding.
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"PROSPECTUS" means the prospectus relating to the delivery of shares of
any securities in connection with an Early Settlement pursuant to Section 5.07
or a Cash Merger Early Settlement of Purchase Contracts pursuant to Section
5.04(b)(2), in the form in which first filed, or transmitted for filing, with
the Securities and Exchange Commission after the effective date of the
Registration Statement pursuant to Rule 424(b) under the Securities Act,
including the documents incorporated by reference therein as of the date of such
Prospectus.
"PURCHASE CONTRACT" means, with respect to any Unit, the contract
forming a part of such Unit and obligating the Company to (i) sell, and the
Holder of such Unit to purchase, shares of Common Stock and (ii) pay the Holder
thereof Contract Adjustment Payments, in each case on the terms and subject to
the conditions set forth in Article Five hereof.
"PURCHASE CONTRACT AGENT" means the Person named as the "PURCHASE
CONTRACT AGENT" in the first paragraph of this Agreement until a successor
Purchase Contract Agent shall have become such pursuant to the applicable
provisions of this Agreement, and thereafter "PURCHASE CONTRACT AGENT" shall
mean such Person or any subsequent successor who is appointed pursuant to this
Agreement.
"PURCHASE CONTRACT SETTLEMENT DATE" means February 16, 2006.
"PURCHASE CONTRACT SETTLEMENT FUND" has the meaning set forth in
Section 5.03.
"PURCHASE PRICE" has the meaning set forth in Section 5.01.
"PURCHASED SHARES" has the meaning set forth in Section 5.04(a)(6).
"QUOTATION AGENT" means any Primary Treasury Dealer selected by the
Company.
"RECORD DATE" for any distribution and Contract Adjustment Payment
payable on any Payment Date means, as to any Global Certificate or any other
Certificate, the first business day of the calendar month in which the relevant
Payment Date falls; provided that the Company may, at its option, select any
other day as the Record Date for any Payment Date so long as such Record Date
selected is more than one Business Day but less than sixty Business Days prior
to such Payment Date.
"REDEMPTION AMOUNT" has the meaning set forth in Section [C] of the
Supplemental Indenture No. 1.
"REDEMPTION PRICE" has the meaning set forth in Section [C] of the
Supplemental Indenture No. 1.
"REFERENCE DEALER" means a dealer engaged in trading of convertible
securities.
10
"REFERENCE PRICE" has the meaning set forth in Section 5.01.
"REGISTRATION STATEMENT" means a registration statement under the
Securities Act prepared by the Company covering, inter alia, the delivery by the
Company of any securities in connection with an Early Settlement on the Early
Settlement Date or a Cash Merger Early Settlement of Purchase Contracts on the
Cash Merger Early Settlement Date under Section 5.04(b)(2), including all
exhibits thereto and the documents incorporated by reference in the prospectus
contained in such registration statement, and any post-effective amendments
thereto.
"REMARKETING" means the remarketing of the Notes by the Remarketing
Agent pursuant to the Remarketing Agreement.
"REMARKETING AGENT" means Xxxxxx Xxxxxxx & Co. Incorporated, or any
successor remarketing agent appointed by the Company pursuant to the Remarketing
Agreement.
"REMARKETING AGREEMENT" means the Remarketing Agreement, dated as of
December 20, 2002, among the Company, the Remarketing Agent and the Purchase
Contract Agent, as amended from time to time.
"REMARKETING DATE" means any of (i) the Initial Remarketing Date, (ii)
the Second Remarketing Date, (iii) the Third Remarketing Date and (iv) the Final
Remarketing Date.
"REMARKETING FEE" has the meaning set forth in Section 5.02(a).
"REMARKETING PER NOTE PRICE" means the Treasury Portfolio Purchase
Price divided by the number of Notes held as components of Corporate Units and
remarketed in the Initial Remarketing, the Second Remarketing or the Third
Remarketing, as the case may be.
"REORGANIZATION EVENT" has the meaning set forth in Section 5.04(b).
"RESET RATE" has the meaning set forth in Section [C] of the
Supplemental Indenture No. 1.
"RESPONSIBLE OFFICER" means, with respect to the Purchase Contract
Agent, any officer of the Purchase Contract Agent assigned by the Purchase
Contract Agent to administer this Purchase Contract Agreement.
"RIGHTS" has the meaning set forth in Section 5.04(a)(11).
"RIGHTS AGREEMENT" has the meaning set forth in Section 5.04(a)(11).
"SECOND REMARKETING" has the meaning set forth in Section 5.02(b).
11
"SECOND REMARKETING DATE" means the third Business Day immediately
preceding December 16, 2005.
"SECURITIES ACT" means the Securities Act of 1933 and any statute
successor thereto, in each case as amended from time to time, and the rules and
regulations promulgated thereunder.
"SECURITIES INTERMEDIARY" means SunTrust Bank, a banking corporation
with trust powers, duly organized and existing under the laws of the State of
Georgia, as Securities Intermediary under the Pledge Agreement until a successor
Securities Intermediary shall have become such pursuant to the applicable
provisions of the Pledge Agreement, and thereafter "SECURITIES INTERMEDIARY"
shall mean such successor or any subsequent successor who is appointed pursuant
to the Pledge Agreement.
"SECURITY REGISTER" and "SECURITIES REGISTRAR" have the respective
meanings set forth in Section 3.05.
"SENIOR INDEBTEDNESS" has the meaning set forth in Section 101 of the
Indenture.
"SEPARATE NOTES" means Notes that are no longer a component of
Corporate Units.
"SEPARATE NOTES PURCHASE PRICE" means the amount in cash equal to the
product of the Remarketing Per Note Price multiplied by the number of Separate
Notes remarketed in the Initial Remarketing, the Second Remarketing or the Third
Remarketing, as the case may be.
"SETTLEMENT RATE" has the meaning set forth in Section 5.01.
"SPECIAL EVENT" has the meaning set forth in Section [C] of the
Supplemental Indenture No. 1.
"SPECIAL EVENT REDEMPTION" means the redemption of the Notes pursuant
to the Indenture following the occurrence of a Special Event.
"SPECIAL EVENT REDEMPTION DATE" means the date upon which a Special
Event Redemption is scheduled to occur pursuant to the Indenture.
"STATED AMOUNT" means $25.00.
"SUCCESSFUL FINAL REMARKETING" has the meaning set forth in Section
5.02(d).
"SUCCESSFUL INITIAL REMARKETING" has the meaning set forth in Section
5.02(a).
12
"SUCCESSFUL REMARKETING" means any of (i) a Successful Initial
Remarketing, (ii) a Successful Second Remarketing, (iii) a Successful Third
Remarketing or (iv) a Successful Final Remarketing.
"SUCCESSFUL SECOND REMARKETING" has the meaning set forth in Section
5.02(b).
"SUCCESSFUL THIRD REMARKETING" has the meaning set forth in Section
5.02(b).
"SUPPLEMENTAL INDENTURE NO. 1" means the Supplemental Indenture No. 1
dated as of the date hereof between the Company and the Indenture Trustee.
"TAX EVENT" has the meaning set forth in Section [C] of the
Supplemental Indenture No. 1.
"TERMINATION DATE" means the date, if any, on which a Termination Event
occurs.
"TERMINATION EVENT" means the occurrence of any of the following
events:
(i) at any time on or prior to the Purchase Contract
Settlement Date, a judgment, decree or court order shall have been
entered granting relief under the Bankruptcy Code, adjudicating the
Company to be insolvent, or approving as properly filed a petition
seeking reorganization or liquidation of the Company or any other
similar applicable Federal or state law and if such judgment, decree or
order shall have been entered more than 60 days prior to the Purchase
Contract Settlement Date, such decree or order shall have continued
undischarged and unstayed for a period of 60 days;
(ii) at any time on or prior to the Purchase Contract
Settlement Date, a judgment, decree or court order for the appointment
of a receiver or liquidator or trustee or assignee in bankruptcy or
insolvency of the Company or of its property, or for the termination or
liquidation of its affairs, shall have been entered and if such
judgment, decree or order shall have been entered more than 60 days
prior to the Purchase Contract Settlement Date, such judgment, decree
or order shall have continued undischarged and unstayed for a period of
60 days; or
(iii) at any time on or prior to the Purchase Contract
Settlement Date, the Company shall file a petition for relief under the
Bankruptcy Code, or shall consent to the filing of a bankruptcy
proceeding against it, or shall file a petition or answer or consent
seeking reorganization or liquidation under the Bankruptcy Code or any
other similar applicable Federal or State law, or shall consent to the
filing of any such petition, or shall consent to the appointment of a
receiver or liquidator or trustee or assignee in bankruptcy or
insolvency of it or of its property, or shall make an assignment for
the benefit of creditors, or shall admit in writing its inability to
pay its debts generally as they become due.
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"THIRD REMARKETING" has the meaning set forth in Section 5.02(b).
"THIRD REMARKETING DATE" means the third Business Day immediately
preceding January 16, 2006.
"THRESHOLD APPRECIATION PRICE" has the meaning set forth in Section
5.01.
"TIA" means the Trust Indenture Act of 1939, as amended from time to
time, or any successor legislation.
"TRADING DAY" has the meaning set forth in Section 5.01.
"TREASURY PORTFOLIO" means a portfolio of (1) U.S. treasury securities
(or principal or interest strips thereof) that mature on or prior to February
15, 2006 in an aggregate amount equal to the Applicable Principal Amount, and
(2) (x) in the case of a Successful Remarketing prior to the Final Remarketing
Date, for the scheduled Payment Date on the Notes that occur on the Purchase
Contract Settlement Date, U.S. treasury securities (or principal or interest
strips thereof) that mature on or prior to February 15, 2006 in an aggregate
amount equal to the aggregate interest payment (assuming no reset of the
interest rate) that would have been due on the Purchase Contract Settlement Date
on the Applicable Principal Amount, and (y) in the case of a Special Event
Redemption, for each scheduled Payment Date that occurs after the Special Event
Redemption Date to and including the Purchase Contract Settlement Date, U.S.
treasury securities (or principal or interest strips thereof) that mature on or
prior to the business day immediately preceding such scheduled Payment Date in
an aggregate amount equal to the aggregate interest payment (assuming no reset
of the interest rate) that would have been due on such scheduled Payment Date on
the Applicable Principal Amount.
"TREASURY PORTFOLIO PURCHASE PRICE" means the lowest aggregate ask-side
price quoted by a Primary Treasury Dealer to the Quotation Agent between 9:00
a.m. and 11:00 a.m. (New York City time) (i) in the case of a Special Event
Redemption, on the third Business Day immediately preceding the Special Event
Redemption Date for the purchase of the applicable Treasury Portfolio for
settlement on the Special Event Redemption Date, and (ii) in the case of any
Successful Remarketing prior to the Final Remarketing Date, on the date of such
Successful Remarketing for the purchase of the applicable Treasury Portfolio for
settlement on the third Business Day immediately following the date of such
Successful Remarketing.
"TREASURY SECURITIES" means zero-coupon U.S. treasury securities that
mature on February 15, 2006 (CUSIP No. 000000XX0).
"TREASURY UNIT" means, following the substitution of Treasury
Securities for Pledged Notes or the Pledged Applicable Ownership Interest in the
Treasury Portfolio as collateral to secure a Holder's obligations under the
Purchase Contract, the collective rights and obligations
14
of a Holder of a Treasury Units Certificate in respect of such Treasury
Securities, subject to the Pledge thereof, and the related Purchase Contract.
"TREASURY UNITS CERTIFICATE" means a certificate evidencing the rights
and obligations of a Holder in respect of the number of Treasury Unit specified
on such certificate.
"UNDERWRITERS" means the underwriters identified in Schedule II to the
Underwriting Agreement.
"UNDERWRITING AGREEMENT" means the Underwriting Agreement, dated
December 16, 2002, among the Company and the Underwriters, including the Pricing
Agreement referred to therein.
"UNIT" means a Corporate Unit or a Treasury Unit, as the case may be.
"VICE PRESIDENT" means any vice president, whether or not designated by
a number or a word or words added before or after the title "vice president."
SECTION 1.02. Compliance Certificates and Opinions.
Except as otherwise expressly provided by this Agreement, upon any
application or request by the Company to the Purchase Contract Agent to take any
action in accordance with any provision of this Agreement, the Company shall
furnish to the Purchase Contract Agent an Officers' Certificate stating that all
conditions precedent, if any, provided for in this Agreement relating to the
proposed action have been complied with and, if requested by the Purchase
Contract Agent, an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent, if any, have been complied with, except
that in the case of any such application or request as to which the furnishing
of such documents is specifically required by any provision of this Agreement
relating to such particular application or request, no additional certificate or
opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Agreement (other than the Officers'
Certificate provided for in Section 10.05) shall include:
(i) a statement that each individual signing such certificate
or opinion has read such covenant or condition and the definitions
herein relating thereto;
(ii) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
15
(iii) a statement that, in the opinion of each such
individual, he or she has made such examination or investigation as is
necessary to enable such individual to express an informed opinion as
to whether or not such covenant or condition has been complied with;
and
(iv) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
SECTION 1.03. Form of Documents Delivered to Purchase Contract Agent.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents. Any
certificate or opinion of an officer of the Company may be based, insofar as it
relates to legal matters, upon a certificate or opinion of, or representations
by, counsel, unless such officer knows, or in the exercise of reasonable care
should know, that the certificate or opinion or representations with respect to
the matters upon which its certificate or opinion is based are erroneous. Any
such certificate or Opinion of Counsel may be based, insofar as it relates to
factual matters, upon a certificate or opinion of, or representations by, an
officer or officers of the Company unless such counsel knows, or in the exercise
of reasonable care should know, that the certificate or opinion or
representations with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Agreement, they may, but need not, be consolidated and
form one instrument.
SECTION 1.04. Acts of Holders; Record Dates.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Agreement to be given or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by an agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Purchase Contract Agent and, where it is hereby expressly required, to
the Company. Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "ACT" of the Holders
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Agreement and (subject to Section 7.01) conclusive in favor of
the Purchase Contract Agent and the Company, if made in the manner provided in
this Section.
16
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved in any manner which the Purchase Contract
Agent deems sufficient.
(c) The ownership of Units shall be proved by the Security Register.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Unit shall bind every future Holder of
the same Unit and the Holder of every Certificate evidencing such Unit issued
upon the registration of transfer thereof or in exchange therefor or in lieu
thereof in respect of anything done, omitted or suffered to be done by the
Purchase Contract Agent or the Company in reliance thereon, whether or not
notation of such action is made upon such Certificate.
(e) The Company may set any date as a record date for the purpose of
determining the Holders of Outstanding Units entitled to give, make or take any
request, demand, authorization, direction, notice, consent, waiver or other
action provided or permitted by this Agreement to be given, made or taken by
Holders of Units. If any record date is set pursuant to this paragraph, the
Holders of the Outstanding Corporate Units and the Outstanding Treasury Units,
as the case may be, on such record date, and no other Holders, shall be entitled
to take the relevant action with respect to the Corporate Units or the Treasury
Units, as the case may be, whether or not such Holders remain Holders after such
record date; provided that no such action shall be effective hereunder unless
taken prior to or on the applicable Expiration Date by Holders of the requisite
number of Outstanding Units on such record date. Nothing contained in this
paragraph shall be construed to prevent the Company from setting a new record
date for any action for which a record date has previously been set pursuant to
this paragraph (whereupon the record date previously set shall automatically and
with no action by any Person be cancelled and be of no effect), and nothing
contained in this paragraph shall be construed to render ineffective any action
taken by Holders of the requisite number of Outstanding Units on the date such
action is taken. Promptly after any record date is set pursuant to this
paragraph, the Company, at its own expense, shall cause notice of such record
date, the proposed action by Holders and the applicable Expiration Date to be
given to the Purchase Contract Agent in writing and to each Holder of Units in
the manner set forth in Section 1.06.
With respect to any record date set pursuant to this Section 1.04(e),
the Company may designate any date as the "EXPIRATION DATE" and from time to
time may change the Expiration Date to any earlier or later day; provided that
no such change shall be effective unless notice of the proposed new Expiration
Date is given to the Purchase Contract Agent in writing, and to each Holder of
Units in the manner set forth in Section 1.06, prior to or on the existing
Expiration Date. If an Expiration Date is not designated with respect to any
record date set pursuant to this Section, the Company shall be deemed to have
initially designated the 180th day after such record date as the Expiration Date
with respect thereto, subject to its right to change the Expiration Date as
provided in this paragraph. Notwithstanding the foregoing, no Expiration Date
shall be later than the 180th day after the applicable record date.
17
SECTION 1.05. Notices.
Any notice or communication is duly given if in writing and delivered
in Person or mailed by first-class mail (registered or certified, return receipt
requested), telecopier (with receipt confirmed) or overnight air courier
guaranteeing next day delivery, to the others' address; provided that notice
shall be deemed given to the Purchase Contract Agent only upon receipt thereof:
If to the Purchase Contract Agent:
SunTrust Bank
00 Xxxx Xxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
Fax: [o]
Attn: Corporate Trust Division
If to the Company:
The Phoneix Companies, Inc.
Xxx Xxxxxxxx Xxx
Xxxxxxxx, Xxxxxxxxxxx
00000-0000
Fax: [o]
Attention:
If to the Collateral Agent:
SunTrust Bank
00 Xxxx Xxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
Fax: [o]
Attn: Corporate Trust Division
If to the Indenture Trustee:
SunTrust Bank
00 Xxxx Xxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
Fax: [o]
Attn: Corporate Trust Division
The Purchase Contract Agent shall send to the Indenture Trustee at the
telecopier number set forth above a copy of any notices in the form of Exhibits
C, D, E or F it sends or receives.
18
SECTION 1.06. Notice to Holders; Waiver.
Where this Agreement provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each Holder affected
by such event, at its address as it appears in the Security Register, not later
than the latest date, and not earlier than the earliest date, prescribed for the
giving of such notice. In any case where notice to Holders is given by mail,
neither the failure to mail such notice, nor any defect in any notice so mailed
to any particular Holder shall affect the sufficiency of such notice with
respect to other Holders. Where this Agreement provides for notice in any
manner, such notice may be waived in writing by the Person entitled to receive
such notice, either before or after the event, and such waiver shall be the
equivalent of such notice. Waivers of notice by Holders shall be filed with the
Purchase Contract Agent, but such filing shall not be a condition precedent to
the validity of any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made with the approval of the Purchase
Contract Agent shall constitute a sufficient notification for every purpose
hereunder.
SECTION 1.07. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
SECTION 1.08. Successors and Assigns.
All covenants and agreements in this Agreement by the Company and the
Purchase Contract Agent shall bind their respective successors and assigns,
whether so expressed or not.
SECTION 1.09. Separability Clause.
In case any provision in this Agreement or in the Units shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions hereof and thereof shall not in any way be affected or
impaired thereby.
SECTION 1.10. Benefits of Agreement.
Nothing contained in this Agreement or in the Units, express or
implied, shall give to any Person, other than the parties hereto and their
successors hereunder and, to the extent provided hereby, the Holders, any
benefits or any legal or equitable right, remedy or claim under this Agreement.
The Holders from time to time shall be beneficiaries of this Agreement and shall
be
19
bound by all of the terms and conditions hereof and of the Units evidenced by
their Certificates by their acceptance of delivery of such Certificates.
SECTION 1.11. Governing Law.
This Agreement and the Units shall be governed by, and construed in
accordance with, the laws of the State of New York.
SECTION 1.12. Legal Holidays.
In any case where any Payment Date shall not be a Business Day
(notwithstanding any other provision of this Agreement or the Units), Contract
Adjustment Payments or other distributions shall not be paid on such date, but
Contract Adjustment Payments or such other distributions shall be paid on the
next succeeding Business Day, unless such Business Day is in the next succeeding
calendar year, in which case such Contract Adjustment Payments or other
distributions shall be paid on the immediately preceding Business Day, in each
case with the same force and effect as if made on such Payment Date.
In any case where the Purchase Contract Settlement Date or any Early
Settlement Date or Cash Merger Early Settlement Date shall not be a Business Day
(notwithstanding any other provision of this Agreement or the Units), Purchase
Contracts shall not be performed and Early Settlement and Cash Merger Early
Settlement shall not be effected on such date, but Purchase Contracts shall be
performed or Early Settlement or Cash Merger Early Settlement shall be effected,
as applicable, on the next succeeding Business Day with the same force and
effect as if made on such Purchase Contract Settlement Date, Early Settlement
Date or Cash Merger Early Settlement Date, as applicable.
SECTION 1.13. Counterparts.
This Agreement may be executed in any number of counterparts by the
parties hereto on separate counterparts, each of which, when so executed and
delivered, shall be deemed an original, but all such counterparts shall together
constitute one and the same instrument.
SECTION 1.14. Inspection of Agreement.
A copy of this Agreement shall be available at all reasonable times
during normal business hours at the Corporate Trust Office for inspection by any
Holder or Beneficial Owner.
SECTION 1.15. Appointment of Financial Institution as Agent for the
Company.
The Company may appoint a financial institution (which may be the
Collateral Agent) to act as its agent in performing its obligations and in
accepting and enforcing performance of the obligations of the Purchase Contract
Agent and the Holders, under this Agreement and the
20
Purchase Contracts, by giving notice of such appointment in the manner provided
in Section 1.05 hereof. Any such appointment shall not relieve the Company in
any way from its obligations hereunder.
SECTION 1.16. No Waiver. No failure on the part of the Company, the
Purchase Contract Agent, the Collateral Agent, the Securities Intermediary or
any of their respective agents to exercise, and no course of dealing with
respect to, and no delay in exercising, any right, power or remedy hereunder
shall operate as a waiver thereof; nor shall any single or partial exercise by
the Company, the Collateral Agent, the Securities Intermediary or any of their
respective agents of any right, power or remedy hereunder preclude any other or
further exercise thereof or the exercise of any other right, power or remedy.
The remedies herein are cumulative and are not exclusive of any remedies
provided by law.
ARTICLE 2
CERTIFICATE FORMS
SECTION 2.01. Forms of Certificates Generally.
The Certificates (including the form of Purchase Contract forming part
of each Unit evidenced thereby) shall be in substantially the form set forth in
Exhibit A hereto (in the case of Certificates evidencing Corporate Units) or
Exhibit B hereto (in the case of Certificates evidencing Treasury Units), with
such letters, numbers or other marks of identification or designation and such
legends or endorsements printed, lithographed or engraved thereon as may be
required by the rules of any securities exchange on which the Units are listed
or any depositary therefor, or as may, consistently herewith, be determined by
the officers of the Company executing such Certificates, as evidenced by their
execution of the Certificates.
The definitive Certificates shall be produced in any manner as
determined by the officers of the Company executing the Units evidenced by such
Certificates, consistent with the provisions of this Agreement, as evidenced by
their execution thereof.
Every Global Certificate authenticated, executed on behalf of the
Holders and delivered hereunder shall bear a legend in substantially the
following form:
"THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED
IN THE NAME OF CEDE & CO., AS NOMINEE OF THE DEPOSITORY TRUST COMPANY,
A NEW YORK CORPORATION (THE "DEPOSITARY"), THE DEPOSITARY OR ANOTHER
NOMINEE OF THE DEPOSITARY. THIS CERTIFICATE IS EXCHANGEABLE FOR
CERTIFICATES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE
DEPOSITARY
21
OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
PURCHASE CONTRACT AGREEMENT AND NO TRANSFER OF THIS CERTIFICATE (OTHER
THAN A TRANSFER OF THIS CERTIFICATE AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE
DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED
EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REQUESTED IN THE NAME OF CEDE & CO. OR SUCH
OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITARY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH
OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN."
SECTION 2.02. Form of Purchase Contract Agent's Certificate of
Authentication.
The form of the Purchase Contract Agent's certificate of authentication
of the Units shall be in substantially the form set forth on the form of the
applicable Certificates.
ARTICLE 3
THE UNITS
SECTION 3.01. Amount; Form and Denominations.
The aggregate number of Units evidenced by Certificates authenticated,
executed on behalf of the Holders and delivered hereunder is limited to
5,200,000 (or 5,980,000 if the over-allotment option granted to the Underwriters
pursuant to the Underwriting Agreement is exercised in full), except for
Certificates authenticated, executed and delivered upon registration of transfer
of, in exchange for, or in lieu of, other Certificates pursuant to Sections
3.04, 3.05, 3.10, 3.13, 3.14 or 8.05.
The Certificates shall be issuable only in registered form and only in
denominations of a single Corporate Unit or Treasury Unit and any integral
multiple thereof.
SECTION 3.02. Rights and Obligations Evidenced by the Certificates.
22
Each Corporate Units Certificate shall evidence the number of Corporate
Units specified therein, with each such Corporate Unit representing (1) the
ownership by the Holder thereof of a beneficial interest in a Note or the
Applicable Ownership Interest in the Treasury Portfolio, as the case may be,
subject to the Pledge of such Note or the Applicable Ownership Interest (as
specified in clause (i) of the definition of such term) in the Treasury
Portfolio, as the case may be, by such Holder pursuant to the Pledge Agreement,
and (2) the rights and obligations of the Holder thereof and the Company under
one Purchase Contract. The Purchase Contract Agent is hereby authorized, as
attorney-in-fact for, and on behalf of, the Holder of each Corporate Unit, to
pledge, pursuant to the Pledge Agreement, the Note and the Applicable Ownership
Interest (as specified in clause (i) of the definition of such term) in the
Treasury Portfolio, if any, forming a part of such Corporate Unit, to the
Collateral Agent for the benefit of the Company, and to grant to the Collateral
Agent, for the benefit of the Company, a security interest in the right, title
and interest of such Holder in such Note and the Applicable Ownership Interest
(as specified in clause (i) of the definition of such term) in the Treasury
Portfolio, if any, to secure the obligation of the Holder under each Purchase
Contract to purchase shares of Common Stock.
Upon the formation of a Treasury Unit pursuant to Section 3.13, each
Treasury Unit Certificate shall evidence the number of Treasury Units specified
therein, with each such Treasury Unit representing (1) the ownership by the
Holder thereof of a 1/40 undivided beneficial interest in a Treasury Security
with a principal amount equal to $1,000, subject to the Pledge of such interest
by such Holder pursuant to the Pledge Agreement, and (2) the rights and
obligations of the Holder thereof and the Company under one Purchase Contract.
The Purchase Contract Agent is hereby authorized, as attorney-in-fact for, and
on behalf of, the Holder of each Treasury Unit, to pledge, pursuant to the
Pledge Agreement, such Holder's interest in the Treasury Security forming a part
of such Treasury Unit to the Collateral Agent, for the benefit of the Company,
and to grant to the Collateral Agent, for the benefit of the Company, a security
interest in the right, title and interest of such Holder in such Treasury
Security to secure the obligation of the Holder under each Purchase Contract to
purchase shares of Common Stock.
Prior to the purchase of shares of Common Stock under each Purchase
Contract, such Purchase Contracts shall not entitle the Holder of a Unit to any
of the rights of a holder of shares of Common Stock, including, without
limitation, the right to vote or receive any dividends or other payments or to
consent or to receive notice as a shareholder in respect of the meetings of
shareholders or for the election of directors of the Company or for any other
matter, or any other rights whatsoever as a shareholder of the Company.
SECTION 3.03. Execution, Authentication, Delivery and Dating.
Subject to the provisions of Sections 3.13 and 3.14 hereof, upon the
execution and delivery of this Agreement, and at any time and from time to time
thereafter, the Company may deliver Certificates executed by the Company to the
Purchase Contract Agent for authentication, execution on behalf of the Holders
and delivery, together with its Issuer Order for authentication
23
of such Certificates, and the Purchase Contract Agent in accordance with such
Issuer Order shall authenticate, execute on behalf of the Holders and deliver
such Certificates.
The Certificates shall be executed on behalf of the Company by its
Chairman of the Board, its Chief Executive Officer, its President, its Treasurer
or one of its Vice Presidents. The signature of any of these officers on the
Certificates may be manual or facsimile.
Certificates bearing the manual or facsimile signatures of individuals
who were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Certificates or did not
hold such offices at the date of such Certificates.
No Purchase Contract evidenced by a Certificate shall be valid until
such Certificate has been executed on behalf of the Holder by the manual
signature of an authorized officer of the Purchase Contract Agent, as such
Holder's attorney-in-fact. Such signature by an authorized officer of the
Purchase Contract Agent shall be conclusive evidence that the Holder of such
Certificate has entered into the Purchase Contracts evidenced by such
Certificate.
Each Certificate shall be dated the date of its authentication.
No Certificate shall be entitled to any benefit under this Agreement or
be valid or obligatory for any purpose unless there appears on such Certificate
a certificate of authentication substantially in the form provided for herein
executed by an authorized officer of the Purchase Contract Agent by manual
signature, and such certificate upon any Certificate shall be conclusive
evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder.
SECTION 3.04. Temporary Certificates.
Pending the preparation of definitive Certificates, the Company shall
execute and deliver to the Purchase Contract Agent, and the Purchase Contract
Agent shall authenticate, execute on behalf of the Holders, and deliver, in lieu
of such definitive Certificates, temporary Certificates which are in
substantially the form set forth in Exhibit A or Exhibit B hereto, as the case
may be, with such letters, numbers or other marks of identification or
designation and such legends or endorsements printed, lithographed or engraved
thereon as may be required by the rules of any securities exchange on which the
Corporate Units or Treasury Units, as the case may be, are listed, or as may,
consistently herewith, be determined by the officers of the Company executing
such Certificates, as evidenced by their execution of the Certificates.
If temporary Certificates are issued, the Company will cause definitive
Certificates to be prepared without unreasonable delay. After the preparation of
definitive Certificates, the temporary Certificates shall be exchangeable for
definitive Certificates upon surrender of the temporary Certificates at the
Corporate Trust Office, at the expense of the Company and without
24
charge to the Holder. Upon surrender for cancellation of any one or more
temporary Certificates, the Company shall execute and deliver to the Purchase
Contract Agent, and the Purchase Contract Agent shall authenticate, execute on
behalf of the Holder, and deliver in exchange therefor, one or more definitive
Certificates of like tenor and denominations and evidencing a like number of
Units as the temporary Certificate or Certificates so surrendered. Until so
exchanged, the temporary Certificates shall in all respects evidence the same
benefits and the same obligations with respect to the Units evidenced thereby as
definitive Certificates.
SECTION 3.05. Registration; Registration of Transfer and Exchange.
The Purchase Contract Agent shall keep at the Corporate Trust Office a
register (the "SECURITY REGISTER") in which, subject to such reasonable
regulations as it may prescribe, the Purchase Contract Agent shall provide for
the registration of Certificates and of transfers of Certificates (the Purchase
Contract Agent, in such capacity, the "SECURITY REGISTRAR"). The Security
Registrar shall record separately the registration and transfer of the
Certificates evidencing Corporate Units and Treasury Units.
Upon surrender for registration of transfer of any Certificate at the
Corporate Trust Office, the Company shall execute and deliver to the Purchase
Contract Agent, and the Purchase Contract Agent shall authenticate, execute on
behalf of the designated transferee or transferees, and deliver, in the name of
the designated transferee or transferees, one or more new Certificates of any
authorized denominations, like tenor, and evidencing a like number of Corporate
Units or Treasury Units, as the case may be.
At the option of the Holder, Certificates may be exchanged for other
Certificates, of any authorized denominations and evidencing a like number of
Corporate Units or Treasury Units, as the case may be, upon surrender of the
Certificates to be exchanged at the Corporate Trust Office. Whenever any
Certificates are so surrendered for exchange, the Company shall execute and
deliver to the Purchase Contract Agent, and the Purchase Contract Agent shall
authenticate, execute on behalf of the Holder, and deliver the Certificates
which the Holder making the exchange is entitled to receive.
All Certificates issued upon any registration of transfer or exchange
of a Certificate shall evidence the ownership of the same number of Corporate
Units or Treasury Units, as the case may be, and be entitled to the same
benefits and subject to the same obligations under this Agreement as the
Corporate Units or Treasury Units, as the case may be, evidenced by the
Certificate surrendered upon such registration of transfer or exchange.
Every Certificate presented or surrendered for registration of transfer
or exchange shall (if so required by the Purchase Contract Agent) be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Purchase Contract Agent duly executed, by
the Holder thereof or its attorney duly authorized in writing.
25
No service charge shall be made for any registration of transfer or
exchange of a Certificate, but the Company and the Purchase Contract Agent may
require payment from the Holder of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any registration of
transfer or exchange of Certificates, other than any exchanges pursuant to
Sections 3.04, 3.06 and 8.05 not involving any transfer.
Notwithstanding the foregoing, the Company shall not be obligated to
execute and deliver to the Purchase Contract Agent, and the Purchase Contract
Agent shall not be obligated to authenticate, execute on behalf of the Holder
and deliver any Certificate in exchange for any other Certificate presented or
surrendered for registration of transfer or for exchange on or after the
Business Day immediately preceding the earliest to occur of any Early Settlement
Date with respect to such Certificate, any Cash Merger Early Settlement Date
with respect to such Certificate, the Purchase Contract Settlement Date or the
Termination Date. In lieu of delivery of a new Certificate, upon satisfaction of
the applicable conditions specified above in this Section and receipt of
appropriate registration or transfer instructions from such Holder, the Purchase
Contract Agent shall:
(i) if the Purchase Contract Settlement Date (including upon
any Cash Settlement) or an Early Settlement Date or a Cash Merger Early
Settlement Date with respect to such other Certificate has occurred,
deliver the shares of Common Stock issuable in respect of the Purchase
Contracts forming a part of the Units evidenced by such other
Certificate; or
(ii) if a Termination Event shall have occurred prior to the
Purchase Contract Settlement Date, transfer the Notes, the Treasury
Securities, or the appropriate Applicable Ownership Interest in the
Treasury Portfolio, as the case may be, evidenced thereby, in each case
subject to the applicable conditions and in accordance with the
applicable provisions of Section 3.15 and Article Five hereof.
SECTION 3.06. Book-Entry Interests.
The Certificates, on original issuance, will be issued in the form of
one or more fully registered Global Certificates, to be delivered to the
Depositary or its custodian by, or on behalf of, the Company. The Company hereby
designates DTC as the initial Depositary. Such Global Certificates shall
initially be registered on the books and records of the Company in the name of
Cede & Co., the nominee of the Depositary, and no Beneficial Owner will receive
a definitive Certificate representing such Beneficial Owner's interest in such
Global Certificate, except as provided in Section 3.09. The Purchase Contract
Agent shall enter into an agreement with the Depositary if so requested by the
Company. Unless and until definitive, fully registered Certificates have been
issued to Beneficial Owners pursuant to Section 3.09:
(i) the provisions of this Section 3.06 shall be in full force
and effect;
26
(ii) the Company shall be entitled to deal with the Depositary
for all purposes of this Agreement (including, without limitation,
making Contract Adjustment Payments and receiving approvals, votes or
consents hereunder) as the Holder of the Units and the sole holder of
the Global Certificates and shall have no obligation to the Beneficial
Owners;
(iii) to the extent that the provisions of this Section 3.06
conflict with any other provisions of this Agreement, the provisions of
this Section 3.06 shall control; and
(iv) the rights of the Beneficial Owners shall be exercised
only through the Depositary and shall be limited to those established
by law and agreements between such Beneficial Owners and the Depositary
or the Depositary Participants.
Transfers of securities evidenced by Global Certificates shall be made through
the facilities of the Depositary, and any cancellation of, or increase or
decrease in the number of, such securities (including the creation of Treasury
Units and the recreation of Corporate Units pursuant to Sections 3.13 and 3.14
respectively) shall be accomplished by making appropriate annotations on the
Schedule of Increases and Decreases for such Global Certificate.
SECTION 3.07. Notices to Holders.
Whenever a notice or other communication to the Holders is required to
be given under this Agreement, the Company or the Company's agent shall give
such notices and communications to the Holders and, with respect to any Units
registered in the name of the Depositary or the nominee of the Depositary, the
Company or the Company's agent shall, except as set forth herein, have no
obligations to the Beneficial Owners.
SECTION 3.08. Appointment of Successor Depositary.
If the Depositary elects to discontinue its services as securities
depositary with respect to the Units, the Company may, in its sole discretion,
appoint a successor Depositary with respect to the Units.
SECTION 3.09. Definitive Certificates.
If:
(i) the Depositary notifies the Company that it is unwilling
or unable to continue its services as securities depositary with
respect to the Units and no successor Depositary has been appointed
pursuant to Section 3.08 within 90 days after such notice; or
27
(ii) the Depositary ceases to be a "clearing agency"
registered under Section 17A of the Exchange Act when the Depositary is
required to be so registered to act as the Depositary and so notifies
the Company, and no successor Depositary has been appointed pursuant to
Section 3.08 within 90 days after such notice; or
(iii) the Company determines in its discretion that the Global
Certificates shall be exchangeable for definitive Certificates,
then (x) definitive Certificates shall be prepared by the Company with respect
to such Units and delivered to the Purchase Contract Agent and (y) upon
surrender of the Global Certificates representing the Units by the Depositary,
accompanied by registration instructions, the Company shall cause definitive
Certificates to be delivered to Beneficial Owners in accordance with the
instructions of the Depositary. The Company and the Purchase Contract Agent
shall not be liable for any delay in delivery of such instructions and may
conclusively rely on and shall be authorized and protected in relying on, such
instructions. Each definitive Certificate so delivered shall evidence Units of
the same kind and tenor as the Global Certificate so surrendered in respect
thereof.
SECTION 3.10. Mutilated, Destroyed, Lost and Stolen Certificates.
If any mutilated Certificate is surrendered to the Purchase Contract
Agent, the Company shall execute and deliver to the Purchase Contract Agent, and
the Purchase Contract Agent shall authenticate, execute on behalf of the Holder,
and deliver in exchange therefor, a new Certificate, evidencing the same number
of Corporate Units or Treasury Units, as the case may be, and bearing a
Certificate number not contemporaneously outstanding.
If there shall be delivered to the Company and the Purchase Contract
Agent (i) evidence to their satisfaction of the destruction, loss or theft of
any Certificate, and (ii) such security or indemnity as may be required by them
to hold each of them and any agent of any of them harmless, then, in the absence
of notice to the Company or the Purchase Contract Agent that such Certificate
has been acquired by a protected purchaser, the Company shall execute and
deliver to the Purchase Contract Agent, and the Purchase Contract Agent shall
authenticate, execute on behalf of the Holder, and deliver to the Holder, in
lieu of any such destroyed, lost or stolen Certificate, a new Certificate,
evidencing the same number of Corporate Units or Treasury Units, as the case may
be, and bearing a Certificate number not contemporaneously outstanding.
Notwithstanding the foregoing, the Company shall not be obligated to
execute and deliver to the Purchase Contract Agent, and the Purchase Contract
Agent shall not be obligated to authenticate, execute on behalf of the Holder,
and deliver to the Holder, a Certificate on or after the Business Day
immediately preceding the earliest of any Early Settlement Date with respect to
such lost or mutilated Certificate, any Cash Merger Early Settlement Date with
respect to such lost or mutilated Certificate, the Purchase Contract Settlement
Date or the Termination Date. In lieu of delivery of a new Certificate, upon
satisfaction of the applicable conditions specified
28
above in this Section and receipt of appropriate registration or transfer
instructions from such Holder, the Purchase Contract Agent shall:
(i) if the Purchase Contract Settlement Date or Early
Settlement Date or Cash Merger Early Settlement Date with respect to
such lost, stolen, destroyed or mutilated Certificate has occurred,
deliver the shares of Common Stock issuable in respect of the Purchase
Contracts forming a part of the Units evidenced by such Certificate; or
(ii) if a Cash Settlement with respect to such lost or
mutilated Certificate or if a Termination Event shall have occurred
prior to the Purchase Contract Settlement Date, transfer the Notes, the
Treasury Securities or the appropriate Applicable Ownership Interest
(as specified in clause (i) of the definition of such term) in the
Treasury Portfolio, as the case may be, evidenced thereby, in each case
subject to the applicable conditions and in accordance with the
applicable provisions of Section 3.15 and Article Five hereof.
Upon the issuance of any new Certificate under this Section, the
Company and the Purchase Contract Agent may require the payment by the Holder of
a sum sufficient to cover any tax or other governmental charge that may be
imposed in relation thereto and any other fees and expenses (including, without
limitation, the fees and expenses of the Purchase Contract Agent) connected
therewith.
Every new Certificate issued pursuant to this Section in lieu of any
destroyed, lost or stolen Certificate shall constitute an original additional
contractual obligation of the Company and of the Holder in respect of the Units
evidenced thereby, whether or not the destroyed, lost or stolen Certificate (and
the Units evidenced thereby) shall be at any time enforceable by anyone, and
shall be entitled to all the benefits and be subject to all the obligations of
this Agreement equally and proportionately with any and all other Certificates
delivered hereunder.
The provisions of this Section are exclusive and shall preclude, to the
extent lawful, all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Certificates.
SECTION 3.11. Persons Deemed Owners.
Prior to due presentment of a Certificate for registration of transfer,
the Company and the Purchase Contract Agent, and any agent of the Company or the
Purchase Contract Agent, may treat the Person in whose name such Certificate is
registered as the owner of the Units evidenced thereby for purposes of (subject
to any applicable record date) any payment or distribution on the Notes or on
the Applicable Ownership Interests (as specified in clause (ii) of the
definition of such term) in the Treasury Portfolio (if any), as applicable,
payment of Contract Adjustment Payments and performance of the Purchase
Contracts and for all other purposes whatsoever in connection with such Units,
whether or not such payment, distribution, or performance shall be overdue and
notwithstanding any notice to the contrary, and neither the Company nor the
29
Purchase Contract Agent, nor any agent of the Company or the Purchase Contract
Agent, shall be affected by notice to the contrary.
Notwithstanding the foregoing, with respect to any Global Certificate,
nothing contained herein shall prevent the Company, the Purchase Contract Agent
or any agent of the Company or the Purchase Contract Agent, from giving effect
to any written certification, proxy or other authorization furnished by the
Depositary (or its nominee), as a Holder, with respect to such Global
Certificate, or impair, as between such Depositary and the related Beneficial
Owner, the operation of customary practices governing the exercise of rights of
the Depositary (or its nominee) as Holder of such Global Certificate. None of
the Company, the Purchase Contract Agent or any agent of the Company or the
Purchase Contract Agent will have any responsibility or liability for any aspect
of the records relating to or payments made on account of beneficial ownership
interests of a Global Certificate or maintaining, supervising or reviewing any
records relating to such beneficial ownership interests.
SECTION 3.12. Cancellation.
All Certificates surrendered for delivery of shares of Common Stock on
or after the Purchase Contract Settlement Date or upon the transfer of Notes, or
for delivery of the appropriate Applicable Ownership Interest in the Treasury
Portfolio or Treasury Securities, as the case may be, after the occurrence of a
Termination Event or pursuant to a Cash Settlement, an Early Settlement or a
Cash Merger Early Settlement, or upon the registration of transfer or exchange
of a Unit, or a Collateral Substitution or the recreation of Corporate Units
shall, if surrendered to any Person other than the Purchase Contract Agent, be
delivered to the Purchase Contract Agent along with appropriate written
instructions regarding the cancellation thereof and, if not already cancelled,
shall be promptly cancelled by it. The Company may at any time deliver to the
Purchase Contract Agent for cancellation any Certificates previously
authenticated, executed and delivered hereunder which the Company may have
acquired in any manner whatsoever, and all Certificates so delivered shall, upon
an Issuer Order, be promptly cancelled by the Purchase Contract Agent. No
Certificates shall be authenticated, executed on behalf of the Holder and
delivered in lieu of or in exchange for any Certificates cancelled as provided
in this Section, except as expressly permitted by this Agreement. All cancelled
Certificates held by the Purchase Contract Agent shall be disposed of in
accordance with its customary practices.
If the Company or any Affiliate of the Company shall acquire any
Certificate, such acquisition shall not operate as a cancellation of such
Certificate unless and until such Certificate is delivered to the Purchase
Contract Agent cancelled or for cancellation.
SECTION 3.13. Creation of Treasury Units by Substitution of Treasury
Securities.
Unless the Treasury Portfolio has replaced the Notes as a component of
the Corporate Units, and subject to the conditions set forth in this Agreement,
a Holder may, at any time from and after the date of this Agreement and prior to
5:00 p.m. (New York City time) on the fifth
30
Business Day immediately preceding the Purchase Contract Settlement Date, effect
a Collateral Substitution and separate the Notes from the related Purchase
Contracts in respect of such Holder's Corporate Units by substituting for such
Notes, Treasury Securities in an aggregate principal amount at maturity equal to
the aggregate principal amount of such Notes; provided that Holders may make
Collateral Substitutions only in integral multiples of 40 Corporate Units. To
effect such substitution, the Holder must:
(1) deposit with the Securities Intermediary Treasury Securities
having an aggregate principal amount at maturity equal to the
aggregate principal amount of the Notes comprising part of
such Corporate Units; and
(2) transfer the related Corporate Units to the Purchase Contract
Agent accompanied by a notice to the Purchase Contract Agent,
substantially in the form of Exhibit C hereto, (i) stating
that the Holder has deposited the relevant amount of Treasury
Securities to the Securities Intermediary and (ii) requesting
that the Purchase Contract Agent instruct the Collateral Agent
to release the Notes underlying such Corporate Units,
whereupon the Purchase Contract Agent shall promptly provide
an instruction to such effect to the Collateral Agent,
substantially in the form of Exhibit A to the Pledge
Agreement.
Upon receipt of the Treasury Securities described in clause (1) above
and the instruction described in clause (2) above, in accordance with the terms
of the Pledge Agreement, the Collateral Agent will cause the Securities
Intermediary to effect the release of such Notes from the Pledge, free and clear
of the Company's security interest therein, and the transfer of such Notes to
the Purchase Contract Agent on behalf of the Holder. Upon receipt of such Notes,
the Purchase Contract Agent shall promptly:
(i) cancel the related Corporate Units;
(ii) transfer the Notes to the Holder (such Notes shall be
tradeable as a separate security, independent of the resulting Treasury
Units); and
(iii) authenticate, execute on behalf of such Holder and
deliver a Treasury Units Certificate executed by the Company in
accordance with Section 3.03 evidencing the same number of Purchase
Contracts as were evidenced by the cancelled Corporate Units.
Holders who elect to separate the Notes from the related Purchase
Contracts and to substitute Treasury Securities for such Notes shall be
responsible for any fees or expenses (including, without limitation, fees and
expenses payable to the Collateral Agent for its services as Collateral Agent)
in respect of the substitution, and neither the Company nor the Purchase
Contract Agent shall be responsible for any such fees or expenses.
31
If the Treasury Portfolio has replaced the Notes as a component of the
Corporate Units and subject to the conditions set forth in this Agreement, a
Holder may, at any time on or prior to the second Business Day immediately
preceding the Purchase Contract Settlement Date, substitute Treasury Securities
for the Applicable Ownership Interests in the Treasury Portfolio included in
such Corporate Units, but only in integral multiples of [o] Corporate Units. In
such an event, the Holder shall transfer Treasury Securities to the Collateral
Agent, and the Purchase Contract Agent shall instruct the Collateral Agent to
release the Pledge of and transfer to the Holder the appropriate Applicable
Ownership Interests in the Treasury Portfolio in the manner set forth above.
In the event a Holder making a Collateral Substitution pursuant to this
Section 3.13 fails to effect a book-entry transfer of the Corporate Units or
fails to deliver Corporate Units Certificates to the Purchase Contract Agent
after depositing Treasury Securities with the Collateral Agent, any
distributions on the Notes or Applicable Ownership Interest in the Treasury
Portfolio constituting a part of such Corporate Units shall be held in the name
of the Purchase Contract Agent or its nominee in trust for the benefit of such
Holder, until such Corporate Units are so transferred or the Corporate Units
Certificate is so delivered, as the case may be, or, such Holder provides
evidence satisfactory to the Company and the Purchase Contract Agent that such
Corporate Units Certificate has been destroyed, lost or stolen, together with
any indemnity that may be required by the Purchase Contract Agent and the
Company.
Except as described in Section 5.02 or in this Section 3.13 or in
connection with a Cash Settlement, an Early Settlement, a Cash Merger Early
Settlement or a Termination Event, for so long as the Purchase Contract
underlying a Corporate Unit remains in effect, such Corporate Units shall not be
separable into its constituent parts, and the rights and obligations of the
Holder in respect of the Notes or Applicable Ownership Interests in the Treasury
Portfolio, as the case may be, and the Purchase Contract comprising such
Corporate Units may be acquired, and may be transferred and exchanged, only as a
Corporate Unit.
SECTION 3.14. Recreation of Corporate Units.
Unless the Treasury Portfolio has replaced the Notes as a component of
the Corporate Units, and subject to the conditions set forth in this Agreement,
a Holder of Treasury Units may recreate Corporate Units at any time on or prior
to 5:00 p.m. (New York City time) on the fifth Business Day immediately
preceding the Purchase Contract Settlement Date; provided that Holders of
Treasury Units may only recreate Corporate Units in integral multiples of 40
Treasury Units. To recreate Corporate Units, the Holder must:
(1) transfer to the Securities Intermediary Notes having an
aggregate principal amount equal to the aggregate principal
amount at stated maturity of the Treasury Securities
comprising part of the Treasury Units; and
32
(2) transfer the related Treasury Units to the Purchase Contract
Agent accompanied by a notice to the Purchase Contract Agent,
substantially in the form of Exhibit C hereto, (i) stating
that the Holder has transferred the relevant amount of Notes
to the Securities Intermediary and (ii) requesting that the
Purchase Contract Agent instruct the Collateral Agent to
release the Treasury Securities underlying such Treasury
Units, whereupon the Purchase Contract Agent shall promptly
provide an instruction to such effect to the Collateral Agent,
substantially in the form of Exhibit C to the Pledge
Agreement.
Upon receipt of the Notes described in clause (1) above and the instruction
described in clause (2) above, in accordance with the terms of the Pledge
Agreement, the Collateral Agent will cause the Securities Intermediary to effect
the release of the Treasury Securities having a corresponding aggregate
principal amount at maturity from the Pledge, free and clear of the Company's
security interest therein, and the transfer thereof to the Purchase Contract
Agent on behalf of the Holder. Upon receipt of such Treasury Securities, the
Purchase Contract Agent shall promptly:
(i) cancel the related Treasury Units;
(ii) transfer the Treasury Securities to the Holder; and
(iii) authenticate, execute on behalf of such Holder and
deliver a Corporate Unit Certificate executed by the Company in
accordance with Section 3.03 evidencing the same number of Purchase
Contracts as were evidenced by the cancelled Treasury Units.
Holders who elect to recreate Corporate Units shall be responsible for
any fees or expenses (including, without limitation, fees and expenses payable
to the Collateral Agent for its services as Collateral Agent) in respect of the
recreation, and neither the Company nor the Purchase Contract Agent shall be
responsible for any such fees or expenses.
If the Treasury Portfolio has replaced the Notes as a component of the
Corporate Units, a Holder may at any time on or prior to the second Business Day
immediately preceding the Purchase Contract Settlement Date substitute the
Applicable Ownership Interests in the Treasury Portfolio for Treasury
Securities, but only in multiples of [C] Treasury Units. In such an event, the
Holder shall transfer the appropriate Applicable Ownership Interests in the
Treasury Portfolio to the Collateral Agent, and the Purchase Contract Agent
shall instruct the Collateral Agent to release the Pledge of and transfer to the
Holder Treasury Securities in the manner set forth above.
Except as provided in Section 5.02 or in this Section 3.14 or in
connection with a Cash Settlement, an Early Settlement, a Cash Merger Early
Settlement or a Termination Event, for so long as the Purchase Contract
underlying a Treasury Unit remains in effect, such Treasury Unit shall not be
separable into its constituent parts and the rights and obligations of the
Holder of such Treasury Unit in respect of the 1/40 of a Treasury Security and
the Purchase Contract
33
comprising such Treasury Unit may be acquired, and may be transferred and
exchanged, only as a Treasury Unit.
SECTION 3.15. Transfer of Collateral upon Occurrence of Termination
Event.
Upon the occurrence of a Termination Event and the transfer to the
Purchase Contract Agent of the Notes, the appropriate Applicable Ownership
Interests in the Treasury Portfolio or the Treasury Securities, as the case may
be, underlying the Corporate Units and the Treasury Units, as the case may be,
pursuant to the terms of the Pledge Agreement, the Purchase Contract Agent shall
request transfer instructions with respect to such Notes, the appropriate
Applicable Ownership Interests in the Treasury Portfolio or Treasury Securities,
as the case may be, from each Holder by written request, substantially in the
form of Exhibit D hereto, mailed to such Holder at its address as it appears in
the Security Register.
Upon book-entry transfer of the Corporate Units or the Treasury Units
or delivery of a Corporate Units Certificate or Treasury Units Certificate to
the Purchase Contract Agent with such transfer instructions, the Purchase
Contract Agent shall transfer the Notes, the appropriate Applicable Ownership
Interests in the Treasury Portfolio or Treasury Securities, as the case may be,
underlying such Corporate Units or Treasury Units, as the case may be, to such
Holder by book-entry transfer, or other appropriate procedures, in accordance
with such instructions. In the event a Holder of Corporate Units or Treasury
Units fails to effect such transfer or delivery, the Notes, the appropriate
Applicable Ownership Interests in the Treasury Portfolio or Treasury Securities,
as the case may be, underlying such Corporate Units or Treasury Units, as the
case may be, and any distributions thereon, shall be held in the name of the
Purchase Contract Agent or its nominee in trust for the benefit of such Holder,
until the earlier to occur of:
(i) the transfer of such Corporate Units or Treasury Units or
surrender of the Corporate Units Certificate or Treasury Units
Certificate or the receipt by the Company and the Purchase Contract
Agent from such Holder of satisfactory evidence that such Corporate
Units Certificate or Treasury Units Certificate has been destroyed,
lost or stolen, together with any indemnity that may be required by the
Purchase Contract Agent and the Company; and
(ii) the expiration of the time period specified in the
abandoned property laws of the relevant State in which the Purchase
Contract Agent holds such property.
SECTION 3.16. No Consent to Assumption.
Each Holder of a Unit, by acceptance thereof, shall be deemed expressly
to have withheld any consent to the assumption under Section 365 of the
Bankruptcy Code or otherwise, of the Purchase Contract by the Company or its
trustee, receiver, liquidator or a person or entity performing similar functions
in the event that the Company becomes the debtor under the
34
Bankruptcy Code or subject to other similar state or Federal law providing for
reorganization or liquidation.
ARTICLE 4
THE NOTES AND APPLICABLE OWNERSHIP INTERESTS IN THE TREASURY PORTFOLIO
SECTION 4.01. Interest Payments; Rights to Interest Payments Preserved.
Any payment on any Note or on the appropriate Applicable Ownership
Interests (as specified in clause (ii) of the definition of such term) in the
Treasury Portfolio, as the case may be, which is paid on any Payment Date shall,
subject to receipt thereof by the Purchase Contract Agent from the Collateral
Agent as provided by the terms of the Pledge Agreement, be paid to the Person in
whose name the Corporate Units Certificate (or one or more Predecessor Corporate
Units Certificates) of which such Note or the appropriate Applicable Ownership
Interests in the Treasury Portfolio, as the case may be, forms a part is
registered at the close of business on the Record Date for such Payment Date.
Each Corporate Units Certificate evidencing Notes or the appropriate
Applicable Ownership Interests in the Treasury Portfolio delivered under this
Agreement upon registration of transfer of or in exchange for or in lieu of any
other Corporate Units Certificate shall carry the right to accrued and unpaid
interest or distributions, and to accrue interest or distributions, which were
carried by the Notes or the appropriate Applicable Ownership Interests in the
Treasury Portfolio underlying such other Corporate Units Certificate.
In the case of any Corporate Unit with respect to which (A) Cash
Settlement of the underlying Purchase Contract is properly effected pursuant to
Section 5.02 hereof, (B) Early Settlement of the underlying Purchase Contract is
properly effected pursuant to Section 5.07 hereof, (C) Cash Merger Early
Settlement of the underlying Purchase Contract is properly effected pursuant to
Section 5.04(b)(2) hereof, (D) a Collateral Substitution is properly effected
pursuant to Section 3.13, or (E) a Successful Initial Remarketing occurs with
respect to the Note that is part of such Corporate Unit, in each case on a date
that is after any Record Date and prior to or on the next succeeding Payment
Date, interest on the Notes or distributions on the appropriate Applicable
Ownership Interests in the Treasury Portfolio, as the case may be, underlying
such Corporate Unit otherwise payable on such Payment Date shall be payable on
such Payment Date notwithstanding such Cash Settlement, Early Settlement, Cash
Merger Early Settlement, Collateral Substitution or Initial Remarketing, and
such payment or distributions shall, subject to receipt thereof by the Purchase
Contract Agent, be payable to the Person in whose name the Corporate Units
Certificate (or one or more Predecessor Corporate Units Certificates) was
registered at the close of business on the Record Date.
35
Except as otherwise expressly provided in the immediately preceding
paragraph, in the case of any Corporate Units with respect to which Cash
Settlement, Early Settlement or Cash Merger Early Settlement of the underlying
Purchase Contract is properly effected, or with respect to which a Collateral
Substitution has been effected, payments on the related Notes or distributions
on the appropriate Applicable Ownership Interests in the Treasury Portfolio, as
the case may be, that would otherwise be payable or made after the Purchase
Contract Settlement Date, Early Settlement Date, Cash Merger Early Settlement
Date or the date of the Collateral Substitution, as the case may be, shall not
be payable hereunder to the Holder of such Corporate Units; provided, however,
that to the extent that such Holder continues to hold Separate Notes or
Applicable Ownership Interest in the Treasury Portfolio that formerly comprised
a part of such Holder's Corporate Units, such Holder shall be entitled to
receive interest on such Separate Notes or distributions on the Applicable
Ownership Interests in the Treasury Portfolio.
SECTION 4.02. Notice and Voting.
Under the terms of the Pledge Agreement, the Purchase Contract Agent will
be entitled to exercise the voting and any other consensual rights pertaining to
the Pledged Notes, but only to the extent instructed in writing by the Holders
as described below. Upon receipt of notice of any meeting at which holders of
Notes are entitled to vote or upon any solicitation of consents, waivers or
proxies of holders of Notes, the Purchase Contract Agent shall, as soon as
practicable thereafter, mail, first class, postage pre-paid, to the Holders of
Corporate Units a notice:
(i) containing such information as is contained in the notice or
solicitation;
(ii) stating that each Holder on the record date set by the Purchase
Contract Agent therefor (which, to the extent possible, shall be the same
date as the record date for determining the holders of Notes, as the case
may be, entitled to vote) shall be entitled to instruct the Purchase
Contract Agent as to the exercise of the voting rights pertaining to such
Notes underlying their Corporate Units; and
(iii) stating the manner in which such instructions may be given.
Upon the written request of the Holders of Corporate Units on such record date
received by the Purchase Contract Agent at least six days prior to such meeting,
the Purchase Contract Agent shall endeavor insofar as practicable to vote or
cause to be voted, in accordance with the instructions set forth in such
requests, the maximum number of Notes, as the case may be, as to which any
particular voting instructions are received. In the absence of specific
instructions from the Holder of a Corporate Unit, the Purchase Contract Agent
shall abstain from voting the Notes underlying such Corporate Unit. The Company
hereby agrees, if applicable, to solicit Holders of Corporate Units to timely
instruct the Purchase Contract Agent in order to enable the Purchase Contract
Agent to vote such Notes.
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The Holders of Corporate Units and Treasury Units shall have no voting or
other rights in respect of Common Stock.
SECTION 4.03. Special Event Redemption.
(a) If the Company elects to redeem the Notes on any Payment Date following
the occurrence of a Special Event as permitted by the Indenture, it shall notify
the Collateral Agent in writing that a Special Event has occurred and that it
intends to redeem the Notes and the Special Event Redemption Date. On the
Special Event Redemption Date, the Collateral Agent shall surrender the Pledged
Notes to the Indenture Trustee against delivery of an amount equal to the
aggregate Redemption Price for such Pledged Notes. Thereafter, pursuant to the
terms of the Pledge Agreement, the Collateral Agent shall cause the Securities
Intermediary to apply an amount equal to the aggregate Redemption Amount of such
funds to purchase on behalf of the Holders of Corporate Units the Treasury
Portfolio and promptly remit the remaining portion of such funds to the Purchase
Contract Agent for payment to the Holders of such Corporate Units.
(b) Upon the occurrence of a Special Event Redemption, (i) the Applicable
Ownership Interests (as specified in clause (i) of the definition of such term)
in the Treasury Portfolio will be substituted as Collateral for the Pledged
Notes and will be held by the Collateral Agent in accordance with the terms of
the Pledge Agreement to secure the obligation of each Holder of a Corporate Unit
to purchase the Common Stock of the Company under the Purchase Contract
constituting a part of such Corporate Unit, (ii) the Holders of Corporate Units
and the Collateral Agent shall have such security interest rights and
obligations with respect to such Applicable Ownership Interests (as specified in
clause (i) of the definition of such term) as the Holders of Corporate Units and
the Collateral Agent had in respect of the Notes, as the case may be, subject to
the Pledge thereof as provided in the Pledge Agreement, and (iii) any reference
herein to the Notes shall be deemed to be a reference to such Applicable
Ownership Interests (as specified in clause (i) of the definition of such term)
in the Treasury Portfolio. The Company may cause to be made in any Corporate
Units Certificates thereafter to be issued such change in phraseology and form
(but not in substance) as may be appropriate to reflect the substitution of the
Applicable Ownership Interests (as specified in clause (i) of the definition of
such term) in the Treasury Portfolio for Notes as Collateral.
(c) The Holders of Separate Notes shall directly receive the redemption
price for the Separate Notes.
ARTICLE 5
THE PURCHASE CONTRACTS
SECTION 5.01. Purchase of Shares of Common Stock.
(a) Each Purchase Contract shall obligate the Holder of the related Units
to purchase, and the Company to sell, on the Purchase Contract Settlement Date
at a price equal to the Stated
37
Amount (the "PURCHASE PRICE"), a number of newly issued shares of Common Stock
(subject to Section 5.09) equal to the Settlement Rate unless an Early
Settlement, a Cash Merger Early Settlement or a Termination Event with respect
to the Units of which such Purchase Contract is a part shall have occurred. The
"SETTLEMENT RATE" is equal to:
(i) if the Adjusted Applicable Market Value (as defined below) is
greater than or equal to $[o] (the "THRESHOLD APPRECIATION PRICE"), [o]
shares of Common Stock per Purchase Contract;
(ii) if the Adjusted Applicable Market Value is less than the
Threshold Appreciation Price but greater than $[o] (the "REFERENCE PRICE"),
the number of shares of Common Stock per Purchase Contact having a value
equal to the Stated Amount divided by the Adjusted Applicable Market Value;
(iii) if the Adjusted Applicable Market Value is less than or equal to
the Reference Price, [o] shares of Common Stock per Purchase Contract;
in each case subject to adjustment as provided in Section 5.04 (and in each case
rounded upward or downward to the nearest 1/10,000th of a share).
The "APPLICABLE MARKET VALUE" means the average of the Closing Price per
share of Common Stock on each of the 20 consecutive Trading Days ending on the
third Trading Day immediately preceding the Purchase Contract Settlement Date,
subject to adjustments set forth under Section 5.04 hereof.
The "ADJUSTED APPLICABLE MARKET VALUE" means (i) prior to any adjustment of
the Settlement Rate pursuant to paragraph (1), (2), (3), (4), (5), (6), (7) or
(10) of Section 5.04(a), the Applicable Market Value, and (ii) at the time of
and after any adjustment of the Settlement Rate pursuant to paragraph (1), (2),
(3), (4), (5), (6), (7) or (10) of Section 5.04(a), the Applicable Market Value
multiplied by a fraction of which the numerator shall be the Settlement Rate
immediately after such adjustment pursuant to paragraph (1), (2), (3), (4), (5),
(6), (7) or (10) of Section 5.04(a) and the denominator shall be the Settlement
Rate immediately prior to such adjustment; provided, however, that if such
adjustment to the Settlement Rate is required to be made pursuant to the
occurrence of any of the events contemplated by paragraph (1), (2), (3), (4),
(5), (6), (7) or (10) of Section 5.04(a) during the period taken into
consideration for determining the Applicable Market Value, appropriate and
customary adjustments shall be made to the Settlement Rate.
The "CLOSING PRICE" per share of Common Stock on any date of determination
means:
(i) the closing sale price as of the close of the principal trading
session (or, if no closing price is reported, the last reported sale price)
per share on the New York Stock Exchange, Inc. (the "NYSE") on such date;
38
(ii) if the Common Stock is not listed for trading on the NYSE on any
such date, the closing sale price (or, if no closing price is reported, the
last reported sale price) per share as reported in the composite
transactions for the principal United States national or regional
securities exchange on which the Common Stock is so listed;
(iii) if the Common Stock is not so listed on a United States national
or regional securities exchange, the last closing sale price per share as
reported by The Nasdaq National Market, Inc.;
(iv) if the Common Stock is not so reported by the Nasdaq National
Market, Inc., the last quoted bid price for the Common Stock in the
over-the-counter market as reported by the National Quotation Bureau or
similar organization; or
(v) if the bid price referred to in clause (iv) is not available, the
market value of Common Stock on such date as determined by a nationally
recognized independent investment banking firm retained by the Company for
purposes of determining the Closing Price.
A "TRADING DAY" means a day on which the Common Stock (1) is not suspended
from trading on any national or regional securities exchange or association or
over-the-counter market at the close of business and (2) has traded at least
once on the national or regional securities exchange or association or
over-the-counter market that is the primary market for the trading of the Common
Stock.
(b) Each Holder of a Corporate Unit or a Treasury Unit, by its acceptance
of such Unit:
(i) irrevocably authorizes the Purchase Contract Agent to enter into
and perform the related Purchase Contract on its behalf as its
attorney-in-fact (including, without limitation, the execution of
Certificates on behalf of such Holder);
(ii) agrees to be bound by the terms and provisions thereof;
(iii) covenants and agrees to perform its obligations under such
Purchase Contract for so long as such Holder remains a Holder of a
Corporate Unit or a Treasury Unit;
(iv) consents to the provisions hereof;
(v) irrevocably authorizes the Purchase Contract Agent to enter into
and perform this Agreement and the Pledge Agreement on its behalf and in
its name as its attorney-in-fact;
39
(vi) consents to, and agrees to be bound by, the Pledge of such
Holder's right, title and interest in and to the Collateral Account,
including the Notes and the Applicable Ownership Interests (as specified in
clause (i) of the definition of such term) in the Treasury Portfolio or the
Treasury Securities pursuant to the Pledge Agreement; and
(vii) for United States federal, state and local income and franchise
tax purposes, agrees to (i) treat an acquisition of the Corporate Units as
an acquisition of the Note and Purchase Contract constituting the Corporate
Units, (ii) treat the Notes as indebtedness and (iii) treat itself as the
owner of the applicable interest in the Collateral Account, including the
Notes and the Applicable Ownership Interests in the Treasury Portfolio (as
specified in clause (i) of the definition of such term) or the Treasury
Securities,
provided that upon a Termination Event, the rights of the Holder of such Units
under the Purchase Contract may be enforced without regard to any other rights
or obligations.
(c) Each Holder of a Corporate Unit or a Treasury Unit, by its acceptance
thereof, further covenants and agrees that to the extent and in the manner
provided in Section 5.02 and the Pledge Agreement, but subject to the terms
thereof, Proceeds of the Notes, the Treasury Securities or the Applicable
Ownership Interests (as specified in clause (i) of the definition of such term)
in the Treasury Portfolio, as applicable, on the Purchase Contract Settlement
Date, shall be paid by the Collateral Agent to the Company in satisfaction of
such Holder's obligations under such Purchase Contract and such Holder shall
acquire no right, title or interest in such Proceeds.
(d) Upon registration of transfer of a Certificate, the transferee shall be
bound (without the necessity of any other action on the part of such transferee)
by the terms of this Agreement, the Purchase Contracts underlying such
Certificate and the Pledge Agreement and the transferor shall be released from
the obligations under this Agreement, the Purchase Contracts underlying the
Certificate so transferred and the Pledge Agreement. The Company covenants and
agrees, and each Holder of a Certificate, by its acceptance thereof, likewise
covenants and agrees, to be bound by the provisions of this paragraph.
SECTION 5.02. Remarketing; Payment of Purchase Price.
(a) (i) Unless a Special Event Redemption has occurred prior to the Initial
Remarketing Date, the Company shall engage the Remarketing Agent pursuant to the
Remarketing Agreement for Remarketing the Notes. By 11:00 a.m. (New York City
time) on the Business Day immediately preceding the Initial Remarketing Date,
the Purchase Contract Agent shall notify the Remarketing Agent of the aggregate
principal amount of Pledged Notes, and the Custodial Agent shall notify the
Remarketing Agent of the aggregate principal amount of Separate Notes (if any)
that are to be remarketed pursuant to clause (ii) below. Concurrently, the
Collateral Agent, pursuant to the terms of the Pledge Agreement, will present
for Remarketing the Pledged Notes, and the Custodial Agent, pursuant to clause
(ii) below, will present for Remarketing the Separate
40
Notes, to the Remarketing Agent. Upon receipt of such notice from the Purchase
Contract Agent and Custodial Agent and the Pledged Notes and Separate Notes (if
any) from the Collateral Agent and Custodial Agent, the Remarketing Agent will,
on the Initial Remarketing Date, use its reasonable efforts to remarket (based
on the Reset Rate) (the "INITIAL REMARKETING") such Pledged Notes and Separate
Notes on such date at a price of approximately 100.25% (or, if the Remarketing
Agent is unable to remarket the Pledged Notes and Separate Notes at such rate,
at a rate below 100.25% in the discretion of the Remarketing Agent, but in no
event less than 100%, net of any Remarketing Fee and any other fees and
commissions) of the sum of the Treasury Portfolio Purchase Price plus the
Separate Notes Purchase Price. If the Remarketing Agent is able to remarket the
Pledged Notes and Separate Notes at a price equal to or greater than 100% (net
of any Remarketing Fee and any other fees and commissions) of the Treasury
Portfolio Purchase Price plus the Separate Notes Purchase Price (a "SUCCESSFUL
INITIAL REMARKETING"), the portion of the proceeds from such Successful Initial
Remarketing equal to the Treasury Portfolio Purchase Price will be applied to
purchase the Treasury Portfolio. The Remarketing Agent shall deduct as a
remarketing fee (the "REMARKETING FEE") an amount equal to the lesser of (i) 25
basis points (0.25%) of the sum of the Treasury Portfolio Purchase Price plus
the Separate Notes Purchase Price and (ii) the amount of the proceeds of such
Remarketing in excess of the sum of the Treasury Portfolio Purchase Price plus
the Separate Notes Purchase Price. None of the Company, the Purchase Contract
Agent, or any Holders of Corporate Units or holders of Separate Notes whose
Notes or Separate Notes are so remarketed will otherwise be responsible for the
payment of any Remarketing Fee in connection therewith. With respect to Separate
Notes, any proceeds of the Initial Remarketing in excess of the Remarketing Fee
attributable to the Separate Notes will be remitted to the Custodial Agent for
payment to the holders of Separate Notes. With respect to Pledged Notes, any
proceeds of the Initial Remarketing in excess of the sum of the Treasury
Portfolio Purchase Price plus the Remarketing Fee with respect to such Pledged
Notes will be remitted to the Purchase Contract Agent for payment to the Holders
of the related Corporate Units. The Treasury Portfolio will be substituted for
the Pledged Notes and the appropriate Applicable Ownership Interests (as
specified in clause (i) of the definition of such term) in the Treasury
Portfolio will be pledged to the Collateral Agent to secure the obligation of
the Holders of Corporate Units to pay the Purchase Price for the Common Stock
under the related Purchase Contracts on the Purchase Contract Settlement Date.
Following the occurrence of a Successful Initial Remarketing, the Holders
of Corporate Units and the Collateral Agent shall have such security interests,
rights and obligations with respect to the Applicable Ownership Interests (as
specified in clause (i) of the definition of such term) in the Treasury
Portfolio as the Holder of Corporate Units and the Collateral Agent had in
respect of the Notes, subject to the Pledge thereof as provided in the Pledge
Agreement, and any reference herein or in the Certificates to the Notes shall be
deemed to be a reference to such Applicable Ownership Interests in the Treasury
Portfolio and any reference herein or in the Certificates to interest on the
Notes shall be deemed to be a reference to corresponding distributions on such
Applicable Ownership Interests in the Treasury Portfolio. The Company may cause
to be made in any Corporate Units Certificates thereafter to be issued such
change in
41
phraseology and form (but not in substance) as may be appropriate to reflect the
substitution of such Applicable Ownership Interests in the Treasury Portfolio
for Notes.
If, in spite of using its reasonable efforts, the Remarketing Agent cannot
remarket the Pledged Notes and the Separate Notes (if any) in the Initial
Remarketing (other than to the Company) at a price not less than 100% (net of
any Remarketing Fee and any other fees and commissions) of the sum of the
Treasury Portfolio Purchase Price plus the Separate Notes Purchase Price or a
condition precedent set forth in the Remarketing Agreement is not fulfilled, the
Initial Remarketing will be deemed to have failed (a "FAILED INITIAL
REMARKETING"). Upon a Failed Initial Remarketing, the Remarketing Agent shall
return the Pledged Notes and Separate Notes (if any) subject to such Remarketing
to the Collateral Agent or the Custodial Agent, as the case may be.
(ii) Prior to 5:00 p.m. (New York City time) on the fifth Business Day
immediately preceding the applicable Remarketing Date, but no earlier than
the Payment Date immediately preceding such date, Holders of Separate Notes
may elect to have their Separate Notes remarketed under the Remarketing
Agreement by delivering their Separate Notes, along with a notice of such
election, substantially in the form of Exhibit F to the Pledge Agreement,
to the Custodial Agent. After such time, such election shall become an
irrevocable election to have such Separate Notes remarketed in such
Remarketing and, if such Remarketing fails, in any subsequent Remarketing.
The Custodial Agent shall hold Separate Notes in an account separate from
the Collateral Account in which the Pledged Notes (as defined in the Pledge
Agreement) shall be held. Holders of Separate Notes electing to have their
Separate Notes remarketed will also have the right to withdraw that
election by written notice to the Custodial Agent, substantially in the
form of Exhibit G to the Pledge Agreement, on or prior to 5:00 p.m. (New
York City time) on the fifth Business Day immediately preceding the
applicable Remarketing Date, upon which notice the Custodial Agent shall
return such Separate Notes to such Holder. Promptly after 11:00 a.m. on the
Business Day immediately preceding the applicable Remarketing Date, the
Custodial Agent shall notify the Remarketing Agent of the aggregate
principal amount of the Separate Notes to be remarketed and will deliver to
the Remarketing Agent for remarketing all such Separate Notes delivered to
the Custodial Agent pursuant to Section 5.07(c) of the Pledge Agreement and
not validly withdrawn prior to such date.
(iii) Not later than seven calendar days nor more than 15 calendar
days prior to the applicable Remarketing Date, the Company shall request
the Depositary or its nominee to notify the Beneficial Owners or Depositary
Participants holding Units of the procedures to be followed in such
Remarketing.
(iv) The Company agrees to use commercially reasonable efforts to
ensure that, if required by applicable law, a registration statement with
regard to the full amount of the Notes to be remarketed in the Initial
Remarketing, the Second Remarketing, the Third
42
Remarketing or the Final Remarketing, as the case may be, shall be
effective with the Securities and Exchange Commission in a form that will
enable the Remarketing Agent to rely on it in connection with such
Remarketing.
(v) The Company shall cause a notice of a Failed Remarketing to be
published (with a copy of such notice to be provided to the Purchase
Contract Agent) on the Business Day immediately following the applicable
Remarketing Date, in a daily newspaper in the English language of general
circulation in the City of New York, which is expected to be The Wall
Street Journal.
(b) (i) Unless a Special Event Redemption has occurred prior to the Second
Remarketing Date, if a Failed Initial Remarketing occurs, the Remarketing Agent
will use its reasonable efforts to remarket the Notes (a "SECOND REMARKETING")
on the Second Remarketing Date. By 11:00 a.m. (New York City time) on the
Business Day immediately preceding the Second Remarketing Date for such Second
Remarketing, the Purchase Contract Agent shall notify the Remarketing Agent of
the aggregate principal amount of Pledged Notes, and the Custodial Agent shall
notify the Remarketing Agent of the aggregate principal amount of Separate Notes
(if any) that are to be remarketed pursuant to Section 5.02(a)(ii).
Concurrently, the Collateral Agent, pursuant to the terms of the Pledge
Agreement, and the Custodial Agent, pursuant to Section 5.02(a)(ii), will
present for Remarketing the Pledged Notes and the Separate Notes (if any) that
are to be remarketed to the Remarketing Agent. Upon receipt of such notice from
the Purchase Contract Agent and the Custodial Agent and Pledged Notes and
Separate Notes (if any) from the Collateral Agent and the Custodial Agent, the
Remarketing Agent will, on the Second Remarketing Date, use its reasonable
efforts to remarket (based on the Reset Rate) such Pledged Notes and Separate
Notes on such date at a price of approximately 100.25% (or, if the Remarketing
Agent is unable to remarket the Pledged Notes and Separate Notes at such rate,
at a rate below 100.25% in the discretion of the Remarketing Agent, but in no
event less than 100%, net of any Remarketing Fee and any other fees and
commissions) of the sum of the Treasury Portfolio Purchase Price plus the
Separate Notes Purchase Price. If the Remarketing Agent is able to remarket the
Pledged Notes and Separate Notes at a price equal to or greater than 100% (net
of any Remarketing Fee and any other fees and commissions) of the Treasury
Portfolio Purchase Price plus the Separate Notes Purchase Price (a "SUCCESSFUL
SECOND REMARKETING"), the portion of the proceeds from such Successful Second
Remarketing equal to the Treasury Portfolio Purchase Price will be applied to
purchase the Treasury Portfolio. The Remarketing Agent shall deduct the
Remarketing Fee from any amount of such proceeds in excess of the sum of the
Treasury Portfolio Purchase Price plus the Separate Notes Purchase Price. None
of the Company, the Purchase Contract Agent or any Holders of Corporate Units or
holders of Separate Notes whose Notes or Separate Notes are so remarketed will
otherwise be responsible for the payment of any Remarketing Fee in connection
therewith. With respect to Separate Notes, any proceeds of the Second
Remarketing in excess of the Remarketing Fee attributable to the Separate Notes
will be remitted to the Custodial Agent for payment to the holders of Separate
Notes. With respect to Pledged Notes, any proceeds of the Second Remarketing in
excess of the sum of the Treasury Portfolio Purchase Price plus the Remarketing
43
Fee with respect to such Pledged Notes will be remitted to the Purchase Contract
Agent for payment to the Holders of the related Corporate Units. The Treasury
Portfolio will be substituted for the Pledged Notes and the appropriate
Applicable Ownership Interests (as specified in clause (i) of the definition of
such term) in the Treasury Portfolio will be pledged to the Collateral Agent to
secure the obligation of the Holders of Corporate Units to pay the Purchase
Price for the Common Stock under the related Purchase Contracts on the Purchase
Contract Settlement Date.
Following the occurrence of a Successful Second Remarketing, the Holders of
Corporate Units and the Collateral Agent shall have such security interests,
rights and obligations with respect to the Applicable Ownership Interests (as
specified in clause (i) of the definition of such term) in the Treasury
Portfolio as the Holder of Corporate Units and the Collateral Agent had in
respect of the Notes, subject to the Pledge thereof as provided in the Pledge
Agreement, and any reference herein or in the Certificates to the Notes shall be
deemed to be a reference to such Applicable Ownership Interests in the Treasury
Portfolio and any reference herein or in the Certificates to interest on the
Notes shall be deemed to be a reference to corresponding distributions on such
Applicable Ownership Interests in the Treasury Portfolio. The Company may cause
to be made in any Corporate Units Certificates thereafter to be issued such
change in phraseology and form (but not in substance) as may be appropriate to
reflect the substitution of such Applicable Ownership Interests in the Treasury
Portfolio for Notes.
If, in spite of using its reasonable efforts, the Remarketing Agent cannot
remarket the Pledged Notes and Separate Notes (if any) in a Second Remarketing
(other than to the Company) at a price not less than 100% (net of any
Remarketing Fee and any other fees and commissions) of the sum of the Treasury
Portfolio Purchase Price plus the Separate Notes Purchase Price or a condition
precedent set forth in the Remarketing Agreement is not fulfilled, the Second
Remarketing will be deemed to have failed (a "FAILED SECOND REMARKETING"). Upon
a Failed Second Remarketing, the Remarketing Agent shall return the Pledged
Notes and the Separate Notes (if any) subject to such Remarketing to the
Collateral Agent or the Custodial Agent, as the case may be.
(ii) Unless a Special Event Redemption has occurred prior to the Third
Remarketing Date, if a Failed Second Remarketing occurs, the Remarketing
Agent will use its reasonable efforts to remarket the Notes (a "THIRD
REMARKETING") on the Third Remarketing Date. By 11:00 a.m. (New York City
time) on the Business Day immediately preceding the Third Remarketing Date
for such Third Remarketing, the Purchase Contract Agent shall notify the
Remarketing Agent of the aggregate principal amount of Pledged Notes, and
the Custodial Agent shall notify the Remarketing Agent of the aggregate
principal amount of Separate Notes (if any) that are to be remarketed
pursuant to Section 5.02(a)(ii). Concurrently, the Collateral Agent,
pursuant to the terms of the Pledge Agreement, and the Custodial Agent,
pursuant to Section 5.02(a)(ii), will present for Remarketing the Pledged
Notes and the Separate Notes (if any) that are to be remarketed to the
Remarketing Agent. Upon receipt of such notice from the Purchase
44
Contract Agent and the Custodial Agent and such Pledged Notes and Separate
Notes from the Collateral Agent and the Custodial Agent, the Remarketing
Agent will, on the Third Remarketing Date, use its reasonable efforts to
remarket (based on the Reset Rate) such Pledged Notes and the Separate
Notes on such date at a price of approximately 100.25% (or, if the
Remarketing Agent is unable to remarket the Pledged Notes and the Separate
Notes at such rate, at a rate below 100.25% in the discretion of the
Remarketing Agent, but in no event less than 100%, net of any Remarketing
Fee and any other fees and commissions) of the sum of the Treasury
Portfolio Purchase Price plus the Separate Notes Purchase Price. If the
Remarketing Agent is able to remarket the Pledged Notes and the Separate
Notes at a price equal to or greater than 100% (net of any Remarketing Fee
and any other fees and commissions) of the Treasury Portfolio Purchase
Price plus the Separate Notes Purchase Price (a "SUCCESSFUL THIRD
REMARKETING"), the portion of the proceeds from such Successful Third
Remarketing equal to the Treasury Portfolio Purchase Price will be applied
to purchase the Treasury Portfolio. The Remarketing Agent shall deduct the
Remarketing Fee from any amount of such proceeds in excess of the sum of
the Treasury Portfolio Purchase Price plus the Separate Notes Purchase
Price. None of the Company, the Purchase Contract Agreement or any Holders
of Corporate Units or holders of Separate Notes whose Notes or Separate
Notes are so remarketed will otherwise be responsible for the payment of
any Remarketing Fee in connection therewith. With respect to Separate
Notes, any proceeds of the Third Remarketing in excess of the Remarketing
Fee attributable to the Separate Notes will be remitted to the Custodial
Agent for payment to the holders of Separate Notes. With respect to Pledged
Notes, any proceeds of the Third Remarketing in excess of the sum of the
Treasury Portfolio Purchase Price plus the Remarketing Fee with respect to
such Pledged Notes will be remitted to the Purchase Contract Agent for
payment to the Holders of the related Corporate Units. The Treasury
Portfolio will be substituted for the Pledged Notes and the appropriate
Applicable Ownership Interests (as specified in clause (i) of the
definition of such term) in the Treasury Portfolio will be pledged to the
Collateral Agent to secure the obligation of the Holders of Corporate Units
to pay the Purchase Price for the Common Stock under the related Purchase
Contracts on the Purchase Contract Settlement Date.
Following the occurrence of a Successful Third Remarketing, the Holders of
Corporate Units and the Collateral Agent shall have such security interests
(with respect to the Collateral Agent), rights and obligations with respect to
the Applicable Ownership Interests (as specified in clause (i) of the definition
of such term) in the Treasury Portfolio as the Holder of Corporate Units and the
Collateral Agent had in respect of the Notes, subject to the Pledge thereof as
provided in the Pledge Agreement, and any reference herein or in the
Certificates to the Notes shall be deemed to be a reference to such Applicable
Ownership Interests in the Treasury Portfolio and any reference herein or in the
Certificates to interest on the Notes shall be deemed to be a reference to
corresponding distributions on such Applicable Ownership Interests in the
Treasury Portfolio. The Company may cause to be made in any Corporate Units
Certificates thereafter to be issued such change in phraseology and form (but
not in substance) as may be
45
appropriate to reflect the substitution of such Applicable Ownership Interests
in the Treasury Portfolio for Notes.
If, in spite of using its reasonable efforts, the Remarketing Agent cannot
remarket the Pledged Notes and the Separate Notes (if any) in a Third
Remarketing (other than to the Company) at a price not less than 100% (net of
any Remarketing Fee and any other fees and commissions) of the sum of the
Treasury Portfolio Purchase Price plus the Separate Notes Purchase Price or a
condition precedent set forth in the Remarketing Agreement is not fulfilled, the
Third Remarketing will be deemed to have failed (a "FAILED THIRD REMARKETING").
Upon a Failed Third Remarketing, the Remarketing Agent shall return the Pledged
Notes and the Separate Notes (if any) subject to such Remarketing to the
Collateral Agent or the Custodial Agent, as the case may be.
(c) (i) Unless a Special Event Redemption, an Early Settlement or a Cash
Merger Early Settlement has occurred prior to the Final Remarketing Date, if no
Successful Remarketing has occurred prior to the Final Remarketing Date, each
Holder shall have the right to satisfy such Holder's obligations under the
Purchase Contract on the Purchase Contract Settlement Date in cash by notifying
the Purchase Contract Agent by use of a notice in substantially the form of
Exhibit E hereto of its intention to pay in cash ("CASH SETTLEMENT") prior to
5:00 p.m. (New York City time) on the fifth Business Day immediately preceding
the Purchase Contract Settlement Date. Promptly following 5:00 p.m. (New York
City time) on the fifth Business Day immediately preceding the Purchase Contract
Settlement Date, the Purchase Contract Agent shall notify the Collateral Agent
and the Indenture Trustee of the receipt of such notices from Holders intending
to make a Cash Settlement.
(ii) A Holder of a Corporate Unit who has so notified the Purchase
Contract Agent of its intention to effect a Cash Settlement shall pay the
Purchase Price to the Securities Intermediary for deposit in the Collateral
Account prior to 5:00 p.m. (New York City time) on the fourth Business Day
immediately preceding the Purchase Contract Settlement Date, in lawful
money of the United States by certified or cashiers' check or wire
transfer, in each case in immediately available funds payable to or upon
the order of the Securities Intermediary. Any cash received by the
Collateral Agent shall be invested promptly by the Securities Intermediary
in Permitted Investments and paid to the Company on the Purchase Contract
Settlement Date in settlement of the Purchase Contracts in accordance with
the terms of this Agreement and the Pledge Agreement. Any funds received by
the Securities Intermediary in respect of the investment earnings from such
Permitted Investments in excess of the Purchase Price for the shares of
Common Stock to be purchased by such Holder shall be distributed to the
Purchase Contract Agent when received for payment to the Holder.
(iii) If a Holder of a Corporate Unit does not notify the Purchase
Contract Agent of its intention to make a Cash Settlement in accordance
with paragraph 5.02(c)(i) above, or does notify the Purchase Contract Agent
in accordance with paragraph 5.02(c)(i) above
46
but fails to make such payment as required by paragraph 5.02(c)(ii) above,
such Holder shall be deemed to have consented to the disposition of the
Pledged Notes pursuant to the Final Remarketing as described in paragraph
5.02(d) below.
(iv) Promptly after 5:00 p.m. (New York City time) on the fourth
Business Day preceding the Purchase Contract Settlement Date, the
Collateral Agent, based on cash payments received by the Collateral Agent
pursuant to Section 5.02(c)(ii) hereof, shall promptly notify the Purchase
Contract Agent and the Indenture Trustee of the aggregate principal amount
of Notes to be tendered for purchase in the Remarketing in a notice
pursuant to the terms of the Pledge Agreement.
(d) (i) Unless a Special Event Redemption, an Early Settlement or a Cash
Merger Early Settlement has occurred prior to the Final Remarketing Date, if a
Failed Third Remarketing has occurred, the Notes of such Holders of Corporate
Units who have not notified the Purchase Contract Agent of their intention to
effect a Cash Settlement as provided in paragraph 5.02(c)(i) above, or who have
so notified the Purchase Contract Agent in accordance with paragraph 5.02(c)(i)
above but have failed to make such payment as required by paragraph 5.02(c)(ii)
above, and the Separate Notes of any holder who has elected for its Separate
Notes to be remarketed pursuant to Section 5.02(a)(ii) will be sold by the
Remarketing Agent (the "FINAL REMARKETING") on the third Business Day
immediately preceding the Purchase Contract Settlement Date (the "FINAL
REMARKETING DATE"). In order to facilitate the Final Remarketing, the Purchase
Contract Agent, based on the notices specified in Section 5.02(c)(iv), and the
Collateral Agent, based on the notices specified in Section 5.02(a)(ii), shall
notify the Remarketing Agent, by 11:00 a.m. (New York City time) on the Business
Day immediately preceding the Final Remarketing Date, of the aggregate principal
amount of Pledged Notes or aggregate principal amount of Separate Notes that are
to be remarketed pursuant to Section 5.02(a)(ii), as the case may be, to be
remarketed. Concurrently, the Collateral Agent, pursuant to the terms of the
Pledge Agreement, and the Custodial Agent shall cause such Pledged Notes and
Separate Notes to be presented to the Remarketing Agent for Remarketing.
(ii) Upon receipt of such notice from the Purchase Contract Agent and
the Collateral Agent and the Pledged Notes and Separate Notes (if any) from
the Collateral Agent or Custodial Agent, as set forth in clause (i) above,
the Remarketing Agent shall, on the Final Remarketing Date, use its
reasonable efforts to remarket (based on the Reset Rate) such Pledged Notes
and the Separate Notes on such date at a price equal to approximately
100.25% (or, if the Remarketing Agent is unable to remarket the Pledged
Notes and the Separate Notes at such rate, at a rate below 100.25% in the
discretion of the Remarketing Agent, but in no event less than 100%, net of
the Final Remarketing Fee and any other fees and commissions) of the
aggregate principal amount of such Notes and Separate Notes being
remarketed, as provided in the Remarketing Agreement. If the Remarketing
Agent is able to remarket the Notes and Separate Notes at a price equal to
or greater than 100% (net of the Final Remarketing Fee and any other fees
and commissions) of the aggregate principal amount of the Notes and
Separate Notes (if any)
47
(a "SUCCESSFUL FINAL REMARKETING"), the Remarketing Agent will remit the
proceeds attributable to the Remarketing of the Pledged Notes from such
Successful Final Remarketing to the Collateral Agent. The Remarketing Agent
may deduct as the remarketing fee (the "FINAL REMARKETING FEE") an amount
equal to the lesser of (i) 25 basis points (0.25%) of the aggregate
principal amount of the remarketed Pledged Notes and Separate Notes (if
any) and (ii) the amount of the proceeds of a Successful Final Remarketing
in excess of the aggregate principal amount of the remarketed Pledged Notes
and Separate Notes (if any). With respect to Separate Notes, any proceeds
of the Final Remarketing in excess of the Final Remarketing Fee
attributable to the Separate Notes will be remitted to the Custodial Agent
for payment to the holders of Separate Notes. The proceeds from the
Remarketing remitted to the Collateral Agent shall be invested by the
Collateral Agent in Permitted Investments, in accordance with the Pledge
Agreement, and then applied to satisfy in full the obligations of such
Holders of Corporate Units to pay the Purchase Price for the shares of
Common Stock under the related Purchase Contracts on the Purchase Contract
Settlement Date. Any proceeds in excess of those required to pay the
Purchase Price and the Final Remarketing Fee will be remitted to the
Purchase Contract Agent for payment to the Holders of the related Corporate
Units.
(iii) If, in spite of using its reasonable efforts, the Remarketing
Agent cannot remarket the Pledged Notes and Separate Notes (if any) at a
price not less than 100% (net of the Final Remarketing Fee and any other
fees and commissions) of the aggregate principal amount of the Pledged
Notes and Separate Notes to be remarketed in the Final Remarketing (other
than to the Company) or a condition precedent set forth in the Remarketing
Agreement is not fulfilled, the remarketing will be deemed to have failed
(a "FAILED FINAL REMARKETING"). Upon a Failed Final Remarketing, the
Remarketing Agent shall return the remarketed Pledged Notes and Separate
Notes (if any) to the Collateral Agent or the Custodial Agent, as the case
may be. Upon a Failed Final Remarketing, a default shall be deemed to have
occurred under this Agreement and the Pledge Agreement and in accordance
with the terms of the Pledge Agreement, the Collateral Agent, for the
benefit of the Company, shall exercise its rights as a secured party with
respect to the Pledged Notes, including, without limitation, those actions
specified in paragraph 5.02(e)(i) below; provided, that if upon a Failed
Final Remarketing, the Collateral Agent exercises such rights for the
benefit of the Company with respect to such Notes, any accrued and unpaid
interest on such Notes shall become payable by the Company to the Purchase
Contract Agent for payment to the Beneficial Owner of the Corporate Units
to which such Notes relate.
(e) With respect to any Pledged Notes which are subject to a Failed Final
Remarketing, and any Notes that are components of a Corporate Unit with respect
to which the Holder has notified the Purchase Contract Agent of his intent to
effect Cash Settlement and failed to deliver the Purchase Price pursuant to
Section 5.02(b)(ii), in each case resulting in an event of default under this
Agreement, the Collateral Agent for the benefit of the Company reserves all of
its
48
rights as a secured party with respect thereto and, subject to applicable law
and paragraph 5.02(i) below, may, in full satisfaction of the Holders'
obligations under the Purchase Contracts among other things, (A) retain the
Notes in accordance with applicable law or (B) dispose of the Notes in
accordance with applicable law, which in each case shall constitute payment in
full for the aggregate Purchase Price for the shares of Common Stock to be
purchased under the Purchase Contracts.
(f) (i) Unless a Holder of a Treasury Unit or a Corporate Unit (if the
Treasury Portfolio has replaced the Notes as a component of such Corporate Unit)
effects an Early Settlement of the underlying Purchase Contract through the
early delivery of cash to the Purchase Contract Agent in the manner described in
Section 5.07 or a Cash Merger Early Settlement of the underlying Purchase
Contract through the early delivery of cash to the Purchase Contract Agent in
the manner described in Section 5.04(b)(2), each Holder of a Treasury Unit or a
Corporate Unit who intends to effect Cash Settlement of the underlying Purchase
Contract shall so notify the Purchase Contract Agent by use of a notice in
substantially the form of Exhibit E hereto prior to 5:00 p.m. (New York City
time) on the fifth Business Day immediately preceding the Purchase Contract
Settlement Date. Prior to 11:00 a.m. (New York City time) on the next succeeding
Business Day, the Purchase Contract Agent shall notify the Collateral Agent of
the receipt of such notices from such Holders intending to make a Cash
Settlement. Holders of Treasury Units may make Cash Settlements only in integral
multiples of 40 Corporate Units.
(ii) A Holder of a Treasury Unit or a Corporate Unit (if the Treasury
Portfolio has replaced the Note as a component of such Corporate Unit) who
has so notified the Purchase Contract Agent of its intention to make a Cash
Settlement in accordance with paragraph 5.02(f)(i) above shall pay the
Purchase Price to the Securities Intermediary for deposit in the Collateral
Account prior to 5:00 p.m. (New York City time) on the fourth Business Day
immediately preceding the Purchase Contract Settlement Date, in lawful
money of the United States by certified or cashiers' check or wire
transfer, in each case in immediately available funds payable to or upon
the order of the Securities Intermediary. Any cash received by the
Collateral Agent shall be invested promptly by the Collateral Agent in
Permitted Investments and paid to the Company on the Purchase Contract
Settlement Date in settlement of the Purchase Contract in accordance with
the terms of this Agreement and the Pledge Agreement. Any funds received by
the Collateral Agent in respect of the investment earnings from the
investment in such Permitted Investments in excess of the Purchase Price
for the shares of Common Stock to be purchased by such Holder shall be
distributed to the Purchase Contract Agent when received for payment to the
Holder.
(iii) If a Holder of a Treasury Unit or a Corporate Unit (if the
Treasury Portfolio has replaced the Note as a component of such Corporate
Unit) fails to notify the Purchase Contract Agent of its intention to make
a Cash Settlement in accordance with Section 5.02(f)(i), or does notify the
Purchase Contract Agent as provided in Section 5.02(f)(i) of its intention
to pay the Purchase Price in cash, but fails to make such payment as
required
49
by Section 5.02(f)(ii), then upon the maturity of the Pledged Treasury
Securities or the appropriate Applicable Ownership Interests (as specified
in clause (i) of the definition of such term) in the Treasury Portfolio
held by the Securities Intermediary on or prior to the Business Day
immediately preceding the Purchase Contract Settlement Date, the principal
amount of the Treasury Securities or the appropriate Applicable Ownership
Interests (as specified in clause (i) of the definition of such term) in
the Treasury Portfolio received by the Collateral Agent shall be invested
promptly in Permitted Investments. On the Purchase Contract Settlement
Date, an amount equal to the Purchase Price shall be remitted to the
Company as payment of such Holder's obligation to pay such Purchase Price
under the related Purchase Contracts without receiving any instructions
from the Holder. In the event the sum of the Proceeds from the related
Pledged Treasury Securities or the appropriate Applicable Ownership
Interests (as specified in clause (i) of the definition of such term) in
the Treasury Portfolio and the Proceeds from such Permitted Investments is
in excess of the aggregate Purchase Price, the Collateral Agent shall cause
the Securities Intermediary to distribute such excess to the Purchase
Contract Agent for the benefit of the Holder of the related Treasury Units
or Corporate Units when received.
(g) Any distribution to Holders of any payments described above shall be
payable at the office of the Purchase Contract Agent in New York City maintained
for that purpose or, at the option of the Holder, by check mailed to the address
of the Person entitled thereto at such address as it appears on the Security
Register.
(h) Upon Cash Settlement of any Purchase Contract:
(i) the Collateral Agent will in accordance with the terms of the
Pledge Agreement cause the Pledged Notes, the appropriate Applicable
Ownership Interests (as specified in clause (i) of the definition of such
term) in the Treasury Portfolio or the Pledged Treasury Securities, as the
case may be, underlying the relevant Units to be released from the Pledge,
free and clear of any security interest of the Company, and transferred to
the Purchase Contract Agent for delivery to the Holder thereof or its
designee as soon as practicable; and
(ii) subject to the receipt thereof, the Purchase Contract Agent
shall, by book-entry transfer or other appropriate procedures, in
accordance with written instructions provided by the Holder thereof,
transfer such Notes, or the appropriate Applicable Ownership Interests (as
specified in clause (i) of the definition of such term) in the Treasury
Portfolio or such Treasury Securities, as the case may be (or, if no such
instructions are given to the Purchase Contract Agent by the Holder, the
Purchase Contract Agent shall hold such Notes, or the appropriate
Applicable Ownership Interests (as specified in clause (i) of the
definition of such term) in the Treasury Portfolio or such Treasury
Securities, as the case may be, and any interest payment thereon, in the
name of the Purchase Contract Agent or its nominee in trust for the benefit
of such Holder until
50
the expiration of the time period specified in the abandoned property laws
of the relevant state where such property is held).
(i) The obligations of the Holders to pay the Purchase Price are
non-recourse obligations and, except to the extent satisfied by Early
Settlement, Cash Merger Early Settlement or Cash Settlement, are payable solely
out of the proceeds of any Collateral pledged to secure the obligations of the
Holders, and in no event will Holders be liable for any deficiency between the
proceeds of the disposition of Collateral and the Purchase Price.
(j) The Company shall not be obligated to issue any shares of Common Stock
in respect of a Purchase Contract or deliver any certificates thereof to the
Holder of the related Units unless the Company shall have received payment for
the Common Stock to be purchased thereunder in the manner herein set forth.
SECTION 5.03. Issuance of Shares of Common Stock. Unless a Termination
Event, an Early Settlement or a Cash Merger Early Settlement shall have
occurred, subject to Section 5.04(b), on the Purchase Contract Settlement Date
upon receipt of the aggregate Purchase Price payable on all Outstanding Units,
the Company shall issue and deposit with the Purchase Contract Agent, for the
benefit of the Holders of the Outstanding Units, one or more certificates
representing newly issued shares of Common Stock registered in the name of the
Purchase Contract Agent (or its nominee) as custodian for the Holders (such
certificates for shares of Common Stock, together with any dividends or
distributions for which a record date and payment date for such dividend or
distribution has occurred after the Purchase Contract Settlement Date, being
hereinafter referred to as the "PURCHASE CONTRACT SETTLEMENT FUND") to which the
Holders are entitled hereunder.
Subject to the foregoing, upon surrender of a Certificate to the Purchase
Contract Agent on or after the Purchase Contract Settlement Date, Early
Settlement Date or Cash Merger Early Settlement Date, as the case may be,
together with settlement instructions thereon duly completed and executed, the
Holder of such Certificate shall be entitled to receive forthwith in exchange
therefor a certificate representing that number of newly issued whole shares of
Common Stock which such Holder is entitled to receive pursuant to the provisions
of this Article Five (after taking into account all Units then held by such
Holder), together with cash in lieu of fractional shares as provided in Section
5.09 and any dividends or distributions with respect to such shares constituting
part of the Purchase Contract Settlement Fund, but without any interest thereon,
and the Certificate so surrendered shall forthwith be cancelled. Such shares
shall be registered in the name of the Holder or the Holder's designee as
specified in the settlement instructions provided by the Holder to the Purchase
Contract Agent. If any shares of Common Stock issued in respect of a Purchase
Contract are to be registered to a Person other than the Person in whose name
the Certificate evidencing such Purchase Contract is registered (but excluding
any Depositary or nominee thereof), no such registration shall be made unless
the Person requesting such registration has paid any transfer and other taxes
required by reason of such registration in a name other than that of the
registered Holder of the Certificate evidencing
51
such Purchase Contract or has established to the satisfaction of the Company
that such tax either has been paid or is not payable.
SECTION 5.04. Adjustment of Settlement Rate.
(a) Adjustments for Dividends, Distributions, Stock Splits, Etc.
(1) In case the Company shall pay or make a dividend or other distribution
on Common Stock in Common Stock, the Settlement Rate in effect at the close of
business on the date fixed for the determination of shareholders entitled to
receive such dividend or other distribution shall be increased by dividing such
Settlement Rate by a fraction of which:
(i) the numerator shall be the number of shares of Common Stock
outstanding at the close of business on the date fixed for such
determination; and
(ii) the denominator shall be the sum of such number of shares and the
total number of shares constituting such dividend or other distribution,
such increase to become effective immediately at the opening of business on the
day following the date fixed for such determination. For the purposes of this
paragraph (1), the number of shares of Common Stock at any time outstanding
shall not include shares held in the treasury of the Company but shall include
any shares issuable in respect of any scrip certificates issued in lieu of
fractions of shares of Common Stock. The Company agrees that it shall not pay
any dividend or make any distribution on shares of Common Stock held in the
treasury of the Company.
(2) In case the Company shall issue rights, warrants or options, other than
pursuant to any dividend reinvestment plans or share purchase plans, to all
holders of its Common Stock (not being available on an equivalent basis to
Holders of the Units upon settlement of the Purchase Contracts underlying such
Units) entitling them, for a period expiring within 45 days after the record
date for the determination of shareholders entitled to receive such rights,
warrants or options, to subscribe for or purchase shares of Common Stock at a
price per share less than the Current Market Price per share of Common Stock on
the date of announcement of such issuance, the Settlement Rate in effect at the
close of business on the date of such announcement shall be increased by
dividing such Settlement Rate by a fraction of which:
(i) the numerator shall be the number of shares of Common Stock
outstanding at the close of business on the date of such announcement plus
the number of shares of Common Stock which the aggregate of the offering
price of the total number of shares of Common Stock so offered for
subscription or purchase would purchase at such Current Market Price; and
52
(ii) the denominator shall be the number of shares of Common Stock
outstanding at the close of business on the date of such announcement plus
the number of shares of Common Stock so offered for subscription or
purchase,
such increase to become effective immediately after the opening of business on
the Business Day following the date of such announcement. The Company agrees
that it shall notify the Purchase Contract Agent if any issuance of such rights,
warrants or options is cancelled or not completed following the announcement
thereof and the Settlement Rate shall thereupon be readjusted to the Settlement
Rate in effect immediately prior to the date of such announcement. For the
purposes of this paragraph (2), the number of shares of Common Stock at any time
outstanding shall not include shares held in the treasury of the Company but
shall include any shares issuable in respect of any scrip certificates issued in
lieu of fractions of shares of Common Stock. The Company agrees that it shall
not issue any such rights, warrants or options in respect of shares of Common
Stock held in the treasury of the Company.
(3) In case outstanding shares of Common Stock shall be subdivided or split
into a greater number of shares of Common Stock, the Settlement Rate in effect
at the close of business on the day preceding the day upon which such
subdivision or split becomes effective shall be proportionately increased, and,
conversely, in case outstanding shares of Common Stock shall each be combined
into a smaller number of shares of Common Stock, the Settlement Rate in effect
at the close of business on the day preceding the day upon which such
combination becomes effective shall be proportionately reduced, such increase or
reduction, as the case may be, to become effective immediately at the opening of
business on the day following the day upon which such subdivision, split or
combination becomes effective.
(4) In case the Company shall, by dividend or otherwise, distribute to all
holders of its Common Stock evidences of its indebtedness or assets (including
shares of capital stock, securities, cash and property but excluding any rights,
warrants or options referred to in paragraph (2) of this Section 5.04(a), any
dividend or distribution paid exclusively in cash and any dividend or
distribution referred to in paragraph (1) of this Section 5.04(a)), the
Settlement Rate in effect at the close of business on the date fixed for the
determination of shareholders entitled to receive such distribution shall be
adjusted by dividing such rate by a fraction of which:
(i) the numerator shall be the Current Market Price per share of
Common Stock on the date fixed for such determination less the then fair
market value (as reasonably determined by the Board of Directors, whose
determination shall be conclusive and the basis for which shall be
described in a Board Resolution) of the portion of the assets or evidences
of indebtedness so distributed applicable to one share of Common Stock; and
(ii) the denominator shall be such Current Market Price per share of
Common Stock,
53
such adjustment to become effective at the opening of business on the day
following the date fixed for the determination of shareholders entitled to
receive such distribution. In any case in which this paragraph (4) is
applicable, paragraph (2) of this Section 5.04(a) shall not be applicable. In
the event that such dividend or distribution is not so paid or made, the
Settlement Rate shall again be adjusted to be the Settlement Rate which would
then be in effect if such dividend or distribution had not been declared.
(5) In case the Company shall, by dividend or otherwise, distribute to all
holders of its Common Stock cash (excluding any cash that is distributed in a
Reorganization Event to which Section 5.04(b) applies, as part of a distribution
referred to in paragraph (4) of this Section or as a regular periodic cash
dividend or distribution) in an aggregate amount that, combined together with
(I) the aggregate amount of any other distributions (other than regular periodic
cash dividends or distributions) to all holders of its Common Stock made
exclusively in cash within the 12 months preceding the date of payment of such
distribution (the "TRAILING 12 MONTH PERIOD") and in respect of which no
adjustment pursuant to this paragraph (5) or paragraph (6) of this Section has
been made and (II) the aggregate amount of any cash plus the fair market value
(as determined by the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution) of consideration (other than
consideration payable in respect of any odd-lot tender offer) payable in respect
of any tender or exchange offer by the Company or any of its subsidiaries and
calculated as of the expiration of such tender or exchange offer for all or any
portion of the Common Stock concluded within the Trailing 12 Month Period and in
respect of which no adjustment pursuant to this paragraph (5) or paragraph (6)
of this Section has been made, exceeds 10% of the product of the Current Market
Price per share of the Common Stock on the date for the determination of holders
of shares of Common Stock entitled to receive such distribution multiplied by
the number of shares of Common Stock outstanding on such date, then, in such
case, the Settlement Rate in effect at the close of business on such record date
shall be adjusted by dividing such rate by a fraction of which:
(i) the numerator shall be the Current Market Price of Common Stock on
such record date less the amount of cash so distributed (and not excluded
as provided above) applicable to one share of Common Stock; and
(ii) the denominator shall be the Current Market Price of Common
Stock,
such increase to be effective at the opening of business on the day following
the record date; provided, however, that in the event the portion of cash so
distributed applicable to one share of Common Stock is equal to or greater than
the Current Market Price per share of Common Stock on the record date, in lieu
of the foregoing adjustment, adequate provision shall be made so that each
holder of a Unit shall have the right to receive upon settlement of the Units
the amount of cash such Holder would have received had such Holder settled each
Unit on the record date. In the event that such dividend or distribution is not
so paid or made, the Settlement Rate shall again be adjusted to be the
Settlement Rate which would then be in effect if such dividend or distribution
had not been declared.
54
(6) If the Company or any subsidiary of the Company shall make a tender or
exchange offer (other than any odd-lot tender offer) for all or any portion of
the Common Stock and upon expiration of such tender or exchange offer (as
amended upon the expiration thereof) the Company or its subsidiary shall be
required to pay to shareholders based on the acceptance (up to any maximum
specified in the terms of the tender or exchange offer) of Purchased Shares (as
herein defined) any consideration, then if the sum of (I) the fair market value
of the aggregate consideration to be paid in such tender offer or exchange offer
(as reasonably determined by the Board of Directors, whose determination shall
be conclusive and the basis for which shall be described in a Board Resolution)
plus (II) the aggregate of the cash plus the fair market value (as reasonably
determined by the Board of Directors, whose determination shall be conclusive
and the basis for which shall be described in a Board Resolution), as of the
expiration of such tender or exchange offer, of consideration payable in respect
of any other tender or exchange offer (other than consideration payable in
respect of any odd-lot tender offer), by the Company or any subsidiary of the
Company for all or any portion of Common Stock expiring within the 12 months
preceding the expiration of such tender or exchange offer and in respect of
which no adjustment pursuant to this paragraph (6) has been made, plus (III) the
aggregate amount of any distributions (other than regular periodic cash
dividends or distributions) to all holders of Common Stock made exclusively in
cash within the 12 months preceding the expiration of such tender or exchange
offer and in respect of which no adjustment pursuant to paragraph (5) has been
made, exceeds 10% of the product of the Current Market Price per share of Common
Stock as of the last time (the "EXPIRATION TIME") tenders could have been made
pursuant to such tender or exchange offer (as it may be amended) times the
number of shares of Common Stock outstanding (including any tendered shares) on
the Expiration Time, then, the Settlement Rate in effect at the close of
business on the day of the Expiration Time shall be adjusted by dividing by a
fraction:
(i) the numerator of which shall be equal to (A) the product of (I)
the Current Market Price per share of Common Stock on the date of the
Expiration Time and (II) the number of shares of Common Stock outstanding
(including any tendered shares) on the date of the Expiration Time less (B)
the amount of cash plus the fair market value (determined as aforesaid) of
the aggregate consideration payable to shareholders based on the
transactions described in clauses (I), (II) and (III) above (assuming in
the case of clause (I) the acceptance, up to any maximum specified in the
terms of the tender or exchange offer, of Purchased Shares); and
(ii) the denominator of which shall be equal to the product of (A) the
Current Market Price per share of Common Stock as of the Expiration Time
and (B) the number of shares of Common Stock outstanding (including any
tendered shares) as of the Expiration Time less the number of all shares
validly tendered and not withdrawn as of the Expiration Time (the shares
deemed so accepted, up to any such maximum, being referred to as the
"PURCHASED SHARES"),
55
such adjustment to become effective at the opening of business on the date
following the date of the Expiration Time.
(7) The reclassification of Common Stock into securities including
securities other than Common Stock (other than any reclassification upon a
Reorganization Event to which Section 5.04(b) applies) shall be deemed to
involve:
(i) a distribution of such securities other than Common Stock to all
holders of Common Stock (and the effective date of such reclassification
shall be deemed to be "the date fixed for the determination of shareholders
entitled to receive such distribution" and the "date fixed for such
determination" within the meaning of paragraph (4) of this Section); and
(ii) a subdivision, split or combination, as the case may be, of the
number of shares of Common Stock outstanding immediately prior to such
reclassification into the number of shares of Common Stock outstanding
immediately thereafter (and the effective date of such reclassification
shall be deemed to be "the day upon which such subdivision or split becomes
effective" or "the day upon which such combination becomes effective", as
the case may be, and "the day upon which such subdivision, split or
combination becomes effective" within the meaning of paragraph (3) of this
Section).
(8) The "CURRENT MARKET PRICE" per share of Common Stock on any date of
determination means the average of the daily Closing Prices for the five
consecutive Trading Days selected by the Company commencing not more than thirty
(30) Trading Days before and ending not later than the earlier of such date of
determination and the day before the "ex date" with respect to the issuance or
distribution requiring such computation. For purposes of this paragraph, the
term "ex date," when used with respect to any issuance or distribution, shall
mean the first date on which Common Stock trades regular way on such exchange or
in such market without the right to receive such issuance or distribution.
(9) All adjustments to the Settlement Rate shall be calculated to the
nearest 1/10,000th of a share of Common Stock (or if there is not a nearest
1/10,000th of a share, to the next lower 1/10,000th of a share). No adjustment
in the Settlement Rate shall be required unless such adjustment would require an
increase or decrease of at least one percent thereof; provided, however, that
any adjustments which by reason of this subparagraph are not required to be made
shall be carried forward and taken into account in any subsequent adjustment.
(10) The Company may, but shall not be required to, make such increases in
the Settlement Rate, in addition to those required by this Section, as the Board
of Directors considers to be advisable in order to avoid or diminish any income
tax to any holders of shares of Common Stock resulting from any dividend or
distribution of stock or issuance of rights or warrants to purchase or subscribe
for stock or from any event treated as such for income tax purposes or for any
other reason.
56
(11) The Company has entered into a Rights Agreement dated as of June 19,
2001 (the "RIGHTS AGREEMENT") with EquiServe Trust Company, N.A. pursuant to
which share purchase rights (the "RIGHTS") have been, and may in the future be,
issued in respect of shares of Common Stock. Each share of Common Stock issued
upon settlement of any Purchase Contract pursuant to this Article 5 shall be
entitled to receive the appropriate number of Rights, if any, and the
certificates representing the Common Stock issued upon such settlement shall
bear such legends, if any, in each case as provided by and subject to the terms
of the Rights Agreement as in effect at the time of such settlement. If after
the date of this Agreement the Rights separate from the Common Stock in
accordance with the provisions of the Rights Agreement so that a Holder would
not be entitled to receive any Rights in respect of the Common Stock issuable
upon settlement of such Purchase Contract, the Settlement Rate will be adjusted
as provided in this Section 5.04 on the separation date, subject to readjustment
in the event of the expiration, termination or redemption of the Rights. In lieu
of any such adjustment, the Company may amend the Rights Agreement to provide
that upon settlement Holders will receive, in addition to the Common Stock
issuable upon such settlement, the Rights that would have attached to such
shares of Common Stock if the Rights had not become separated from the Common
Stock pursuant to the provisions of the Rights Agreement. If the Company
hereafter adopts any stockholder rights plan similar to the Rights Agreement, a
Holder shall be entitled to receive upon settlement of its Purchase Contracts in
addition to the shares of Common Stock issuable upon settlement the related
rights for the Common Stock whether or not the rights under the future
stockholder rights plan have separated from the Common Stock at the time of
settlement but otherwise subject to the generally applicable terms of such plan
and no additional adjustment to the Settlement Rate shall be made for the future
stockholder rights plan under this Section 5.04.
(b) Adjustment for Consolidation, Merger or Other Reorganization Event.
(1) In the event of:
(i) any consolidation or merger of the Company with or into another
Person (other than a merger or consolidation in which the Company is the
continuing corporation and in which the shares of Common Stock outstanding
immediately prior to the merger or consolidation are not exchanged for
cash, securities or other property of the Company or another corporation);
(ii) any sale, transfer, lease or conveyance to another Person of the
property of the Company as an entirety or substantially as an entirety;
(iii) any statutory share exchange of the Company with another Person
(other than in connection with a merger or acquisition); or
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(iv) any liquidation, dissolution or termination of the Company other
than as a result of or after the occurrence of a Termination Event (any
event described in clauses (i), (ii), (iii) and (iv), a "REORGANIZATION
EVENT"),
each Purchase Contract shall become, without the consent of the Holder of the
Unit representing such Purchase Contract, an agreement to purchase only the kind
of securities, cash and other property receivable upon consummation of such
Reorganization Event by a holder of Common Stock immediately prior to the
closing date of such Reorganization Event.
The amount of such securities, cash and other property receivable upon
settlement of each such Purchase Contract after the consummation of the
Reorganization Event shall be based on the value as of such settlement date of
the hypothetical amount of securities, cash and other property that would have
been received upon consummation of the Reorganization Event in exchange for the
maximum number of Common Stock deliverable under a Purchase Contract immediately
prior to the closing date of the Reorganization Event (collectively, the
"EXCHANGE PROPERTY"). In determining the kind and amount of the Exchange
Property pursuant to the foregoing, it will be assumed that such holder of
Common Stock is not a Person with which the Company consolidated or into which
the Company merged or which merged into the Company or to which such sale or
transfer was made, as the case may be (any such Person, a "CONSTITUENT PERSON"),
or an Affiliate of a Constituent Person to the extent such Reorganization Event
provides for different treatment of Common Stock held by Affiliates of the
Company and non-affiliates and such Holder failed to exercise its rights of
election, if any, as to the kind or amount of securities, cash and other
property receivable upon such Reorganization Event (provided that if the kind or
amount of securities, cash and other property receivable upon such
Reorganization Event is not the same for each share of Common Stock held
immediately prior to such Reorganization Event by other than a Constituent
Person or an Affiliate thereof and in respect of which such rights of election
shall not have been exercised ("NON-ELECTING SHARE"), then for the purpose of
this Section the kind and amount of securities, cash and other property
receivable upon such Reorganization Event by each non-electing share shall be
deemed to be the kind and amount so receivable per share by a plurality of the
non-electing shares).
The actual amount of Exchange Property receivable upon settlement of each
Purchase Contract shall be (1) in the case of settlement on the Purchase
Contract Settlement Date or pursuant to Section 5.04(b)(2), a variable amount
based upon the applicable Settlement Rate and the Adjusted Applicable Market
Value of the Exchange Property at such time and (2) in the case of any Early
Settlement, determined in accordance with the procedures described under Section
5.07 using the Settlement Rate that results in the minimum amount of Exchange
Property being delivered under such Purchase Contract.
For purposes of this Section 5.04(b)(1) and Section 5.04(b)(2), the term
"Adjusted Applicable Market Value" shall be deemed to refer to the "Adjusted
Applicable Market Value" of the Exchange Property, and such value shall be
determined (A) with respect to any publicly traded securities that comprise all
or part of the Exchange Property, based on the Closing Price of
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such securities, (B) in the case of any cash that comprises all or part of the
Exchange Property, based on the amount of such cash and (C) in the case of any
other property that comprises all or part of the Exchange Property, based on the
value of such property, as determined by a nationally recognized independent
investment banking firm retained by the Company for this purpose; provided that
prior to the separation of the Rights or any similar stockholder rights from the
Common Stock, such Rights or similar stockholder rights shall be deemed to have
no value. The term "Closing Price" shall be deemed to refer to the closing sale
price, last quoted bid price or mid-point of the last bid and ask prices, as the
case may be, of any publicly traded securities that comprise all or part of the
Exchange Property. The term "Trading Day" shall be deemed to refer to any
publicly traded securities that comprise all or part of the Exchange Property.
In the event of such a Reorganization Event, the Person formed by such
consolidation, merger or exchange or the Person which acquires the assets of the
Company or, in the event of a liquidation, dissolution or termination of the
Company, the Company or a liquidating trust created in connection therewith,
shall execute and deliver to the Purchase Contract Agent an agreement
supplemental hereto providing that each Holder of an Outstanding Unit shall have
the rights provided by this Section 5.04(b). Such supplemental agreement shall
provide for adjustments which, for events subsequent to the effective date of
such supplemental agreement, shall be as nearly equivalent as may be practicable
to the adjustments provided for in this Section 5.04. The above provisions of
this Section 5.04 shall similarly apply to successive Reorganization Events.
(2) In the event of a consolidation or merger of the Company with or into
another Person or any merger of another Person into the Company (other than a
merger that does not result in any reclassification, conversion, exchange or
cancellation of outstanding shares of Common Stock), in each case in which 30%
or more of the total consideration paid to the Company's shareholders consists
of cash or cash equivalents (a "CASH MERGER"), a Holder of a Unit may settle
("CASH MERGER EARLY SETTLEMENT") its Purchase Contract, upon the conditions set
forth below, at the Settlement Rate in effect immediately prior to the closing
of the Cash Merger; provided that (i) the Cash Merger Early Settlement Date (as
defined below) is no later than the fifth Business Day immediately preceding the
Purchase Contract Settlement Date and (ii) no Cash Merger Early Settlement will
be permitted pursuant to this Section 5.04(b)(2) unless, at the time such Cash
Merger Early Settlement is effected, there is an effective Registration
Statement with respect to any securities to be issued and delivered in
connection with such Cash Merger Early Settlement, if such a Registration
Statement is required (in the view of counsel, which need not be in the form of
a written opinion, for the Company) under the Securities Act. If such a
Registration Statement is so required, the Company covenants and agrees to use
commercially reasonable efforts to (A) have in effect a Registration Statement
covering any securities to be delivered in respect of the Purchase Contracts
being settled and (B) provide a Prospectus in connection therewith, in each case
in a form that may be used in connection with such Cash Merger Early Settlement.
If a Holder effects a Cash Merger Early Settlement of some or all of its
Purchase Contracts, such Holder shall be entitled to receive, on the Cash Merger
Early Settlement Date, the aggregate amount of any Deferred Contract Adjustment
Payments and
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any accrued and unpaid Contract Adjustment Payments since the immediately
preceding Payment Date with respect to such Purchase Contracts. The Company
shall pay such amount as a credit against the amount otherwise payable by the
Holders to effect such Cash Merger Early Settlement.
Within five Business Days of the completion of a Cash Merger, the Company
shall provide written notice to Holders of Units of such completion of a Cash
Merger, which shall specify the deadline for submitting the notice to settle
early in cash pursuant to this Section 5.04(b)(2), the date on which such Cash
Merger Early Settlement shall occur (which date shall be at least 10 days but
not more than 20 days after the date of such written notice by the Company, but
which shall in no event be later than the fifth Business Day immediately
preceding the Purchase Contract Settlement Date) (the "CASH MERGER EARLY
SETTLEMENT DATE"), the applicable Settlement Rate and the amount (per share of
Common Stock) of cash, securities and other consideration receivable by the
Holder, including the amount of Contract Adjustment Payments receivable, upon
settlement.
Corporate Units Holders and Treasury Units Holders may only effect Cash
Merger Early Settlement pursuant to this Section 5.04(b)(2) in integral
multiples of 40 Corporate Units or Treasury Units, as the case may be. If the
Treasury Portfolio has replaced the Notes as a component of the Corporate Units,
Corporate Units Holders may only effect Cash Merger Early Settlement pursuant to
this Section 5.04(b)(2) in multiples of [o] Corporate Units. Other than the
provisions relating to timing of notice and settlement, which shall be as set
forth above, the provisions of Section 5.01(a) shall apply with respect to a
Cash Merger Early Settlement pursuant to this Section 5.04(b)(2).
In order to exercise the right to effect Cash Merger Early Settlement with
respect to any Purchase Contracts, the Holder of the Certificate evidencing
Units shall deliver, no later than 5:00 p.m. (New York City time) on the third
Business Day immediately preceding the Cash Merger Early Settlement Date, such
Certificate to the Purchase Contract Agent at the Corporate Trust Office duly
endorsed for transfer to the Company or in blank with the form of Election to
Settle Early on the reverse thereof duly completed and accompanied by payment
(payable to the Company in immediately available funds) in an amount equal to
the product of (A) the Stated Amount times (B) the number of Purchase Contracts
with respect to which the Holder has elected to effect Cash Merger Early
Settlement, less the amount of any Contract Adjustment Payments payable to the
Holder on the Cash Merger Early Settlement Date.
If a Holder properly effects an effective Cash Merger Early Settlement in
accordance with the provisions of this Section 5.04(b)(2), the Company will
deliver (or will cause the Collateral Agent to deliver) to the Holder on the
Cash Merger Early Settlement Date:
(i) the kind and amount of securities, cash and other property
receivable upon such Cash Merger by a Holder of the number of shares of
Common Stock issuable on account of each Purchase Contract if the Purchase
Contract Settlement Date had occurred
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immediately prior to such Cash Merger (based on the Settlement Rate in
effect at such time), assuming such Holder of Common Stock is not a
Constituent Person or an Affiliate of a Constituent Person to the extent
such Cash Merger provides for different treatment of Common Stock held by
Affiliates of the Company and non-affiliates and such Holder failed to
exercise its rights of election, if any, as to the kind or amount of
securities, cash and other property receivable upon such Cash Merger
(provided that if the kind or amount of securities, cash and other property
receivable upon such Cash Merger is not the same for each non-electing
share, then for the purpose of this Section 5.04(b)(2), the kind and amount
of securities, cash and other property receivable upon such Cash Merger by
each non-electing share shall be deemed to be the kind and amount so
receivable per share by a plurality of the non-electing shares). For the
avoidance of doubt, for the purposes of determining the Adjusted Applicable
Market Value (in connection with determining the appropriate Settlement
Rate to be applied in the foregoing sentence), the date of the closing of
the Cash Merger shall be deemed to be the Purchase Contract Settlement
Date;
(ii) the Notes, the Applicable Ownership Interests in the Treasury
Portfolio or Treasury Securities, as the case may be, related to the
Purchase Contracts with respect to which the Holder is effecting a Cash
Merger Early Settlement; and
(iii) if so required under the Securities Act, a Prospectus as
contemplated by this Section 5.04(b)(2).
(c) All calculations and determinations pursuant to this Section 5.04 shall
be made by the Company or its agent and the Purchase Contract Agent shall have
no responsibility with respect thereto.
(d) The Corporate Units or the Treasury Units of the Holders who do not
elect Cash Merger Early Settlement in accordance with the foregoing will
continue to remain outstanding and be subject to settlement on the Purchase
Contract Settlement Date in accordance with the terms hereof.
SECTION 5.05. Notice of Adjustments and Certain Other Events.
(a) Whenever the Settlement Rate is adjusted as herein provided, the
Company shall within 10 Business Days following the occurrence of an event that
requires an adjustment to the Settlement Rate pursuant to Section 5.04 (or if
the Company is not aware of such occurrence, as soon as practicable after
becoming so aware):
(i) compute the adjusted Settlement Rate in accordance with Section
5.04 and prepare and transmit to the Purchase Contract Agent an Officers'
Certificate setting forth the Settlement Rate, the method of calculation
thereof in reasonable detail, and the facts requiring such adjustment and
upon which such adjustment is based; and
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(ii) provide a written notice to the Holders of the Units of the
occurrence of such event and a statement in reasonable detail setting forth
the method by which the adjustment to the Settlement Rate was determined
and setting forth the adjusted Settlement Rate.
(b) The Purchase Contract Agent shall not at any time be under any duty or
responsibility to any Holder of Units to determine whether any facts exist which
may require any adjustment of the Settlement Rate, or with respect to the nature
or extent or calculation of any such adjustment when made, or with respect to
the method employed in making the same. The Purchase Contract Agent shall be
fully authorized and protected in relying on any Officers' Certificate delivered
pursuant to Section 5.05(a)(i) and any adjustment contained therein and the
Purchase Contract Agent shall not be deemed to have knowledge of any adjustment
unless and until it has received such certificate. The Purchase Contract Agent
shall not be accountable with respect to the validity or value (or the kind or
amount) of any shares of Common Stock, or of any securities or property, which
may at the time be issued or delivered with respect to any Purchase Contract;
and the Purchase Contract Agent makes no representation with respect thereto.
The Purchase Contract Agent shall not be responsible for any failure of the
Company to issue, transfer or deliver any shares of Common Stock pursuant to a
Purchase Contract or to comply with any of the duties, responsibilities or
covenants of the Company contained in this Article.
SECTION 5.06. Termination Event; Notice.
The Purchase Contracts and all obligations and rights of the Company and
the Holders thereunder, including, without limitation, the rights of the Holders
to receive and the obligation of the Company to pay any Contract Adjustment
Payments (including any accrued and unpaid Contract Adjustment Payments and any
Deferred Contract Adjustment Payments), if the Company shall have such
obligation, and the rights and obligations of Holders to purchase Common Stock,
shall immediately and automatically terminate, without the necessity of any
notice or action by any Holder, the Purchase Contract Agent or the Company, if,
prior to or on the Purchase Contract Settlement Date, a Termination Event shall
have occurred.
Upon and after the occurrence of a Termination Event, the Units shall
thereafter represent the right to receive the Notes, the Treasury Securities or
the appropriate Applicable Ownership Interests in the Treasury Portfolio, as the
case may be, forming part of such Units, in accordance with the provisions of
Section 5.04 of the Pledge Agreement. Upon the occurrence of a Termination
Event, the Company shall promptly but in no event later than two Business Days
thereafter give written notice to the Purchase Contract Agent, the Collateral
Agent and the Holders, at their addresses as they appear in the Security
Register.
SECTION 5.07. Early Settlement. (a) Subject to and upon compliance with the
provisions of this Section 5.07, at the option of the Holder thereof, Purchase
Contracts underlying Units may be settled early ("EARLY SETTLEMENT") at any time
prior to 5:00 p.m. (New York City time) on the fifth Business Day immediately
preceding the Purchase Contract Settlement Date; provided that
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no Early Settlement will be permitted pursuant to this Section 5.07 unless, at
the time such Early Settlement is effected, there is an effective Registration
Statement with respect to any securities to be issued and delivered in
connection with such Early Settlement, if such a Registration Statement is
required (in the view of counsel, which need not be in the form of a written
opinion, for the Company) under the Securities Act. If such a Registration
Statement is so required, the Company covenants and agrees to use commercially
reasonable efforts to (A) have in effect a Registration Statement covering any
securities to be delivered in respect of the Purchase Contracts being settled
and (B) provide a Prospectus in connection therewith, in each case in a form
that may be used in connection with such Early Settlement.
(b) In order to exercise the right to effect Early Settlement with respect
to any Purchase Contracts, the Holder of the Certificate evidencing Units shall
deliver, at any time prior to 5:00 a.m. (New York City time) on the fifth
Business Day immediately preceding the Purchase Contract Settlement Date, such
Certificate to the Purchase Contract Agent at the Corporate Trust Office duly
endorsed for transfer to the Company or in blank with the form of Election to
Settle Early on the reverse thereof duly completed and accompanied by payment
(payable to the Company in immediately available funds) in an amount (the "EARLY
SETTLEMENT AMOUNT") equal to:
(i) the sum of (A) product of (I) the Stated Amount times (II) the
number of Purchase Contracts with respect to which the Holder has elected
to effect Early Settlement, plus (B) if such delivery is made with respect
to any Purchase Contracts during the period from the close of business on
any Record Date next preceding any Payment Date to the opening of business
on such Payment Date, an amount equal to the Contract Adjustment Payments
payable on such Payment Date with respect to such Purchase Contracts, less
(ii) the amount of any Deferred Contract Adjustment Payments payable
to such Holder as a result of such Early Settlement.
Except as provided in the immediately preceding sentence, no payment shall
be made upon Early Settlement of any Purchase Contract on account of any
Contract Adjustment Payments accrued on such Purchase Contract since the
immediately preceding Payment Date or on account of any dividends on the Common
Stock issued upon such Early Settlement. However, a Holder effecting an Early
Settlement of some or all of its Purchase Contracts shall be entitled to
receive, on the date it receives the shares of Common Stock referred to in
Section 5.07(d), the amount of any Deferred Contract Adjustment Payments with
respect to such Purchase Contracts, calculated as of the immediately preceding
Payment Date. The amount of such Deferred Contract Adjustment Payments shall be
credited against the amount otherwise payable by the Holder to effect such Early
Settlement as set forth in clause (ii) above. If the foregoing requirements are
first satisfied with respect to Purchase Contracts underlying any Units at or
prior to 5:00 p.m. (New York City time) on a Business Day, such day shall be the
"EARLY SETTLEMENT DATE" with respect to such Units and if such requirements are
first satisfied after 5:00
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p.m. (New York City time) on a Business Day or on a day that is not a Business
Day, the "EARLY SETTLEMENT DATE" with respect to such Units shall be the next
succeeding Business Day.
Upon the receipt of such Certificate and Early Settlement Amount from the
Holder, the Purchase Contract Agent shall pay to the Company such Early
Settlement Amount, the receipt of which payment the Company shall confirm in
writing. The Purchase Contract Agent shall then, in accordance with Section 5.06
of the Pledge Agreement, notify the Collateral Agent that (A) such Holder has
elected to effect an Early Settlement, which notice shall set forth the number
of such Purchase Contracts as to which such Holder has elected to effect Early
Settlement, (B) the Purchase Contract Agent has received from such Holder, and
paid to the Company as confirmed in writing by the Company, the related Early
Settlement Amount and (C) all conditions to such Early Settlement have been
satisfied.
Holders of Treasury Units may only effect Early Settlement pursuant to this
Section 5.07 in integral multiples of 40 Treasury Units. If the Treasury
Portfolio has replaced the Notes as a component of the Corporate Units,
Corporate Units Holders may only effect Early Settlement pursuant to this
Section 5.07 in integral multiples of [C] Corporate Units.
Upon Early Settlement of the Purchase Contracts, the rights of the Holders
to receive and the obligation of the Company to pay any accrued and unpaid
Contract Adjustment Payments since the immediately preceding Payment Date and
any future Contract Adjustment Payments with respect to such Purchase Contracts
shall immediately and automatically terminate.
(c) Upon Early Settlement of Purchase Contracts by a Holder of the related
Units, the Company shall issue, and the Holder shall be entitled to receive, [C]
shares of Common Stock on account of each Purchase Contract as to which Early
Settlement is effected (the "EARLY SETTLEMENT RATE"). The Early Settlement Rate
shall be adjusted in the same manner and at the same time as the Settlement Rate
is adjusted pursuant to Section 5.04.
(d) No later than the third Business Day after the applicable Early
Settlement Date, the Company shall cause:
(i) the shares of Common Stock issuable upon Early Settlement of
Purchase Contracts to be issued and delivered, together with payment in
lieu of any fraction of a share, as provided in Section 5.09; and
(ii) the related Notes or the Applicable Ownership Interests in the
Treasury Portfolio, as applicable, in the case of Corporate Units, or the
related Treasury Securities, in the case of Treasury Units, to be released
from the Pledge by the Collateral Agent and transferred, in each case, to
the Purchase Contract Agent for delivery to the Holder thereof or its
designee.
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(e) Upon Early Settlement of any Purchase Contracts, and subject to receipt
of shares of Common Stock from the Company and the Notes, the Applicable
Ownership Interests in the Treasury Portfolio or Treasury Securities, as the
case may be, from the Securities Intermediary, as applicable, the Purchase
Contract Agent shall, in accordance with the instructions provided by the Holder
thereof on the applicable form of Election to Settle Early on the reverse of the
Certificate evidencing the related Units:
(i) transfer to the Holder the Notes, the Applicable Ownership
Interests in the Treasury Portfolio or Treasury Securities, as the case may
be, forming a part of such Units,
(ii) deliver to the Holder a certificate or certificates for the full
number of shares of Common Stock issuable upon such Early Settlement,
together with payment in lieu of any fraction of a share, as provided in
Section 5.09, and
(iii) if so required under the Securities Act, deliver a Prospectus
for the shares of Common Stock issuable upon such Early Settlement as
contemplated by Section 5.07(a).
(f) In the event that Early Settlement is effected with respect to Purchase
Contracts underlying less than all the Units evidenced by a Certificate, upon
such Early Settlement the Company shall execute and the Purchase Contract Agent
shall execute on behalf of the Holder, authenticate and deliver to the Holder
thereof, at the expense of the Company, a Certificate evidencing the Units as to
which Early Settlement was not effected.
(g) A Holder of a Unit who effects Early Settlement may elect to have the
Notes no longer a part of a Corporate Unit remarketed in accordance with the
provisions of Section 5.02.
SECTION 5.08. Intentionally Omitted.
SECTION 5.09. No Fractional Shares.
No fractional shares or scrip representing fractional shares of Common
Stock shall be issued or delivered upon settlement on the Purchase Contract
Settlement Date, or upon Early Settlement or Cash Merger Early Settlement of any
Purchase Contracts. If Certificates evidencing more than one Purchase Contract
shall be surrendered for settlement at one time by the same Holder, the number
of full shares of Common Stock which shall be delivered upon settlement shall be
computed on the basis of the aggregate number of Purchase Contracts evidenced by
the Certificates so surrendered. Instead of any fractional share of Common Stock
which would otherwise be deliverable upon settlement of any Purchase Contracts
on the Purchase Contract Settlement Date, or upon Early Settlement or Cash
Merger Early Settlement, the Company, through the Purchase Contract Agent, shall
make a cash payment in respect of such fractional interest in an amount equal to
the percentage of such fractional share times the Applicable Market Value
calculated as if the date of such settlement were the Purchase Contract
65
Settlement Date. The Company shall provide the Purchase Contract Agent from time
to time with sufficient funds to permit the Purchase Contract Agent to make all
cash payments required by this Section 5.09 in a timely manner.
SECTION 5.10. Charges and Taxes.
The Company will pay all stock transfer and similar taxes attributable to
the initial issuance and delivery of the shares of Common Stock pursuant to the
Purchase Contracts; provided, however, that the Company shall not be required to
pay any such tax or taxes which may be payable in respect of any exchange of or
substitution for a Certificate evidencing a Unit or any issuance of a share of
Common Stock in a name other than that of the registered Holder of a Certificate
surrendered in respect of the Units evidenced thereby, other than in the name of
the Purchase Contract Agent, as custodian for such Holder, and the Company shall
not be required to issue or deliver such share certificates or Certificates
unless or until the Person or Persons requesting the transfer or issuance
thereof shall have paid to the Company the amount of such tax or shall have
established to the satisfaction of the Company that such tax has been paid.
SECTION 5.11. Contract Adjustment Payments.
(a) Subject to Section 5.11(d), the Company shall pay, on each Payment
Date, the Contract Adjustment Payments payable in respect of each Purchase
Contract to the Person in whose name a Certificate is registered at the close of
business on the Record Date relating to such Payment Date. The Contract
Adjustment Payments will be payable at the office of the Purchase Contract Agent
in Borough of Manhattan, New York City maintained for that purpose. If the
book-entry system for the Units has been terminated, the Contract Adjustment
Payments will be payable, at the option of the Company, by check mailed to the
address of the Person entitled thereto at such Person's address as it appears on
the Security Register, or by wire transfer to the account designated by such
Person by a prior written notice to the Purchase Contract Agent. If any date on
which Contract Adjustment Payments are to be made is not a Business Day, then
payment of the Contract Adjustment Payments payable on such date will be made on
the next succeeding day that is a Business Day (and without any interest in
respect of any such delay); provided that if such Business Day is in the next
succeeding calendar year, then payment of the Contract Adjustment Payments will
be made on the Business Day immediately preceding such Business Day. Contract
Adjustment Payments payable for any period will be computed on the basis of a
360-day year of twelve 30-day months. The Contract Adjustment Payments will
accrue from December 20, 2002.
(b) Upon the occurrence of a Termination Event, the Company's obligation to
pay future Contract Adjustment Payments (including any accrued Contract
Adjustment Payments and any Deferred Contract Adjustment Payments) shall cease.
(c) Each Certificate delivered under this Agreement upon registration of
transfer of or in exchange for or in lieu of (including as a result of a
Collateral Substitution or the recreation of
66
Corporate Units) any other Certificate shall carry the right to accrued and
unpaid Contract Adjustment Payments and Deferred Contract Adjustment Payments,
which right was carried by the Purchase Contracts underlying such other
Certificates.
(d) In the case of any Unit with respect to which Early Settlement or Cash
Merger Early Settlement of the underlying Purchase Contract is effected on a
date that is after any Record Date and prior to or on the next succeeding
Payment Date, Contract Adjustment Payments otherwise payable on such Payment
Date shall be payable on such Payment Date notwithstanding such Early Settlement
or Cash Merger Early Settlement, and such Contract Adjustment Payments shall be
paid to the Person in whose name the Certificate evidencing such Unit is
registered at the close of business on such Record Date.
(e) The Company's obligations with respect to Contract Adjustment Payments,
if any, will be subordinated and junior in right of payment to the Company's
obligations under any Senior Indebtedness.
(f) In the event (x) of any payment by, or distribution of assets of, the
Company of any kind or character, whether in cash, property or securities, to
creditors upon any dissolution, winding-up, liquidation or reorganization of the
Company, whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, or (y) subject to the provisions of Section
5.11(h) below, that (i) a default shall have occurred and be continuing with
respect to the payment of principal, interest or any other monetary amounts due
and payable on any Senior Indebtedness and such default shall have continued
beyond the period of grace, if any, specified in the instrument evidencing such
Senior Indebtedness (and the Purchase Contract Agent shall have received written
notice thereof from the Company or one or more holders of Senior Indebtedness or
their representative or representatives or the trustee or trustees under any
indenture pursuant to which any such Senior Indebtedness may have been issued),
or (ii) the maturity of any Senior Indebtedness shall have been accelerated
because of a default in respect of such Senior Indebtedness (and the Purchase
Contract Agent shall have received written notice thereof from the Company or
one or more holders of Senior Indebtedness or their representative or
representatives or the trustee or trustees under any indenture pursuant to which
any such Senior Indebtedness may have been issued), then:
(i) the holders of all Senior Indebtedness shall first be entitled to
receive, in the case of clause (x) above, payment of all amounts due or to
become due upon all Senior Indebtedness and, in the case of subclauses (i)
and (ii) of clause (y) above, payment of all amounts due thereon, or
provision shall be made for such payment in money or money's worth, before
the Holders of any of the Units are entitled to receive any Contract
Adjustment Payments on the Purchase Contracts underlying the Units;
(ii) any payment by, or distribution of assets of, the Company of any
kind or character, whether in cash, property or securities, to which the
Holders of any of the Units would be entitled except for the provisions of
Section 5.11(e) through (q), including any
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such payment or distribution which may be payable or deliverable by reason
of the payment of any other indebtedness of the Company being subordinated
to the payment of such Contract Adjustment Payments on the Purchase
Contracts underlying the Units, shall be paid or delivered by the Person
making such payment or distribution, whether a trustee in bankruptcy, a
receiver or liquidating trustee or otherwise, directly to the
representative or representatives of the holders of Senior Indebtedness or
to the trustee or trustees under any indenture under which any instruments
evidencing any of such Senior Indebtedness may have been issued, ratably
according to the aggregate amounts remaining unpaid on account of such
Senior Indebtedness held or represented by each, to the extent necessary to
make payment in full of all Senior Indebtedness remaining unpaid after
giving effect to any concurrent payment or distribution (or provision
therefor) to the holders of such Senior Indebtedness, before any payment or
distribution is made of such Contract Adjustment Payments to the Holders of
such Units; and
(iii) in the event that, notwithstanding the foregoing, any payment
by, or distribution of assets of, the Company of any kind or character,
whether in cash, property or securities, including any such payment or
distribution which may be payable or deliverable by reason of the payment
of any other indebtedness of the Company being subordinated to the payment
of Contract Adjustment Payments on the Purchase Contracts underlying the
Units, shall be received by the Purchase Contract Agent or the Holders of
any of the Units when such payment or distribution is prohibited pursuant
to Section 5.11(e) through (q), such payment or distribution shall be paid
over to the representative or representatives of the holders of Senior
Indebtedness or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing any such Senior Indebtedness may have been
issued, ratably as aforesaid, for application to the payment of all Senior
Indebtedness remaining unpaid until all such Senior Indebtedness shall have
been paid in full, after giving effect to any concurrent payment or
distribution (or provision therefor) to the holders of such Senior
Indebtedness.
(g) For purposes of Section 5.11(e) through (q), the words "cash, property
or securities" shall not be deemed to include shares of stock of the Company as
reorganized or readjusted, or securities of the Company or any other Person
provided for by a plan of reorganization or readjustment, the payment of which
is subordinated at least to the extent provided in Section 5.11(e) through (q)
with respect to such Contract Adjustment Payments on the Units to the payment of
all Senior Indebtedness which may at the time be outstanding; provided that (i)
the indebtedness or guarantee of indebtedness, as the case may be, that
constitutes Senior Indebtedness is assumed by the Person, if any, resulting from
any such reorganization or readjustment, and (ii) the rights of the holders of
the Senior Indebtedness are not, without the consent of each such holder
adversely affected thereby, altered by such reorganization or readjustment;
(h) Any failure by the Company to make any payment on or perform any other
obligation under Senior Indebtedness, other than any indebtedness incurred by
the Company or
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assumed or guaranteed, directly or indirectly, by the Company for money borrowed
(or any deferral, renewal, extension or refunding thereof) or any indebtedness
or obligation as to which the provisions of Section 5.11(e) through (g) shall
have been waived by the Company in the instrument or instruments by which the
Company incurred, assumed, guaranteed or otherwise created such indebtedness or
obligation, shall not be deemed a default or event of default if (i) the Company
shall be disputing its obligation to make such payment or perform such
obligation and (ii) either (A) no final judgment relating to such dispute shall
have been issued against the Company which is in full force and effect and is
not subject to further review, including a judgment that has become final by
reason of the expiration of the time within which a party may seek further
appeal or review, and (B) in the event a judgment that is subject to further
review or appeal has been issued, the Company shall in good faith be prosecuting
an appeal or other proceeding for review and a stay of execution shall have been
obtained pending such appeal or review.
(i) Subject to the irrevocable payment in full of all Senior Indebtedness,
the Holders of the Units shall be subrogated (equally and ratably with the
holders of all obligations of the Company which by their express terms are
subordinated to Senior Indebtedness of the Company to the same extent as payment
of the Contract Adjustment Payments in respect of the Purchase Contracts
underlying the Units is subordinated and which are entitled to like rights of
subrogation) to the rights of the holders of Senior Indebtedness to receive
payments or distributions of cash, property or securities of the Company
applicable to the Senior Indebtedness until all such Contract Adjustment
Payments owing on the Units shall be paid in full, and as between the Company,
its creditors other than holders of such Senior Indebtedness and the Holders, no
such payment or distribution made to the holders of Senior Indebtedness by
virtue of Section 5.11(e) through (q) that otherwise would have been made to the
Holders shall be deemed to be a payment by the Company on account of such Senior
Indebtedness, it being understood that the provisions of Section 5.11(e) through
(q) are and are intended solely for the purpose of defining the relative rights
of the Holders, on the one hand, and the holders of Senior Indebtedness, on the
other hand.
(j) Nothing contained in Section 5.11(e) through (q) or elsewhere in this
Agreement or in the Units is intended to or shall impair, as among the Company,
its creditors other than the holders of Senior Indebtedness and the Holders, the
obligation of the Company, which is absolute and unconditional, to pay to the
Holders such Contract Adjustment Payments on the Units as and when the same
shall become due and payable in accordance with their terms, or is intended to
or shall affect the relative rights of the Holders and creditors of the Company
other than the holders of Senior Indebtedness, nor shall anything herein or
therein prevent the Purchase Contract Agent or any Holder from exercising all
remedies otherwise permitted by applicable law upon default under this
Agreement, subject to the rights, if any, under Section 5.11(e) through (q), of
the holders of Senior Indebtedness in respect of cash, property or securities of
the Company received upon the exercise of any such remedy.
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(k) Upon payment or distribution of assets of the Company referred to
in Section 5.11(e) through (q), the Purchase Contract Agent and the Holders
shall be entitled to rely upon any order or decree made by any court of
competent jurisdiction in which any such dissolution, winding up, liquidation or
reorganization proceeding affecting the affairs of the Company is pending or
upon a certificate of the trustee in bankruptcy, receiver, assignee for the
benefit of creditors, liquidating trustee or Purchase Contract Agent or other
person making any payment or distribution, delivered to the Purchase Contract
Agent or to the Holders, for the purpose of ascertaining the Persons entitled to
participate in such payment or distribution, the holders of the Senior
Indebtedness and other indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to these Section 5.11(e) through (q).
(l) The Purchase Contract Agent shall be entitled to rely on the
delivery to it of a written notice by a Person representing himself to be a
holder of Senior Indebtedness (or a trustee or representative on behalf of such
holder) to establish that such notice has been given by a holder of Senior
Indebtedness or a trustee or representative on behalf of any such holder or
holders. In the event that the Purchase Contract Agent determines in good faith
that further evidence is required with respect to the right of any Person as a
holder of Senior Indebtedness to participate in any payment or distribution
pursuant to Section 5.11(e) through (q), the Purchase Contract Agent may request
such Person to furnish evidence to the reasonable satisfaction of the Purchase
Contract Agent as to the amount of Senior Indebtedness held by such Person, the
extent to which such Person is entitled to participate in such payment or
distribution and any other facts pertinent to the rights of such Person under
Section 5.11(e) through (q), and, if such evidence is not furnished, the
Purchase Contract Agent may defer payment to such Person pending judicial
determination as to the right of such Person to receive such payment.
(m) Nothing contained in Section 5.11(e) through (q) shall affect the
obligations of the Company to make, or prevent the Company from making, payment
of the Contract Adjustment Payments, except as otherwise provided in these
Section 5.11(e) through (q).
(n) Each Holder of Units, by its acceptance thereof, authorizes and
directs the Purchase Contract Agent on its behalf to take such action as may be
necessary or appropriate to effectuate the subordination provided in Section
5.11 (e) through (q) and appoints the Purchase Contract Agent its
attorney-in-fact, as the case may be, for any and all such purposes.
(o) The Company shall give prompt written notice to the Purchase
Contract Agent of any fact known to the Company that would prohibit the making
of any payment of moneys to or by the Purchase Contract Agent in respect of the
Units pursuant to the provisions of this Section. Notwithstanding the provisions
of Section 5.11(e) through (q) or any other provisions of this Agreement, the
Purchase Contract Agent shall not be charged with knowledge of the existence of
any facts that would prohibit the making of any payment of moneys to or by the
Purchase Contract Agent, or the taking of any other action by the Purchase
Contract Agent, unless and until the Purchase Contract Agent shall have received
written notice thereof mailed or delivered
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to the Purchase Contract Agent at its Corporate Trust Office from the Company,
any Holder, or the holder or representative of any Senior Indebtedness; provided
that if at least two Business Days prior to the date upon which by the terms
hereof any such moneys may become payable for any purpose, the Purchase Contract
Agent shall not have received with respect to such moneys the notice provided
for in this Section, then, anything herein contained to the contrary
notwithstanding, the Purchase Contract Agent shall have full power and authority
to receive such moneys and to apply the same to the purpose for which they were
received and shall not be affected by any notice to the contrary that may be
received by it within two Business Days prior to or on or after such date.
(p) The Purchase Contract Agent in its individual capacity shall be
entitled to all the rights set forth in this Section with respect to any Senior
Indebtedness at the time held by it, to the same extent as any other holder of
Senior Indebtedness and nothing in this Agreement shall deprive the Purchase
Contract Agent of any of its rights as such holder.
(q) No right of any present or future holder of any Senior
Indebtedness to enforce the subordination herein shall at any time or in any way
be prejudiced or impaired by any act or failure to act on the part of the
Company or by any noncompliance by the Company with the terms, provisions and
covenants of this Agreement, regardless of any knowledge thereof which any such
holder may have or be otherwise charged with.
(r) Nothing in this Section 5.11 shall apply to claims of, or payments
to, the Purchase Contract Agent under or pursuant to Section 7.07.
(s) With respect to the holders of Senior Indebtedness, (i) the duties
and obligations of the Purchase Contract Agent shall be determined solely by the
express provisions of this Agreement; (ii) the Purchase Contract Agent shall not
be liable to any such holders if it shall, acting in good faith, mistakenly pay
over or distribute to the Holders or to the Company or any other Person cash,
property or securities to which any holders of Senior Indebtedness shall be
entitled by virtue of this Section 5.11 or otherwise; (iii) no implied covenants
or obligations shall be read into this Agreement against the Purchase Contract
Agent; and (iv) the Purchase Contract Agent shall not be deemed to be a
fiduciary as to such holders.
SECTION 5.12. Deferral of Contract Adjustment Payments. (a) The Company
has the right to defer payment of all or part of the Contract Adjustment
Payments in respect of each Purchase Contract until no later than the Purchase
Contract Settlement Date (or, in the event of an effective Early Settlement or
Cash Merger Early Settlement, the Early Settlement Date or Cash Merger Early
Settlement Date, as the case may be), but only if the Company shall give the
Holders and the Purchase Contract Agent written notice of its election to defer
such payment (specifying the amount to be deferred) at least ten Business Days
prior to the earlier of (i) the next succeeding Payment Date or (ii) the date
the Company is required to give notice of the
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Record Date or Payment Date with respect to payment of such Contract Adjustment
Payments to the NYSE or other applicable self-regulatory organization or to
Holders, but in any event not less than one Business Day prior to such Record
Date. If the Company so elects to defer Contract Adjustment Payments, the
Company shall pay additional Contract Adjustment Payments on such deferred
installments of Contract Adjustment Payments at a rate equal to [C]% per annum,
compounding on each succeeding Payment Date, until such deferred installments
are paid in full (such deferred installments of Contract Adjustment Payments
together with the accrued additional Contract Adjustment Payments thereon, being
referred to herein as the "DEFERRED CONTRACT ADJUSTMENT PAYMENTS"). Deferred
Contract Adjustment Payments shall be due on the next succeeding Payment Date
except to the extent that payment is deferred pursuant to this Section.
(b) In the event that the Company elects to defer the payment of
Contract Adjustment Payments on the Purchase Contract s until the Purchase
Contract Settlement Date (or, in the event of an effective Early Settlement or
Cash Merger Early Settlement, the Early Settlement Date or Cash Merger Early
Settlement Date, as the case may be), each Holder will receive on the Purchase
Contract Settlement Date, Early Settlement Date or Cash Merger Early Settlement
Date, as applicable, the aggregate amount of Deferred Contract Adjustment
Payments to the extent such amounts are not deducted from the Settlement Price
in the case of a Cash Settlement, any Early Settlement or any Cash Merger Early
Settlement. The Company shall pay such amount on the Purchase Contract
Settlement Date (or, in the event of an effective Early Settlement or Cash
Merger Early Settlement, the Early Settlement Date or Cash Merger Early
Settlement Date, as the case may be) in the manner described in Section ?.
(c) In the event the Company exercises its option to defer the payment
of Contract Adjustment Payments, then, until all Deferred Contract Adjustment
Payments have been paid, the Company shall not, and shall not permit any of its
subsidiaries to, declare or pay dividends on, make distributions with respect
to, or redeem, purchase or acquire, or make a liquidation payment with respect
to, any of its capital stock or their capital stock; provided that the Company's
subsidiaries will not be restricted from declaring or paying such dividends, or
making such distributions, to the Company or any of the Company's other
subsidiaries as a result of the foregoing.
ARTICLE 6
REMEDIES
SECTION 6.01. Unconditional Right of Holders to Receive Contract
Adjustment Payments and to Purchase Shares of Common Stock.
Each Holder of a Unit shall have the right, which is absolute and
unconditional, (i) to receive each Contract Adjustment Payment with respect to
the Purchase Contract comprising part
72
of such Unit on the respective Payment Date for such Unit and (ii) except upon
and following a Termination Event, to purchase shares of Common Stock pursuant
to such Purchase Contract and, in each such case, to institute suit for the
enforcement of any such right to receive Contract Adjustment Payments and the
right to purchase shares of Common Stock, and such rights shall not be impaired
without the consent of such Holder.
SECTION 6.02. Restoration of Rights and Remedies.
If any Holder has instituted any proceeding to enforce any right or
remedy under this Agreement and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to such Holder, then
and in every such case, subject to any determination in such proceeding, the
Company and such Holder shall be restored severally and respectively to their
former positions hereunder, and thereafter all rights and remedies of such
Holder shall continue as though no such proceeding had been instituted.
SECTION 6.03. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Certificates in the last paragraph of
Section 3.10, no right or remedy herein conferred upon or reserved to the
Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
SECTION 6.04. Delay or Omission Not Waiver.
No delay or omission of any Holder to exercise any right upon a default
or remedy upon a default shall impair any such right or remedy or constitute a
waiver of any such right. Every right and remedy given by this Article or by law
to the Holders may be exercised from time to time, and as often as may be deemed
expedient, by such Holders.
SECTION 6.05. Undertaking for Costs.
All parties to this Agreement agree, and each Holder of a Unit, by its
acceptance of such Unit shall be deemed to have agreed, that any court may in
its discretion require, in any suit for the enforcement of any right or remedy
under this Agreement, or in any suit against the Purchase Contract Agent for any
action taken, suffered or omitted by it as Purchase Contract Agent, the filing
by any party litigant in such suit of an undertaking to pay the costs of such
suit, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys' fees and costs against any party litigant in
such suit, having due regard to the merits and good faith of the claims or
defenses made by such party litigant; provided that the provisions of this
Section shall
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not apply to any suit instituted by the Purchase Contract Agent, to any suit
instituted by any Holder, or group of Holders, holding in the aggregate more
than 10% of the Outstanding Units, or to any suit instituted by any Holder for
the enforcement of interest on any Notes or Contract Adjustment Payments on or
after the respective Payment Date therefor in respect of any Unit held by such
Holder, or for enforcement of the right to purchase shares of Common Stock under
the Purchase Contracts constituting part of any Unit held by such Holder.
SECTION 6.06. Waiver of Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Agreement; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Purchase Contract Agent or the Holders, but will
suffer and permit the execution of every such power as though no such law had
been enacted.
ARTICLE 7
THE PURCHASE CONTRACT AGENT
SECTION 7.01. Certain Duties and Responsibilities.
(a) The Purchase Contract Agent:
(1) undertakes to perform, with respect to the Units, such duties and
only such duties as are specifically set forth in this Agreement, the Pledge
Agreement and the Remarketing Agreement and no implied covenants or obligations
shall be read into this Agreement, the Pledge Agreement or the Remarketing
Agreement against the Purchase Contract Agent; and
(2) in the absence of bad faith or gross negligence on its part, may,
with respect to the Units, conclusively rely, as to the truth of the statements
and the correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Purchase Contract Agent and conforming to the
requirements of this Agreement or the Pledge Agreement or the Remarketing
Agreement, as applicable, but in the case of any certificates or opinions which
by any provision hereof are specifically required to be furnished to the
Purchase Contract Agent, the Purchase Contract Agent shall be under a duty to
examine the same to determine whether or not they conform to the requirements of
this Agreement, the Pledge Agreement or the Remarketing Agreement, as applicable
(but need not confirm or investigate the accuracy of the mathematical
calculations or other facts stated therein).
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(b) No provision of this Agreement, the Pledge Agreement or the
Remarketing Agreement shall be construed to relieve the Purchase Contract Agent
from liability for its own grossly negligent action, its own grossly negligent
failure to act, or its own willful misconduct, except that:
(1) this Subsection shall not be construed to limit the effect of
Subsection (a) of this Section;
(2) the Purchase Contract Agent shall not be liable for any error of
judgment made in good faith by a Responsible Officer, unless it shall be
conclusively determined by a court of competent jurisdiction that the Purchase
Contract Agent was grossly negligent in ascertaining the pertinent facts; and
(3) no provision of this Agreement or the Pledge Agreement or the
Remarketing Agreement shall require the Purchase Contract 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.
(c) Whether or not therein expressly so provided, every provision of
this Agreement, the Pledge Agreement and the Remarketing Agreement relating to
the conduct or affecting the liability of or affording protection to the
Purchase Contract Agent shall be subject to the provisions of this Section.
(d) The Purchase Contract Agent is authorized to execute and deliver
the Pledge Agreement and the Remarketing Agreement in its capacity as Purchase
Contract Agent.
SECTION 7.02. Notice of Default.
Within 30 days after the occurrence of any default by the Company
hereunder of which a Responsible Officer of the Purchase Contract Agent has
actual knowledge, the Purchase Contract Agent shall transmit by mail to the
Company and the Holders of Units, as their names and addresses appear in the
Security Register, notice of such default hereunder, unless such default shall
have been cured or waived.
SECTION 7.03. Certain Rights of Purchase Contract Agent.
Subject to the provisions of Section 7.01:
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(1) the Purchase Contract Agent may, in the absence of bad faith,
conclusively rely and shall be fully protected in acting or refraining from
acting upon any resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, Note, note, other evidence of
indebtedness or other paper or document believed by it to be genuine and to have
been signed or presented by the proper party or parties;
(2) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by an Officers' Certificate, Issuer Order or Issuer
Request, and any resolution of the Board of Directors of the Company may be
sufficiently evidenced by a Board Resolution;
(3) whenever in the administration of this Agreement or the Pledge
Agreement or the Remarketing Agreement the Purchase Contract Agent shall deem it
desirable that a matter be proved or established prior to taking, suffering or
omitting to take any action hereunder, the Purchase Contract Agent (unless other
evidence be herein specifically prescribed in this Agreement) may, in the
absence of bad faith on its part, conclusively rely upon an Officers'
Certificate of the Company;
(4) the Purchase Contract Agent may consult with counsel of its
selection appointed with due care by it hereunder and the advice of such counsel
or any Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it hereunder
in good faith and in reliance thereon;
(5) the Purchase Contract Agent shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Purchase Contract Agent, in its discretion, may make
reasonable further inquiry or investigation into such facts or matters related
to the execution, delivery and performance of the Purchase Contracts as it may
see fit, and, if the Purchase Contract Agent shall determine to make such
further inquiry or investigation, it shall be entitled to examine the relevant
books, records and premises of the Company, personally or by agent or attorney;
(6) the Purchase Contract Agent may execute any of the powers
hereunder or perform any duties hereunder either directly or by or through
agents, attorneys, custodians or nominees or an Affiliate and the Purchase
Contract Agent shall not be responsible for any misconduct or negligence on the
part of any agent, attorney, custodian or nominee or an Affiliate appointed with
due care by it hereunder;
(7) the Purchase Contract Agent shall be under no obligation to
exercise any of the rights or powers vested in it by this Agreement at the
request or direction of any of the Holders pursuant to this Agreement, unless
such Holders shall have offered to the Purchase Contract Agent security or
indemnity satisfactory to the Purchase Contract Agent against the costs,
expenses and liabilities which might be incurred by it in compliance with such
request or direction;
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(8) the Purchase Contract Agent shall not be liable for any action
taken, suffered, or omitted to be taken by it in the absence of bad faith or
gross negligence by it;
(9) the Purchase Contract Agent shall not be deemed to have notice of
any default hereunder unless a Responsible Officer of the Purchase Contract
Agent has actual knowledge thereof or unless written notice of any event which
is in fact such a default is received by the Purchase Contract Agent at the
Corporate Trust Office of the Purchase Contract Agent, and such notice
references the Units and this Agreement;
(10) the Purchase Contract Agent may request that the Company deliver
an Officers' Certificate setting forth the names of individuals and/or titles of
officers authorized at such time to take specified actions pursuant to this
Agreement, which Officers' Certificate may be signed by any person authorized to
sign an Officers' Certificate, including any person specified as so authorized
in any such certificate previously delivered and not superseded;
(11) the rights, privileges, protections, immunities and benefits given
to the Purchase Contract Agent, including, without limitation, its right to be
indemnified, are extended to, and shall be enforceable by, the Purchase Contract
Agent in each of its capacities hereunder, and to each agent, custodian and
other Person employed to act hereunder; and
(12) The Purchase Contract Agent shall not be required to initiate or
conduct any litigation or collection proceedings hereunder and shall have no
responsibilities with respect to any default hereunder except as expressly set
forth herein.
SECTION 7.04. Not Responsible for Recitals or Issuance of Units.
The recitals contained herein, in the Pledge Agreement, the Remarketing
Agreement and in the Certificates shall be taken as the statements of the
Company, and the Purchase Contract Agent assumes no responsibility for their
accuracy or validity. The Purchase Contract Agent makes no representations as to
the validity or sufficiency of either this Agreement or of the Units, or of the
Pledge Agreement or the Pledge or the Collateral and shall have no
responsibility for perfecting or maintaining the perfection of any security
interest in the Collateral. The Purchase Contract Agent shall not be accountable
for the use or application by the Company of the proceeds in respect of the
Purchase Contracts.
SECTION 7.05. May Hold Units.
Any Security Registrar or any other agent of the Company, or the
Purchase Contract Agent and its Affiliates, in their individual or any other
capacity, may become the owner or pledgee of Units and may otherwise deal with
the Company, the Collateral Agent or any other Person with the same rights it
would have if it were not Security Registrar or such other agent, or the
Purchase Contract Agent. The Company may become the owner or pledgee of Units.
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SECTION 7.06. Money Held in Custody.
Money held by the Purchase Contract Agent in custody hereunder need not
be segregated from the Purchase Contract Agent's other funds except to the
extent required by law or provided herein. The Purchase Contract Agent shall be
under no obligation to invest or pay interest on any money received by it
hereunder except as otherwise provided hereunder or agreed in writing with the
Company.
SECTION 7.07. Compensation and Reimbursement.
The Company agrees:
(1) to pay to the Purchase Contract Agent compensation for all
services rendered by it hereunder, under the Pledge Agreement and under the
Remarketing Agreement as the Company and the Purchase Contract Agent shall from
time to time agree in writing;
(2) except as otherwise expressly provided for herein, to reimburse
the Purchase Contract Agent upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Purchase Contract Agent in
accordance with any provision of this Agreement, the Pledge Agreement and the
Remarketing Agreement (including the reasonable compensation and the expenses
and disbursements of its agents and counsel) in connection with the negotiation,
preparation, execution and delivery and performance of this Agreement, the
Pledge Agreement and the Remarketing Agreement and any modification, supplement
or waiver of any of the terms thereof, except any such expense, disbursement or
advance as may be attributable to its gross negligence, willful misconduct or
bad faith; and
(3) to indemnify the Purchase Contract Agent and any predecessor
Purchase Contract Agent (and each of its directors, officers, agents and
employees (collectively, the "INDEMNITEES") for, and to hold it harmless
against, any loss, claim, damage, fine, penalty, liability or expense (including
reasonable fees and expenses of counsel) incurred without gross negligence,
willful misconduct or bad faith on its part, arising out of or in connection
with the acceptance or administration of its duties hereunder and under the
Pledge Agreement and the Remarketing Agreement, including the Indemnitees'
reasonable costs and expenses of defending themselves against any claim (whether
asserted by the Company, a Holder or any other person) or liability in
connection with the exercise or performance of any of the Purchase Contract
Agent's powers or duties hereunder or thereunder.
The provisions of this Section shall survive the resignation and
removal of the Purchase Contract Agent and the termination of this Agreement.
SECTION 7.08. Corporate Purchase Contract Agent Required; Eligibility.
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There shall at all times be a Purchase Contract Agent hereunder which
shall be a Person organized and doing business under the laws of the United
States of America, any State thereof or the District of Columbia, authorized
under such laws to exercise corporate trust powers, having (or being a member of
a bank holding company having) a combined capital and surplus of at least
$50,000,000, subject to supervision or examination by Federal or State authority
and having a corporate trust office in the Borough of Manhattan, New York City,
if there be such a Person in the Borough of Manhattan, New York City, qualified
and eligible under this Article and willing to act on reasonable terms. If such
Person publishes reports of condition at least annually, pursuant to law or to
the requirements of said supervising or examining authority, then for the
purposes of this Section, the combined capital and surplus of such Person shall
be deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. If at any time the Purchase Contract Agent
shall cease to be eligible in accordance with the provisions of this Section, it
shall resign immediately in the manner and with the effect hereinafter specified
in this Article.
SECTION 7.09. Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Purchase Contract Agent and no
appointment of a successor Purchase Contract Agent pursuant to this Article
shall become effective until the acceptance of appointment by the successor
Purchase Contract Agent in accordance with the applicable requirements of
Section 7.10.
(b) The Purchase Contract Agent may resign at any time by giving
written notice thereof to the Company 60 days prior to the effective date of
such resignation. If the instrument of acceptance by a successor Purchase
Contract Agent required by Section 7.10 shall not have been delivered to the
Purchase Contract Agent within 30 days after the giving of such notice of
resignation, the resigning Purchase Contract Agent may petition, at the expense
of the Company, any court of competent jurisdiction for the appointment of a
successor Purchase Contract Agent.
(c) The Purchase Contract Agent may be removed at any time by Act of
the Holders of a majority in number of the Outstanding Units delivered to the
Purchase Contract Agent and the Company. If the instrument of acceptance by a
successor Purchase Contract Agent required by Section 7.10 shall not have been
delivered to the Purchase Contract Agent within 30 days after such Act, the
Purchase Contract Agent being removed may petition any court of competent
jurisdiction for the appointment of a successor Purchase Contract Agent.
(d) If at any time:
(1) the Purchase Contract Agent fails to comply with Section
310(b) of the TIA, as if the Purchase Contract Agent were an indenture
trustee under an indenture qualified under the TIA, and shall fail to
resign after written request therefor by the Company or by any Holder
who has been a bona fide Holder of a Unit for at least six months;
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(2) the Purchase Contract Agent shall cease to be eligible
under Section 7.08 and shall fail to resign after written request
therefor by the Company or by any such Holder; or
(3) the Purchase Contract Agent shall become incapable of
acting or shall be adjudged a bankrupt or insolvent or a receiver of
the Purchase Contract Agent or of its property shall be appointed or
any public officer shall take charge or control of the Purchase
Contract Agent or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, (i) the Company by a Board Resolution may remove the
Purchase Contract Agent, or (ii) any Holder who has been a bona fide Holder of a
Unit for at least six months may, on behalf of himself and all others similarly
situated, petition any court of competent jurisdiction for the removal of the
Purchase Contract Agent and the appointment of a successor Purchase Contract
Agent.
(e) If the Purchase Contract Agent shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of Purchase
Contract Agent for any cause, the Company, by a Board Resolution, shall promptly
appoint a successor Purchase Contract Agent and shall comply with the applicable
requirements of Section 7.10. If no successor Purchase Contract Agent shall have
been so appointed by the Company and accepted appointment in the manner required
by Section 7.10, any Holder who has been a bona fide Holder of a Unit for at
least six months, on behalf of itself and all others similarly situated, or the
Purchase Contract Agent may petition at the expense of the Company, any court of
competent jurisdiction for the appointment of a successor Purchase Contract
Agent.
(f) The Company shall give, or shall cause such successor Purchase
Contract Agent to give, notice of each resignation and each removal of the
Purchase Contract Agent and each appointment of a successor Purchase Contract
Agent by mailing written notice of such event by first-class mail, postage
prepaid, to all Holders as their names and addresses appear in the applicable
Security Register. Each notice shall include the name of the successor Purchase
Contract Agent and the address of its Corporate Trust Office.
SECTION 7.10. Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor Purchase
Contract Agent, every such successor Purchase Contract Agent so appointed shall
execute, acknowledge and deliver to the Company and to the retiring Purchase
Contract Agent an instrument accepting such appointment, and thereupon the
resignation or removal of the retiring Purchase Contract Agent shall become
effective and such successor Purchase Contract Agent, without any further act,
deed or conveyance, shall become vested with all the rights, powers, agencies
and duties of the retiring Purchase Contract Agent; but, on the request of the
Company or the successor Purchase Contract Agent, such retiring Purchase
Contract Agent shall, upon payment of its charges, execute and
80
deliver an instrument transferring to such successor Purchase Contract Agent all
the rights, powers and trusts of the retiring Purchase Contract Agent and duly
assign, transfer and deliver to such successor Purchase Contract Agent all
property and money held by such retiring Purchase Contract Agent hereunder.
(b) Upon request of any such successor Purchase Contract Agent, the
Company shall execute any and all instruments for more fully and certainly
vesting in and confirming to such successor Purchase Contract Agent all such
rights, powers and agencies referred to in paragraph (a) of this Section.
(c) No successor Purchase Contract Agent shall accept its appointment
unless at the time of such acceptance such successor Purchase Contract Agent
shall be qualified and eligible under this Article.
SECTION 7.11. Merger, Conversion, Consolidation or Succession to
Business.
Any Person into which the Purchase Contract Agent may be merged or
converted or with which it may be consolidated, or any Person resulting from any
merger, conversion or consolidation to which the Purchase Contract Agent shall
be a party, or any Person succeeding to all or substantially all the corporate
trust business of the Purchase Contract Agent, shall be the successor of the
Purchase Contract Agent hereunder, provided that such Person shall be otherwise
qualified and eligible under this Article, without the execution or filing of
any paper or any further act on the part of any of the parties hereto. In case
any Certificates shall have been authenticated and executed on behalf of the
Holders, but not delivered, by the Purchase Contract Agent then in office, any
successor by merger, conversion or consolidation to such Purchase Contract Agent
may adopt such authentication and execution and deliver the Certificates so
authenticated and executed with the same effect as if such successor Purchase
Contract Agent had itself authenticated and executed such Units.
SECTION 7.12. Preservation of Information; Communications to Holders.
(a) The Purchase Contract Agent shall preserve, in as current a form
as is reasonably practicable, the names and addresses of Holders received by the
Purchase Contract Agent in its capacity as Security Registrar.
(b) If three or more Holders (herein referred to as "APPLICANTS")
apply in writing to the Purchase Contract Agent, and furnish to the Purchase
Contract Agent reasonable proof that each such applicant has owned a Unit for a
period of at least six months preceding the date of such application, and such
application states that the applicants desire to communicate with other Holders
with respect to their rights under this Agreement or under the Units and is
accompanied by a copy of the form of proxy or other communication which such
applicants propose to transmit, then the Purchase Contract Agent shall mail to
all the Holders copies of the form of proxy or other communication which is
specified in such request, with reasonable promptness
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after a tender to the Purchase Contract Agent of the materials to be mailed and
of payment, or provision for the payment, of the reasonable expenses of such
mailing.
SECTION 7.13. No Obligations of Purchase Contract Agent.
Except to the extent otherwise expressly provided in this Agreement,
the Purchase Contract Agent assumes no obligations and shall not be subject to
any liability under this Agreement, the Pledge Agreement, the Remarketing
Agreement or any Purchase Contract in respect of the obligations of the Holder
of any Unit thereunder. The Company agrees, and each Holder of a Certificate, by
its acceptance thereof, shall be deemed to have agreed, that the Purchase
Contract Agent's execution of the Certificates on behalf of the Holders shall be
solely as agent and attorney-in-fact for the Holders, and that the Purchase
Contract Agent shall have no obligation to perform such Purchase Contracts on
behalf of the Holders, except to the extent expressly provided in Article Five
hereof. Anything contained in this Agreement to the contrary notwithstanding, in
no event shall the Purchase Contract Agent or its officers, directors, employees
or agents be liable under this Agreement, the Pledge Agreement or the
Remarketing Agreement to any third party for indirect, incidental, special,
punitive, or consequential loss or damage of any kind whatsoever, including lost
profits, whether or not the likelihood of such loss or damage was known to the
Purchase Contract Agent and regardless of the form of action.
SECTION 7.14. Tax Compliance.
(a) The Purchase Contract Agent, on its own behalf and on behalf of
the Company, will comply with all applicable certification, information
reporting and withholding (including "backup" withholding) requirements imposed
by applicable tax laws, regulations or administrative practice with respect to
(i) any payments made with respect to the Units or (ii) the issuance, delivery,
holding, transfer, redemption or exercise of rights under the Units. Such
compliance shall include, without limitation, the preparation and timely filing
of required returns and the timely payment of all amounts required to be
withheld to the appropriate taxing authority or its designated agent.
(b) The Purchase Contract Agent shall comply in accordance with the
terms hereof with any written direction received from the Company with respect
to the execution or certification of any required documentation and the
application of such requirements to particular payments or Holders or in other
particular circumstances, and may for purposes of this Agreement conclusively
rely on any such direction in accordance with the provisions of Section
7.01(a)(2) hereof.
(c) The Purchase Contract Agent shall maintain all appropriate records
documenting compliance with such requirements, and shall make such records
available, on written request, to the Company or its authorized representative
within a reasonable period of time after receipt of such request.
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ARTICLE 8
SUPPLEMENTAL AGREEMENTS
SECTION 8.01. Supplemental Agreements Without Consent of Holders.
Without the consent of any Holders, the Company, when authorized by a
Board Resolution, and the Purchase Contract Agent, at any time and from time to
time, may enter into one or more agreements supplemental hereto, in form
satisfactory to the Company and the Purchase Contract Agent, to:
(1) evidence the succession of another Person to the Company,
and the assumption by any such successor of the covenants of the
Company herein and in the Certificates;
(2) evidence and provide for the acceptance of appointment
hereunder by a successor Purchase Contract Agent;
(3) add to the covenants of the Company for the benefit of the
Holders, or surrender any right or power herein conferred upon the
Company;
(4) make provision with respect to the rights of Holders
pursuant to the requirements of Section 5.04(b); or
(5) except as provided for in Section 5.04, cure any
ambiguity, correct or supplement any provisions herein which may be
inconsistent with any other provisions herein, or make any other
provisions with respect to such matters or questions arising under this
Agreement, provided that such action shall not adversely affect the
interests of the Holders in any material respect.
SECTION 8.02. Supplemental Agreements with Consent of Holders.
With the consent of the Holders of not less than a majority of the
Outstanding Units voting together as one class, including without limitation the
consent of the Holders obtained in connection with a tender or an exchange
offer, by Act of said Holders delivered to the Company and the Purchase Contract
Agent, the Company, when authorized by a Board Resolution, and the Purchase
Contract Agent may enter into an agreement or agreements supplemental hereto for
the purpose of modifying in any manner the terms of the Purchase Contracts, or
the provisions of this Agreement or the rights of the Holders in respect of the
Units; provided, however, that, except as contemplated herein, no such
supplemental agreement shall, without the unanimous consent of the Holders of
each outstanding Purchase Contract affected thereby,
83
(1) change any Payment Date;
(2) change the amount or the type of Collateral required to be
Pledged to secure a Holder's obligations under the Purchase Contract,
unless such change is not adverse to the Holders, impair the right of
the Holder of any Purchase Contract to receive distributions on the
related Collateral or otherwise adversely affect the Holder's rights in
or to such Collateral or adversely alter the rights in or to such
Collateral;
(3) impair the right to institute suit for the enforcement of
any Purchase Contract or any Contract Adjustment Payments;
(4) reduce the number of shares of Common Stock or the amount
of any other property to be purchased pursuant to any Purchase
Contract, increase the price to purchase shares of Common Stock or any
other property upon settlement of any Purchase Contract or change the
Purchase Contract Settlement Date or the right to Early Settlement or
Cash Merger Early Settlement or otherwise adversely affect the Holder's
rights under the Purchase Contract;
(5) reduce any Contract Adjustment Payments or change any
place where, or the coin or currency in which, any Contract Adjustment
Payment is payable; or
(6) reduce the percentage of the outstanding Purchase
Contracts the consent of whose Holders is required for any modification
or amendment to the provisions of this Agreement, the Purchase
Contracts or the Pledge Agreement;
provided that if any amendment or proposal referred to above would adversely
affect only the Corporate Units or the Treasury Units, then only the affected
class of Holders as of the record date for the Holders entitled to vote thereon
will be entitled to vote on such amendment or proposal, and such amendment or
proposal shall not be effective except with the consent of Holders of not less
than a majority of such class; and provided, further, that the unanimous consent
of the Holders of each outstanding Purchase Contract of such class affected
thereby shall be required to approve any amendment or proposal specified in
clauses (1) through (6) above.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental agreement, but it shall
be sufficient if such Act shall approve the substance thereof.
SECTION 8.03. Execution of Supplemental Agreements.
In executing, or accepting the additional agencies created by, any
supplemental agreement permitted by this Article or the modifications thereby of
the agencies created by this Agreement, the Purchase Contract Agent shall be
provided, and (subject to Section 7.01) shall be fully authorized and protected
in relying upon, an Officers' Certificate and an Opinion of Counsel
84
stating that the execution of such supplemental agreement is authorized or
permitted by this Agreement and that any and all conditions precedent to the
execution and delivery of such supplemental agreement have been satisfied. The
Purchase Contract Agent may, but shall not be obligated to, enter into any such
supplemental agreement which affects the Purchase Contract Agent's own rights,
duties or immunities under this Agreement or otherwise.
SECTION 8.04. Effect of Supplemental Agreements.
Upon the execution of any supplemental agreement under this Article,
this Agreement shall be modified in accordance therewith, and such supplemental
agreement shall form a part of this Agreement for all purposes; and every Holder
of Certificates theretofore or thereafter authenticated, executed on behalf of
the Holders and delivered hereunder, shall be bound thereby.
SECTION 8.05. Reference to Supplemental Agreements.
Certificates authenticated, executed on behalf of the Holders and
delivered after the execution of any supplemental agreement pursuant to this
Article may, and shall if required by the Purchase Contract Agent, bear a
notation in form approved by the Purchase Contract Agent as to any matter
provided for in such supplemental agreement. If the Company shall so determine,
new Certificates so modified as to conform, in the opinion of the Purchase
Contract Agent and the Company, to any such supplemental agreement may be
prepared and executed by the Company and authenticated, executed on behalf of
the Holders and delivered by the Purchase Contract Agent in exchange for
outstanding Certificates.
ARTICLE 9
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 9.01. Covenant Not to Consolidate, Merge, Convey, Transfer or
Lease Property Except under Certain Conditions.
The Company covenants that it will not consolidate with, convert into,
or merge with and into, any other corporation or sell, assign, transfer, lease
or convey all or substantially all of its properties and assets to any Person,
unless:
(i) either the Company shall be the continuing corporation,
or the successor (if other than the Company) shall be a corporation
organized and existing under the laws of the United States of America
or a State thereof or the District of Columbia and such corporation
shall expressly assume all the obligations of the Company under the
Purchase Contracts, this Agreement, the Pledge Agreement, the Indenture
(including any supplement thereto) and the Remarketing Agreement by one
or more supplemental agreements in form reasonably satisfactory to the
Purchase Contract Agent and the
85
Collateral Agent, executed and delivered to the Purchase Contract Agent
and the Collateral Agent by such corporation; and
(ii) the Company or such successor corporation, as the case
may be, shall not, immediately after such consolidation, conversion,
merger, sale, assignment, transfer, lease or conveyance, be in default
of payment obligations under the Purchase Contracts, this Agreement,
the Pledge Agreement, the Indenture (including any supplement thereto)
or the Remarketing Agreement or in material default in the performance
of any other covenants under any of the foregoing agreements.
SECTION 9.02. Rights and Duties of Successor Corporation.
In case of any such merger, consolidation, share exchange, sale,
assignment, transfer, lease or conveyance and upon any such assumption by a
successor corporation in accordance with Section 9.01, such successor
corporation shall succeed to and be substituted for the Company with the same
effect as if it had been named herein as the Company. Such successor corporation
thereupon may cause to be signed, and may issue either in its own name or in the
name of The Phoneix Companies, Inc., any or all of the Certificates evidencing
Units issuable hereunder which theretofore shall not have been signed by the
Company and delivered to the Purchase Contract Agent; and, upon the order of
such successor corporation, instead of the Company, and subject to all the
terms, conditions and limitations in this Agreement prescribed, the Purchase
Contract Agent shall authenticate and execute on behalf of the Holders and
deliver any Certificates which previously shall have been signed and delivered
by the officers of the Company to the Purchase Contract Agent for authentication
and execution, and any Certificate evidencing Units which such successor
corporation thereafter shall cause to be signed and delivered to the Purchase
Contract Agent for that purpose. All the Certificates issued shall in all
respects have the same legal rank and benefit under this Agreement as the
Certificates theretofore or thereafter issued in accordance with the terms of
this Agreement as though all of such Certificates had been issued at the date of
the execution hereof.
In case of any such merger, consolidation, share exchange, sale,
assignment, transfer, lease or conveyance such change in phraseology and form
(but not in substance) may be made in the Certificates evidencing Units
thereafter to be issued as may be appropriate.
SECTION 9.03. Officers' Certificate and Opinion of Counsel Given to
Purchase Contract Agent.
The Purchase Contract Agent, subject to Sections 7.01 and 7.03, shall
receive an Officers' Certificate and an Opinion of Counsel as conclusive
evidence that any such merger, consolidation, share exchange, sale, assignment,
transfer, lease or conveyance, and any such assumption, complies with the
provisions of this Article and that all conditions precedent to the consummation
of any such merger, consolidation, share exchange, sale, assignment, transfer,
lease or conveyance have been met.
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ARTICLE 10
COVENANTS
SECTION 10.01. Performance under Purchase Contracts.
The Company covenants and agrees for the benefit of the Holders from
time to time of the Units that it will duly and punctually perform its
obligations under the Purchase Contracts in accordance with the terms of the
Purchase Contracts and this Agreement.
SECTION 10.02. Maintenance of Office or Agency.
The Company will maintain in the Borough of Manhattan, New York City an
office or agency where Certificates may be presented or surrendered for
acquisition of shares of Common Stock upon settlement of the Purchase Contracts
on the Purchase Contract Settlement Date or upon Early Settlement or Cash Merger
Early Settlement and for transfer of Collateral upon occurrence of a Termination
Event, where Certificates may be surrendered for registration of transfer or
exchange, for a Collateral Substitution or recreation of Corporate Units and
where notices and demands to or upon the Company in respect of the Units and
this Agreement may be served. The Company will give prompt written notice to the
Purchase Contract Agent of the location, and any change in the location, of such
office or agency. The Company initially designates the Corporate Trust Office of
the Purchase Contract Agent as such office of the Company. If at any time the
Company shall fail to maintain any such required office or agency or shall fail
to furnish the Purchase Contract Agent with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office, and the Company hereby appoints the Purchase Contract
Agent as its agent to receive all such presentations, surrenders, notices and
demands.
The Company may also from time to time designate one or more other
offices or agencies where Certificates may be presented or surrendered for any
or all such purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the
Borough of Manhattan, New York City for such purposes. The Company will give
prompt written notice to the Purchase Contract Agent of any such designation or
rescission and of any change in the location of any such other office or agency.
The Company hereby designates as the place of payment for the Units the
Corporate Trust Office and appoints the Purchase Contract Agent at its Corporate
Trust Office as paying agent in such city.
SECTION 10.03. Company to Reserve Common Stock.
The Company shall at all times prior to the Purchase Contract
Settlement Date reserve and keep available, free from preemptive rights, out of
its authorized but unissued Common Stock the full number of shares of Common
Stock issuable against tender of payment in respect of all Purchase Contracts
constituting a part of the Units evidenced by Outstanding Certificates.
87
SECTION 10.04. Covenants as to Common Stock.
The Company covenants that all shares of Common Stock which may be
issued against tender of payment in respect of any Purchase Contract
constituting a part of the Outstanding Units will, upon issuance, be duly
authorized, validly issued, fully paid and nonassessable.
SECTION 10.05. Statements of Officers of the Company as to Default.
The Company will deliver to the Purchase Contract Agent, within 120
days after the end of each fiscal year of the Company (which as of the date
hereof is December 31) ending after the date hereof, an Officers' Certificate,
stating whether or not to the knowledge of the signers thereof the Company is in
default in the performance and observance of any of the terms, provisions and
conditions hereof, and if the Company shall be in default, specifying all such
defaults and the nature and status thereof of which they may have knowledge.
SECTION 10.06. ERISA.
Each Holder from time to time of the Units that is a Plan or who used
assets of a Plan to purchase Units hereby represents that either (i) no portion
of the assets used by such Holder to acquire the Corporate Units constitutes
assets of the Plan or (ii) the purchase or holding of the Corporate Units by
such purchaser or transferee will not constitute a non-exempt prohibited
transaction under Section 406 of ERISA or Section 4973 of the Code or similar
violation under any applicable laws.
SECTION 10.07. Tax Treatment. The Company covenants and agrees, and by
purchasing a Corporate Unit each Holder agrees, for United States federal, state
and local income and franchise tax purposes, to (i) treat a Holder's acquisition
of the Corporate Units as the acquisition of the Notes and Purchase Contracts
constituting the Corporate Units, (ii) treat each Holder as the owner of the
applicable interest in the Collateral Account, including the Notes and
Applicable Ownership Interests in the Treasury Portfolio or the Treasury
Securities and (iii) treat each Purchase Contract as a forward purchase contract
for the purchase of Common Stock.
[SIGNATURES ON THE FOLLOWING PAGE]
88
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
THE PHOENIX COMPANIES, INC.
By:
-------------------------------------
Name:
Title:
SUNTRUST BANK,
as Purchase Contract Agent
By:
-------------------------------------
Name:
Title:
EXHIBIT A
(FORM OF FACE OF CORPORATE UNIT CERTIFICATE)
[For inclusion in Global Certificates only - THIS CERTIFICATE IS A
GLOBAL CERTIFICATE WITHIN THE MEANING OF THE PURCHASE CONTRACT AGREEMENT
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF CEDE & CO., AS THE
NOMINEE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE
"DEPOSITARY"), THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY. THIS
CERTIFICATE IS EXCHANGEABLE FOR CERTIFICATES REGISTERED IN THE NAME OF A PERSON
OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES
DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT AND NO TRANSFER OF THIS CERTIFICATE
(OTHER THAN A TRANSFER OF THIS CERTIFICATE AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED EXCEPT IN LIMITED
CIRCUMSTANCES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
No. ________ CUSIP No.
Number of Corporate Units:_________________
THE PHOENIX COMPANIES, INC.
Corporate Units
This Corporate Units Certificate certifies that [Cede & Co.] [_______]
is the registered Holder of the number of Corporate Units set forth above [For
inclusion in Global Certificates only - or such other number of Corporate Units
reflected in the Schedule of Increases or Decreases in Global Certificate
attached hereto]. Each Corporate Unit consists of (i) either (a) the beneficial
ownership by the Holder of $25.00 principal amount of Notes due February 16,
2008 (the "NOTES") of The Phoneix Companies, Inc., a Delaware corporation (the
"COMPANY"), subject to the Pledge of such Note by such Holder pursuant to the
Pledge Agreement, or (b) upon
the occurrence of a Special Event Redemption prior to the Purchase Contract
Settlement Date or a Successful Remarketing of the Notes prior to the Final
Remarketing Date, the appropriate Applicable Ownership Interests (as specified
in clause (i) of the definition of such term) in the Treasury Portfolio by such
Holder pursuant to the Pledge Agreement, and (ii) the rights and obligations of
the Holder under one Purchase Contract with the Company. All capitalized terms
used herein which are defined in the Purchase Contract Agreement (as defined on
the reverse hereof) have the meaning set forth therein.
Pursuant to the Pledge Agreement, the Notes or the appropriate
Applicable Ownership Interests (as specified in clause (i) of the definition of
such term) in the Treasury Portfolio, as the case may be, constituting part of
each Corporate Unit evidenced hereby have been pledged to the Collateral Agent,
for the benefit of the Company, to secure the obligations of the Holder under
the Purchase Contract comprising part of such Corporate Unit.
The Pledge Agreement provides that all payments of the principal amount
with respect to any of the Pledged Notes or the appropriate Applicable Ownership
Interests (as specified in clause (i) of the definition of such term) in the
Treasury Portfolio, as the case may be, or interest or distributions on any
Pledged Notes (as defined in the Pledge Agreement) or the appropriate Applicable
Ownership Interests (as specified in clause (ii) of the definition of such term)
in the Treasury Portfolio, as the case may be, constituting part of the
Corporate Units received by the Securities Intermediary shall be paid by wire
transfer in same day funds (i) in the case of (A) interest on Pledged Notes or
distributions with respect to the appropriate Applicable Ownership Interests (as
specified in clause (ii) of the definition of such term) in the Treasury
Portfolio, as the case may be, and (B) any payments of the principal amount of
any Notes or with respect to the appropriate Applicable Ownership Interests (as
specified in clause (i) of the definition of such term) in the Treasury
Portfolio, as the case may be, that have been released from the Pledge pursuant
to the Pledge Agreement, to the Purchase Contract Agent to the account
designated by the Purchase Contract Agent, no later than 2:00 p.m., New York
City time, on the Business Day such payment is received by the Securities
Intermediary (provided that in the event such payment is received by the
Securities Intermediary on a day that is not a Business Day or after 12:30 p.m.,
New York City time, on a Business Day, then such payment shall be made no later
than 10:30 a.m., New York City time, on the next succeeding Business Day) and
(ii) in the case of payments with respect to the principal amount of the Notes
or with respect to the appropriate Applicable Ownership Interests (as specified
in clause (i) of the definition of such term) in the Treasury Portfolio, to the
Company on the Purchase Contract Settlement Date (as described herein) in
accordance with the terms of the Pledge Agreement, in full satisfaction of the
respective obligations of the Holders of the Corporate Units of which such
Pledged Notes or the Applicable Ownership Interests (as specified in clause (i)
of the definition of such term) in the Treasury Portfolio, as the case may be,
are a part under the Purchase Contracts forming a part of such Corporate Units.
Interest on the Notes and distributions on the appropriate Applicable Ownership
Interests (as specified in clause (ii) of the definition of such term) in the
Treasury Portfolio, as the case may be, forming part of a Corporate Units
evidenced hereby, which are payable quarterly in arrears on February 16, May 16,
August 16, and November 16 of each year,
A-2
commencing February 16, 2003 (a "PAYMENT DATE"), shall, subject to receipt
thereof by the Purchase Contract Agent from the Securities Intermediary, be paid
to the Person in whose name this Corporate Units Certificate (or a Predecessor
Corporate Units Certificate) is registered at the close of business on the
Record Date for such Payment Date.
Each Purchase Contract evidenced hereby obligates the Holder of this
Corporate Units Certificate to purchase, and the Company to sell, on February
16, 2006 (the "PURCHASE CONTRACT SETTLEMENT DATE"), at a price equal to $25.00
(the "STATED AMOUNT"), a number of newly issued shares of common stock, par
value $0.01 per share ("COMMON STOCK"), of the Company, equal to the Settlement
Rate, unless on or prior to the Purchase Contract Settlement Date there shall
have occurred a Termination Event or an Early Settlement or Cash Merger Early
Settlement with respect to such Purchase Contract, all as provided in the
Purchase Contract Agreement and more fully described on the reverse hereof. The
purchase price (the "PURCHASE PRICE") for the shares of Common Stock purchased
pursuant to each Purchase Contract evidenced hereby, if not paid earlier, shall
be paid on the Purchase Contract Settlement Date by application of payment
received in respect of the principal amount with respect to any Pledged Notes
pursuant to the Remarketing or the appropriate Applicable Ownership Interests
(as specified in clause (i) of the definition of such term) in the Treasury
Portfolio, as the case may be, pledged to secure the obligations under such
Purchase Contract of the Holder of the Corporate Units of which such Purchase
Contract is a part.
Each Purchase Contract evidenced hereby obligates the holder to agree,
for United States federal, state and local income and franchise tax purposes, to
(i) treat an acquisition of the Corporate Units as an acquisition of the Notes
and Purchase Contracts constituting the Corporate Units, (ii) treat itself as
owner of the applicable interest in the Collateral Account, including the Notes
and the Applicable Ownership Interests in the Treasury Portfolio and (iii) treat
each Purchase Contract as a forward purchase contract for the purchase of Common
Stock.
The Company shall pay, on each Payment Date, in respect of each
Purchase Contract forming part of a Corporate Unit evidenced hereby, an amount
(the "CONTRACT ADJUSTMENT PAYMENTS") equal to [C]% per year of the Stated
Amount. Such Contract Adjustment Payments shall be payable to the Person in
whose name this Corporate Units Certificate is registered at the close of
business on the Record Date for such Payment Date. The Company may, at its
option, defer such Contract Adjustment Payments.
Interest on the Notes and distributions on the Applicable Ownership
Interests (as specified in clause (ii) of the definition of such term) and the
Contract Adjustment Payments will be payable at the office of the Purchase
Contract Agent in New York City. If the book-entry system for the Corporate
Units has been terminated, the Contract Adjustment Payments will be payable, at
the option of the Company, by check mailed to the address of the Person entitled
thereto at such Person's address as it appears on the Security Register, or by
wire transfer to the account designated by such Person by a prior written notice
to the Purchase Contract Agent.
A-3
Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Purchase Contract Agent by manual signature, this Corporate Units
Certificate shall not be entitled to any benefit under the Pledge Agreement or
the Purchase Contract Agreement or be valid or obligatory for any purpose.
A-4
IN WITNESS WHEREOF, the Company and the Holder specified above have
caused this instrument to be duly executed.
The Phoneix Companies, Inc.
By:
-------------------------------------
Name:
Title:
HOLDER SPECIFIED ABOVE (as to
obligations of such Holder under the
Purchase Contracts)
By: SUNTRUST BANK,
not individually but solely as
Attorney-in-Fact of such Holder
By:
-------------------------------------
Name:
Title:
DATED:
-------------------------
A-5
CERTIFICATE OF AUTHENTICATION
OF PURCHASE CONTRACT AGENT
This is one of the Corporate Units Certificates referred to in the
within mentioned Purchase Contract Agreement.
By: SUNTRUST BANK,
as Purchase Contract Agent
By:
-------------------------------------
Name:
Title:
Dated:
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(FORM OF REVERSE OF CORPORATE UNIT CERTIFICATE)
Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of December 20, 2002 (as may be supplemented from
time to time, the "PURCHASE CONTRACT AGREEMENT"), between the Company and
SunTrust Bank, as Purchase Contract Agent (including its successors hereunder,
the "PURCHASE CONTRACT AGENT"), to which Purchase Contract Agreement and
supplemental agreements thereto reference is hereby made for a description of
the respective rights, limitations of rights, obligations, duties and immunities
thereunder of the Purchase Contract Agent, the Company, and the Holders and of
the terms upon which the Corporate Units Certificates are, and are to be,
executed and delivered.
Each Purchase Contract evidenced hereby obligates the Holder of this
Corporate Units Certificate to purchase, and the Company to sell, on the
Purchase Contract Settlement Date at a price equal to the Stated Amount (the
"PURCHASE PRICE"), a number of shares of Common Stock equal to the Settlement
Rate, unless an Early Settlement, a Cash Merger Early Settlement or a
Termination Event with respect to the Units of which such Purchase Contract is a
part shall have occurred. The "SETTLEMENT RATE" is equal to:
(1) if the Adjusted Applicable Market Value (as defined
below) is greater than or equal to $[o] (the "THRESHOLD APPRECIATION
PRICE"), [o] shares of Common Stock per Purchase Contract;
(2) if the Adjusted Applicable Market Value is less than the
Threshold Appreciation Price but greater than $[o] (the "REFERENCE
PRICE"), the number of shares of Common Stock per Purchase Contact
having a value equal to the Stated Amount divided by the Adjusted
Applicable Market Value; and
(3) if the Adjusted Applicable Market Value is less than or
equal to the Reference Price, [o] shares of Common Stock per Purchase
Contract;
in each case subject to adjustment as provided in the Purchase Contract
Agreement (and in each case rounded upward or downward to the nearest 1/10,000th
of a share).
No fractional shares of Common Stock will be issued upon settlement of
Purchase Contracts, as provided in Section 5.09 of the Purchase Contract
Agreement.
Each Purchase Contract evidenced hereby, which is settled through Early
Settlement or Cash Merger Early Settlement shall obligate the Holder of the
related Corporate Units to purchase at the Purchase Price, and the Company to
sell, a number of newly issued shares of Common Stock equal to the Early
Settlement Rate (in the case of an Early Settlement) or applicable Settlement
Rate (in the case of a Cash Merger Early Settlement).
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The "APPLICABLE MARKET VALUE" means the average of the Closing Price
per share of Common Stock on each of the 20 consecutive Trading Days ending on
the third Trading Day immediately preceding the Purchase Contract Settlement
Date subject to adjustments set forth under Section 5.04 of the Purchase
Contract Agreement.
The "ADJUSTED APPLICABLE MARKET VALUE" means (i) prior to any
adjustment of the Settlement Rate pursuant to paragraph (1), (2), (3), (4), (5),
(6), (7) or (10) of Section 5.04(a) of the Purchase Contract Agreement, the
Applicable Market Value, and (ii) at the time of and after any adjustment of the
Settlement Rate pursuant to paragraph (1), (2), (3), (4), (5), (6), (7) or (10)
of Section 5.04(a) of the Purchase Contract Agreement, the Applicable Market
Value multiplied by a fraction, the numerator of which shall be the Settlement
Rate immediately after such adjustment pursuant to paragraph (1), (2), (3), (4),
(5), (6), (7) or (10) of Section 5.04(a) of the Purchase Contract Agreement and
the denominator of which shall be the Settlement Rate immediately prior to such
adjustment; provided, however, that if such adjustment to the Settlement Rate is
required to be made pursuant to the occurrence of any of the events contemplated
by paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of Section 5.04(a) of the
Purchase Contract Agreement during the period taken into consideration for
determining the Applicable Market Value, appropriate and customary adjustments
shall be made to the Settlement Rate.
The "CLOSING PRICE" per share of Common Stock on any date of
determination means:
(1) the closing sale price as of the close of the principal
trading session (or, if no closing price is reported, the last reported
sale price) per share on the New York Stock Exchange, Inc. (the "NYSE")
on such date;
(2) if Common Stock is not listed for trading on the NYSE on
any such date, the closing sale price (or, if no closing price is
reported, the last reported sale price) per share as reported in the
composite transactions for the principal United States national or
regional securities exchange on which Common Stock is so listed;
(3) if Common Stock is not so listed on a United States
national or regional securities exchange, the last closing sale price
per share as reported by The Nasdaq Stock Market, Inc.;
(4) if Common Stock is not so reported, the last quoted bid
price for Common Stock in the over-the-counter market as reported by
the National Quotation Bureau or similar organization; or
(5) if such bid price is not available, the market value of
Common Stock on such date as determined by a nationally recognized
independent investment banking firm retained for this purpose by the
Company.
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A "TRADING DAY" means a day on which Common Stock (1) is not suspended
from trading on any national or regional securities exchange or association or
over-the-counter market at the close of business and (2) has traded at least
once on the national or regional securities exchange or association or
over-the-counter market that is the primary market for the trading of Common
Stock.
In accordance with the terms of the Purchase Contract Agreement, the
Holder of this Corporate Units Certificate may pay the Purchase Price for the
shares of Common Stock purchased pursuant to each Purchase Contract evidenced
hereby by effecting a Cash Settlement, an Early Settlement or, if applicable, a
Cash Merger Early Settlement or from the proceeds of the Applicable Ownership
Interests (as specified in clause (i) of the definition of such term) in the
Treasury Portfolio or a Remarketing of the related Pledged Notes. Unless the
Treasury Portfolio has replaced the Notes as a component of Corporate Units, a
Holder of Corporate Units who (1) does not, on or prior to 5:00 p.m. (New York
City time) on the fifth Business Day immediately preceding the Purchase Contract
Settlement Date, notify the Purchase Contract Agent of its intention to effect a
Cash Settlement, or who does so notify the Purchase Contract Agent but fails to
make an effective Cash Settlement prior to 5:00 p.m. (New York City time) on the
fourth Business Day immediately preceding the Purchase Contract Settlement Date,
or (2) on or prior to 5:00 p.m. (New York City time) on the fifth Business Day
prior to the Purchase Contract Settlement Date, does not make an effective Early
Settlement, shall pay the Purchase Price for the shares of Common Stock to be
delivered under the related Purchase Contract from the proceeds of the sale of
the related Pledged Notes held by the Collateral Agent unless the Holder has
previously made a Cash Merger Early Settlement. Unless the Treasury Portfolio
has replaced the Notes as a component of Corporate Unit, such sale will be made
by the Remarketing Agent pursuant to the terms of the Remarketing Agreement on
the Final Remarketing Date. If the Treasury Portfolio has replaced the Notes as
a component of Corporate Units, a Holder of Corporate Units who does not notify
the Purchase Contract Agent, on or prior to 5:00 p.m. (New York City time) on
the fifth Business Day immediately preceding the Purchase Contract Settlement
Date of its intention to effect a Cash Settlement shall pay the Purchase Price
for the shares of Common Stock to be delivered under the related Purchase
Contract from the proceeds at maturity of the Applicable Ownership Interests (as
defined in clause (i) of the definition of such term) in the Treasury Portfolio.
If, as provided in the Purchase Contract Agreement, upon the occurrence
of a Failed Final Remarketing, the Collateral Agent, for the benefit of the
Company, exercises its rights as a secured creditor with respect to the Pledged
Notes related to this Corporate Units Certificate, any accrued and unpaid
interest on such Pledged Notes will become payable by the Company to the holder
of this Corporate Units Certificate in the manner provided for in the Purchase
Contract Agreement.
The Company shall not be obligated to issue any shares of Common Stock
in respect of a Purchase Contract or deliver any certificates therefor to the
Holder unless it shall have received
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payment of the aggregate Purchase Price for the shares of Common Stock to be
purchased thereunder in the manner set forth in the Purchase Contract Agreement.
Each Purchase Contract evidenced hereby and all obligations and rights
of the Company and the Holder thereunder shall terminate if a Termination Event
shall occur. Upon the occurrence of a Termination Event, the Company shall give
written notice to the Purchase Contract Agent and to the Holders, at their
addresses as they appear in the Security Register. Upon and after the occurrence
of a Termination Event, the Collateral Agent shall release the Pledged Notes or
the appropriate Applicable Ownership Interests (as specified in clause (i) of
the definition of such term) in the Treasury Portfolio forming a part of each
Corporate Unit from the Pledge. A Corporate Unit shall thereafter represent the
right to receive the Note or the appropriate Applicable Ownership Interests in
the Treasury Portfolio forming a part of such Corporate Units in accordance with
the terms of the Purchase Contract Agreement and the Pledge Agreement.
Under the terms of the Pledge Agreement and the Purchase Contract
Agreement, the Purchase Contract Agent will be entitled to exercise the voting
and any other consensual rights pertaining to the Pledged Notes, but only to the
extent instructed in writing by the Holders. Upon receipt of notice of any
meeting at which holders of Notes are entitled to vote or upon the solicitation
of consents, waivers or proxies of holders of Notes, the Purchase Contract Agent
shall, as soon as practicable thereafter, mail to the Corporate Units Holders a
notice:
(1) containing such information as is contained in the notice
or solicitation;
(2) stating that each Corporate Units Holder on the record
date set by the Purchase Contract Agent therefor (which, to the extent
possible, shall be the same date as the record date for determining the
holders of Notes entitled to vote) shall be entitled to instruct the
Purchase Contract Agent as to the exercise of the voting rights
pertaining to the Notes constituting a part of such Holder's Corporate
Units; and
(3) stating the manner in which such instructions may be
given.
Upon the written request of the Corporate Units Holders on such record date,
received by the Purchase Contract Agent at least six days prior to such meeting,
the Purchase Contract Agent shall endeavor insofar as practicable to vote or
cause to be voted, in accordance with the instructions set forth in such
requests, the maximum aggregate principal amount of Notes as to which any
particular voting instructions are received. In the absence of specific
instructions from the Holder of a Corporate Unit, the Purchase Contract Agent
shall abstain from voting the Note evidenced by such Corporate Unit.
Upon the occurrence of a Special Event Redemption, the Collateral Agent
shall surrender the Pledged Notes against delivery of an amount equal to the
aggregate Redemption Price of the Pledged Notes and shall deposit funds in the
Collateral Account in exchange for the Pledged
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Notes. Thereafter, pursuant to the terms of the Pledge Agreement, the Collateral
Agent shall cause the Securities Intermediary to apply an amount equal to the
aggregate Redemption Amount of such funds to purchase on behalf of the Holders
of Corporate Units, the Treasury Portfolio and promptly (a) transfer the
Applicable Ownership Interests (as specified in clause (i) of the definition of
such term) in the Treasury Portfolio to the Collateral Account to secure the
obligations of each Holder of Corporate Units to purchase shares of Common Stock
under the Purchase Contracts constituting a part of such Corporate Units, (b)
transfer the Applicable Ownership Interests (as specified in clause (ii) of the
definition of such term) in the Treasury Portfolio to the Purchase Contract
Agent for the benefit of the Holders of such Corporate Units and (C) remit the
remaining portion of such funds to the Purchase Contract Agent for payment to
the Holders of such Corporate Units.
Upon the occurrence of a Successful Remarketing of Notes prior to the
Final Remarketing Date, pursuant to the terms of the Remarketing Agreement, the
Remarketing Agent will apply an amount equal to the Treasury Portfolio Purchase
Price to purchase on behalf of the Holders of Corporate Units, the Treasury
Portfolio, and, after deducting the Remarketing Fee to the extent permitted
under the terms of the Remarketing Agreement, promptly remit the remaining
portion of such proceeds of such Successful Remarketing to the Purchase Contract
Agent for payment to the Holders of such Corporate Units.
Following the occurrence of (i) a Special Event Redemption prior to the
Purchase Contract Settlement Date, or (ii) a Successful Remarketing of the Notes
prior to the Final Remarketing Date, the Holders of Corporate Units and the
Collateral Agent shall have such security interest rights and obligations with
respect to the Applicable Ownership Interests (as specified in clause (i) of the
definition of such term) in the Treasury Portfolio as the Holder of Corporate
Units and the Collateral Agent had in respect of the Notes, as the case may be,
subject to the Pledge thereof as provided in the Pledge Agreement and any
reference herein to the Notes shall be deemed to be a reference to such Treasury
Portfolio.
The Corporate Units Certificates are issuable only in registered form
and only in denominations of a single Corporate Unit and any integral multiple
thereof. The transfer of any Corporate Units Certificate will be registered and
Corporate Units Certificates may be exchanged as provided in the Purchase
Contract Agreement. The Security Registrar may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents permitted by
the Purchase Contract Agreement. No service charge shall be required for any
such registration of transfer or exchange, but the Company and the Purchase
Contract Agent may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith. A Holder who elects to
substitute a Treasury Security for a Note, thereby creating Treasury Units,
shall be responsible for any fees or expenses payable in connection therewith.
Except as provided in the Purchase Contract Agreement, for so long as the
Purchase Contract underlying a Corporate Units remains in effect, such Corporate
Units shall not be separable into its constituent parts, and the rights and
obligations of the Holder of such Corporate Units in respect of the Notes and
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Purchase Contract constituting such Corporate Units may be transferred and
exchanged only as a Corporate Unit.
Unless the Treasury Portfolio has replaced the Notes as a component of
the Corporate Units, and subject to the conditions set forth in the Purchase
Contract Agreement, the Holder of Corporate Units may substitute, at any time
prior to 5:00 p.m. (New York City time) on the fifth Business Day immediately
preceding the Purchase Contract Settlement Date, for the Pledged Notes securing
such Holder's obligations under the related Purchase Contracts, Treasury
Securities in an aggregate principal amount at maturity equal to the aggregate
principal amount of the Pledged Notes in accordance with the terms of the
Purchase Contract Agreement and the Pledge Agreement. From and after such
Collateral Substitution, each Unit for which such Pledged Treasury Securities
secures the Holder's obligation under the Purchase Contract shall be referred to
as a "TREASURY UNIT". A Holder may make such Collateral Substitution only in
integral multiples of 40 Corporate Units for 40 Treasury Units.
If the Treasury Portfolio has replaced the Notes as a component of the
Corporate Units, a Holder may, at any time on or prior to the second Business
Day immediately preceding the Purchase Contract Settlement Date, substitute
Treasury Securities for the Applicable Ownership Interests in the Treasury
Portfolio, but only in integral multiples of [o] Corporate Units. In such an
event, the Holder shall transfer Treasury Securities to the Collateral Agent,
and the Purchase Contract Agent shall instruct the Collateral Agent to release
the Pledge of and transfer to the Holder the appropriate Applicable Ownership
Interests in the Treasury Portfolio.
The Company shall pay, on each Payment Date, the Contract Adjustment
Payments payable in respect of each Purchase Contract to the Person in whose
name the Corporate Units Certificate evidencing such Purchase Contract is
registered at the close of business on the Record Date for such Payment Date.
Contract Adjustment Payments will be payable at the office of the Purchase
Contract Agent in New York City. If the book-entry system for the Corporate
Units has been terminated, the Contract Adjustment Payments will be payable, at
the option of the Company, by check mailed to the address of the Person entitled
thereto at such Person's address as it appears on the Security Register, or by
wire transfer to the account designated by such Person by a prior written notice
to the Purchase Contract Agent.
The Company has the right to defer payment of all or part of the
Contract Adjustment Payments in respect of each Purchase Contract until no later
than the Purchase Contract Settlement Date (or in the event of an effective
Early Settlement or Cash Merger Early Settlement, the Early Settlement Date or
Cash Merger Early Settlement Date, as the case may be). If the Company so elects
to defer Contract Adjustment Payments, the Company shall pay additional Contract
Adjustment Payments on such deferred installments of Purchase Contract Payments
at a rate equal to [o]% per annum, compounding on each succeeding Payment Date,
until such deferred installments are paid. In the event that the Company elects
to defer the payment of Contract Adjustment Payments on the Warrants until the
Purchase Contract Settlement Date (or, in the event of an effective Early
Settlement or Cash Merger Early
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Settlement, the Early Settlement Date or Cash Merger Early Settlement Date, as
the case may be), each Holder will receive on the Purchase Contract Settlement
Date, Early Settlement Date or Cash Merger Early Settlement Date, as applicable,
the aggregate amount of Deferred Contract Adjustment Payments to the extent such
fees are not deducted from the Settlement Price in the case of a Cash Settlement
or any Early Settlement or Cash Merger Early Settlement.
The Purchase Contracts and all obligations and rights of the Company
and the Holders thereunder, including, without limitation, the rights of the
Holders to receive and the obligation of the Company to pay any Contract
Adjustment Payments, shall immediately and automatically terminate, without the
necessity of any notice or action by any Holder, the Purchase Contract Agent or
the Company, if, on or prior to the Purchase Contract Settlement Date, a
Termination Event shall have occurred. Upon the occurrence of a Termination
Event, the Company shall promptly but in no event later than two Business Days
thereafter give written notice to the Purchase Contract Agent, the Collateral
Agent and the Holders, at their addresses as they appear in the Security
Register. Upon and after the occurrence of a Termination Event, the Collateral
Agent shall release the Notes or the appropriate Applicable Ownership Interests
(as specified in clause (i) of the definition of such term) in the Treasury
Portfolio, as the case may be, from the Pledge in accordance with the provisions
of the Pledge Agreement.
Subject to and upon compliance with the provisions of the Purchase
Contract Agreement, at the option of the Holder thereof, Purchase Contracts
underlying Units may be settled early at any time prior to 5:00 p.m. (New York
City time) on the fifth Business Day immediately preceding the Purchase Contract
Settlement Date ("EARLY SETTLEMENT") as provided in the Purchase Contract
Agreement. In order to exercise the right to effect Early Settlement with
respect to any Purchase Contract evidenced by this Certificate, the Holder of
this Corporate Units Certificate shall deliver to the Purchase Contract Agent at
the Corporate Trust Office an Election to Settle Early form set forth below duly
completed and accompanied by payment in the form of immediately available funds
payable to the order of the Company in an amount (the "EARLY SETTLEMENT AMOUNT")
equal to:
(i) the sum of (A) the product of (I) the Stated Amount times
(II) the number of Purchase Contracts with respect to which the Holder
has elected to effect Early Settlement, plus (B) if such delivery is
made with respect to any Purchase Contracts during the period from the
close of business on any Record Date next preceding any Payment Date to
the opening of business on such Payment Date, an amount equal to the
Contract Adjustment Payments payable on such Payment Date with respect
to such Purchase Contracts, less
(ii) the amount of any Deferred Contract Adjustment Payments
payable to such Holder as a result of such Early Settlement.
Upon Early Settlement of Purchase Contracts by a Holder of the related
Units, the Pledged Notes or Pledge Applicable Ownership Interests (as specified
in clause (i) of the
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definition of such term) underlying such Units shall be released from the Pledge
as provided in the Pledge Agreement and the Holder shall be entitled to receive
a number of shares of Common Stock on account of each Purchase Contract forming
part of a Corporate Unit as to which Early Settlement is effected equal to [C]
shares of Common Stock per Purchase Contract (the "EARLY SETTLEMENT RATE"). The
Early Settlement Rate shall be adjusted in the same manner and at the same time
as the Settlement Rate is adjusted as provided in Section 5.04 of the Purchase
Contract Agreement.
Upon the occurrence of a Cash Merger, a Holder of Corporate Units may
effect Cash Merger Early Settlement of the Purchase Contract underlying such
Corporate Units pursuant to the terms of Section 5.04(b)(2) of the Purchase
Contract Agreement. Upon Cash Merger Early Settlement of Purchase Contracts by a
Holder of the related Corporate Units, the Pledged Notes or Pledged Applicable
Ownership Interests (as specified in clause (i) of the definition of such term)
in the Treasury Portfolio underlying such Corporate Units shall be released from
the Pledge as provided in the Pledge Agreement.
Upon registration of transfer of this Corporate Units Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee, except as may be required by the Purchase Contract Agent
pursuant to the Purchase Contract Agreement), under the terms of the Purchase
Contract Agreement and the Purchase Contracts evidenced hereby and the
transferor shall be released from the obligations under the Purchase Contracts
evidenced by this Corporate Units Certificate. The Company covenants and agrees,
and the Holder, by its acceptance hereof, likewise covenants and agrees, to be
bound by the provisions of this paragraph.
The Holder of this Corporate Units Certificate, by its acceptance
hereof, authorizes the Purchase Contract Agent to enter into and perform the
related Purchase Contracts forming part of the Corporate Units evidenced hereby
on its behalf as its attorney-in-fact, expressly withholds any consent to the
assumption (i.e., affirmance) of the Purchase Contracts by the Company or its
trustee in the event that the Company becomes the subject of a case under the
Bankruptcy Code, agrees to be bound by the terms and provisions thereof,
covenants and agrees to perform its obligations under such Purchase Contracts,
consents to the provisions of the Purchase Contract Agreement, authorizes the
Purchase Contract Agent to enter into and perform the Purchase Contract
Agreement and the Pledge Agreement on its behalf as its attorney-in-fact, and
consents to the Pledge of the Notes or the appropriate Applicable Ownership
Interests (as specified in clause (i) of the definition of such term) in the
Treasury Portfolio, as the case may be, underlying this Corporate Units
Certificate pursuant to the Pledge Agreement. The Holder further covenants and
agrees that, to the extent and in the manner provided in the Purchase Contract
Agreement and the Pledge Agreement, but subject to the terms thereof, payments
with respect to the aggregate principal amount of the Pledged Notes or the
appropriate Applicable Ownership Interests (as specified in clause (i) of the
definition of such term) in the Treasury Portfolio, as the case may be, on the
Purchase Contract Settlement Date shall be paid by the Collateral Agent to
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the Company in satisfaction of such Holder's obligations under such Purchase
Contract and such Holder shall acquire no right, title or interest in such
payments.
Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of a majority of the
Purchase Contracts.
The Purchase Contracts shall be governed by, and construed in
accordance with, the laws of the State of New York.
Prior to due presentment of this Certificate for registration of
transfer, the Company, the Purchase Contract Agent and its Affiliates and any
agent of the Company or the Purchase Contract Agent may treat the Person in
whose name this Corporate Units Certificate is registered as the owner of the
Corporate Units evidenced hereby for the purpose of receiving payments of
interest payable on the Notes, receiving payments of Contract Adjustment
Payments (subject to any applicable record date), performance of the Purchase
Contracts and for all other purposes whatsoever, whether or not any payments in
respect thereof be overdue and notwithstanding any notice to the contrary, and
neither the Company, the Purchase Contract Agent nor any such agent shall be
affected by notice to the contrary.
The Purchase Contracts shall not, prior to the settlement thereof,
entitle the Holder to any of the rights of a holder of shares of Common Stock.
A copy of the Purchase Contract Agreement is available for inspection
at the offices of the Purchase Contract Agent.
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ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM: as tenants in common
UNIF GIFT MIN ACT: ___________________ Custodian __________________
(cust) (minor)
Under Uniform Gifts to Minors Act of __________
TENANT: as tenants by the entireties
JT TEN: as joint tenants with right of survivorship and
not as tenants in common
Additional abbreviations may also be used though not in the above list.
__________________
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
(Please insert Social Security or Taxpayer I.D. or other
Identifying Number of Assignee)
________________________________________________________________________________
(Please Print or Type Name and Address Including Postal Zip Code of Assignee)
the within Corporate Units Certificates and all rights thereunder, hereby
irrevocably constituting and appointing attorney __________________, to transfer
said Corporate Units Certificates on the books of The Phoneix Companies, Inc.,
with full power of substitution in the premises.
Dated: ________________________ Signature ______________________________
NOTICE: The signature to this assignment
must correspond with the name as it
appears upon the face of the within
Corporate Units Certificates in every
particular, without alteration or
enlargement or any change whatsoever.
Signature Guarantee: ____________________________
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SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for shares of Common
Stock deliverable upon settlement on or after the Purchase Contract Settlement
Date of the Purchase Contracts underlying the number of Corporate Units
evidenced by this Corporate Units Certificate be registered in the name of, and
delivered, together with a check in payment for any fractional share, to the
undersigned at the address indicated below unless a different name and address
have been indicated below. If shares are to be registered in the name of a
Person other than the undersigned, the undersigned will pay any transfer tax
payable incident thereto.
Dated: ______________________________ ________________________________________
Signature
Signature Guarantee: ___________________
(if assigned to another person)
If shares are to be registered in
the name of and delivered to a Person REGISTERED HOLDER
other than the Holder, please (i)
print such Person's name and address
and (ii) provide a guarantee of Please print name and address of
your signature: Registered Holder:
_____________________________________ ________________________________________
Name Name
_____________________________________ ________________________________________
Address Address
_____________________________________ ________________________________________
_____________________________________ ________________________________________
_____________________________________ ________________________________________
Social Security or other
Taxpayer Identification
Number, if any ________________________________________
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ELECTION TO SETTLE EARLY/CASH MERGER EARLY SETTLEMENT
The undersigned Holder of this Corporate Units Certificate hereby
irrevocably exercises the option to effect [Early Settlement] [Cash Merger Early
Settlement following a Cash Merger] in accordance with the terms of the Purchase
Contract Agreement with respect to the Purchase Contracts underlying the number
of Corporate Units evidenced by this Corporate Units Certificate specified
below. The undersigned Holder directs that a certificate for shares of Common
Stock or other securities deliverable upon such [Early Settlement] [Cash Merger
Early Settlement] be registered in the name of, and delivered, together with a
check in payment for any fractional share and any Corporate Units Certificate
representing any Corporate Units evidenced hereby as to which [Early Settlement]
[Cash Merger Early Settlement] of the related Purchase Contracts is not
effected, to the undersigned at the address indicated below unless a different
name and address have been indicated below. Pledged Notes or the appropriate
Applicable Ownership Interests in the Treasury Portfolio, as the case may be,
deliverable upon such [Early Settlement] [Cash Merger Early Settlement] will be
transferred in accordance with the transfer instructions set forth below. If
shares are to be registered in the name of a Person other than the undersigned,
the undersigned will pay any transfer tax payable incident thereto.
Dated: _______________________________ ___________________________________
Signature
Signature Guarantee: _______________________________
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Number of Units evidenced hereby as to which [Early Settlement] [Cash
Merger Early Settlement] of the related Purchase Contracts is being elected:
If shares of Common Stock or Corporate REGISTERED HOLDER
Units Certificates are to be registered
in the name of and delivered to and
Pledged Notes or the Applicable
Ownership Interests in the Treasury
Portfolio, as the case may be, are to
be transferred to a Person other than
the Holder, please print such Person's
name and address:
Please print name and address of
Registered Holder:
______________________________________ ________________________________________
Name Name
______________________________________ ________________________________________
Address Address
______________________________________ ________________________________________
______________________________________ ________________________________________
______________________________________ ________________________________________
Social Security or other
Taxpayer Identification
Number, if any ________________________________________
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Transfer Instructions for Pledged Notes or the Applicable Ownership Interests in
the Treasury Portfolio, as the case may be, transferable upon [Early Settlement]
[Cash Merger Early Settlement] or a Termination Event:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
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[TO BE ATTACHED TO GLOBAL CERTIFICATES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The following increases or decreases in this Global Certificate have been made:
Number of Corporate
Amount of increase in Amount of decrease in Units evidenced by this
Number of Corporate Number of Corporate Global Certificate Signature of authorized
Units evidenced by the Units evidenced by the following such signatory of Purchase
Date Global Certificate Global Certificate decrease or increase Contract Agent
---- ---------------------- ---------------------- ----------------------- -----------------------
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EXHIBIT B
(FORM OF FACE OF TREASURY UNIT CERTIFICATE)
[For inclusion in Global Certificate only - THIS CERTIFICATE IS A
GLOBAL CERTIFICATE WITHIN THE MEANING OF THE PURCHASE CONTRACT AGREEMENT
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF CEDE & CO., AS NOMINEE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE "DEPOSITARY"), THE
DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY. THIS CERTIFICATE IS
EXCHANGEABLE FOR CERTIFICATES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE
DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
PURCHASE CONTRACT AGREEMENT AND NO TRANSFER OF THIS CERTIFICATE (OTHER THAN A
TRANSFER OF THIS CERTIFICATE AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE
DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER
NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
No. ____ CUSIP No.
Number of Treasury Units:___________
The Phoneix Companies, Inc.
Treasury Units
This Treasury Units Certificate certifies that [Cede & Co.]
[__________________] is the registered Holder of the number of Treasury Units
set forth above [For inclusion in Global Certificates only - or such other
number of Treasury Units as is reflected in the Schedule of Increases or
Decreases in Global Certificate attached hereto]. Each Treasury Unit consists of
(i) a 1/40 undivided beneficial ownership interest of a Treasury Security having
a principal amount at maturity equal to $1,000, subject to the Pledge of such
Treasury Security by such Holder pursuant to the Pledge Agreement, and (ii) the
rights and obligations of the Holder under one
Purchase Contract with The Phoneix Companies, Inc., a Delaware corporation (the
"COMPANY"). All capitalized terms used herein which are defined in the Purchase
Contract Agreement (as defined on the reverse hereof) have the meaning set forth
therein.
Pursuant to the Pledge Agreement, the Treasury Securities constituting
part of each Treasury Unit evidenced hereby have been pledged to the Collateral
Agent, for the benefit of the Company, to secure the obligations of the Holder
under the Purchase Contract comprising part of such Treasury Unit. Each Purchase
Contract evidenced hereby obligates the Holder of this Treasury Units
Certificate to purchase, and the Company, to sell, on February 16, 2006 (the
"PURCHASE CONTRACT SETTLEMENT DATE"), at a price equal to $25.00 (the "STATED
AMOUNT"), a number of newly issued shares of common stock, par value $0.01 per
share ("COMMON STOCK"), of the Company, equal to the Settlement Rate, unless
prior to or on the Purchase Contract Settlement Date there shall have occurred a
Termination Event, an Early Settlement or a Cash Merger Early Settlement with
respect to such Purchase Contract, all as provided in the Purchase Contract
Agreement and more fully described on the reverse hereof. The purchase price
(the "PURCHASE PRICE") for the shares of Common Stock purchased pursuant to each
Purchase Contract evidenced hereby, if not paid earlier, shall be paid on the
Purchase Contract Settlement Date by application of the proceeds from the
Treasury Securities at maturity pledged to secure the obligations of the Holder
under such Purchase Contract of the Treasury Units of which such Purchase
Contract is a part.
Each Purchase Contract evidenced hereby obligates the holder to agree,
for United States federal, state and local income and franchise tax purposes, to
(i) treat an acquisition of the Corporate Units as an acquisition of the Notes
and Purchase Contracts constituting the Corporate Units, (ii) treat itself as
owner of the applicable interest in the Collateral Account, including the Notes
and the Applicable Ownership Interests in the Treasury Portfolio and (iii) treat
each Purchase Contract as a forward purchase contract for the purchase of Common
Stock.
The Company shall pay, on each Payment Date, in respect of each
Purchase Contract forming part of a Treasury Unit evidenced hereby, an amount
(the "CONTRACT ADJUSTMENT PAYMENTS") equal to [C]% per year of the Stated
Amount. Such Contract Adjustment Payments shall be payable to the Person in
whose name this Treasury Units Certificate is registered at the close of
business on the Record Date for such Payment Date. The Company may, at its
option, defer such Contract Adjustment Payments.
Contract Adjustment Payments will be payable at the office of the
Purchase Contract Agent in New York City. If the book-entry system for the
Corporate Units has been terminated, the Contract Adjustment Payments will be
payable, at the option of the Company, by check mailed to the address of the
Person entitled thereto at such Person's address as it appears on the Security
Register, or by wire transfer to the account designated by such Person by a
prior written notice to the Purchase Contract Agent.
B-2
Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Purchase Contract Agent by manual signature, this Treasury Units Certificate
shall not be entitled to any benefit under the Pledge Agreement or the Purchase
Contract Agreement or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company and the Holder specified above have
caused this instrument to be duly executed.
The Phoneix Companies, Inc.
By:
------------------------------------
Name:
Title:
HOLDER SPECIFIED ABOVE (as to
obligations of such Holder under the
Purchase Contracts)
By: SUNTRUST BANK,
not individually but solely as
Attorney-in-Fact of such Holder
By:
------------------------------------
Authorized Officer
Dated:
-----------------------------
B-3
CERTIFICATE OF AUTHENTICATION OF
PURCHASE CONTRACT AGENT
This is one of the Treasury Units referred to in the within-mentioned
Purchase Contract Agreement.
By: SUNTRUST BANK,
as Purchase Contract Agent
By:
------------------------------------
Authorized Officer
Dated:
------------------------------
B-4
(REVERSE OF TREASURY UNIT CERTIFICATE)
Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of December 20, 2002 (as may be supplemented from
time to time, the "PURCHASE CONTRACT AGREEMENT") between the Company and
SunTrust Bank, as Purchase Contract Agent (including its successors thereunder,
herein called the "PURCHASE CONTRACT AGENT"), to which the Purchase Contract
Agreement and supplemental agreements thereto reference is hereby made for a
description of the respective rights, limitations of rights, obligations, duties
and immunities thereunder of the Purchase Contract Agent, the Company and the
Holders and of the terms upon which the Treasury Units Certificates are, and are
to be, executed and delivered.
Each Purchase Contract evidenced hereby obligates the Holder of this
Treasury Units Certificate to purchase, and the Company to sell, on the Purchase
Contract Settlement Date at a price equal to the Stated Amount (the "PURCHASE
PRICE") a number of newly issued shares of Common Stock equal to the Settlement
Rate, unless an Early Settlement, a Cash Merger Early Settlement or a
Termination Event with respect to the Units of which such Purchase Contract is a
part shall have occurred. The "SETTLEMENT RATE" is equal to:
(1) if the Adjusted Applicable Market Value (as defined
below) is greater than or equal to $[o] (the "THRESHOLD APPRECIATION
PRICE"), [o] shares of Common Stock per Purchase Contract;
(2) if the Adjusted Applicable Market Value is less than the
Threshold Appreciation Price but greater than $[o] (the "REFERENCE
PRICE"), the number of shares of Common Stock per Purchase Contact
having a value equal to the Stated Amount divided by the Adjusted
Applicable Market Value; and
(3) if the Adjusted Applicable Market Value is less than or
equal to the Reference Price, [o] shares of Common Stock per Purchase
Contract;
in each case subject to adjustment as provided in the Purchase Contract
Agreement (and in each case rounded upward or downward to the nearest 1/10,000th
of a share).
No fractional shares of Common Stock will be issued upon settlement of
Purchase Contracts, as provided in Section 5.09 of the Purchase Contract
Agreement.
Each Purchase Contract evidenced hereby, which is settled through Early
Settlement or Cash Merger Early Settlement shall obligate the Holder of the
related Treasury Units to purchase at the Purchase Price, and the Company to
sell, a number of newly issued shares of Common Stock equal to the Early
Settlement Rate (in the case of an Early Settlement) or applicable Settlement
Rate (in the case of a Cash Merger Early Settlement).
B-5
The "APPLICABLE MARKET VALUE" means the average of the Closing Prices
per share of Common Stock on each of the 20 consecutive Trading Days ending on
the third Trading Day immediately preceding the Purchase Contract Settlement
Date, subject to adjustments set forth under Section 5.04 hereof.
The "ADJUSTED APPLICABLE MARKET VALUE" means (i) prior to any
adjustment of the Settlement Rate pursuant to paragraph (1), (2), (3), (4), (5),
(6), (7) or (10) of Section 5.04(a) of the Purchase Contract Agreement, the
Applicable Market Value, and (ii) at the time of and after any adjustment of the
Settlement Rate pursuant to paragraph (1), (2), (3), (4), (5), (6), (7) or (10)
of Section 5.04(a) of the Purchase Contract Agreement, the Applicable Market
Value multiplied by a fraction, the numerator of which shall be the Settlement
Rate immediately after such adjustment pursuant to paragraph (1), (2), (3), (4),
(5), (6), (7) or (10) of Section 5.04(a) of the Purchase Contract Agreement and
the denominator of which shall be the Settlement Rate immediately prior to such
adjustment; provided, however, that if such adjustment to the Settlement Rate is
required to be made pursuant to the occurrence of any of the events contemplated
by paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of Section 5.04(a) of the
Purchase Contract Agreement during the period taken into consideration for
determining the Applicable Market Value, appropriate and customary adjustments
shall be made to the Settlement Rate.
The "CLOSING PRICE" per share of Common Stock on any date of
determination means the:
(1) closing sale price as of the close of the principal
trading session (or, if no closing price is reported, the last reported
sale price) per share on the New York Stock Exchange, Inc. (the "NYSE")
on such date;
(2) if the Common Stock is not listed for trading on the NYSE
on any such date, the closing sale price (or, if no closing price is
reported, the last reported sale price) per share as reported in the
composite transactions for the principal United States national or
regional securities exchange on which the Common Stock is so listed;
(3) if the Common Stock is not so listed on a United States
national or regional securities exchange, the last closing sale price
per share as reported by The Nasdaq Stock Market, Inc.;
(4) if the Common Stock is not so reported, the last quoted
bid price for the Common Stock in the over-the-counter market as
reported by the National Quotation Bureau or similar organization; or
(5) if such bid price is not available, the market value of
the Common Stock on such date as determined by a nationally recognized
independent investment banking firm retained for this purpose by the
Company.
B-6
A "TRADING DAY" means a day on which the Common Stock (1) is not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (2) has
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of the Common Stock.
In accordance with the terms of the Purchase Contract Agreement, the
Holder of this Treasury Unit shall pay the Purchase Price for the shares of the
Common Stock purchased pursuant to each Purchase Contract evidenced hereby
either by effecting a Cash Settlement, an Early Settlement or, if applicable, a
Cash Merger Early Settlement of each such Purchase Contract or by applying a
principal amount of the Pledged Treasury Securities underlying such Holder's
Treasury Unit equal to the Stated Amount of such Purchase Contract to the
purchase of the Common Stock. A Holder of Treasury Units who (1) does not on or
prior to 5:00 p.m. (New York City time) on the fifth Business Day immediately
preceding the Purchase Contract Settlement Date, notify the Purchase Contract
Agent of its intention to effect a Cash Settlement, or who does so notify the
Purchase Contract Agent but fails to make an effective Cash Settlement prior to
5:00 p.m. (New York City time) on the fourth Business Day immediately preceding
the Purchase Contract Settlement Date, (2) on or prior to 5:00 p.m. (New York
City time) on the fifth Business Day prior to the Purchase Contract Settlement
Date, does not make an effective Early Settlement, or (3) on or prior to 5:00
p.m. (New York City time) on the fifth Business Day prior to the Purchase
Contract Settlement Date, does not make an effective Cash Merger Early
Settlement, shall pay the Purchase Price for the shares of Common Stock to be
issued under the related Purchase Contract from the proceeds of the Pledged
Treasury Securities.
The Company shall not be obligated to issue any shares of Common Stock
in respect of a Purchase Contract or deliver any certificates therefor to the
Holder unless it shall have received payment of the aggregate purchase price for
the shares of Common Stock to be purchased thereunder in the manner set forth in
the Purchase Contract Agreement.
The Company has the right to defer payment of all or part of the
Contract Adjustment Payments in respect of each Purchase Contract until no later
than the Purchase Contract Settlement Date (or in the event of an effective
Early Settlement or Cash Merger Early Settlement, the Early Settlement Date or
Cash Merger Early Settlement Date, as the case may be). If the Company so elects
to defer Contract Adjustment Payments, the Company shall pay additional Contract
Adjustment Payments on such deferred installments of Purchase Contract Payments
at a rate equal to [C]% per annum, compounding on each succeeding Payment Date,
until such deferred installments are paid. In the event that the Company elects
to defer the payment of Contract Adjustment Payments on the Warrants until the
Purchase Contract Settlement Date (or, in the event of an effective Early
Settlement or Cash Merger Early Settlement, the Early Settlement Date or Cash
Merger Early Settlement Date, as the case may be), each Holder will receive on
the Purchase Contract Settlement Date, Early Settlement Date or Cash Merger
Early Settlement Date, as applicable, the aggregate amount of Deferred Contract
B-7
Adjustment Payments to the extent such fees are not deducted from the Settlement
Price in the case of a Cash Settlement or any Early Settlement or Cash Merger
Early Settlement.
The Purchase Contracts and all obligations and rights of the Company
and the Holders thereunder, including, without limitation, the rights of the
Holders to receive and the obligation of the Company to pay any Contract
Adjustment Payments, shall immediately and automatically terminate, without the
necessity of any notice or action by any Holder, the Purchase Contract Agent or
the Company, if, on or prior to the Purchase Contract Settlement Date, a
Termination Event shall have occurred. Upon the occurrence of a Termination
Event, the Company shall promptly but in no event later than two Business Days
thereafter give written notice to the Purchase Contract Agent, the Collateral
Agent and the Holders, at their addresses as they appear in the Security
Register. Upon and after the occurrence of a Termination Event, the Collateral
Agent shall release the Pledged Treasury Securities (as defined in the Pledge
Agreement) forming a part of each Treasury Unit. A Treasury Unit shall
thereafter represent the right to receive the Proceeds of the Treasury Security
forming a part of such Treasury Unit, in accordance with the terms of the
Purchase Contract Agreement and the Pledge Agreement.
The Treasury Units Certificates are issuable only in registered form
and only in denominations of a single Treasury Unit and any integral multiple
thereof. The transfer of any Treasury Units Certificate will be registered and
Treasury Units Certificates may be exchanged as provided in the Purchase
Contract Agreement. The Security Registrar may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents permitted by
the Purchase Contract Agreement. No service charge shall be required for any
such registration of transfer or exchange, but the Company and the Purchase
Contract Agent may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith. A Holder who elects to
substitute Notes, for Treasury Securities, thereby recreating Corporate Units,
shall be responsible for any fees or expenses associated therewith. Except as
provided in the Purchase Contract Agreement, for so long as the Purchase
Contract underlying a Treasury Unit remains in effect, such Treasury Unit shall
not be separable into its constituent parts, and the rights and obligations of
the Holder of such Treasury Unit in respect of the Treasury Security and the
Purchase Contract constituting such Treasury Unit may be transferred and
exchanged only as a Treasury Unit.
Unless the Treasury Portfolio has replaced the Notes as a component of
the Corporate Units and subject to the conditions set forth in the Purchase
Contract Agreement, a Holder of Treasury Units may recreate, at any time prior
to 5:00 p.m. (New York City time) on the fifth Business Day immediately
preceding the Purchase Contract Settlement Date, Corporate Units by delivering
to the Securities Intermediary Notes with an aggregate principal amount, equal
to the aggregate principal amount at maturity of the Pledged Treasury Securities
in exchange for the release of such Pledged Treasury Securities in accordance
with the terms of the Purchase Contract Agreement and the Pledge Agreement. From
and after such substitution, the Holder's Units shall be referred to as a
"CORPORATE UNIT". Any such creation of Corporate Units may be effected only in
multiples of 40 Treasury Units for 40 Corporate Units.
B-8
The Company shall pay, on each Payment Date, the Contract Adjustment
Payments payable in respect of each Purchase Contract to the Person in whose
name the Treasury Units Certificate evidencing such Purchase Contract is
registered at the close of business on the Record Date for such Payment Date.
Contract Adjustment Payments will be payable at the office of the Purchase
Contract Agent in New York City or, at the option of the Holder, by check mailed
to the address of the Person entitled thereto at such address as it appears on
the Security Register.
The Purchase Contracts and all obligations and rights of the Company
and the Holders thereunder, including, without limitation, the rights of the
Holders to receive and the obligation of the Company to pay any Contract
Adjustment Payments, shall immediately and automatically terminate, without the
necessity of any notice or action by any Holder, the Purchase Contract Agent or
the Company, if, on or prior to the Purchase Contract Settlement Date, a
Termination Event shall have occurred. Upon the occurrence of a Termination
Event, the Company shall promptly but in no event later than two Business Days
thereafter give written notice to the Purchase Contract Agent, the Collateral
Agent and the Holders, at their addresses as they appear in the Security
Register. Upon and after the occurrence of a Termination Event, the Collateral
Agent shall release the Treasury Securities from the Pledge in accordance with
the provisions of the Pledge Agreement. A Treasury Unit shall thereafter
represent the right to receive the interest in the Treasury Security forming a
part of such Treasury Unit, in accordance with the terms of the Purchase
Contract Agreement and the Pledge Agreement.
Subject to and upon compliance with the provisions of the Purchase
Contract Agreement, at the option of the Holder thereof, Purchase Contracts
underlying Units may be settled early ("EARLY SETTLEMENT") as provided in the
Purchase Contract Agreement. In order to exercise the right to effect Early
Settlement with respect to any Purchase Contract evidenced by this Certificate,
the Holder of this Treasury Units Certificate shall deliver to the Purchase
Contract Agent at the Corporate Trust Office an Election to Settle Early form
set forth below duly completed and accompanied by payment in the form of
immediately available funds payable to the order of the Company in an amount
(the "EARLY SETTLEMENT AMOUNT") equal to:
(i) the sum of (A) the product of (I) the Stated Amount times
(II) the number of Purchase Contracts with respect to which the Holder
has elected to effect Early Settlement, plus (B) if such delivery is
made with respect to any Purchase Contracts during the period from the
close of business on any Record Date next preceding any Payment Date to
the opening of business on such Payment Date, an amount equal to the
Contract Adjustment Payments payable on such Payment Date with respect
to such Purchase Contracts, less
(ii) the amount of any Deferred Contract Adjustment Payments
payable to such Holder as a result of such Early Settlement.
Upon Early Settlement of Purchase Contracts by a Holder of the related
Units, the Pledged Treasury Securities underlying such Units shall be released
from the Pledge as provided
B-9
in the Pledge Agreement and the Holder shall be entitled to receive a number of
shares of Common Stock on account of each Purchase Contract forming part of a
Treasury Unit as to which Early Settlement is effected equal to [C] shares of
Common Stock per Purchase Contract (the "EARLY SETTLEMENT RATE"). The Early
Settlement Rate shall be adjusted in the same manner and at the same time as the
Settlement Rate is adjusted as provided in Section 5.04 of the Purchase Contract
Agreement.
Upon the occurrence of a Cash Merger, a Holder of Treasury Units may
effect Cash Merger Early Settlement of the Purchase Contract underlying such
Treasury Units pursuant to the terms of Section 5.04(b)(2) of the Purchase
Contract Agreement. Upon Cash Merger Early Settlement of Purchase Contracts by a
Holder of the related Treasury Units, the Pledged Treasury Securities underlying
such Treasury Units shall be released from the Pledge as provided in the Pledge
Agreement.
Upon registration of transfer of this Treasury Units Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee, except as may be required by the Purchase Contract Agent
pursuant to the Purchase Contract Agreement), under the terms of the Purchase
Contract Agreement and the Purchase Contracts evidenced hereby and the
transferor shall be released from the obligations under the Purchase Contracts
evidenced by this Treasury Units Certificate. The Company covenants and agrees,
and the Holder, by its acceptance hereof, likewise covenants and agrees, to be
bound by the provisions of this paragraph.
The Holder of this Treasury Units Certificate, by its acceptance
hereof, authorizes the Purchase Contract Agent to enter into and perform the
related Purchase Contracts forming part of the Treasury Units evidenced hereby
on its behalf as its attorney-in-fact, expressly withholds any consent to the
assumption (i.e., affirmance) of the Purchase Contracts by the Company or its
trustee in the event that the Company becomes the subject of a case under the
Bankruptcy Code, agrees to be bound by the terms and provisions thereof,
covenants and agrees to perform its obligations under such Purchase Contracts,
consents to the provisions of the Purchase Contract Agreement, authorizes the
Purchase Contract Agent to enter into and perform the Purchase Contract
Agreement and the Pledge Agreement on its behalf as its attorney-in-fact, and
consents to the Pledge of the Treasury Securities underlying this Treasury Units
Certificate pursuant to the Pledge Agreement. The Holder further covenants and
agrees, that, to the extent and in the manner provided in the Purchase Contract
Agreement and the Pledge Agreement, but subject to the terms thereof, payments
in respect to the aggregate principal amount of the Pledged Treasury Securities
on the Purchase Contract Settlement Date shall be paid by the Collateral Agent
to the Company in satisfaction of such Holder's obligations under such Purchase
Contract and such Holder shall acquire no right, title or interest in such
payments.
Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of a majority of the
Purchase Contracts.
B-10
The Purchase Contracts shall for all purposes be governed by, and
construed in accordance with, the laws of the State of New York.
Prior to due presentment of this Certificate for registration or
transfer, the Company, the Purchase Contract Agent and its Affiliates and any
agent of the Company or the Purchase Contract Agent may treat the Person in
whose name this Treasury Units Certificate is registered as the owner of the
Treasury Units evidenced hereby for the purpose of receiving payments of
interest on the Treasury Securities, receiving payments of Contract Adjustment
Payments (subject to any applicable record date), performance of the Purchase
Contracts and for all other purposes whatsoever, whether or not any payments in
respect thereof be overdue and notwithstanding any notice to the contrary, and
neither the Company, the Purchase Contract Agent nor any such agent shall be
affected by notice to the contrary.
The Purchase Contracts shall not, prior to the settlement thereof,
entitle the Holder to any of the rights of a holder of shares of Common Stock.
A copy of the Purchase Contract Agreement is available for inspection
at the offices of the Purchase Contract Agent.
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM: as tenants in common
UNIF GIFT MIN ACT: __________________ Custodian ___________________
(cust) (minor)
Under Uniform Gifts to Minors Act of____________
________________________________________________
TENANT: as tenants by the entireties
JT TEN: as joint tenants with right of survivorship and
not as tenants in common
Additional abbreviations may also be used though not in the above list.
______________
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
(Please insert Social Security or Taxpayer I.D. or other
Identifying Number of Assignee)
B-11
________________________________________________________________________________
(Please Print or Type Name and Address Including Postal Zip Code of Assignee)
the within Treasury Units Certificates and all rights thereunder, hereby
irrevocably constituting and appointing ______________________________ attorney
to transfer said Treasury Units Certificates on the books of The Phoneix
Companies, Inc., with full power of substitution in the premises.
Dated: ______________________________ ________________________________________
Signature
NOTICE: The signature to this assignment
must correspond with the name as it
appears upon the face of the within
Treasury Units Certificates in every
particular, without alteration or
enlargement or any change whatsoever.
Signature Guarantee: ______________________________
B-12
SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for shares of Common
Stock deliverable upon settlement on or after the Purchase Contract Settlement
Date of the Purchase Contracts underlying the number of Treasury Units evidenced
by this Treasury Units Certificate be registered in the name of, and delivered,
together with a check in payment for any fractional share, to the undersigned at
the address indicated below unless a different name and address have been
indicated below. If shares are to be registered in the name of a Person other
than the undersigned, the undersigned will pay any transfer tax payable incident
thereto.
Dated: ______________________________ ________________________________________
Signature
Signature Guarantee: ___________________
(if assigned to another person)
If shares are to be registered in the
name of and delivered to a Person REGISTERED HOLDER
other than the Holder, please
(i) print such Person's name and
address and (ii) provide a guarantee
of your signature: Please print name and address of
Registered Holder:
_____________________________________ ________________________________________
Name Name
_____________________________________ ________________________________________
Address Address
_____________________________________ ________________________________________
_____________________________________ ________________________________________
_____________________________________ ________________________________________
Social Security or other
Taxpayer Identification
Number, if any ________________________________________
B-13
ELECTION TO SETTLE EARLY/CASH MERGER EARLY SETTLEMENT
The undersigned Holder of this Treasury Units Certificate hereby
irrevocably exercises the option to effect [Early Settlement] [Cash Merger Early
Settlement upon a Cash Merger] in accordance with the terms of the Purchase
Contract Agreement with respect to the Purchase Contracts underlying the number
of Treasury Units evidenced by this Treasury Units Certificate specified below.
The option to effect [Early Settlement] [Cash Merger Early Settlement] may be
exercised only with respect to Purchase Contracts underlying Treasury Units with
an aggregate Stated Amount equal to $1,000 or an integral multiple thereof. The
undersigned Holder directs that a certificate for shares of Common Stock or
other securities deliverable upon such [Early Settlement] [Cash Merger Early
Settlement] be registered in the name of, and delivered, together with a check
in payment for any fractional share and any Treasury Units Certificate
representing any Treasury Units evidenced hereby as to which Cash Merger Early
Settlement of the related Purchase Contracts is not effected, to the undersigned
at the address indicated below unless a different name and address have been
indicated below. Pledged Treasury Securities deliverable upon such [Early
Settlement] [Cash Merger Early Settlement] will be transferred in accordance
with the transfer instructions set forth below. If shares are to be registered
in the name of a Person other than the undersigned, the undersigned will pay any
transfer tax payable incident thereto.
Dated: ______________________________ ________________________________________
Signature
Signature Guarantee: _____________________________
B-14
Number of Units evidenced hereby as to which [Early Settlement] [Cash
Merger Early Settlement] of the related Purchase Contracts is being elected:
If shares of Common Stock or Treasury REGISTERED HOLDER
Units Certificates are to be
registered in the name of and
delivered to and Pledged Treasury
Securities are to be transferred to
a Person other than the Holder,
please print such Person's name
and address:
Please print name and address of
Registered Holder:
_____________________________________ ________________________________________
Name Name
_____________________________________ ________________________________________
Address Address
_____________________________________ ________________________________________
_____________________________________ ________________________________________
_____________________________________ ________________________________________
Social Security or other
Taxpayer Identification
Number, if any ________________________________________
B-15
Transfer Instructions for Pledged Treasury Securities Transferable upon [Early
Settlement] [Cash Merger Early Settlement] or a Termination Event:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
B-16
[TO BE ATTACHED TO GLOBAL CERTIFICATES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The following increases or decreases in this Global Certificate have been made:
Number of Treasury
Amount of increase in Amount of decrease in Units evidenced by this
Number of Treasury Number of Treasury Global Certificate Signature of authorized
Units evidenced by the Units evidenced by the following such signatory of Purchase
Date Global Certificate Global Certificate decrease or increase Contract Agent
---- ---------------------- ---------------------- ----------------------- -----------------------
B-17
EXHIBIT C
INSTRUCTION TO PURCHASE CONTRACT AGENT
SunTrust Bank
The Purchase Contract Agent
00 Xxxx Xxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
Attn: Corporate Trust Division
Re: [_______ Corporate Units] [_______ Treasury Units] of The Phoneix
Companies, Inc., a Delaware corporation (the "COMPANY").
The undersigned Holder hereby notifies you that it has delivered to
SunTrust Bank, as Securities Intermediary, for credit to the Collateral Account,
$______ aggregate principal amount of [Notes] [Treasury Securities] in exchange
for the [Pledged Notes] [Pledged Treasury Securities] held in the Collateral
Account, in accordance with the Pledge Agreement, dated as of December 20, 2002
(the "PLEDGE AGREEMENT"; unless otherwise defined herein, terms defined in the
Pledge Agreement are used herein as defined therein), between you, the Company,
the Collateral Agent, the Custodial Agent and the Securities Intermediary. The
undersigned Holder has paid all applicable fees and expenses relating to such
exchange. The undersigned Holder hereby instructs you to instruct the Collateral
Agent to release to you on behalf of the undersigned Holder the [Pledged Notes]
[Pledged Treasury Securities] related to such [Corporate Units] [Treasury
Units].
Date: _______________________________ ________________________________________
Signature
Signature Guarantee: _____________________________
Please print name and address of Registered Holder:
_____________________________________ ________________________________________
Name Social Security or other Taxpayer
Identification Number, if any
Address
_____________________________________
_____________________________________
_____________________________________
_____________________________________
C-2
EXHIBIT D
NOTICE FROM PURCHASE CONTRACT AGENT
TO HOLDERS
(Transfer of Collateral upon Occurrence of a Termination Event)
[HOLDER]
_____________________________________
_____________________________________
Attention:
Telecopy: __________
Re: [__________ Corporate Units] [______ Treasury Units] of The Phoneix
Companies, Inc., a Delaware corporation (the "COMPANY")
Please refer to the Purchase Contract Agreement, dated as of December
20, 2002 (the "PURCHASE CONTRACT AGREEMENT"; unless otherwise defined herein,
terms defined in the Purchase Contract Agreement are used herein as defined
therein), between the Company and the undersigned, as Purchase Contract Agent
and as attorney-in-fact for the holders of Corporate Units and [Applicable
Ownership Interests (as specified in clause (i) of the definition of such term)
and] Treasury Units from time to time.
We hereby notify you that a Termination Event has occurred and that
[the Notes] [Applicable Ownership Interests (as specified in clause (i) of the
definition of such term) in the Treasury Portfolio] [the Treasury Securities]
compromising a portion of your ownership interest in _____ [Corporate Units]
[Treasury Units] have been released and are being held by us for your account
pending receipt of transfer instructions with respect to such [Notes][Treasury
Securities] (the "RELEASED SECURITIES").
Pursuant to Section 3.15 of the Purchase Contract Agreement, we hereby
request written transfer instructions with respect to the Released Securities.
Upon receipt of your instructions and upon transfer to us of your [Corporate
Units][Treasury Units] effected through book-entry or by delivery to us of your
[Corporate Units Certificate][Treasury Units Certificate], we shall transfer the
Released Securities by book-entry transfer or other appropriate procedures, in
accordance with your instructions. In the event you fail to effect such transfer
or delivery, the Released Securities and any distributions thereon, shall be
held in our name, or a nominee in trust for your benefit, until such time as
such [Corporate Units][Treasury Units] are transferred or your [Corporate Units
Certificate] [Treasury Units Certificate] is surrendered or satisfactory
evidence is provided that such [Corporate Units Certificate][Treasury Units
Certificate] has been destroyed, lost or stolen, together with any
indemnification that we or the Company may require.
Date: By: SUNTRUST BANK,
as the Purchase Contract Agent
____________________________________
Name:
Title: Authorized Signatory
D-2
EXHIBIT E
NOTICE TO SETTLE BY CASH
SunTrust Bank
The Purchase Contract Agent
00 Xxxx Xxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
Attn: Corporate Trust Division
Re: [_______ Corporate Units] [Treasury Units] of The Phoneix Companies,
Inc., a Delaware corporation (the "COMPANY")
The undersigned Holder hereby irrevocably notifies you in accordance
with Section 5.02 of the Purchase Contract Agreement, dated as of December 20,
2002 (the "PURCHASE CONTRACT AGREEMENT"; unless otherwise defined herein, terms
defined in the Purchase Contract Agreement are used herein as defined therein),
between the Company and you, as Purchase Contract Agent and as Attorney-in-Fact
for the Holders of the Purchase Contracts, that such Holder has elected to pay
to the Securities Intermediary for deposit in the Collateral Account, prior to
or on 11:00 a.m. (New York City time) on the fourth Business Day immediately
preceding the Purchase Contract Settlement Date (in lawful money of the Unit ed
States by certified or cashiers' check or wire transfer, in immediately
available funds), $______ as the Purchase Price for the shares of Common Stock
issuable to such Holder by the Company with respect to _____ Purchase Contracts
on the Purchase Contract Settlement Date. The undersigned Holder hereby
instructs you to notify promptly the Collateral Agent of the undersigned
Holders' election to make such Cash Settlement with respect to the Purchase
Contracts related to such Holder's [Corporate Units] [Treasury Units].
Date: _______________________________ ________________________________________
Signature
Signature Guarantee: ___________________
Please print name and address of Registered Holder:
E-1
EXHIBIT F
NOTICE FROM PURCHASE CONTRACT AGENT
TO COLLATERAL AGENT
(Settlement of Purchase Contract through Remarketing)
SunTrust Bank
The Collateral Agent
00 Xxxx Xxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
Attn: Corporate Trust Division
Re: __________ Corporate Units of The Phoneix Companies, Inc.,
a Delaware corporation (the "COMPANY")
Please refer to the Purchase Contract Agreement, dated as of December
20, 2002 (the "PURCHASE CONTRACT AGREEMENT"; unless otherwise defined herein,
terms defined in the Purchase Contract Agreement are used herein as defined
therein), between the Company and the undersigned, as Purchase Contract Agent
and as attorney-in-fact for the Holders of Corporate Units from time to time.
In accordance with Section 5.02 of the Purchase Contract Agreement and,
based on notices of [Early Settlements][Cash Settlements] received from Holders
of Corporate Units as of 5:00 p.m. (New York City time), on the fifth Business
Day immediately preceding the ______ Remarketing Date, we hereby notify you that
an aggregate principal amount of $______ Notes are to be tendered for purchase
in the Remarketing.
Date: By: SUNTRUST BANK,
as the Purchase Contract Agent
____________________________________
Name:
Title: Authorized Signatory
F-1
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