1
EXHIBIT 4(k)
===========================
FORM OF
TARGETED GROWTH ENHANCED TERMS SECURITIES
GUARANTEE AGREEMENT
TARGETS TRUST II
Dated as of , 1999
===========================
2
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation.................................1
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act: Application...............................4
SECTION 2.2 Lists of Holders of Securities.................................4
SECTION 2.3 Reports by the TARGETS Guarantee Trustee.......................5
SECTION 2.4 Periodic Reports to TARGETS Guarantee Trustee..................5
SECTION 2.5 Evidence of Compliance with Conditions Precedent...............5
SECTION 2.6 Events of Default; Waiver......................................5
SECTION 2.7 Event of Default Notice.......................................5
SECTION 2.8 Conflicting Interests..........................................6
ARTICLE III
POWERS, DUTIES AND RIGHTS OF TARGETS GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the TARGETS Guarantee Trustee.............6
SECTION 3.2 Certain Rights of TARGETS Guarantee Trustee....................8
SECTION 3.3 Not Responsible for Recitals or Issuance of Guarantee.........10
ARTICLE IV
TARGETS GUARANTEE TRUSTEE
SECTION 4.1 TARGETS Guarantee Trustee; Eligibility........................10
SECTION 4.2 Appointment. Removal and Resignation of TARGETS Guarantee
Trustees....................................................10
ARTICLE V
GUARANTEE
SECTION 5.1 Guarantee.....................................................11
SECTION 5.2 Waiver of Notice and Demand...................................11
SECTION 5.3 Obligations Not Affected......................................12
SECTION 5.4 Rights of Holders.............................................12
SECTION 5.5 Guarantee of Payment..........................................13
SECTION 5.6 Subrogation...................................................13
SECTION 5.7 Independent Obligations.......................................13
3
ARTICLE VI
TERMINATION
SECTION 6.1 Termination...................................................13
ARTICLE VII
INDEMNIFICATION
SECTION 7.1 Exculpation...................................................14
SECTION 7.2 Indemnification...............................................14
ARTICLE VIII
MISCELLANEOUS
SECTION 8.1 Successors and Assigns........................................15
SECTION 8.2 Amendments....................................................15
SECTION 8.3 Consolidations and Mergers....................................15
SECTION 8.4 Notices.......................................................15
SECTION 8.5 Benefit.......................................................16
SECTION 8.6 Governing Law.................................................16
ii
4
This GUARANTEE AGREEMENT (the "TARGETS Guarantee"), dated as of
, 1999, is executed and delivered by Xxxxxxx Xxxxx Xxxxxx
Holdings Inc., a Delaware corporation (together with any successors by way of
merger the "Guarantor"), and The Chase Manhattan Bank, as trustee (the "TARGETS
Guarantee Trustee"), for the benefit of the Holders (as defined herein) from
time to time of the TARGETS (as defined herein) of TARGETS Trust II, a Delaware
statutory business trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of Trust
(the "Declaration"), dated as of , 1999 among the trustees of the
Issuer named therein, the Guarantor, as sponsor, and the holders from time to
time of undivided beneficial interests in the assets of the Issuer, the Issuer
is issuing on the date hereof preferred securities designated the
Targeted Growth Enhanced Terms Securities(R) (the "TARGETS");
WHEREAS, as incentive for the Holders to purchase the TARGETS, the
Guarantor desires irrevocably and unconditionally to agree, to the extent set
forth in this TARGETS Guarantee, to pay to the Holders the Guarantee Payments
(as defined herein) and to make certain other payments on the terms and
conditions set forth herein.
NOW, THEREFORE, in consideration of the purchase by each Holder of
TARGETS, which purchase the Guarantor hereby agrees shall benefit the Guarantor,
the Guarantor executes and delivers this TARGETS Guarantee for the benefit of
the Holders.
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation
In this TARGETS Guarantee, unless the context otherwise requires:
(a) Capitalized terms used in this TARGETS Guarantee but not
defined in the preamble above have the respective meanings
assigned to them in this Section 1.1;
(b) A term defined anywhere in this TARGETS Guarantee has the same
meaning throughout;
(c) all references to "the TARGETS Guarantee" or "this TARGETS
Guarantee" are to this TARGETS Guarantee as modified,
supplemented or amended from time to time;
(d) all references in this TARGETS Guarantee to Articles and
Sections are to Articles and Sections of this TARGETS
Guarantee, unless otherwise specified;
5
(e) a term defined in the Trust Indenture Act has the same meaning
when used in this TARGETS Guarantee, unless otherwise defined
in this TARGETS Guarantee or unless the context otherwise
requires; and
(f) a reference to the singular includes the plural and vice
versa.
"Accelerated Maturity Date" has the meaning specified in the
Declaration.
"Accelerated Maturity Payment" has the meaning specified in the
Declaration.
"Affiliate" has the same meaning as given to that term in Rule 405
of the Securities Act of 1933, as amended, or any successor rule thereunder.
"Authorized Officer" of a Person means any Person that is authorized
to bind such Person.
"Business Day" means any day other than a Saturday, Sunday or a day
on which banking institutions in The City of New York are permitted or required
by any applicable law to close.
"Common Securities" means the securities representing common
undivided beneficial interests in the assets of the Issuer.
"Corporate Trust Office" means the office of the TARGETS Guarantee
Trustee at which the corporate trust business of the TARGETS Guarantee Trustee
shall, at any particular time, be principally administered, which office at the
date of execution of this Agreement is located at 000 Xxxx 00xx Xxxxxx - 00xx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000.
"Covered Person" means any Holder or beneficial owner of TARGETS.
"Event of Default" means a default by the Guarantor on any of its
payment or other obligations under this TARGETS Guarantee.
"Forward Contract" means the Forward Contract of the Guarantor
issuable under the Indenture, held by the Institutional Trustee (as defined in
the Declaration) of the Issuer.
"Guarantee Payments" means the following payments or distributions,
without duplication, with respect to the TARGETS, to the extent not paid or made
by the Issuer: (i) any Maturity Payment that is required to be made in respect
of the TARGETS, to the extent the Issuer has funds available therefor, (ii) any
Accelerated Maturity Payment that is required to be made in respect of the
TARGETS, to the extent the Issuer has funds available therefor, (iii) any
Quarterly Distribution that is required to be made in respect of the TARGETS, to
the extent the Issuer has funds available therefor, (iv) any distribution of
Treasury Proceeds that is required to be made in respect of the TARGETS, to the
extent the Issuer has funds available therefor, and (v) any other remaining
assets of the Issuer payable to the Holders of the TARGETS upon liquidation of
the Issuer.
2
6
"Holder" shall mean any holder, as registered on the books and
records of the Issuer, of any TARGETS; provided, however, that in determining
whether the holders of the requisite percentage of TARGETS have given any
request, notice, consent or waiver hereunder, "Holder" shall not include the
Guarantor or any Affiliate of the Guarantor.
"Indemnified Person" means the TARGETS Guarantee Trustee, any
Affiliate of the TARGETS Guarantee Trustee, or any officers, directors,
shareholders, members, partners, employees, representatives, nominees,
custodians or agents of the TARGETS Guarantee Trustee.
"Indenture" means the Indenture dated as of , 1999, between
the Guarantor and The Chase Manhattan Bank, as trustee, and any indenture
supplemental thereto pursuant to which the securities representing interests in
a Forward Contract (defined in the Indenture as the "Securities") are to be
issued to the Institutional Trustee of the Issuer.
"Majority of the TARGETS" means, except as provided by the Trust
Indenture Act, a vote by Holder(s), voting separately as a class, holding
TARGETS representing more than 50% of the aggregate beneficial interests
represented by all outstanding TARGETS.
"Maturity Date" has the meaning specified in the Declaration.
"Maturity Payment" has the meaning specified in the Declaration.
"Officers' Certificate" means, with respect to any Person, a
certificate signed by two Authorized Officers of such Person. Any Officers'
Certificate delivered with respect to compliance with a condition or covenant
provided for in this TARGETS Guarantee shall include:
(a) a statement that each officer signing the Officers' Certificate
has read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Officers'
Certificate;
(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such
officer to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such officer,
such condition or covenant has been complied with.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Quarterly Distribution" has the meaning specified in the
Declaration.
3
7
"Responsible Officer" means, with respect to the TARGETS Guarantee
Trustee, any officer within the Corporate Trust Office of the TARGETS Guarantee
Trustee, including any vice-president, any assistant vice-president, any
assistant secretary, the treasurer, any assistant treasurer, trust officer or
other officer of the Corporate Trust Office of the TARGETS Guarantee Trustee
customarily performing functions similar to those performed by any of the above
designated officers and, in any case, that has direct responsibility for the
administration of this TARGETS Guarantee and also means, with respect to a
particular corporate trust matter, any other officer to whom such matter is
referred because of that officer's knowledge of and familiarity with the
particular subject.
"Successor TARGETS Guarantee Trustee" means a successor TARGETS
Guarantee Trustee possessing the qualifications to act as TARGETS Guarantee
Trustee under Section 4.1.
"TARGETS Guarantee Trustee" means The Chase Manhattan Bank, until a
Successor TARGETS Guarantee Trustee has been appointed and has accepted such
appointment pursuant to the terms of this TARGETS Guarantee and thereafter means
each such Successor TARGETS Guarantee Trustee.
"Treasury Proceeds" has the meaning specified in the Indenture.
"Treasury Securities" has the meaning specified in the Declaration.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act: Application
(a) This TARGETS Guarantee is subject to the provisions of the Trust
Indenture Act that are required to be part of this TARGETS Guarantee and shall,
to the extent applicable, be governed by such provisions; and
(b) if and to the extent that any provision of this TARGETS
Guarantee limits, qualifies or conflicts with the duties imposed by Section 310
to 317, inclusive, of the Trust Indenture Act, such imposed duties shall
control.
SECTION 2.2 Lists of Holders of Securities
(a) The Guarantor shall provide the TARGETS Guarantee Trustee with a
list, in such form as the TARGETS Guarantee Trustee may reasonably require, of
the names and addresses of the Holders ("List of Holders") as of such date, (i)
within one Business Day after January 1 and June 30 of each year, and (ii) at
any other time within 30 days of receipt by the Guarantor of a written request
for a List of Holders as of a date no more than 14 days before such List of
Holders is given to the TARGETS Guarantee Trustee; provided that the Guarantor
shall
4
8
not be obligated to provide such List of Holders at any time the List of Holders
does not differ from the most recent List of Holders given to the TARGETS
Guarantee Trustee by the Guarantor. The TARGETS Guarantee Trustee may destroy
any List of Holders previously given to it on receipt of a new List of Holders.
(b) The TARGETS Guarantee Trustee shall comply with its obligations
under Sections 311(a), 311(b) and 312 (b) of the Trust Indenture Act.
SECTION 2.3 Reports by the TARGETS Guarantee Trustee
Within 60 days after April 15 of each year, the TARGETS Guarantee
Trustee shall provide to the Holders such reports as are required by Section 313
of the Trust Indenture Act, if any, in the form and in the manner provided by
Section 313 of the Trust Indenture Act. The TARGETS Guarantee Trustee shall also
comply with the requirements of Section 313(d) of the Trust Indenture Act.
SECTION 2.4 Periodic Reports to TARGETS Guarantee Trustee
The Guarantor shall provide to the TARGETS Guarantee Trustee such
documents, reports and information as required by Section 314 (if any) and the
compliance certificate required by Section 314 of the Trust Indenture Act in the
form, in the manner and at the times required by Section 314 of the Trust
Indenture Act.
SECTION 2.5 Evidence of Compliance with Conditions Precedent
The Guarantor shall provide to the TARGETS Guarantee Trustee such
evidence of compliance with any conditions precedent, if any, provided for in
this TARGETS Guarantee that relate to any of the matters set forth in Section
314(c) of the Trust Indenture Act. Any certificate or opinion required to be
given by an officer pursuant to Section 314(c)(1) may be given in the form of an
Officers' Certificate.
SECTION 2.6 Events of Default; Waiver
The Holders of a Majority of TARGETS may, by vote, on behalf of the
Holders of all of the TARGETS, waive any past Event of Default and its
consequences. Upon such waiver, any such Event of Default shall cease to exist,
and any Event of Default arising therefrom shall be deemed to have been cured,
for every purpose of this TARGETS Guarantee, but no such waiver shall extend to
any subsequent or other default or Event of Default or impair any right
consequent thereon.
SECTION 2.7 Event of Default; Notice
(a) The TARGETS Guarantee Trustee shall, within 90 days after the
occurrence of an Event of Default, transmit by mail, first class postage
prepaid, to the Holders, notices of all Events of Default actually known to a
Responsible Officer of the TARGETS Guarantee Trustee, unless such defaults have
been cured before the giving of such notice; provided that the
5
9
TARGETS Guarantee Trustee shall be protected in withholding such notice if and
so long as a Responsible Officer of the TARGETS Guarantee Trustee in good faith
determines that the withholding of such notice is in the interests of the
Holders.
(b) The TARGETS Guarantee Trustee shall not be deemed to have
knowledge of any Event of Default unless the TARGETS Guarantee Trustee shall
have received written notice of such Event of Default or a Responsible Officer
of the TARGETS Guarantee Trustee charged with the administration of the
Declaration shall have obtained actual knowledge of such Event of Default.
SECTION 2.8 Conflicting Interests
The Declaration shall be deemed to be specifically described in this
TARGETS Guarantee for the purposes of clause (i) of the first proviso contained
in Section 310(b) of the Trust Indenture Act.
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
TARGETS GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the TARGETS Guarantee Trustee
(a) This TARGETS Guarantee shall be held by the TARGETS Guarantee
Trustee for the benefit of the Holders, and the TARGETS Guarantee Trustee shall
not transfer its right, title and interest in this TARGETS Guarantee to any
Person except a Holder exercising his or her rights pursuant to Section 5.4(b)
or to a Successor TARGETS Guarantee Trustee on acceptance by such Successor
TARGETS Guarantee Trustee of its appointment to act as Successor TARGETS
Guarantee Trustee. The right, title and interest of the TARGETS Guarantee
Trustee shall automatically vest in any Successor TARGETS Guarantee Trustee, and
such vesting and cessation of title shall be effective whether or not
conveyancing documents have been executed and delivered pursuant to the
appointment of such Successor TARGETS Guarantee Trustee.
(b) If an Event of Default actually known to a Responsible Officer
of the TARGETS Guarantee Trustee has occurred and is continuing, the TARGETS
Guarantee Trustee shall enforce this TARGETS Guarantee for the benefit of the
Holders of the TARGETS.
(c) The TARGETS Guarantee Trustee, before the occurrence of any
Event of Default and after the curing of all Events of Default that may have
occurred, shall undertake to perform only such duties as are specifically set
forth in this TARGETS Guarantee, and no implied covenants shall be read into
this TARGETS Guarantee against the TARGETS Guarantee Trustee. In case an Event
of Default has occurred (that has not been cured or waived pursuant to Section
2.6) and is actually known to a Responsible Officer of the TARGETS Guarantee
Trustee, the TARGETS Guarantee Trustee shall exercise such of the rights and
powers vested in it by this TARGETS Guarantee, and use the same degree of care
and skill in its exercise thereof, as a prudent person would exercise or use
under the circumstances in the conduct of his or her own affairs.
6
10
(d) No provision of this TARGETS Guarantee shall be construed to
relieve the TARGETS Guarantee Trustee from liability for its own negligent
action, its own negligent failure to act, or its own willful misconduct, except
that:
(i) prior to the occurrence of any Event of Default and after
the curing or waiving of all such Events of Default that may have
occurred:
(A) the duties and obligations of the TARGETS Guarantee
Trustee shall be determined solely by the express provisions of this
TARGETS Guarantee, and the TARGETS Guarantee Trustee shall not be
liable except for the performance of such duties and obligations as
are specifically set forth in this TARGETS Guarantee, and no implied
covenants or obligations shall be read into this TARGETS Guarantee
against the TARGETS Guarantee Trustee; and
(B) in the absence of bad faith on the part of the
TARGETS Guarantee Trustee, the TARGETS Guarantee Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any certificates
or opinions furnished to the TARGETS Guarantee Trustee and
conforming to the requirements of this TARGETS Guarantee, but in the
case of any such certificates or opinions that by any provision
hereof are specifically required to be furnished to the TARGETS
Guarantee Trustee, the TARGETS Guarantee Trustee shall be under a
duty to examine the same to determine whether or not they conform to
the requirements of this TARGETS Guarantee;
(ii) the TARGETS Guarantee Trustee shall not be liable for any
error of judgment made in good faith by a Responsible Officer of the
TARGETS Guarantee Trustee, unless it shall be proved that the TARGETS
Guarantee Trustee was negligent in ascertaining the pertinent facts upon
which such judgment was made;
(iii) the TARGETS Guarantee Trustee shall not be liable with
respect to any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders of not less than a Majority
of the TARGETS relating to the time, method and place of conducting any
proceeding for any remedy available to the TARGETS Guarantee Trustee, or
exercising any trust or power conferred upon the TARGETS Guarantee Trustee
under this TARGETS Guarantee;
(iv) no provision of this TARGETS Guarantee shall require the
TARGETS Guarantee Trustee to expend or risk its own funds or otherwise
incur personal financial liability in the performance of any of its duties
or in the exercise of any of its rights or powers, if the TARGETS
Guarantee Trustee shall have reasonable grounds for believing that the
repayment of such funds or liability is not reasonably assured to it under
the terms of this TARGETS Guarantee or indemnity, reasonably satisfactory
to the TARGETS Guarantee Trustee, against such risk or liability is not
reasonably assured to it;
7
11
(v) The granting of any right to the TARGETS Guarantee Trustee
hereunder shall not, subject to the following, be deemed to impose on the
TARGETS Guarantee Trustee an obligation to exercise such rights subject to
3.1(d)(vi); and
(vi) the TARGETS Guarantee Trustee shall not be obligated to
exercise any remedy or take any action hereunder unless directed to do so
by the holders of a Majority of the TARGETS and shall have no liability
for its failure to act pending receipt by it of any such direction.
This Section 3.1 is in furtherance of and subject to Sections 315
and 316 of the Trust Indenture Act.
SECTION 3.2 Certain Rights of TARGETS Guarantee Trustee
(a) Subject to the provisions of Section 3.1:
(i) The TARGETS Guarantee Trustee may 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, debenture, note, other evidence
of indebtedness or other paper or document believed by it to be genuine
and to have been signed, sent or presented by the proper party or parties.
(ii) Any direction or act of the Guarantor contemplated by
this TARGETS Guarantee shall be sufficiently evidenced by an Officers'
Certificate.
(iii) Whenever, in the administration of this TARGETS
Guarantee, the TARGETS Guarantee Trustee shall deem it desirable that a
matter be proved or established before taking, suffering or omitting any
action hereunder, the TARGETS Guarantee Trustee (unless other evidence is
herein specifically prescribed) may, in the absence of bad faith on its
part, request and conclusively rely upon an Officers' Certificate which,
upon receipt of such request, shall be promptly delivered by the
Guarantor.
(iv) The TARGETS Guarantee Trustee shall have no duty to see
to any recording, filing or registration of any instrument (or any
rerecording, refiling or registration thereof).
(v) The TARGETS Guarantee Trustee may consult with counsel,
and the advice or opinion of such counsel with respect to legal matters
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
accordance with such advice or opinion. Such counsel may be counsel to the
Guarantor or any of its Affiliates and may include any of its employees.
The TARGETS Guarantee Trustee shall have the right at any time to seek
instructions concerning the administration of this TARGETS Guarantee from
any court of competent jurisdiction.
8
12
(vi) The TARGETS Guarantee Trustee shall be under no
obligation to exercise any of the rights or powers vested in it by this
TARGETS Guarantee at the request or direction of any Holder, unless such
Holder shall have provided to the TARGETS Guarantee Trustee such security
and indemnity, reasonably satisfactory to the TARGETS Guarantee Trustee,
against the costs, expenses (including attorneys' fees and expenses and
the expenses of the TARGETS Guarantee Trustee's agents, nominees or
custodians) and liabilities that might be incurred by it in complying with
such request or direction, including such reasonable advances as may be
requested by the TARGETS Guarantee Trustee; provided that nothing
contained in this Section 3.2(a) (vi) shall be taken to relieve the
TARGETS Guarantee Trustee, upon the occurrence of an Event of Default, of
its obligation to exercise the rights and powers vested in it by this
TARGETS Guarantee.
(vii) The TARGETS Guarantee Trustee 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 TARGETS Guarantee
Trustee, in its discretion, may make such further inquiry or investigation
into such facts or matters as it may see fit.
(viii) The TARGETS Guarantee Trustee may execute any of the
trusts or powers hereunder or perform any duties hereunder either directly
or by or through agents, nominees, custodians or attorneys, and the
TARGETS Guarantee Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by
it hereunder.
(ix) Any action taken by the TARGETS Guarantee Trustee or its
agents hereunder shall bind the Holders of the TARGETS, and the signature
of the TARGETS Guarantee Trustee or its agents alone shall be sufficient
and effective to perform any such action. No third party shall be required
to inquire as to the authority of the TARGETS Guarantee Trustee to so act
or as to its compliance with any of the terms and provisions of this
TARGETS Guarantee, both of which shall be conclusively evidenced by the
TARGETS Guarantee Trustee's or its agent's taking such action.
(x) Whenever in the administration of this TARGETS Guarantee
the TARGETS Guarantee Trustee shall deem it desirable to receive
instructions with respect to enforcing any remedy or right or taking any
other action hereunder, the TARGETS Guarantee Trustee (i) may request
instructions from the Holders of a Majority of the TARGETS, (ii) may
refrain from enforcing such remedy or right or taking such other action
until such instructions are received, and (iii) shall be protected in
conclusively relying on or acting in accordance with such instructions.
(b) No provision of this TARGETS Guarantee shall be deemed to impose
any duty or obligation on the TARGETS Guarantee Trustee to perform any act or
acts or exercise any right, power, duty or obligation conferred or imposed on it
in any jurisdiction in which it shall be
9
13
illegal, or in which the TARGETS Guarantee Trustee shall be unqualified or
incompetent in accordance with applicable law, to perform any such act or acts
or to exercise any such right, power, duty or obligation. No permissive power or
authority available to the TARGETS Guarantee Trustee shall be construed to be a
duty.
SECTION 3.3 Not Responsible for Recitals or Issuance of Guarantee
The recitals contained in this Guarantee shall be taken as the
statements of the Guarantor, and the TARGETS Guarantee Trustee does not assume
any responsibility for their correctness. The TARGETS Guarantee Trustee makes no
representation as to the validity or sufficiency of this TARGETS Guarantee.
ARTICLE IV
TARGETS GUARANTEE TRUSTEE
SECTION 4.1 TARGETS Guarantee Trustee; Eligibility
(a) There shall at all times be a TARGETS Guarantee Trustee which
shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing business under the
laws of the United States of America or any State or Territory thereof or
of the District of Columbia, or a corporation or Person permitted by the
Securities and Exchange Commission to act as an institutional trustee
under the Trust Indenture Act, authorized under such laws to exercise
corporate trust powers, having a combined capital and surplus of at least
50 million U.S. dollars ($50,000,000), and subject to supervision or
examination by Federal, State, Territorial or District of Columbia
authority. If such corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of the supervising or
examining authority referred to above, then, for the purposes of this
Section 4.1(a) (ii), the combined capital and surplus of such corporation
shall be deemed to be its combined capital and surplus as set forth in its
most recent report of condition so published.
(b) If at any time the TARGETS Guarantee Trustee shall cease to be
eligible to so act under Section 4.1(a), the TARGETS Guarantee Trustee shall
immediately resign in the manner and with the effect set out in Section 4.2(c).
(c) If the TARGETS Guarantee Trustee has or shall acquire any
"conflicting interest" within the meaning of Section 310(b) of the Trust
Indenture Act, the TARGETS Guarantee Trustee and Guarantor shall in all respects
comply with the provisions of Section 310(b) of the Trust Indenture Act.
SECTION 4.2 Appointment, Removal and Resignation of TARGETS Guarantee Trustees
(a) Subject to Section 4.2(b), the TARGETS Guarantee Trustee may be
appointed or removed without cause at any time by the Guarantor.
10
14
(b) The TARGETS Guarantee Trustee shall not be removed in accordance
with Section 4.2(a) until a Successor TARGETS Guarantee Trustee has been
appointed and has accepted such appointment by written instrument executed by
such Successor TARGETS Guarantee Trustee and delivered to the Guarantor.
(c) The TARGETS Guarantee Trustee appointed to office shall hold
office until a Successor TARGETS Guarantee Trustee shall have been appointed or
until its removal or resignation. The TARGETS Guarantee Trustee may resign from
office (without need for prior or subsequent accounting) by an instrument in
writing executed by the TARGETS Guarantee Trustee and delivered to the
Guarantor, which resignation shall not take effect until a Successor TARGETS
Guarantee Trustee has been appointed and has accepted such appointment by
instrument in writing executed by such Successor TARGETS Guarantee Trustee and
delivered to the Guarantor and the resigning TARGETS Guarantee Trustee.
(d) If no Successor TARGETS Guarantee Trustee shall have been
appointed and accepted appointment as provided in this Section 4.2 within 60
days after delivery to the Guarantor of an instrument of resignation, the
resigning TARGETS Guarantee Trustee may petition any court of competent
jurisdiction for appointment of a Successor TARGETS Guarantee Trustee. Such
court may thereupon, after prescribing such notice, if any, as it may deem
proper, appoint a Successor TARGETS Guarantee Trustee.
(e) No TARGETS Guarantee Trustee shall be liable for the acts or
omissions to act of any Successor TARGETS Guarantee Trustee.
(f) Upon termination of this TARGETS Guarantee or removal or
resignation of the TARGETS Guarantee Trustee pursuant to this Section 4.2, the
Guarantor shall pay to the TARGETS Guarantee Trustee all amounts accrued and
owing to such TARGETS Guarantee Trustee to the date of such termination, removal
or resignation.
ARTICLE V
GUARANTEE
SECTION 5.1 Guarantee
The Guarantor irrevocably and unconditionally agrees to pay in full
to the Holders the Guarantee Payments (without duplication of amounts
theretofore paid by the Issuer), as and when due, regardless of any defense,
right of set-off or counterclaim that the Issuer may have or assert. The
Guarantor's obligation to make a Guarantee Payment may be satisfied by direct
payment of the required amounts by the Guarantor to the Holders or by causing
the Issuer to pay such amounts to the Holders.
SECTION 5.2 Waiver of Notice and Demand
The Guarantor hereby waives notice of acceptance of this TARGETS
Guarantee and of any liability to which it applies or may apply, presentment,
demand for payment, any right to require a proceeding first against the Issuer
or any other Person before proceeding against the
11
15
Guarantor, protest, notice of nonpayment, notice of dishonor, notice of
redemption and all other notices and demands.
SECTION 5.3 Obligations Not Affected
The obligations, covenants, agreements and duties of the Guarantor
under this TARGETS Guarantee shall in no way be affected or impaired by reason
of the happening from time to time of any of the following:
(a) the release or waiver, by operation of law or otherwise, of the
performance or observance by the Issuer of any express or implied agreement,
covenant, term or condition relating to the TARGETS to be performed or observed
by the Issuer;
(b) the extension of time for the payment by the Issuer of all or
any portion of the Maturity Payment, Accelerated Maturity Payment, Quarterly
Distributions, Treasury Proceeds or any other sums payable under the terms of
the TARGETS or the extension of time for the performance of any other obligation
under, arising out of, or in connection with, the TARGETS;
(c) any failure, omission, delay or lack of diligence on the part of
the Holders to enforce, assert or exercise any right, privilege, power or remedy
conferred on the Holders pursuant to the terms of the TARGETS, or any action on
the part of the Issuer granting indulgence or extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution, sale of
any collateral, receivership, insolvency, bankruptcy, assignment for the benefit
of creditors, reorganization, arrangement, composition or readjustment of debt
of, or other similar proceedings affecting, the Issuer or any of the assets of
the Issuer;
(e) any invalidity of, or defect or deficiency in, the TARGETS;
(f) the settlement or compromise of any obligation guaranteed hereby
or hereby incurred; or
(g) any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of a guarantor, it being
the intent of this Section 5.3 that the obligations of the Guarantor hereunder
shall be absolute and unconditional under any and all circumstances.
There shall be no obligation of the Holders to give notice to, or
obtain consent of, the Guarantor with respect to the happening of any of the
foregoing.
SECTION 5.4 Rights of Holders
(a) The Holders of a Majority of the TARGETS have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the TARGETS Guarantee Trustee in respect of this TARGETS Guarantee
or exercising any trust or power conferred upon the TARGETS Guarantee Trustee
under this TARGETS Guarantee.
12
16
(b) If the TARGETS Guarantee Trustee fails to enforce its rights
under this TARGETS Guarantee, any Holder may directly institute a legal
proceeding against the Guarantor to enforce the TARGETS Guarantee Trustee's
rights under this TARGETS Guarantee, without first instituting a legal
proceeding against the Issuer, the TARGETS Guarantee Trustee or any other Person
or entity.
(c) A Holder of TARGETS may also directly institute a legal
proceeding against the Guarantor to enforce such Holder's right to receive
payment under this TARGETS Guarantee without first (i) directing the TARGETS
Guarantee Trustee to enforce the terms of this TARGETS Guarantee or (ii)
instituting a legal proceeding directly against the Issuer or any other Person
or entity.
SECTION 5.5 Guarantee of Payment
This TARGETS Guarantee creates a guarantee of payment and not of
collection.
SECTION 5.6 Subrogation
The Guarantor shall be subrogated to all (if any) rights of the
Holders of TARGETS against the Issuer in respect of any amounts paid to such
Holders by the Guarantor under this TARGETS Guarantee; provided, however, that
the Guarantor shall not (except to the extent required by mandatory provisions
of law) be entitled to enforce or exercise any right that it may acquire by way
of subrogation or any indemnity, reimbursement or other agreement, in all cases
as a result of payment under this TARGETS Guarantee, if, at the time of any such
payment, any amounts are due and unpaid under this TARGETS Guarantee. If any
amount shall be paid to the Guarantor in violation of the preceding sentence,
the Guarantor agrees to hold such amount in trust for the Holders and to pay
over such amount to the Holders.
SECTION 5.7 Independent Obligations
The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Issuer with respect to the TARGETS, and
that the Guarantor shall be liable as principal and as debtor hereunder to make
Guarantee Payments pursuant to the terms of this TARGETS Guarantee
notwithstanding the occurrence of any event referred to in subsections (a)
through (g), inclusive, of Section 5.3 hereof.
ARTICLE VI
TERMINATION
SECTION 6.1 Termination
This TARGETS Guarantee shall terminate upon the earliest to occur of
(i) full payment of the Maturity Payment and the final payment due in respect of
the Treasury Securities, (ii) full payment of the Accelerated Maturity Payment
and the distribution of the Treasury Proceeds on an Accelerated Maturity Date to
the Holders of the TARGETS and the Common Securities as of the Record Date (as
defined in the Indenture) and (iii) full payment of the
13
17
amounts payable in accordance with the Declaration upon liquidation of the
Issuer. Notwithstanding the foregoing, this TARGETS Guarantee will continue to
be effective or will be reinstated, as the case may be, if at any time any
Holder must restore payment of any sums paid under the TARGETS or under this
TARGETS Guarantee.
ARTICLE VII
INDEMNIFICATION
SECTION 7.1 Exculpation
(a) No Indemnified Person shall be liable, responsible or
accountable in damages or otherwise to the Guarantor or any Covered Person for
any loss, damage or claim incurred by reason of any act or omission performed or
omitted by such Indemnified Person in good faith in accordance with this TARGETS
Guarantee and in a manner that such Indemnified Person reasonably believed to be
within the scope of the authority conferred on such Indemnified Person by this
TARGETS Guarantee or by law, except that an Indemnified Person shall be liable
for any such loss, damage or claim incurred by reason of such Indemnified
Person's negligence or willful misconduct with respect to such acts or
omissions.
(b) An Indemnified Person shall be fully protected in relying in
good faith upon the records of the Guarantor and upon such information,
opinions, reports or statements presented to the Guarantor by any Person as to
matters the Indemnified Person reasonably believes are within such other
Person's professional or expert competence and who has been selected with
reasonable care by or on behalf of the Guarantor, including information,
opinions, reports or statements as to the value and amount of the assets,
liabilities, profits, losses, or any other facts pertinent to the existence and
amount of assets from which Distributions to Holders might properly be paid.
SECTION 7.2 Indemnification
The Guarantor agrees to indemnify each Indemnified Person for, and
to hold each Indemnified Person harmless against, any loss, liability or expense
incurred without negligence or bad faith on its part, arising out of or in
connection with the acceptance or administration of the trust or trusts
hereunder, including the costs and expenses (including reasonable legal fees and
expenses) of defending itself against, or investigating, any claim or liability
in connection with the exercise or performance of any of its powers or duties
hereunder. The obligation to indemnify as set forth in this Section 7.2 shall
survive the termination of this TARGETS Guarantee.
14
18
ARTICLE VIII
MISCELLANEOUS
SECTION 8.1 Successors and Assigns
All guarantees and agreements contained in this TARGETS Guarantee
shall bind the successors, assigns, receivers, trustees and representatives of
the Guarantor and shall inure to the benefit of the Holders of the TARGETS then
outstanding.
SECTION 8.2 Amendments
Except with respect to any changes that do not adversely affect the
rights of Holders (in which case no consent of Holders will be required), this
TARGETS Guarantee may be amended only with the prior approval of the Holders of
not less than a Majority of the TARGETS. The provisions of Section 12.2 of the
Declaration with respect to meetings of Holders apply to the giving of such
approval.
SECTION 8.3 Consolidations and Mergers
The Guarantor may consolidate with, or sell, lease or convey all or
substantially all of its assets to, or merge with or into, any other
corporation; provided that in any such case (i) either the Guarantor shall be
the continuing corporation, or the successor corporation shall be a corporation
organized and existing under the laws of the United States of America or any
State or Territory thereof or of the District of Columbia and such successor
corporation shall expressly assume the due and punctual payment of the Guarantee
Payments described herein and the due and punctual performance and observance of
all of the covenants and conditions of this TARGETS Guarantee, and (ii) the
Guarantor or such successor corporation, as the case may be, shall not,
immediately after such merger or consolidation, or such sale, lease or
conveyance, be in default in the performance of any such covenant or condition.
SECTION 8.4 Notices
All notices provided for in this TARGETS Guarantee shall be in
writing, duly signed by the party giving such notice, and shall be delivered,
telecopied or mailed by first class mail postage prepaid as follows:
(a) If given to the TARGETS Guarantee Trustee, at the TARGETS
Guarantee Trustee's mailing address set forth below (or such other address as
the TARGETS Guarantee Trustee may give notice of to the Holders)
000 Xxxx 00xx Xxxxxx - 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Structured Finance Services
(b) If given to the Guarantor, at the Guarantor's mailing address
set forth below (or such other address as the Guarantor may give notice of to
the Holders)
15
19
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
(c) If given to any Holder, at the address set forth on the books
and records of the Issuer.
All notices provided for in this TARGETS Guarantee shall be deemed
to have been given when received in person, telecopied with receipt confirmed,
or mailed by first class mail, postage prepaid except that if a notice or other
document is refused delivery or cannot be delivered because of a changed address
of which no notice was given, such notice or other document shall be deemed to
have been delivered on the date of such refusal or inability to deliver.
SECTION 8.5 Benefit
This TARGETS Guarantee is solely for the benefit of the Holders of
the TARGETS and, subject to Section 3.l(a), is not separately transferable from
the TARGETS.
SECTION 8.6 Governing Law
THIS TARGETS GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, AND ALL
RIGHTS AND REMEDIES SHALL BE GOVERNED BY SUCH LAWS WITHOUT REGARD FOR THE
PRINCIPLES OF ITS CONFLICTS OF LAWS.
16
20
THIS TARGETS GUARANTEE is executed as of the day and year first
above written.
XXXXXXX XXXXX XXXXXX HOLDINGS INC.
as Guarantor
By:
-------------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK, as
TARGETS Guarantee Trustee
By:
-------------------------------------
Name:
Title:
