EXHIBIT 4.6
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PP&L RESOURCES, INC.
AND
THE CHASE MANHATTAN BANK,
AS PURCHASE CONTRACT AGENT AND TRUSTEE
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PURCHASE CONTRACT AGREEMENT
-------------------------------
Dated as of
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Reconciliation and Tie
between Trust Indenture Act
of 1939 and Purchase Contract
Agreement dated as of ________, 1999.
Section of Section of
Trust Indenture Act Purchase Contract
of 1939, as amended Agreement
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310(a)..................................................7.8
310(b)..................................................7.9(g), 11.8
310(c)..................................................Inapplicable
311(a)..................................................11.2(b)
311(b)..................................................11.2(b)
311(c)..................................................Inapplicable
312(a)..................................................11.2(a)
312(b)..................................................11.2(b)
313.....................................................11.3
314(a)..................................................11.4
314(b)..................................................Inapplicable
314(c)..................................................11.5
314(d)..................................................Inapplicable
314(e)..................................................1.2, 1.3, 11.5
314(f)..................................................11.1
315(a)..................................................7.1(a)
315(b)..................................................7.2
315(c)..................................................7.1(e)
315(d)..................................................7.1(b)
316(a)..................................................11.6
316(b)..................................................6.1
316(c)..................................................11.2
317(a)..................................................Inapplicable
317(b)..................................................Inapplicable
318(a)..................................................11.1(b)
318(b)..................................................11.1
318(c)..................................................11.1(a)
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Note: This reconciliation and tie shall not, for any purpose, be deemed to be a
part of the Purchase Contract Agreement.
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TABLE OF CONTENTS
ARTICLE I Definitions and Other Provisions of General Application .....1
SECTION 1.1 Definitions ................................................ 1
SECTION 1.2 Compliance Certificates and Opinions ....................... 9
SECTION 1.3 Form of Documents Delivered to Purchase Contract Agent .....10
SECTION 1.4 Acts of Holders; Record Dates ..............................10
SECTION 1.5 Notices to Purchase Contract Agent, Company, collateral
Agent or Guarantor ......................................12
SECTION 1.6 Notice to Holders; Waiver ..................................13
SECTION 1.7 Effect of Headings and Table of Contents ...................13
SECTION 1.8 Successors and Assigns .....................................13
SECTION 1.9 Separability Clause ........................................13
SECTION 1.10 Benefits of Agreement ......................................14
SECTION 1.11 Governing Law ..............................................14
SECTION 1.12 Legal Holidays .............................................14
SECTION 1.13 Counterparts ...............................................14
SECTION 1.14 Inspection of Agreement ....................................14
ARTICLE II Certificate Forms ..........................................15
SECTION 2.1 Forms of Certificates Generally ............................15
SECTION 2.2 Form of Purchase Contract Agent's Certificate of
Authentication .......................................16
ARTICLE III The Securities..............................................16
SECTION 3.1 Amount; Form and Denominations..............................16
SECTION 3.2 Rights and Obligations Evidenced by the Certificates........16
SECTION 3.3 Execution, Authentication, Delivery and Dating..............17
SECTION 3.4 Temporary Certificates......................................18
SECTION 3.5 Registration; Registration of Transfer and Exchange.........19
SECTION 3.6 Book-Entry Interests........................................20
SECTION 3.7 Notices to Holders..........................................20
SECTION 3.8 Appointment of Successor Clearing Agency....................21
SECTION 3.9 Definitive Certificates.....................................21
SECTION 3.10 Mutilated, Destroyed, Lost and Stolen Certificates..........21
SECTION3.11 Persons Deemed Owners.......................................22
SECTION 3.12 Cancellation................................................23
SECTION 3.13 Creation of Treasury SPC Units by Substitution of
Treasury Securities ..................................23
SECTION 3.14 Reestablishment of SPC Units ...............................25
SECTION 3.15 Transfer of Collateral upon Occurrence of
Termination Event ....................................26
SECTION 3.16 No Consent to Assumption ...................................26
ARTICLE IV The Notes ..................................................26
SECTION 4.1 Interest Payments; Rights to Interest Payments Preserved ...26
SECTION 4.2 [Deferral of Interest Payments .............................27
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SECTION 4.3 Interest Rate Reset; Notice Relating to Cash Settlement ....27
SECTION 4.4 Notice and Voting ..........................................28
ARTICLE V The Purchase Contracts .....................................28
SECTION 5.1 Purchase of Shares of Common Stock .........................28
SECTION 5.2 Purchase Contract Payments .................................30
SECTION 5.3 [Deferral of Purchase Contract Payments ....................31
SECTION 5.4 Payment of Purchase Price ..................................31
SECTION 5.5 Issuance of Shares of Common Stock .........................35
SECTION 5.6 Adjustment of Settlement Rate ..............................36
SECTION 5.7 Notice of Adjustments and Certain Other Events .............42
SECTION 5.8 Termination Event; Notice ..................................42
SECTION 5.9 Early Settlement ...........................................43
SECTION 5.10 No Fractional Shares .......................................45
SECTION 5.11 Charges and Taxes ..........................................45
ARTICLE VI Remedies ...................................................45
SECTION 6.1 Unconditional Right of Holders to Receive Purchase
Contract Payments and to Purchase Shares
of Common Stock ......................................45
SECTION 6.2 Restoration of Rights and Remedies .........................46
SECTION 6.3 Rights and Remedies Cumulative .............................46
SECTION 6.4 Delay or Omission Not Waiver ...............................46
SECTION 6.5 Undertaking for Costs ......................................46
SECTION 6.6 Waiver of Stay or Extension Laws ...........................47
ARTICLE VII The Purchase Contract Agent ................................47
SECTION 7.1 Certain Duties and Responsibilities ........................47
SECTION 7.2 Notice of Default ..........................................48
SECTION 7.3 Certain Rights of Purchase Contract Agent ..................48
SECTION 7.4 Not Responsible for Recitals or Issuance of Securities .....49
SECTION 7.5 May Hold Securities ........................................49
SECTION 7.6 Money Held in Custody ......................................50
SECTION 7.7 Compensation and Reimbursement .............................50
SECTION 7.8 Corporate Purchase Contract Agent Required; Eligibility ....50
SECTION 7.9 Resignation and Removal; Appointment of Successor ..........51
SECTION 7.10 Acceptance of Appointment by Successor .....................52
SECTION 7.11 Merger, Conversion, Consolidation or Succession to Business.52
SECTION 7.12 Preservation of Information; Communications to Holders .....53
SECTION 7.13 No Obligations of Purchase Contract Agent ..................53
SECTION 7.14 Tax Compliance .............................................53
ARTICLE VIII Supplemental Agreements ....................................54
SECTION 8.1 Supplemental Agreements Without Consent of Holders .........54
SECTION 8.2 Supplemental Agreements With Consent of Holders ............55
SECTION 8.3 Execution of Supplemental Agreements .......................56
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SECTION 8.4 Effect of Supplemental Agreements ..........................56
SECTION 8.5 Reference to Supplemental Agreements .......................56
ARTICLE IX Merger, Consolidation, Sale or Conveyance ..................56
SECTION 9.1 Covenant Not to Merge, Consolidate, Sell or Convey
Property Except Under Certain Conditions .............56
SECTION 9.2 Rights and Duties of Successor Corporation .................57
SECTION 9.3 Officer's Certificate and Opinion of Counsel Given to
Purchase Contract Agent ..............................57
ARTICLE X Covenants ..................................................58
SECTION 10.1 Performance Under Purchase Contracts .......................58
SECTION 10.2 Maintenance of Office or Agency ............................58
SECTION 10.3 Company to Reserve Common Stock ............................58
SECTION 10.4 Covenants as to Common Stock ...............................58
SECTION 10.5 ERISA ......................................................59
ARTICLE XI Trust Indenture Act ........................................59
SECTION 11.1 Trust Indenture Act; Application ...........................59
SECTION 11.2 Lists of Holders of Securities .............................59
SECTION 11.3 Reports by the Purchase Contract Agent .....................59
SECTION 11.4 Periodic Reports to Purchase Contract Agent ................60
SECTION 11.5 Evidence of Compliance with Conditions Precedent ...........60
SECTION 11.6 Defaults; Waiver ...........................................60
SECTION 11.7 Purchase Contract Agent's Knowledge of Defaults ............60
SECTION 11.8 SECTION 11.8. Conflicting Interests ........................60
SECTION 11.9 SECTION 11.9. Direction of Purchase Contract Agent .........61
EXHIBITS
EXHIBIT A Form of SPC Units Certificate
EXHIBIT B Form of Treasury SPC Units Certificate
EXHIBIT C Instruction to Purchase Contract Agent
EXHIBIT D Notice from Purchase Contract Agent to Holders
(Transfer of Collateral upon Occurrence of a
Termination Event)
EXHIBIT E Notice to Settle by Cash
EXHIBIT F Notice from Purchase Contract Agent to Collateral Agent
and Indenture Trustee (Settlement of Purchase Contract
through Remarketing)
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PURCHASE CONTRACT AGREEMENT, dated as of ____________, ______, between
PP&L RESOURCES, INC., a Pennsylvania corporation (the "Company"), and THE CHASE
MANHATTAN BANK, a New York banking corporation, acting as purchase contract
agent, attorney-in-fact and trustee for the Holders of Securities 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 Securities.
All things necessary to make the Purchase Contracts, when the
Certificates are executed by the Company and authenticated, executed on behalf
of the Holders and delivered by the 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
Securities by the Holders thereof, it is mutually agreed as follows:
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 1.1 DEFINITIONS.
For all purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular, and
nouns and pronouns of the masculine gender include the feminine and neuter
genders;
(b) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles in the United States;
(c) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular
Article, Section, Exhibit or other subdivision; and
(d) the following terms have the meanings given to them in this
Section 1.1(d):
"ACT" has the meaning, with respect to any Holder, set forth in
Section 1.4.
"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 5.1.
"APPLICANTS" has the meaning set forth in Section 7.12(b).
"AUTHORIZED OFFICER" means the Chairman of the Board, the President,
any Vice President, the Treasurer, any Assistant Treasurer or any other officer
or agent of the Company duly authorized by the Board of Directors to act in
respect of matters relating to this Agreement.
"BANKRUPTCY CODE" means title 11 of the United States Code, or any
other law of the United States that from time to time provides a uniform system
of bankruptcy laws.
"BENEFICIAL OWNER" means, with respect to a Global Certificate, a
Person who is the beneficial owner of such Book-Entry Interest as reflected on
the books of the Clearing Agency or on the books of a Person maintaining an
account with such Clearing Agency (directly as a Clearing Agency Participant or
as an indirect participant, in each case in accordance with the rules of such
Clearing Agency).
"BOARD OF DIRECTORS" means the board of directors of the Company or a
duly authorized committee of that board.
"BOARD RESOLUTION" means one or more resolutions of the Board of
Directors, a copy of which has been certified by the Secretary or an Assistant
Secretary of the Company, to have been duly adopted by the Board of Directors
and to be in full force and effect on the date of such certification and
delivered to the Purchase Contract Agent.
"BOOK-ENTRY INTEREST" means a beneficial interest in a Global
Certificate, ownership and transfers of which shall be maintained and made
through book entries by a Clearing Agency as described in Section 3.6.
"BUSINESS DAY" means any day other than a Saturday or Sunday or a day
on which banking institutions in New York, New York are authorized or required
by law or executive order to remain closed or a day on which the Indenture
Trustee is closed for business; provided that for purposes of the second
paragraph of Section 1.12 only, the term "Business Day" shall also be deemed to
exclude any day on which trading on the New York Stock Exchange, Inc. is closed
or suspended.
"CASH SETTLEMENT" has the meaning set forth in Section 5.4(a)(i).
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"CERTIFICATE" means a SPC Units Certificate or a Treasury SPC Units
Certificate.
"CLEARING AGENCY" means an organization registered as a "Clearing
Agency" pursuant to Section 17A of the Exchange Act that is acting as a
depositary for the Securities and in whose name, or in the name of a nominee of
that organization, shall be registered a Global Certificate and which shall
undertake to effect book entry transfers and pledges of the Securities.
"CLEARING AGENCY PARTICIPANT" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time the Clearing
Agency effects book entry transfers and pledges of securities deposited with the
Clearing Agency.
"CLOSING PRICE" has the meaning set forth in Section 5.1.
"CODE" means the Internal Revenue Code of 1986, as amended.
"COLLATERAL" has the meaning set forth in Section 1 of the Pledge
Agreement.
"COLLATERAL ACCOUNT" has the meaning set forth in Section 1 of the
Pledge Agreement.
"COLLATERAL AGENT" means _____________, as Collateral Agent under
the 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" has the meaning set forth in Section 3.13.
"COMMON STOCK" means the Common Stock, par value $.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 5.6(b).
"CORPORATE TRUST OFFICE" means the principal corporate trust office of
the Purchase Contract Agent at which, at any particular time, its corporate
trust business shall be administered, which office at the date hereof is located
at The Chase Manhattan Bank, 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Corporate Trustee Administration.
"COUPON RATE" means the percentage rate per annum at which each Note
will bear interest.
"CURRENT MARKET PRICE" has the meaning set forth in Section 5.6(a)(8).
"DEPOSITARY" means DTC until another Clearing Agency becomes its
successor.
"DTC" means The Depository Trust Company, the initial Clearing Agency.
3
"EARLY SETTLEMENT" has the meaning set forth in Section 5.9(a).
"EARLY SETTLEMENT AMOUNT" has the meaning set forth in Section 5.9(a).
"EARLY SETTLEMENT DATE" has the meaning set forth in Section 5.9(a).
"EARLY SETTLEMENT RATE" has the meaning set forth in Section 5.9(b).
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"EXCHANGE ACT" means the Securities Exchange Act of 1934 and any
statute successor thereto, in each case as amended from time to time, and the
rules and regulations promulgated thereunder.
"EXPIRATION DATE" has the meaning set forth in Section 1.4(e).
["EXPIRATION TIME" has the meaning set forth in Section 5.6(a)(6).]
["EXTENSION PERIOD" has the meaning set forth in Section 4.2.]
"FAILED REMARKETING" has the meaning set forth in Section 5.4(b).
"GLOBAL CERTIFICATE" means a Certificate that evidences all or part of
the Securities and is registered in the name of a Clearing Agency or a nominee
thereof.
"HOLDER" means, with respect to a Security, the Person in whose name
the Security evidenced by a SPC Units Certificate or a Treasury SPC Units
Certificate is registered in the related SPC Units Register or the Treasury SPC
Units Register, as the case may be.
"INDENTURE" means the Subordinated Indenture, dated as of __________,
_______, among PP&L Capital Funding, Inc., as Issuer, the Company, as Guarantor,
and The Chase Manhattan Bank, as Trustee, pursuant to which the Notes are to be
issued, as originally executed and delivered and as it may from time to time be
supplemented and amended by one or more indentures supplemental thereto entered
into pursuant to the applicable provisions thereof and shall include the terms
of a particular series established as contemplated by Section 301 thereof.
"INDENTURE TRUSTEE" means The Chase Manhattan Bank, as trustee under
the Indenture, or any successor thereto.
"ISSUER ORDER" or "ISSUER REQUEST" means a written order or request
signed in the name of the Company by an Authorized Officer, and delivered to the
Purchase Contract Agent.
"NOTES" means the PP&L Capital Funding, Inc. [Notes] due , guaranteed
as to payment of principal, premium, if any, and interest by the Company, issued
under the Indenture, each bearing interest, payable on the Payment Dates, at the
4
Coupon Rate until the Purchase Contract Settlement Date, and at the Reset Rate
thereafter and substantially in the form of Exhibit __ hereto.
"NYSE" has the meaning set forth in Section 5.1.
"OFFICER'S CERTIFICATE" means a certificate signed by an Authorized
Officer.
"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.
"OUTSTANDING" means, with respect to any SPC Units or Treasury SPC
Units and as of the date of determination, all SPC Units or Treasury SPC Units
evidenced by Certificates theretofore authenticated, executed and delivered
under this Agreement, except:
(1) If a Termination Event has occurred, (i) Treasury SPC Units and
(ii) SPC Units for which the underlying Notes have been theretofore
deposited with the Purchase Contract Agent in trust for the Holders of such
SPC Units;
(2) SPC Units and Treasury SPC 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
(3) SPC Units and Treasury SPC 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 bona fide purchaser in whose hands
the SPC Units or Treasury SPC 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 SPC Units or Treasury SPC Units have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, SPC Units or
Treasury SPC Units owned by the Company or any Affiliate of the Company shall be
disregarded and deemed not to be Outstanding Securities, except that, in
determining whether the Purchase Contract Agent shall be protected in relying
upon any such request, demand, authorization, direction, notice, consent or
waiver, only SPC Units or Treasury SPC Units which a Responsible Officer of the
Purchase Contract Agent knows to be so owned shall be so disregarded. SPC Units
or Treasury SPC Units so owned which have been pledged in good faith may be
regarded as Outstanding Securities if the pledgee establishes to the
satisfaction of the Purchase Contract Agent the pledgee's right so to act with
respect to such SPC Units or Treasury SPC 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, commencing _____________, [1999].
5
"PERMITTED INVESTMENTS" has the meaning set forth in Section 1 of the
Pledge Agreement.
"PERSON" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint-stock company, limited
liability company, trust, unincorporated organization or government or any
agency or political subdivision thereof or any other entity of whatever nature.
["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 or
the Treasury Securities, in either case constituting a part of the Securities.
"PLEDGE AGREEMENT" means the Pledge Agreement, dated as of the date
hereof, among the Company, the Collateral 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 Securities.
"PLEDGED NOTES" has the meaning set forth in Section 1 of the Pledge
Agreement.
"PREDECESSOR CERTIFICATE" means a Predecessor SPC Units Certificate or
a Predecessor Treasury SPC Units Certificate.
"PREDECESSOR SPC UNITS CERTIFICATE" of any particular SPC Units
Certificate means every previous SPC Units Certificate evidencing all or a
portion of the rights and obligations of the Company and the Holder under the
SPC Units evidenced thereby; and, for the purposes of this definition, any SPC
Units Certificate authenticated and delivered under Section 3.10 in exchange for
or in lieu of a mutilated, destroyed, lost or stolen SPC 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 SPC Units Certificate.
"PREDECESSOR TREASURY SPC UNITS CERTIFICATE" of any particular
Treasury SPC Units Certificate means every previous Treasury SPC Units
Certificate evidencing all or a portion of the rights and obligations of the
Company and the Holder under the Treasury SPC Units evidenced thereby; and, for
the purposes of this definition, any Treasury SPC Units Certificate
authenticated and delivered under Section 3.10 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Treasury SPC 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 SPC Units Certificate.
"PROCEEDS" has the meaning set forth in Section 1 of the Pledge
Agreement.
"PURCHASE CONTRACT" means, with respect to any Security, the contract
forming a part of such Security and obligating the Company to (i) sell, and the
Holder of such Security to purchase, shares of Common Stock and (ii) pay the
Holder Purchase Contract Payments on the terms and subject to the conditions set
forth in Article Five hereof.
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"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.
"PURCHASE CONTRACT PAYMENTS" means the payments payable by the Company
on the Payment Dates in respect of each Purchase Contract, equal to ____% per
annum of the Stated Amount.
"PURCHASE CONTRACT SETTLEMENT DATE" means __________________.
"PURCHASE CONTRACT SETTLEMENT FUND" has the meaning set forth in
Section 5.5.
"PURCHASE PRICE" has the meaning set forth in Section 5.1.
["PURCHASED SHARES" has the meaning set forth in Section 5.6(a)(6)].
"RECORD DATE" for the Purchase Contract Payments payable on any
Payment Date means, as to any Global Certificate, the Business Day next
preceding such Payment Date, and as to any other Certificate, a day selected by
the Company which shall be at least one Business Day but less than thirty (30)
Business Days prior to such Payment Date [and which shall correspond to the
related record date for the Notes].
"REFERENCE PRICE" has the meaning set forth in Section 5.1.
"REGISTER" means the SPC Units Register and the Treasury SPC Units
Register.
"REGISTRAR" means the SPC Units Registrar and the Treasury SPC Units
Registrar.
"REMARKETING" has the meaning set forth in the [Notes.]
"REMARKETING AGENT" has the meaning set forth in Section 5.4(b).
"REMARKETING AGREEMENT" means the Remarketing Agreement, dated as of
__________, between the Company and the Remarketing Agent, including any
supplements thereto.
"REMARKETING FEE" has the meaning set forth in Section 5.4(b).
"REORGANIZATION EVENT" has the meaning set forth in Section 5.6(b).
"RESET RATE" means the Coupon Rate to be in effect for the Notes on
and after the Purchase Contract Settlement Date, as determined in accordance
with Section 4.3 and the form of Note included in Exhibit __ hereto.
"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 its corporate trust matters.
7
"SECURITIES INTERMEDIARY" means , 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.
"SECURITY" means a SPC Unit or a Treasury SPC Unit, as the case may
be.
"SETTLEMENT RATE" has the meaning set forth in Section 5.1.
"SPC UNIT" means a Security, initially issued in substantially the
form set forth as Exhibit A hereto in the Stated Amount of $50, which represents
(i) beneficial ownership by the Holder of one Note having a principal amount of
$50, subject to the Pledge thereof pursuant to the Pledge Agreement, and (ii)
the rights and obligations of the Holder thereof and the Company under one
Purchase Contract.
"SPC UNITS CERTIFICATE" means a certificate evidencing the rights and
obligations of a Holder in respect of the number of SPC Units specified on such
certificate.
"SPC UNITS REGISTER" and "SPC UNITS REGISTRAR" have the respective
meanings set forth in Section 3.5.
"STATED AMOUNT" means $50.
"STATED MATURITY" means, with respect to the Notes, _____________.
"TERMINATION DATE" means the date, if any, on which a Termination
Event occurs.
"TERMINATION EVENT" means the occurrence of any of the following
events:
(1) at any time on or prior to the Purchase Contract Settlement Date,
a judgment, decree or court order shall have been entered granting relief
under the Bankruptcy Code, adjudicating the Company to be insolvent, or
approving as properly filed a petition seeking reorganization or
liquidation of the Company or any other similar applicable Federal or State
law, and, unless such judgment, decree or order shall have been entered
within 60 days prior to the Purchase Contract Settlement Date, such decree
or order shall have continued undischarged and unstayed for a period of 60
days;
(2) 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, unless such judgment, decree or
order shall have been entered within 60 days prior to the Purchase Contract
Settlement Date, such judgment, decree or order shall have continued
undischarged and unstayed for a period of 60 days; or
(3) 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
8
file a petition or answer or consent seeking reorganization or liquidation
under the Bankruptcy Code or any other similar applicable Federal or State
law, or shall consent to the filing of any such petition, or shall consent
to the appointment of a receiver or liquidator or trustee or assignee in
bankruptcy or insolvency of it or of its property, or shall make an
assignment for the benefit of creditors, or shall admit in writing its
inability to pay its debts generally as they become due.
"THRESHOLD APPRECIATION PRICE" has the meaning set forth in Section
5.1.
"TIA" means the Trust Indenture Act of 1939, as amended from time to
time, or any successor legislation.
"TRADING DAY" has the meaning set forth in Section 5.1.
"TREASURY SPC UNIT" means a Security, in substantially the form set
forth as Exhibit B hereto, which represents (i) a 1/20 undivided beneficial
ownership interest in a Treasury Security having a principal amount at maturity
equal to $1,000, subject to the Pledge thereof pursuant to the Pledge Agreement
and (ii) the rights and obligations of the Holder thereof and the Company under
one Purchase Contract.
"TREASURY SPC UNITS CERTIFICATE" means a certificate evidencing the
rights and obligations of a Holder in respect of the number of Treasury SPC
Units specified on such certificate.
"TREASURY SPC UNITS REGISTER" and "Treasury SPC Units Registrar" have
the respective meanings set forth in Section 3.5.
"TREASURY SECURITIES" means zero-coupon U.S. Treasury Securities
(Cusip No. ______) which are the principal strip of the ____% U.S. Treasury
Securities which mature on ____________.
"UNDERWRITING AGREEMENT" means the Underwriting Agreement, dated
____________, between the Company and _______________________.
SECTION 1.2 COMPLIANCE CERTIFICATES AND OPINIONS.
Except as otherwise expressly provided by this Agreement, upon any
application or request by the Company to the Purchase Contract Agent to take any
action under any provision of this Agreement, the Company shall furnish to the
Purchase Contract Agent an Officer's 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.
9
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Agreement shall include:
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, he or
she has made such examination or investigation as is necessary to enable
such individual to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(4) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
SECTION 1.3 FORM OF DOCUMENTS DELIVERED TO 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 his certificate or opinion is based are
erroneous. Any such certificate or Opinion of Counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Agreement, they may, but need not, be consolidated and
form one instrument.
SECTION 1.4 ACTS OF HOLDERS; RECORD DATES.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Agreement to be given or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by an agent
duly appointed in writing; and, except as herein otherwise expressly
10
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 7.1) conclusive in favor of the Purchase
Contract Agent and the Company, if made in the manner provided in this
Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved in any manner which the Purchase
Contract Agent deems sufficient.
(c) The ownership of Securities shall be proved by the SPC Units
Register or the Treasury SPC Units Register, as the case may be.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Certificate shall bind every
future Holder of the same Certificate and the Holder of every Certificate
issued upon the registration of transfer thereof or in exchange therefor or
in lieu thereof in respect of anything done, omitted or suffered to be done
by the 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 day as a record date for the purpose of
determining the Holders of Outstanding Securities entitled to give, make or
take any request, demand, authorization, direction, notice, consent, waiver
or other action provided or permitted by this Agreement to be given, made
or taken by Holders of Securities. If any record date is set pursuant to
this paragraph, the Holders of the Outstanding SPC Units and the
Outstanding Treasury SPC 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 SPC Units or the Treasury SPC 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 Securities 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 Securities on the date such action is taken. Promptly after any
record date is set pursuant to this paragraph, the Company, at its own
expense, shall cause notice of such record date, the proposed action by
Holders and the applicable Expiration Date to be given to the Purchase
Contract Agent in writing and to each Holder of Securities in the manner
set forth in Section 1.6.
11
With respect to any record date set pursuant to this Section, the
Company may designate any date as the "Expiration Date" and from time to time
may change the Expiration Date to any earlier or later day; provided that no
such change shall be effective unless notice of the proposed new Expiration Date
is given to the Purchase Contract Agent in writing, and to each Holder of
Securities in the manner set forth in Section 1.6, 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.
SECTION 1.5 NOTICES TO PURCHASE CONTRACT AGENT, COMPANY, COLLATERAL AGENT
OR GUARANTOR.
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:
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.:
Attention: Corporate Trustee Administration
If to the Company:
PP&L Resources, Inc.
Xxx Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Telecopier No.: (000) 000-0000
Attention: Treasurer
If to the Collateral Agent:
Telecopier No.:
Attention:
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If to the Indenture Trustee:
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.:
Attention: Corporate Trustee Administration
SECTION 1.6 NOTICE TO HOLDERS; WAIVER.
Where this Agreement provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each Holder affected
by such event, at its address as it appears in the applicable Register, not
later than the latest date, and not earlier than the earliest date, prescribed
for the giving of such notice. In any case where notice to Holders is given by
mail, neither the failure to mail such notice, nor any defect in any notice so
mailed to any particular Holder shall affect the sufficiency of such notice with
respect to other Holders. Where this Agreement provides for notice in any
manner, such notice may be waived in writing by the Person entitled to receive
such notice, either before or after the event, and such waiver shall be the
equivalent of such notice. Waivers of notice by Holders shall be filed with the
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 1.7 EFFECT OF HEADINGS AND TABLE OF CONTENTS.
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
SECTION 1.8 SUCCESSORS AND ASSIGNS.
All covenants and agreements in this Agreement by the Company shall
bind its successors and assigns, whether so expressed or not.
SECTION 1.9 SEPARABILITY CLAUSE.
In case any provision in this Agreement or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions hereof and thereof shall not in any way be affected or
impaired thereby.
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SECTION 1.10 BENEFITS OF AGREEMENT.
Nothing contained in this Agreement or in the Securities, express or
implied, shall give to any Person, other than the parties hereto and their
successors hereunder and, to the extent provided hereby, the Holders, any
benefits or any legal or equitable right, remedy or claim under this Agreement.
The Holders from time to time shall be beneficiaries of this Agreement and shall
be bound by all of the terms and conditions hereof and of the Securities
evidenced by their Certificates by their acceptance of delivery of such
Certificates.
SECTION 1.11 GOVERNING LAW.
This Agreement and the Securities shall be governed by, and construed
in accordance with, the laws of the State of New York.
SECTION 1.12 LEGAL HOLIDAYS.
In any case where any Payment Date shall not be a Business Day,
notwithstanding any other provision of this Agreement or the SPC Units
Certificates or the Treasury SPC Units Certificates, Purchase Contract Payments
shall not be made on such date, but shall be made on the next succeeding
Business Day with the same force and effect as if made on such Payment Date,
provided that no interest shall accrue or be payable by the Company or any
Holder for the period from and after any such Payment Date, except that, if such
next succeeding Business Day is in the next succeeding calendar year, such
payment shall be made on the immediately preceding Business Day with the same
force and effect as if made on such Payment Date.
In any case where any Purchase Contract Settlement Date shall not be a
Business Day, notwithstanding any other provision of this Agreement, the SPC
Units Certificates or the Treasury SPC Units Certificates, the Purchase
Contracts shall not be performed on such date, but the Purchase Contracts shall
be performed on the immediately following Business Day with the same force and
effect as if performed on the Purchase Contract Settlement Date.
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.
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ARTICLE II
CERTIFICATE FORMS
SECTION 2.1 FORMS OF CERTIFICATES GENERALLY.
The SPC Units Certificates (including the form of Purchase Contract
forming part of each SPC Unit evidenced thereby) shall be in substantially the
form set forth in Exhibit A hereto, with such letters, numbers or other marks of
identification or designation and such legends or endorsements printed,
lithographed or engraved thereon as may be required by the rules of any
securities exchange on which the SPC Units are listed or any depositary
therefor, or as may, consistently herewith, be determined by the officers of the
Company executing such SPC Units Certificates, as evidenced by their execution
of the SPC Units Certificates.
The definitive SPC Units Certificates shall be printed, lithographed
or engraved on steel engraved borders or may be produced in any other manner,
all as determined by the officers of the Company executing the SPC Units
evidenced by such SPC Units Certificates, consistent with the provisions of this
Agreement, as evidenced by their execution thereof.
The Treasury SPC Units Certificates (including the form of Purchase
Contract forming part of each Treasury SPC Unit evidenced thereby) shall be in
substantially the form set forth in Exhibit B hereto, with such letters, numbers
or other marks of identification or designation and such legends or endorsements
printed, lithographed or engraved thereon as may be required by the rules of any
securities exchange on which the Treasury SPC Units may be listed or any
depositary therefor, or as may, consistently herewith, be determined by the
officers of the Company executing such Treasury SPC Units Certificates, as
evidenced by their execution of the Treasury SPC Units Certificates.
The definitive Treasury SPC Units Certificates shall be printed,
lithographed or engraved on steel engraved borders or may be produced in any
other manner, all as determined by the officers of the Company executing the
Treasury SPC Units evidenced by such Treasury SPC Units 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 THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
(THE "DEPOSITARY"), OR A NOMINEE OF THE DEPOSITARY. THIS CERTIFICATE
IS EXCHANGEABLE FOR CERTIFICATES REGISTERED IN THE NAME OF A PERSON
OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT AND NO
TRANSFER OF THIS CERTIFICATE (OTHER THAN A TRANSFER OF THIS
CERTIFICATE AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE
15
DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED EXCEPT IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REQUESTED IN THE NAME OF CEDE & CO. OR
SUCH OTHER NAME AS REGISTERED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITARY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH
OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN."
SECTION 2.2 FORM OF PURCHASE CONTRACT AGENT'S CERTIFICATE OF AUTHENTICATION.
The form of the Purchase Contract Agent's certificate of
authentication of the SPC Units shall be in substantially the form set forth on
the form of SPC Units Certificate set forth as Exhibit A hereto.
The form of the Purchase Contract Agent's certificate of
authentication of the Treasury SPC Units shall be in substantially the form set
forth on the form of Treasury SPC Units Certificate set forth as Exhibit B
hereto.
ARTICLE III
THE SECURITIES
SECTION 3.1 AMOUNT; FORM AND DENOMINATIONS.
The aggregate number of Securities evidenced by Certificates
authenticated, executed on behalf of the Holders and delivered hereunder is
limited to ___________ (including _________ relating to the Underwriters'
over-allotment option), except for Certificates authenticated, executed and
delivered upon registration of transfer of, in exchange for, or in lieu of,
other Certificates pursuant to Section 3.4, 3.5, 3.10, 3.12, 3.13, 3.14, 5.9
or 8.5.
The Certificates shall be issuable only in registered form and only in
denominations of a single SPC Unit or Treasury SPC Unit and any integral
multiple thereof.
SECTION 3.2 RIGHTS AND OBLIGATIONS EVIDENCED BY THE CERTIFICATES.
Each SPC Units Certificate shall evidence the number of SPC Units
specified therein, with each such SPC Unit representing (1) the ownership by the
Holder thereof of a beneficial interest in one Note having a principal amount of
16
$50, subject to the Pledge of such Note 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 as
attorney-in-fact for, and on behalf of, the Holder of each SPC Unit shall
pledge, pursuant to the Pledge Agreement, the Note forming a part of such SPC
Unit, to the Collateral Agent and grant to the Collateral Agent a security
interest in the right, title and interest of such Holder in such Note for the
benefit of the Company, 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 SPC Units Certificate to any of the rights of
a holder of shares of Common Stock, including, without limitation, the right to
vote or receive any dividends or other payments or to consent or to receive
notice as a 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.
Upon the formation of a Treasury SPC Unit pursuant to Section 3.13,
each Treasury SPC Units Certificate shall evidence the number of Treasury SPC
Units specified therein, with each such Treasury SPC Unit representing (1) the
ownership by the Holder thereof of a 1/20 undivided beneficial ownership
interest in a Treasury Security with 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 (2) the rights and obligations of the Holder
thereof and the Company under one Purchase Contract. The Purchase Contract Agent
as attorney-in-fact for, and on behalf of, the Holder of each Treasury SPC Unit
shall pledge, pursuant to the Pledge Agreement, each Treasury Security or
portion thereof forming a part of such Treasury SPC Unit, to the Collateral
Agent and grant to the Collateral Agent a security interest in the right, title
and interest of such Holder in such Treasury Security for the benefit of the
Company, 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 Treasury SPC Units Certificate to any of the rights of a holder of
shares of Common Stock, including, without limitation, the right to vote or
receive any dividends or other payments or to consent or to receive notice as a
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 3.3 EXECUTION, AUTHENTICATION, DELIVERY AND DATING.
Subject to the provisions of Sections 3.13 and 3.14 hereof, upon the
execution and delivery of this Agreement, and at any time and from time to time
thereafter, the Company may deliver Certificates executed by the Company to the
Purchase Contract Agent for authentication, execution on behalf of the Holders
and delivery, together with its Issuer Order for authentication 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 one of
its Authorized Officers. The signature of any Authorized Officer on the
Certificates may be manual or facsimile.
17
Certificates bearing the manual or facsimile signatures of individuals
who were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Certificates or did not
hold such offices at the date of such Certificates.
No Purchase Contract evidenced by a Certificate shall be valid until
such Certificate has been executed on behalf of the Holder by the manual
signature of an authorized signatory of the Purchase Contract Agent, as such
Holder's attorney-in-fact. Such signature by an authorized signatory 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 signatory 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 3.4 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
SPC Units or Treasury SPC 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 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 SPC
Units or Treasury SPC Units, as the case may be, as the temporary Certificate or
Certificates so surrendered. Until so exchanged, the temporary Certificates
shall in all respects evidence the same benefits and the same obligations with
respect to the SPC Units or Treasury SPC Units, as the case may be, evidenced
thereby as definitive Certificates.
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SECTION 3.5 REGISTRATION; REGISTRATION OF TRANSFER AND EXCHANGE.
The Purchase Contract Agent shall keep at the Corporate Trust Office a
register (the "SPC Units Register") in which, subject to such reasonable
regulations as it may prescribe, the Purchase Contract Agent shall provide for
the registration of SPC Units Certificates and of transfers of SPC Units
Certificates (the Purchase Contract Agent, in such capacity, the "SPC Units
Registrar") and a register (the "Treasury SPC Units Register") in which, subject
to such reasonable regulations as it may prescribe, the Purchase Contract Agent
shall provide for the registration of the Treasury SPC Units Certificates and of
transfers of Treasury SPC Units Certificates (the Purchase Contract Agent, in
such capacity, the "Treasury SPC Units Registrar").
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 SPC Units
or Treasury SPC 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
SPC Units or Treasury SPC 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 SPC Units or
Treasury SPC Units, as the case may be, and be entitled to the same benefits and
subject to the same obligations, under this Agreement as the SPC Units or
Treasury SPC 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.
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 3.6 and 8.5 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 during the period
19
commencing on the Business Day immediately preceding the Purchase Contract
Settlement Date and ending on such Purchase Contract Settlement Date, or on or
after 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:
(1) if the Purchase Contract Settlement Date has occurred, deliver the
shares of Common Stock issuable in respect of the Purchase Contracts
forming a part of the Securities evidenced by such other Certificate; or
(2) if a Termination Event shall have occurred prior to the Purchase
Contract Settlement Date, transfer the Notes or the Treasury Securities, as
the case may be, evidenced thereby, in each case subject to the applicable
conditions and in accordance with the applicable provisions of Article Five
hereof.
SECTION 3.6 BOOK-ENTRY INTERESTS.
The Certificates, on original issuance, will be issued in the form of
one or more fully registered Global Certificates, to be delivered to the
Depositary by, or on behalf of, the Company. Such Global Certificate shall
initially be registered on the books and records of the Company in the name of
Cede & Co., the nominee of the Depositary, and no Beneficial Owner will receive
a definitive Certificate representing such Beneficial Owner's interest in such
Global Certificate, except as provided in Section 3.9. The 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 3.9:
(1) the provisions of this Section 3.6 shall be in full force and
effect;
(2) the Company shall be entitled to deal with the Clearing Agency for
all purposes of this Agreement (including making Purchase Contract Payments
and receiving approvals, votes or consents hereunder) as the Holder of the
Securities and the sole holder of the Global Certificates and shall have no
obligation to the Beneficial Owners;
(3) to the extent that the provisions of this Section 3.6 conflict
with any other provisions of this Agreement, the provisions of this Section
3.6 shall control; and
(4) the rights of the Beneficial Owners shall be exercised only
through the Clearing Agency and shall be limited to those established by
law and agreements between such Beneficial Owners and the Clearing Agency
or the Clearing Agency Participants.
SECTION 3.7 NOTICES TO HOLDERS.
Whenever a notice or other communication to the Holders is required to
be given under this Agreement, the Company or the Company's agent shall give
such notices and communications to the Holders and, with respect to any
Securities registered in the name of a Clearing Agency or the nominee of a
Clearing Agency, the Company or the Company's agent shall, except as set forth
herein, have no obligations to the Beneficial Owners.
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SECTION 3.8 APPOINTMENT OF SUCCESSOR CLEARING AGENCY.
If any Clearing Agency elects to discontinue its services as
securities depositary with respect to the Securities, the Company may, in its
sole discretion, appoint a successor Clearing Agency with respect to the
Securities.
SECTION 3.9 DEFINITIVE CERTIFICATES.
If:
(1) a Clearing Agency elects to discontinue its services as securities
depositary with respect to the Securities and a successor Clearing Agency
is not appointed within 90 days after such discontinuance pursuant to
Section 3.8; or
(2) the Company elects to terminate the book-entry system through the
Clearing Agency with respect to the Securities,
then upon surrender of the Global Certificates representing the Securities by
the Clearing Agency, accompanied by registration instructions, the Company shall
cause definitive Certificates to be delivered to Beneficial Owners in accordance
with the instructions of the Clearing Agency. The Company shall not be liable
for any delay in delivery of such instructions and may conclusively rely on and
shall be protected in relying on, such instructions.
SECTION 3.10 MUTILATED, DESTROYED, LOST AND STOLEN CERTIFICATES.
If any mutilated Certificate is surrendered to the 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 SPC Units or Treasury SPC 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 bona fide 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 SPC Units or Treasury SPC 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 during the period commencing on the
Business Day immediately preceding the Purchase Contract Settlement Date and
ending on such Purchase Contract Settlement Date or on or after the Termination
Date. In lieu of delivery of a new Certificate, upon satisfaction of the
21
applicable conditions specified above in this Section and receipt of appropriate
registration or transfer instructions from such Holder, the Purchase Contract
Agent shall:
(1) if the Purchase Contract Settlement Date has occurred, deliver the
shares of Common Stock issuable in respect of the Purchase Contracts
forming a part of the Securities evidenced by such Certificate; or
(2) if a Termination Event shall have occurred prior to the Purchase
Contract Settlement Date, transfer the Notes or the Treasury Securities, as
the case may be, evidenced thereby, in each case subject to the applicable
conditions and in accordance with the applicable provisions of Article Five
hereof.
Upon the issuance of any new Certificate under this Section, the
Company and the 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 expenses (including 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
Security evidenced thereby, whether or not the destroyed, lost or stolen
Certificate (and the Securities evidenced thereby) shall be at any time
enforceable by anyone, and shall be entitled to all the benefits and be subject
to all the obligations of this Agreement equally and proportionately with any
and all other Certificates delivered hereunder.
The provisions of this Section are exclusive and shall preclude, to
the extent lawful, all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Certificates.
SECTION 3.11 PERSONS DEEMED OWNERS.
Prior to due presentment of a Certificate for registration of
transfer, the Company and the 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 SPC Units or Treasury SPC Units
evidenced thereby, for the purpose of receiving interest payments on the Notes,
receiving Purchase Contract Payments, performance of the Purchase Contracts and
for all other purposes whatsoever, whether or not any interest payments on the
Notes or Purchase Contract Payments payable in respect of the Purchase Contracts
constituting a part of the SPC Units or Treasury SPC Units evidenced thereby
shall be overdue and notwithstanding any notice to the contrary, and neither the
Company nor the 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, treating the
Clearing Agency as the sole Holder of such Global Certificate, from giving
effect to any written certification, proxy or other authorization furnished by
any Clearing Agency (or its nominee), as a Holder, with respect to such Global
Certificate or impair, as between such Clearing Agency and owners of beneficial
22
interests in such Global Certificate, the operation of customary practices
governing the exercise of rights of such Clearing Agency (or its nominee) as
Holder of such Global Certificate.
SECTION 3.12 CANCELLATION.
All Certificates surrendered for delivery of shares of Common Stock on
or after the Purchase Contract Settlement Date, upon the transfer of Notes or
Treasury Securities, as the case may be, after the occurrence of a Termination
Event or pursuant to an Early Settlement, or upon the registration of transfer
or exchange of a Security, or a Collateral Substitution or the reestablishment
of SPC Units shall, if surrendered to any Person other than the Purchase
Contract Agent, be delivered to the Purchase Contract Agent 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 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 destroyed by the
Purchase Contract Agent unless otherwise directed by Issuer Order.
If the Company or any Affiliate of the Company shall acquire any
Certificate, such acquisition shall not operate as a cancellation of such
Certificate unless and until such Certificate is delivered to the Purchase
Contract Agent cancelled or for cancellation.
SECTION 3.13 CREATION OF TREASURY SPC UNITS BY SUBSTITUTION OF TREASURY
SECURITIES.
A Holder may separate the Notes from the related Purchase Contracts in
respect of such Holder's SPC Units by substituting for such Notes, Treasury
Securities in an aggregate principal amount equal to the aggregate principal
amount of such Notes (a "Collateral Substitution"), at any time from and after
the date of this Agreement and prior to or on the seventh Business Day
immediately preceding the Purchase Contract Settlement Date by:
(1) depositing with the [Securities Intermediary] Treasury Securities
having an aggregate principal amount equal to the aggregate principal
amount of the Notes comprising part of such SPC Units; and
(2) transferring the related SPC 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 Treasury Securities to the Securities Intermediary
and (ii) requesting that the Purchase Contract Agent instruct the
Collateral Agent to release the Notes underlying such SPC Units, whereupon
the Purchase Contract Agent shall promptly give such instruction to the
Collateral Agent, substantially in the form of Exhibit A to the Pledge
Agreement. [Insert any provisions for adjustment relating to Purchase
Contract Payments.]
23
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 thereof, the
Purchase Contract Agent shall promptly:
(i) cancel the related SPC Units transferred and surrendered;
(ii) transfer the Notes that had been components of such SPC Unit to
the Holder; and
(iii) authenticate, execute on behalf of such Holder and deliver a
Treasury SPC Units Certificate executed by the Company in accordance with
Section 3.3 evidencing the same number of Purchase Contracts as were
evidenced by the cancelled SPC 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 payable to the Collateral Agent for its
services as Collateral Agent in respect of the substitution, and the Company
shall not be responsible for any such fees or expenses.
Holders may make Collateral Substitutions only in integral multiples
of 20 SPC Units.
In the event a Holder making a Collateral Substitution pursuant to
this Section 3.13 fails to effect a book-entry transfer of the SPC Units or
fails to deliver SPC Units Certificates to the Purchase Contract Agent after
depositing Treasury Securities with the Collateral Agent, the Notes,
constituting a part of such SPC Units, and any interest payments on such Notes,
shall be held in the name of the Purchase Contract Agent or its nominee in trust
for the benefit of such Holder, until such SPC Units are so transferred or the
SPC Units Certificate is so delivered, as the case may be, or, with respect to a
SPC Units Certificate, such Holder provides evidence satisfactory to the Company
and the Purchase Contract Agent that such SPC 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 this Section 3.13, for so long as the Purchase
Contract underlying a SPC Unit remains in effect, such SPC Unit shall not be
separable into its constituent parts, and the rights and obligations of the
Holder in respect of the Note and the Purchase Contract comprising such SPC Unit
may be acquired, and may be transferred and exchanged, only as a SPC Unit.
24
SECTION 3.14 REESTABLISHMENT OF SPC UNITS.
A Holder of Treasury SPC Units may recreate SPC Units at any time
prior to or on the seventh Business Day immediately preceding the Purchase
Contract Settlement Date by:
(1) depositing with the [Securities Intermediary] Notes, having an
aggregate principal amount equal to the aggregate principal amount at
maturity of the Treasury Securities comprising part of the Treasury SPC
Units; and
(2) transferring the related Treasury SPC 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 SPC Units, whereupon the Purchase Contract Agent shall promptly
give such instruction to the Collateral Agent, substantially in the form of
Exhibit C to the Pledge Agreement.
Upon receipt of the 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 to the Purchase Contract Agent on
behalf of the Holder. Upon receipt thereof, the Purchase Contract Agent shall
promptly:
(i) cancel the related Treasury SPC Units transferred and surrendered;
(ii) transfer the Treasury Securities that had been components of such
Treasury SPC Units to the Holder; and
(iii) authenticate, execute on behalf of such Holder and deliver a SPC
Units Certificate executed by the Company in accordance with Section 3.3
evidencing the same number of Purchase Contracts as were evidenced by the
cancelled Treasury SPC Units.
Holders who elect to recreate SPC Units shall be responsible for any
fees or expenses payable to the Collateral Agent for its services as Collateral
Agent in respect of the substitution, and the Company shall not be responsible
for any such fees or expenses.
Holders of Treasury SPC Units may reestablish SPC Units in integral
multiples of 20 Treasury SPC Units for 20 SPC Units.
Except as provided in this Section 3.14, for so long as the Purchase
Contract underlying a Treasury SPC Unit remains in effect, such Treasury SPC
Unit shall not be separable into its constituent parts and the rights and
obligations of the Holder of such Treasury SPC Unit in respect of the 1/20 of a
Treasury Security and the Purchase Contract comprising such Treasury SPC Unit
may be acquired, and may be transferred and exchanged, only as a Treasury SPC
Unit.
25
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 or the Treasury Securities, as the case may
be, underlying the SPC Units and the Treasury SPC 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 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 SPC Units Register or the Treasury SPC Units Register, as the case may be.
Upon book-entry transfer of the SPC Units or the Treasury SPC Units or
delivery of a SPC Units Certificate or Treasury SPC Units Certificate to the
Purchase Contract Agent with such transfer instructions, the Purchase Contract
Agent shall transfer the Notes or Treasury Securities, as the case may be,
underlying such SPC Units or Treasury SPC 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 SPC Units or Treasury SPC Units
fails to effect such transfer or delivery, the Notes or Treasury Securities, as
the case may be, underlying such SPC Units or Treasury SPC 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 of:
(1) such SPC Units or Treasury SPC Units are transferred or the SPC
Units Certificate or Treasury SPC Units Certificate is surrendered or such
Holder provides satisfactory evidence that such SPC Units Certificate or
Treasury SPC 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
(2) the expiration of the time period specified in the abandoned
property laws of the [relevant State].
SECTION 3.16 NO CONSENT TO ASSUMPTION.
Each Holder of a Security, by acceptance thereof, shall be deemed
expressly to have withheld any consent to the assumption under Section 365 of
the Bankruptcy Code or otherwise, of the Purchase Contract by the Company or its
trustee, receiver, liquidate or a person or entity performing similar functions
in the event that the Company becomes the debtor under the Bankruptcy Code or
subject to other similar state or Federal law providing for reorganization or
liquidation.
ARTICLE IV
THE NOTES
SECTION 4.1 INTEREST PAYMENTS; RIGHTS TO INTEREST PAYMENTS PRESERVED.
An interest payment on any Note 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
26
the Person in whose name the SPC Units Certificate (or one or more Predecessor
SPC Units Certificates) of which such Note is a part is registered at the close
of business on the Record Date for such Payment Date.
Each SPC Units Certificate evidencing the Note delivered under this
Agreement upon registration of transfer of or in exchange for or in lieu of any
other SPC Units Certificate shall carry the right to accrued and unpaid and
deferred interest and the right to accrue interest, which rights were carried by
the Note underlying such other SPC Units Certificate.
In the case of any SPC Units with respect to which Cash Settlement of
the underlying Purchase Contract is effected [prior to or] on the [fifth]
Business Day immediately preceding the Purchase Contract Settlement Date
pursuant to prior notice, or with respect to which Early Settlement of the
underlying Purchase Contract is effected on an Early Settlement Date, or with
respect to which a Collateral Substitution is effected, in each case on a date
that is after any Record Date and prior to or on the next succeeding Payment
Date, the interest payment on the Note underlying such SPC Unit otherwise
payable on such Payment Date shall be payable on such Payment Date
notwithstanding such Cash Settlement or Early Settlement or Collateral
Substitution, and such interest payment shall, subject to receipt thereof by the
Purchase Contract Agent, be payable to the Person in whose name the SPC Units
Certificate (or one or more Predecessor SPC Units Certificates) was registered
at the close of business on the Record Date. Except as otherwise expressly
provided in the immediately preceding sentence, in the case of any SPC Unit with
respect to which Cash Settlement or Early Settlement of the underlying Purchase
Contract is effected [prior to or] on the [fifth] Business Day immediately
preceding the Purchase Contract Settlement Date or an Early Settlement Date, as
the case may be, or with respect to which a Collateral Substitution has been
effected, interest payments on the related Notes that would otherwise be payable
after the Purchase Contract Settlement Date or Early Settlement Date shall not
be payable hereunder to the Holder of such SPC Units; provided, however, that to
the extent that such Holder continues to hold the separated Note that formerly
comprised a part of such Holder's SPC Unit, such Holder shall be entitled to
receive the interest payments on such separated Note, as provided therein.
SECTION 4.2 [DEFERRAL OF INTEREST PAYMENTS.
So long as no event of default has occurred and is occurring under the
Indenture, the Company shall have the right at any time until the Stated
Maturity of the Notes to defer the payment of interest on the Notes as provided
therein for a period of time not extending beyond the Stated Maturity (each such
period of deferral, an "Extension Period"). If the Company so elects to defer
interest payments on the Notes, the Company shall pay at the end of the
Extension Period all interest then accrued and unpaid, together with accrued
interest at the Coupon Rate or the Reset Rate, as applicable, compounded on each
succeeding Payment Date.]
SECTION 4.3 INTEREST RATE RESET; NOTICE RELATING TO CASH SETTLEMENT.
The Coupon Rate on the Notes to be in effect on and after the Purchase
Contract Settlement Date shall be reset on the third Business Day immediately
preceding the Purchase Contract Settlement Date to the Reset Rate (such Reset
27
Rate to be in effect on and after the Purchase Contract Settlement Date). [The
Reset Rate shall be equal to or greater than the Coupon Rate.]
Not later than 15 calendar days nor more than 30 calendar days prior
to the third Business Day immediately preceding the Purchase Contract Settlement
Date, the Company shall request that the Depositary (or any successor Clearing
Agency or its nominee), notify the Beneficial Owners or Clearing Agency
Participants holding SPC Units of the interest rate reset and any procedures to
be followed by Holders of SPC Units who intend to effect a Cash Settlement prior
to or on the fifth Business Day immediately preceding the Purchase Contract
Settlement Date.
SECTION 4.4 NOTICE AND VOTING.
Under and subject to 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 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 to the Holders of SPC Units a notice:
(1) containing such information as is contained in the notice or
solicitation;
(2) 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 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 SPC
Units; and
(3) stating the manner in which such instructions may be given.
Upon the written request of the Holders of SPC Units on such record
date, 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 to which any particular voting
instructions are received. In the absence of specific instructions from the
Holder of a SPC Unit, the Purchase Contract Agent shall abstain from voting the
Notes underlying such SPC Unit. The Company hereby agrees, if applicable, to
solicit Holders of SPC Units to timely instruct the Purchase Contract Agent in
order to enable the Purchase Contract Agent to vote such Notes.
ARTICLE V
THE PURCHASE CONTRACTS
SECTION 5.1 PURCHASE OF SHARES OF COMMON STOCK.
Each Purchase Contract shall, unless a Termination Event or an Early
Settlement in accordance with Section 5.9 hereof has occurred with respect to
the Security of which such Purchase Contract is a part, obligate the Holder of
the related Security to purchase, and the Company to sell, on the Purchase
28
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. The
"Settlement Rate" is equal to:
(1) if the Applicable Market Value (as defined below) equals or
exceeds $___________ (the "Threshold Appreciation Price"), ______________
shares of Common Stock per Purchase Contract;
(2) if the Applicable Market Value is less than the Threshold
Appreciation Price but greater than $____________ (the "Reference Price"),
the number of shares of Common Stock having a value, based on the
Applicable Market Value, equal to the Stated Amount; and
(3) if the Applicable Market Value is less than or equal to the
Reference Price, ___________ shares of Common Stock per Purchase Contract,
in each case subject to adjustment as provided in Section 5.6 (and in each case
rounded upward or downward to the nearest 1/10,000th of a share).
As provided in Section 5.10, no fractional shares of Common Stock will
be issued upon settlement of Purchase Contracts.
The "Applicable Market Value" means the average of the Closing Price
per share of Common Stock on each of the 20 consecutive Trading Days ending on
the third Trading Day immediately preceding the Purchase Contract Settlement
Date.
The "Closing Price" per share of Common Stock on any date of
determination means:
(1) the closing sale price (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 per share as reported in the composite
transactions for the principal United States 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 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 average of the mid-point
of the last bid and ask prices of Common Stock on such date from at least
three nationally recognized independent investment banking firms retained
for this purpose by the Company.
29
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.
Each Holder of a SPC Unit or a Treasury SPC Unit, by its acceptance
thereof:
(1) irrevocably authorizes the Purchase Contract Agent to enter into
and perform the related Purchase Contract on its behalf as its attorney-in-
fact (including the execution of Certificates on behalf of such Holder);
(2) agrees to be bound by the terms and provisions thereof;
(3) covenants and agrees to perform its obligations under such
Purchase Contracts;
(4) consents to the provisions hereof;
(5) irrevocably authorizes the Purchase Contract Agent to enter into
and perform this Agreement and the Pledge Agreement on its behalf as its
attorney-in-fact; and
(6) consents to, and agrees to be bound by, the Pledge of the Notes or
the Treasury Securities pursuant to the Pledge Agreement,
[provided that upon a Termination Event, the rights of the Holder of such
Security under the Purchase Contract may be enforced without regard to any other
rights or obligations.] Each Holder of a SPC Unit or a Treasury SPC Unit, by its
acceptance thereof, further covenants and agrees, that to the extent and in the
manner provided in Section 5.4 and the Pledge Agreement, but subject to the
terms thereof, payments in respect of the Notes or the proceeds from the
Treasury Securities at maturity on the Purchase Contract Settlement Date, as the
case may be, 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.
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 5.2 PURCHASE CONTRACT PAYMENTS.
Subject to Section 5.3, the Company shall pay, on each Payment Date,
the Purchase Contract Payments payable in respect of each Purchase Contract to
the Person in whose name a Certificate (or one or more Predecessor Certificates)
30
is registered at the close of business on the Record Date next preceding such
Payment Date. The Purchase Contract Payments will be payable at the office of
the Purchase Contract Agent in The City of New York maintained for that purpose
or, at the option of the Company, by check mailed to the address of the Person
entitled thereto at such Person's address as it appears on the SPC Units
Register or Treasury SPC Units Register. If any date on which Purchase Contract
Payments are to be made is not a Business Day, then payment of the Purchase
Contract Payments payable on such date will be made on the next day that is a
Business Day (and without any interest in respect of any such delay), [except
that, if such Business Day is in the next calendar year, such payment will be
made on the preceding Business Day].
Upon the occurrence of a Termination Event, the Company's obligation
to pay Purchase Contract Payments (including any accrued or deferred Purchase
Contract Payments) shall cease.
Each Certificate delivered under this Agreement upon registration of
transfer of or in exchange for or in lieu of (including as a result of a
Collateral Substitution or the reestablishment of SPC Units) any other
Certificate shall carry the right to accrued and unpaid or deferred Purchase
Contract Payments and the right to accrue Purchase Contract Payments, which
rights were carried by the Purchase Contracts underlying such other
Certificates.
Subject to Section 5.9, in the case of any Security with respect to
which Early Settlement of the underlying Purchase Contract is effected on an
Early Settlement Date that is after any Record Date and prior to or on the next
succeeding Payment Date, Purchase Contract Payments otherwise payable on such
Payment Date shall be payable on such Payment Date notwithstanding such Early
Settlement, and such Purchase Contract Payments shall be paid to the Person in
whose name the Certificate evidencing such Security (or one or more Predecessor
Certificates) is registered at the close of business on such Record Date. Except
as otherwise expressly provided in the immediately preceding sentence, in the
case of any Security with respect to which Early Settlement of the underlying
Purchase Contract is effected on an Early Settlement Date, Purchase Contract
Payments that would otherwise be payable after the Early Settlement Date with
respect to such Purchase Contract shall not be payable.
[Insert, if applicable: Provisions relating to ranking of Purchase
Contract Payments.]
SECTION 5.3 [DEFERRAL OF PURCHASE CONTRACT PAYMENTS.
The Company has the right to defer payment of all or part of the
Purchase Contract Payments in respect of each Purchase Contract until no later
than the Purchase Contract Settlement Date. If the Company so elects to defer
Purchase Contract Payments, the Company shall pay additional Purchase Contract
Payments on such deferred installments of Purchase Contract Payments at a rate
equal to ____% per annum, compounding quarterly, until such deferred
installments are paid. If a Holder effects an Early Settlement or if a
Termination Event shall occur, such Holder will have no right to receive any
accrued deferred Purchase Contract Payments.]
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SECTION 5.4 PAYMENT OF PURCHASE PRICE.
(a) (i) Unless a Holder of a SPC Unit effects an Early Settlement of
the underlying Purchase Contract in the manner described in Section 5.9,
each such Holder who intends to pay in cash to satisfy such Holder's
obligations under the Purchase Contract shall notify the Purchase Contract
Agent by use of a notice in substantially the form of Exhibit E hereto of
his intention to pay in cash ("Cash Settlement") the Purchase Price for the
shares of Common Stock to be purchased pursuant to the related Purchase
Contract. Such notice shall be given prior to 5:00 p.m. (New York City
time) on the seventh Business Day immediately preceding the Purchase
Contract Settlement Date. Prior to 11:00 a.m. (New York City time) on the
next succeeding Business Day, the 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 SPC Unit who has so notified the Purchase Contract
Agent of his intention to effect a Cash Settlement in accordance with
paragraph (a)(i) above shall pay the Purchase Price to the Securities
Intermediary for deposit in the Collateral Account prior to 11:00 a.m. (New
York City time) on the [fifth] Business Day immediately preceding the
Purchase Contract Settlement Date in lawful money of the United States by
certified or cashiers' check or wire transfer, in each case in immediately
available funds payable to or upon the order of the [Securities
Intermediary]. Any cash received by the Collateral Agent shall be invested
promptly by the Securities Intermediary in Permitted Investments and paid
to the Company on the Purchase Contract Settlement Date in settlement of
the Purchase Contract in accordance with the terms of this Agreement and
the Pledge Agreement. Any funds received by the Securities Intermediary in
respect of the investment earnings from the investment in such Permitted
Investments, shall be distributed to the Purchase Contract Agent when
received for payment to the Holder of the related SPC Unit.
(iii) If a Holder of a SPC Unit fails to notify the Purchase Contract
Agent of his intention to make a Cash Settlement in accordance with
paragraph (a)(i) above, or does notify the Purchase Contract Agent as
provided in paragraph (a)(i) above of his intention to pay the Purchase
Price in cash, but fails to make such payment as required by paragraph
(a)(ii) above, [the Notes of such holder will not be remarketed, but
instead the Collateral Agent, for the benefit of the Company, will exercise
its rights as a secured party with respect to the Notes, including those
rights described in paragraph (b) below.
(iv) Promptly after 11:00 a.m. (New York City time) on the [fifth]
Business Day preceding the Purchase Contract Settlement Date, the Purchase
Contract Agent, based on notices received by the Purchase Contract Agent
pursuant to Section 5.4(a) hereof and notice from the Securities
Intermediary regarding cash received by it prior to such time, shall notify
the Collateral Agent and the Indenture Trustee of the aggregate number of
Notes to be tendered for purchase in the Remarketing in a notice
substantially in the form of Exhibit F hereto.
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(b) In order to dispose of the Notes, SPC Units Holders who have not
notified the Purchase Contract Agent of their intention to effect a Cash
Settlement as provided in paragraph (a)(i) above, or who have so notified
the Purchase Contract Agent but failed to make such payment as required by
paragraph (a)(ii) above, the Company shall engage _______________________
(the "Remarketing Agent") pursuant to the Remarketing Agreement
to sell such Notes. In order to facilitate the Remarketing, the Purchase
Contract Agent, based on the notices specified in Section 5.4(a)(iv), shall
notify the Remarketing Agent, promptly after 11:00 a.m. (New York City
time) on the [fifth] Business Day immediately preceding the Purchase
Contract Settlement Date, of the aggregate number of Notes that are part of
SPC Units to be remarketed. Concurrently, the Collateral Agent, pursuant to
the terms of the Pledge Agreement, shall cause such Notes to be presented
to the Remarketing Agent for Remarketing.
Upon receipt of such notice from the Purchase Contract Agent and such
Notes, the Remarketing Agent shall, on the third Business Day immediately
preceding the Purchase Contract Settlement Date, use reasonable efforts to
remarket such Notes on such date at a price equal to at least [100.25%] of
the Stated Amount [($50.1250)], as provided in the Remarketing Agreement.
The proceeds from the Remarketing shall automatically be applied by the
Collateral Agent, in accordance with the Pledge Agreement, to satisfy in
full such SPC Units Holders' obligations to pay the Purchase Price for the
shares of Common Stock under the related Purchase Contracts on the Purchase
Contract Settlement Date. In addition, $[.1250] per Note of the proceeds
shall be remitted to the Remarketing Agent for services rendered in
connection with the Remarketing (the "Remarketing Fee"). Any proceeds
remaining after satisfaction of the Purchase Contract and payment of the
Remarketing Fee shall be payable to the Holder of such SPC Unit.
If, in spite of using their reasonable efforts, the Remarketing Agent
cannot remarket the related Notes of such Holders of SPC Units at a price
equal to at least [100.25%] of the Stated Amount [($50.1250)], the
Remarketing shall be deemed to have failed (a "Failed Remarketing") and in
accordance with the terms of the Pledge Agreement, the Collateral Agent,
for the benefit of the Company, shall exercise its rights as a secured
party with respect to such Notes, including those actions specified in
paragraph (c) below; provided, that if upon a Failed Remarketing the
Collateral Agent exercises such rights for the benefit of the Company with
respect to such Notes, any accrued and unpaid and deferred interest on such
Notes shall become payable by the Company to the Purchase Contract Agent
for payment to the Beneficial Owner of the SPC Units to which such Notes
relate. The Company shall cause a notice of such Failed Remarketing to be
published on the second Business Day immediately preceding the Purchase
Contract Settlement Date in a daily newspaper in the English language of
general circulation in New York City, which is expected to be The Wall
Street Journal, and on Bloomberg News.
(c) With respect to any Notes which are subject to a Failed
Remarketing, the Collateral Agent for the benefit of the Company reserves
all of its rights as a secured party with respect thereto and, subject to
applicable law and paragraph (g) below, may, among other things, (i) retain
33
the Notes in full satisfaction of the Holders' obligations under the
Purchase Contracts or (ii) sell the Notes in one or more public or private
sales.
(d) (i) Unless a Holder of a Treasury SPC Units 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
5.9, each such Holder who intends to pay in cash shall notify the Purchase
Contract Agent by use of a notice in substantially the form of Exhibit E
hereto of his intention to pay in cash the Purchase Price for the shares of
Common Stock to be purchased pursuant to the related Purchase Contract.
Such notice shall be given prior to 5:00 p.m. (New York City time) on the
seventh Business Day immediately preceding the Purchase Contract Settlement
Date. Prior to 11:00 a.m. (New York City time) on the next succeeding
Business Day, the Purchase Contract Agent shall notify the Collateral Agent
of the receipt of such notices from such Holders intending to make a Cash
Settlement.
(ii) A Holder of a Treasury SPC Unit who has so notified the Purchase
Contract Agent of his intention to make a Cash Settlement in accordance
with paragraph (d)(i) above shall pay the Purchase Price to the Securities
Intermediary for deposit in the Collateral Account prior to 11:00 a.m. (New
York City time) on the [fifth] Business Day immediately preceding the
Purchase Contract Settlement Date in lawful money of the United States by
certified or cashiers' check or wire transfer, in each case in immediately
available funds payable to or upon the order of the [Securities
Intermediary]. Any cash received by the Collateral Agent shall be invested
promptly by the Securities Intermediary in Permitted Investments and paid
to the Company on the Purchase Contract Settlement Date in settlement of
the Purchase Contract in accordance with the terms of this Agreement and
the Pledge Agreement. Any funds received by the Securities Intermediary in
respect of the investment earnings from the investment in such Permitted
Investments shall be distributed to the Purchase Contract Agent when
received for payment to the Holder of the related Treasury SPC Unit.
(iii) If a Holder of a Treasury SPC Unit fails to notify the Purchase
Contract Agent of his intention to make a Cash Settlement in accordance
with paragraph (d)(i) above, or does notify the Purchase Contract Agent as
provided in paragraph (d)(i) above of his intention to pay the Purchase
Price in cash, but fails to make such payment as required by paragraph
(d)(ii) above, then upon the maturity of the Pledged Treasury Securities
held by the Securities Intermediary on the Business Day immediately
preceding the Purchase Contract Settlement Date, the principal amount of
the Treasury Securities received by the Securities Intermediary shall be
invested promptly in Permitted Investments.
On the Purchase Contract Settlement Date, an amount equal to the
Purchase Price shall be remitted to the Company as payment thereof without
receiving any instructions from the Holder of the related Treasury SPC
Unit. In the event the sum of the proceeds from the related Pledged
Treasury Securities and the investment earnings earned from such
investments is in excess of the aggregate Purchase Price of the Purchase
Contracts being settled thereby, the Collateral Agent shall cause the
34
Securities Intermediary to distribute such excess to the Purchase Contract
Agent for the benefit of the Holder of the related Treasury SPC Unit when
received.
(iv) A Holder of a Treasury SPC Unit may elect to have the Note, no
longer a part of a SPC Unit, remarketed. A Holder making such an election
must notify the Indenture Trustee prior to 11:00 a.m. (New York City time)
on the fifth Business Day immediately preceding the Purchase Contract
Settlement Date, of the aggregate number of Notes that are not part of SPC
Units to be remarketed. Any such notice will be irrevocable and may not be
conditioned upon the level at which the Reset Rate is established in the
Remarketing. Concurrently, the Indenture Trustee shall cause such Notes to
be presented to the Remarketing Agent for Remarketing.
(e) Any distribution to Holders of excess funds and interest 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 Register.
(f) Upon Cash Settlement of any Purchase Contract:
(1) the Collateral Agent will in accordance with the terms of the
Pledge Agreement cause the Pledged Note or the Pledged Treasury Securities,
as the case may be, underlying the relevant Security to be released from
the Pledge, free and clear of any security interest of the Company, and
transferred to the Purchase Contract Agent for delivery to the Holder
thereof or its designee as soon as practicable; and
(2) 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 Note 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 Note 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
the expiration of the time period specified in the abandoned property laws
of the relevant State).
(g) The obligations of the Holders to pay the Purchase Price are non-
recourse obligations and, except to the extent satisfied by Early
Settlement or Cash Settlement, are payable solely out of the proceeds of
any Collateral pledged to secure the obligations of the Holders and in no
event will Holders be liable for any deficiency between the proceeds of the
disposition of Collateral and the Purchase Price.
(h) 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 SPC Unit or Treasury SPC Unit unless the
Company shall have received payment in full for the aggregate purchase
price for the Common Stock to be purchased thereunder in the manner herein
set forth.
35
SECTION 5.5 ISSUANCE OF SHARES OF COMMON STOCK.
Unless a Termination Event or an Early Settlement shall have occurred,
on the Purchase Contract Settlement Date, upon its receipt of payment in full of
the applicable Purchase Price for shares of Common Stock purchased by Holders
pursuant to the foregoing provisions of this Article and subject to Section
5.6(b), the Company shall issue and deposit with the Purchase Contract Agent,
for the benefit of the Holders of the Outstanding Securities, one or more
certificates representing the 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 both 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,
together with settlement instructions thereon duly completed and executed, the
Holder of such Certificate shall be entitled to receive in exchange therefor a
certificate representing that number of whole shares of Common Stock which such
Holder is entitled to receive pursuant to the provisions of this Article Five
(after taking into account all Securities then held by such Holder), together
with cash in lieu of fractional shares as provided in Section 5.10 and any
dividends or distributions with respect to such shares constituting part of the
Purchase Contract Settlement Fund, but without 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, no such
registration shall be made unless the Person requesting such registration has
paid any transfer and other taxes required by reason of such registration in a
name other than that of the registered Holder of the Certificate evidencing such
Purchase Contract or has established to the satisfaction of the Company that
such tax either has been paid or is not payable.
SECTION 5.6 ADJUSTMENT OF SETTLEMENT RATE.
(a) Adjustments for Dividends, Distributions, Stock Splits, Etc.
(1) In case the Company shall pay or make a dividend or other
distribution on Common Stock in Common Stock, the Settlement Rate, as in
effect at the opening of business on the day following 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
36
distribution, such increase to become effective immediately after the
opening of business on the day following the date fixed for such
determination. For the purposes of this paragraph (1), the number of
shares of Common Stock at any time outstanding shall not include shares
held in the treasury of the Company but shall include any shares issuable
in respect of any scrip certificates issued in lieu of fractions of shares
of Common Stock. The Company will not pay any dividend or make any
distribution on shares of Common Stock held in the treasury of the Company.
(2) In case the Company shall issue rights, warrants or options to all
holders of its Common Stock that are not available on an equivalent basis
to Holders of the Securities upon settlement of the Purchase Contracts
underlying such Securities entitling such holders of the Common Stock, 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 fixed for the determination of shareholders entitled to receive such
rights, warrants or options (other than pursuant to a dividend reinvestment
plan), the Settlement Rate in effect at the opening of business on the day
following the date fixed for such determination shall be increased by
dividing such Settlement Rate by a fraction of which:
(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 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
(ii) the denominator shall be the number of shares of Common Stock
outstanding at the close of business on the date fixed for such
determination plus the number of shares of Common Stock so offered for
subscription or purchase,
such increase to become effective immediately after the opening of business
on the day following the date fixed for such determination. For the
purposes of this paragraph (2), the number of shares of Common Stock at any
time outstanding shall not include shares held in the treasury of the
Company but shall include any shares issuable in respect of any scrip
certificates issued in lieu of fractions of shares of Common Stock. The
Company shall not issue any such rights, 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 opening of business on the day following the day upon
which such subdivision or split becomes effective shall be proportionately
increased, and, conversely, in case outstanding shares of Common Stock
shall each be combined into a smaller number of shares of Common Stock, the
Settlement Rate in effect at the opening of business on the day following
the day upon which such combination becomes effective shall be
proportionately reduced, such increase or reduction, as the case may be, to
37
become effective immediately after the opening of business on the day
following the day upon which such subdivision, split or combination becomes
effective.
(4) In case the Company shall, by dividend or otherwise, distribute to
all holders of its Common Stock evidences of its indebtedness or assets
(including securities, but excluding any rights, warrants or options
referred to in paragraph (2) of this Section 5.6(a), any dividend or
distribution paid exclusively in cash and any dividend or distribution
referred to in paragraph (1) of this Section 5.6(a)), the Settlement Rate
shall be adjusted so that the same shall equal the rate determined by
dividing the Settlement Rate in effect immediately prior to the close of
business on the date fixed for the determination of shareholders entitled
to receive such distribution 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 determined by the Board of Directors, whose determination
shall be conclusive and described in a Board Resolution) of the portion of
the assets or evidences of indebtedness so distributed applicable to one
share of Common Stock; and
(ii) the denominator shall be such Current Market Price per share
of Common Stock,
such adjustment to become effective immediately prior to the opening of
business on the day following the date fixed for the determination of
shareholders entitled to receive such distribution. In any case in which
this paragraph (4) is applicable, paragraph (2) of this Section 5.6(a)
shall not be applicable.
(5) In case the Company shall, (I) 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 5.6(b) applies or
as part of a distribution referred to in paragraph (4) of this Section
5.6(a)) in an aggregate amount that, combined together with (II) the
aggregate amount of any other distributions to all holders of its Common
Stock made exclusively in cash within the 12 months preceding the date of
payment of such distribution and in respect of which no adjustment pursuant
to this paragraph (5) or paragraph (6) of this Section 5.6(a) has been made
and (III) the aggregate of any cash plus the fair market value (as
determined by the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution) of consideration payable in
respect of any tender or exchange offer by the Company or any of its
subsidiaries for all or any portion of the Common Stock concluded within
the 12 months preceding the date of payment of the distribution described
in clause (I) above and in respect of which no adjustment pursuant to this
paragraph (5) or paragraph (6) of this Section 5.6(a) has been made,
exceeds 15% of the product of the Current Market Price per share of the
Common Stock on the date for the determination of holders of shares of
Common Stock entitled to receive such distribution times the number of
shares of Common Stock outstanding on such date, then, and in each such
case, immediately after the close of business on such date for
determination, the Settlement Rate, shall be increased so that the same
shall equal the rate determined by dividing the Settlement Rate in effect
immediately prior to the close of business on the date fixed for
determination of the stockholders entitled to receive such distribution by
38
a fraction (i) the numerator of which shall be equal to the Current Market
Price per share of the Common Stock on the date fixed for such
determination less an amount equal to the quotient of (x) the combined
amount distributed or payable in the transactions described in clauses (I),
(II) and (III) above and (y) the number of shares of Common Stock
outstanding on such date for determination and (ii) the denominator of
which shall be equal to the Current Market Price per share of the Common
Stock on such date for determination.
(6) In case a tender or exchange offer made by the Company or any
subsidiary of the Company for all or any portion of Common Stock shall
expire and such tender or exchange offer (as amended upon the expiration
thereof) shall require the payment to shareholders (based on the acceptance
(up to any maximum specified in the terms of the tender or exchange offer)
of Purchased Shares) of (I) an aggregate consideration having a fair market
value (as determined by the Board of Directors, whose determination shall
be conclusive and described in a Board Resolution) that combined together
with the aggregate of the cash plus the fair market value (as determined by
the Board of Directors, whose determination shall be conclusive and
described in a Board Resolution), as of the expiration of such tender or
exchange offer, of consideration payable in respect of any other tender or
exchange offer, by the Company or any subsidiary of the Company for all or
any portion of Common Stock expiring within the 12 months preceding the
expiration of such tender or exchange offer and in respect of which no
adjustment pursuant to paragraph (5) of this Section 5.6(a) or this
paragraph (6) has been made, and (II) the aggregate amount of any
distributions to all holders of the Company's Common Stock made exclusively
in cash within the 12 months preceding the expiration of such tender or
exchange offer and in respect of which no adjustment pursuant to paragraph
(5) of this Section 5.6(a) or this paragraph (6) has been made, exceeds 15%
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, and in each such case, immediately prior to the
opening of business on the day after the date of the Expiration Time, the
Settlement Rate shall be adjusted so that the same shall equal the rate
determined by dividing the Settlement Rate immediately prior to the close
of business on the date of the Expiration Time by a fraction:
(i) the numerator of which shall be equal to (A) the product of
(I) the Current Market Price per share of Common Stock on the date of the
Expiration Time and (II) the number of shares of Common Stock outstanding
(including any tendered shares) on the Expiration Time less (B) the amount
of cash plus the fair market value (determined as aforesaid) of the
aggregate consideration payable to shareholders based on the transactions
described in clauses (I) and (II) 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
39
shares validly tendered and not withdrawn as of the Expiration Time (the
shares deemed so accepted, up to any such maximum, being referred to as the
"Purchased Shares").
(7) The reclassification of Common Stock into securities including
securities other than Common Stock (other than any reclassification upon a
Reorganization Event to which Section 5.6(b) applies) shall be deemed to
involve:
(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 day
means the average of the daily Closing Prices for the five consecutive
Trading Days selected by the Company commencing not more than 30 Trading
Days before, and ending not later than, the earlier of the day in question
and the day before the "ex date" with respect to the issuance or
distribution requiring such computation. For purposes of this paragraph,
the term "ex date", when used with respect to any issuance or distribution,
shall mean the first date on which Common Stock trades regular way on such
exchange or in such market without the right to receive such issuance or
distribution.
(9) All adjustments to the Settlement Rate shall be calculated to the
nearest 1/10,000th of a share of Common Stock (or if there is not a nearest
1/10,000th of a share, to the next lower 1/10,000th of a share). No
adjustment in the Settlement Rate shall be required unless such adjustment
would require an increase or decrease of at least one percent thereof;
provided, however, that any adjustments which by reason of this
subparagraph are not required to be made shall be carried forward and taken
into account in any subsequent adjustment. If an adjustment is made to the
Settlement Rate pursuant to paragraph (1), (2), (3), (4), (5), (6), (7) or
(10) of this Section 5.6(a), an adjustment shall also be made to the
Applicable Market Value solely to determine which of clauses (a), (b) or
(c) of the definition of Settlement Rate in Section 5.1 will apply on the
Purchase Contract Settlement Date. Such adjustment shall be made by
multiplying the Applicable Market Value by a fraction of which the
numerator shall be the Settlement Rate immediately after such adjustment
pursuant to paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of this
Section 5.6(a) and the denominator shall be the Settlement Rate immediately
prior to such adjustment; provided, however, that if such adjustment to the
40
Settlement Rate is required to be made pursuant to the occurrence of any of
the events contemplated by paragraph (1), (2), (3), (4), (5), (7) or (10)
of this Section 5.6(a) during the period taken into consideration for
determining the Applicable Market Value, appropriate and customary
adjustments shall be made to the Settlement Rate.
(10) The Company may make such increases in the Settlement Rate, in
addition to those required by this Section, as it considers to be advisable
in order to avoid or diminish any income tax to any holders of shares of
Common Stock resulting from any dividend or distribution of stock or
issuance of rights or warrants to purchase or subscribe for stock or from
any event treated as such for income tax purposes or for any other reason.
(b) Adjustment for Consolidation, Merger or Other Reorganization
Event.
In the event of:
(i) any consolidation or merger of the Company with or into
another Person (other than a merger or consolidation in which the Company
is the continuing corporation and in which the 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);
(iv) any liquidation, dissolution or termination of the Company
other than as a result of or after the occurrence of a Termination Event
(any such event, a "Reorganization Event"),
the Settlement Rate will be adjusted to provide that each Holder of
Securities will receive on the Purchase Contract Settlement Date with
respect to each Purchase Contract forming a part thereof, the kind and
amount of securities, cash and other property receivable upon such
Reorganization Event (without any interest thereon, and without any right
to dividends or distribution thereon which have a record date that is prior
to the Purchase Contract Settlement Date) by a Holder of the number of
shares of Common Stock issuable on account of each Purchase Contract if the
Purchase Contract Settlement Date had occurred immediately prior to such
Reorganization Event, assuming such Holder of Common Stock is not a Person
with which the Company consolidated or into which the Company merged or
which merged into the Company or to which such sale or transfer was made,
as the case may be (any such Person, a "Constituent Person"), or an
Affiliate of a Constituent Person to the extent such Reorganization Event
provides for different treatment of Common Stock held by Affiliates of the
Company and non-affiliates and such Holder failed to exercise his rights of
election, if any, as to the kind or amount of securities, cash and other
property receivable upon such Reorganization Event (provided that if the
kind or amount of securities, cash and other property receivable upon such
41
Reorganization Event is not the same for each share of Common Stock held
immediately prior to such Reorganization Event by other than a Constituent
Person or an Affiliate thereof and in respect of which such rights of
election shall not have been exercised ("non-electing share"), then for the
purpose of this Section the kind and amount of securities, cash and other
property receivable upon such Reorganization Event by each non- electing
share shall be deemed to be the kind and amount so receivable per share by
a plurality of the non-electing shares).
In the event of such a Reorganization Event, the Person formed by such
consolidation, merger or exchange or the Person which acquires the assets
of the Company or, in the event of a liquidation, 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 the Holders of each
Outstanding Security shall have the rights provided by this Section 5.6(b).
Such supplemental agreement shall provide for adjustments which, for events
subsequent to the effective date of such supplemental agreement, shall be
as nearly equivalent as may be practicable to the adjustments provided for
in this Section. The above provisions of this Section shall similarly apply
to successive Reorganization Events.
SECTION 5.7 NOTICE OF ADJUSTMENTS AND CERTAIN OTHER EVENTS.
(a) Whenever the Settlement Rate is adjusted as herein provided, the
Company shall:
(1) forthwith compute the adjusted Settlement Rate in accordance with
Section 5.6 and prepare and transmit to the Purchase Contract Agent an
Officer's 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
(2) within 10 Business Days following the occurrence of an event that
requires an adjustment to the Settlement Rate pursuant to Section 5.6 (or
if the Company is not aware of such occurrence, as soon as practicable
after becoming so aware), provide a written notice to the Holders of the
Securities of the occurrence of such event and a statement in reasonable
detail setting forth the method by which the adjustment to the Settlement
Rate was determined and setting forth the adjusted Settlement Rate.
(b) The Purchase Contract Agent shall not at any time be under any
duty or responsibility to any Holder of Securities to determine whether any
facts exist which may require any adjustment of the Settlement Rate, or
with respect to the nature or extent or calculation of any such adjustment
when made, or with respect to the method employed in making the same. The
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
42
or deliver any shares of Common Stock pursuant to a Purchase Contract or to
comply with any of the duties, responsibilities or covenants of the Company
contained in this Article.
SECTION 5.8 TERMINATION EVENT; NOTICE.
The Purchase Contracts and all obligations and rights of the Company
and the Holders thereunder, including, without limitation, the rights of the
Holders to receive and the obligation of the Company to pay any Purchase
Contract Payments (including any deferred or accrued and unpaid Purchase
Contract 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 Securities
shall thereafter represent the right to receive the Notes forming part of such
Securities in the case of SPC Units, or Treasury Securities in the case of
Treasury SPC Units, in accordance with the provisions of Section 5.4 of the
Pledge Agreement. Upon the occurrence of a Termination Event, the Company shall
promptly but in no event later than two Business Days thereafter give written
notice to the Purchase Contract Agent, the Collateral Agent and the Holders, at
their addresses as they appear in the Register.
SECTION 5.9 EARLY SETTLEMENT.
(a) Subject to and upon compliance with the provisions of this Section
5.9, at the option of the Holder thereof, Purchase Contracts underlying
Securities may be settled early ("Early Settlement") prior to or on the
seventh Business Day immediately preceding the Purchase Contract Settlement
Date, as provided herein. In order to exercise the right to effect Early
Settlement with respect to any Purchase Contracts, the Holder of the
Certificate evidencing Securities shall deliver such Certificates 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:
(1) the product of (A) the Stated Amount times (B) the number of
Purchase Contracts with respect to which the Holder has elected to effect
Early Settlement, plus
(2) if such delivery is made with respect to any Purchase Contracts
during the period from the close of business on any Record Date next
preceding any Payment Date to the opening of business on such Payment Date,
an amount equal to the sum of (x) the Purchase Contract Payments payable on
such Payment Date with respect to such Purchase Contracts plus (y) in the
case of a SPC Units Certificate, the interest on the related Notes payable
on such Payment Date.
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Except as provided in the immediately preceding sentence and subject to the
second to last paragraph of Section 5.2, no payment shall be made upon
Early Settlement of any Purchase Contract on account of any Purchase
Contract Payments accrued on such Purchase Contract or on account of any
dividends on the Common Stock issued upon such Early Settlement. If the
foregoing requirements are first satisfied with respect to Purchase
Contracts underlying any Securities prior to or at 5:00 p.m. (New York City
time) on a Business Day, such day shall be the "Early Settlement Date" with
respect to such Securities and if such requirements are first satisfied
after 5:00 p.m. (New York City time) on a Business Day or on a day that is
not a Business Day, the "Early Settlement Date" with respect to such
Securities shall be the next succeeding Business Day.
(b) Upon Early Settlement of Purchase Contracts by a Holder of the
related Securities, the Company shall issue, and the Holder shall be
entitled to receive, 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.
(c) No later than the third Business Day after the applicable Early
Settlement Date, the Company shall cause:
(1) the shares of Common Stock issuable upon Early Settlement of
Purchase Contracts to be issued and delivered, together with payment in
lieu of any fraction of a share, as provided in Section 5.10; and
(2) the related Notes, in the case of SPC Units, or the related
Treasury Securities, in the case of Treasury SPC 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.
(d) Upon Early Settlement of any Purchase Contracts, and subject to
receipt of shares of Common Stock from the Company and the Notes 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 Securities:
(1) transfer to the Holder the Notes or Treasury Securities, as the
case may be, forming a part of such Securities; and
(2) deliver to the Holder a certificate or certificates for the full
number of shares of Common Stock issuable upon such Early Settlement,
together with payment in lieu of any fraction of a share, as provided in
Section 5.10.
(e) In the event that Early Settlement is effected with respect to
Purchase Contracts underlying less than all the Securities evidenced by a
Certificate, upon such Early Settlement the Company shall execute and the
Purchase Contract Agent shall authenticate, countersign and deliver to the
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Holder thereof, at the expense of the Company, a Certificate evidencing the
Securities as to which Early Settlement was not effected.
(f) A Holder of a Security who effects Early Settlement may elect to
have the Note, no longer a part of a SPC Unit or Treasury SPC Unit. as the
case my be, remarketed. A Holder making such an election must notify the
Indenture Trustee prior to 11:00 a.m. (New York City time) on the fifth
Business Day immediately preceding the Purchase Contract Settlement Date,
of the aggregate number of Notes that are not part of SPC Units or Treasury
SPC Units, as the case may be, to be remarketed. Any such notice will be
irrevocable and may not be conditioned upon the level at which the Reset
Rate is established in the Remarketing. Concurrently, the Indenture Trustee
shall cause such Notes to be presented to the Remarketing Agent for
Remarketing.
SECTION 5.10 NO FRACTIONAL SHARES.
No fractional shares or scrip representing fractional shares of Common
Stock shall be issued or delivered upon settlement on the Purchase Contract
Settlement Date or upon Early Settlement of any Purchase Contracts. If
Certificates evidencing more than one Purchase Contract shall be surrendered for
settlement at one time by the same Holder, the number of full shares of Common
Stock which shall be delivered upon settlement shall be computed on the basis of
the aggregate number of Purchase Contracts evidenced by the Certificates so
surrendered. Instead of any fractional share of Common Stock which would
otherwise be deliverable upon settlement of any Purchase Contracts on the
Purchase Contract Settlement Date or upon Early Settlement, the Company, through
the Purchase Contract Agent, shall make a cash payment in respect of such
fractional interest in an amount equal to the value of such fractional shares
times the Applicable Market Value. The Company shall provide the 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 5.10 in a
timely manner.
SECTION 5.11 CHARGES AND TAXES.
The Company will pay all stock transfer and similar taxes attributable
to the initial issuance and delivery of the shares of Common Stock pursuant to
the Purchase Contracts; provided, however, that the Company shall not be
required to pay any such tax or taxes which may be payable in respect of any
exchange of or substitution for a Certificate evidencing a Security or any
issuance of a share of Common Stock in a name other than that of the registered
Holder of a Certificate surrendered in respect of the Securities evidenced
thereby, other than in the name of the 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.
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ARTICLE VI
REMEDIES
SECTION 6.1 UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PURCHASE CONTRACT
PAYMENTS AND TO PURCHASE SHARES OF COMMON STOCK.
Each Holder of a SPC Unit or Treasury SPC Unit shall have the right,
which is absolute and unconditional, (1) subject to the payment by such Holder
of Purchase Contract Payments pursuant to Section 5.9(a), to receive each
Purchase Contract Payment with respect to the Purchase Contract constituting a
part of such Security on the respective Payment Date for such Security
(provided, however, that a Holder will have no right to receive any accrued
deferred Purchase Contract Payments if such Holder effects an Early Settlement
or if a Termination Event shall occur), and (2) 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 Purchase Contract Payment and right to
purchase shares of Common Stock, and such rights shall not be impaired without
the consent of such Holder.
SECTION 6.2 RESTORATION OF RIGHTS AND REMEDIES.
If any Holder has instituted any proceeding to enforce any right or
remedy under this Agreement and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to such Holder, then
and in every such case, subject to any determination in such proceeding, the
Company and such Holder shall be restored severally and respectively to their
former positions hereunder and thereafter all rights and remedies of such Holder
shall continue as though no such proceeding had been instituted.
SECTION 6.3 RIGHTS AND REMEDIES CUMULATIVE.
Except as otherwise provided with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Certificates in the last
paragraph of Section 3.10, no right or remedy herein conferred upon or reserved
to the Holders is intended to be exclusive of any other right or remedy, and
every right and remedy shall, to the extent permitted by law, be cumulative and
in addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
SECTION 6.4 DELAY OR OMISSION NOT WAIVER.
No delay or omission of any Holder to exercise any right or remedy
upon a default shall impair any such right or remedy or constitute a waiver of
any such right. Every right and remedy given by this Article or by law to the
Holders may be exercised from time to time, and as often as may be deemed
expedient, by such Holders.
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SECTION 6.5 UNDERTAKING FOR COSTS.
All parties to this Agreement agree, and each Holder of a SPC Unit or
a Treasury SPC Unit, by its acceptance of such SPC Unit or Treasury SPC 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, against any party litigant in such suit, having due regard to the merits
and good faith of the claims or defenses made by such party litigant; provided
that the provisions of this Section shall not apply to any suit instituted by
the Company, to any suit instituted by the Purchase Contract Agent, to any suit
instituted by any Holder, or group of Holders, holding in the aggregate more
than 10% of the Outstanding Securities, or to any suit instituted by any Holder
for the enforcement of distributions on any Notes or Purchase Contract Payments
on any Purchase Contract on or after the respective Payment Date therefor in
respect of any Security held by such Holder, or for enforcement of the right to
purchase shares of Common Stock under the Purchase Contracts constituting part
of any Security held by such Holder.
SECTION 6.6 WAIVER OF STAY OR EXTENSION LAWS.
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Agreement; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to 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 VII
THE PURCHASE CONTRACT AGENT
SECTION 7.1 CERTAIN DUTIES AND RESPONSIBILITIES.
(a) Prior to a default and after the curing or waiving of all such
defaults that may have occurred, the Purchase Contract Agent:
(1) undertakes to perform, with respect to the Securities, such duties
and only such duties as are specifically set forth in this Agreement and
the Pledge Agreement, and no implied covenants or obligations shall be read
into this Agreement or the Pledge Agreement against the Purchase Contract
Agent; and
(2) in the absence of bad faith or negligence on its part, may, with
respect to the Securities, conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Purchase Contract Agent and
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conforming to the requirements of this Agreement or the Pledge 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 or the Pledge Agreement, as applicable.
(b) No provision of this Agreement or the Pledge Agreement shall be
construed to relieve the Purchase Contract Agent from liability for its own
negligent action, its own 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
proved that the Purchase Contract Agent was negligent in ascertaining the
pertinent facts; and
(3) no provision of this Agreement or the Pledge 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
adequate indemnity is not provided to it.
(c) Whether or not therein expressly so provided, every provision of
this Agreement and the Pledge 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 in its capacity as Purchase Contract Agent.
(e) In case a Default has occurred (that has not been cured or
waived), and is actually known by a Responsible Officer of the Purchase
Contract Agent, the Purchase Contract Agent shall exercise such of the
rights and powers vested in it by this Agreement, 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.
(f) At the request of the Company, the Purchase Contract Agent is
authorized to execute and deliver one or more Remarketing Agreements to,
among other things, effectuate Section 5.4
SECTION 7.2 NOTICE OF DEFAULT.
Within 90 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 Securities, as their names and addresses appear in
the Register, notice of such default hereunder, unless such default shall have
48
been cured or waived; provided that, except for a default in any payment
-------------
obligation hereunder, the Purchase Contract Agent shall be protected in
withholding such notice if and so long as the Responsible Officer of the
Purchase Contract Agent in good faith determines that the withholding of such
notice is in the interests of the Holders of the Securities.
SECTION 7.3 CERTAIN RIGHTS OF PURCHASE CONTRACT AGENT.
Subject to the provisions of Section 7.1:
(1) the Purchase Contract Agent may rely and shall be protected in
acting or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of indebtedness or
other paper or document believed by it to be genuine and to have been
signed or presented by the proper party or parties;
(2) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by an Officer's 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 the Purchase
Contract Agent shall deem it desirable that a matter be proved or
established prior to taking, suffering or omitting any action hereunder,
the Purchase Contract Agent (unless other evidence be herein specifically
prescribed) may, in the absence of bad faith on its part, rely upon an
Officer's Certificate of the Company;
(4) the Purchase Contract Agent may consult with counsel and the
written advice of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in reliance thereon;
(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 given a reasonable opportunity to examine the
books, records and premises of the Company, personally or by agent or
attorney; and
(6) the Purchase Contract Agent may execute any of the powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys or an Affiliate and the Purchase Contract Agent shall
not be responsible for any misconduct or negligence on the part of any
agent or attorney or an Affiliate appointed with due care by it hereunder.
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SECTION 7.4 NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.
The recitals contained herein and in the Certificates shall be taken
as the statements of the Company, and the Purchase Contract Agent assumes no
responsibility for their accuracy. The Purchase Contract Agent makes no
representations as to the validity or sufficiency of either this Agreement or of
the Securities, or of the Pledge Agreement or the Pledge. The 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 7.5 MAY HOLD SECURITIES.
Any 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 Securities and may otherwise deal with the
Company, the Collateral Agent or any other Person with the same rights it would
have if it were not Registrar or such other agent, or the Purchase Contract
Agent.
SECTION 7.6 MONEY HELD IN CUSTODY.
Money held by the Purchase Contract Agent in custody hereunder need
not be segregated from the 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
agreed in writing with the Company.
SECTION 7.7 COMPENSATION AND REIMBURSEMENT.
The Company agrees:
(1) to pay to the Purchase Contract Agent compensation for all
services rendered by it hereunder and under the Pledge 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 and the Pledge Agreement
(including the reasonable compensation and the expenses and disbursements
of its agents and counsel), except any such expense, disbursement or
advance as may be attributable to its negligence or bad faith; and
(3) to indemnify the Purchase Contract Agent and any predecessor
Purchase Contract Agent for, and to hold it harmless against, any loss,
liability or expense incurred without negligence or bad faith on its part,
arising out of or in connection with the acceptance or administration of
its duties hereunder, including the costs and expenses of defending itself
against any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder.
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SECTION 7.8 CORPORATE PURCHASE CONTRACT AGENT REQUIRED; ELIGIBILITY.
There shall at all times be an Purchase Contract Agent hereunder which
shall be a corporation organized and doing business under the laws of the United
States of America, any State thereof or the District of Columbia, authorized
under such laws to exercise corporate trust powers, having (or being a member of
a bank holding company having) a combined capital and surplus of at least
$50,000,000, subject to supervision or examination by Federal or State authority
and having a corporate trust office in New York, New York, if there be such a
corporation in New York, New York, qualified and eligible under this Article and
willing to act on reasonable terms. If such corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of said
supervising or examining authority, then for the purposes of this Section, the
combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. If at any time the 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 7.9 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 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 Securities delivered
to the Purchase Contract Agent and the Company.
(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, after written request therefor by the
Company or by any Holder who has been a bona fide Holder of a Security for
at least six months;
(2) the Purchase Contract Agent shall cease to be eligible under
Section 7.8 and shall fail to resign after written request therefor by the
Company or by any such Holder; or
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(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 Security for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent jurisdiction
for the removal of the 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 Security for at least six months may, on behalf of
itself and all others similarly situated, petition any court of competent
jurisdiction for the appointment of a successor 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 Register. Each notice shall include the name of the successor
Purchase Contract Agent and the address of its Corporate Trust Office.
(g) If the Purchase Contract Agent has or shall acquire any
"conflicting interest" within the meaning of Section 310(b) of the Trust
Indenture Act, the Purchase Contract Agent and the Company shall in all
respects comply with the provisions of Section 310(b) of the Trust
Indenture Act.
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 deliver an instrument transferring to such
successor Purchase Contract Agent all the rights, powers and trusts of the
retiring Purchase Contract Agent and shall duly assign, transfer and
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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 such Person shall be otherwise
qualified and eligible under this Article, with the execution or filing of any
paper or any further act on the part of any of the parties hereto. In case any
Certificates shall have been authenticated and executed on behalf of the
Holders, but not delivered, by the 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 Securities.
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 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 Security for a period of at least six months preceding the date of such
application, and such application states that the applicants desire to
communicate with other Holders with respect to their rights under this
Agreement or under the Securities and is accompanied by a copy of the form
of proxy or other communication which such applicants propose to transmit,
then the 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 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.
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SECTION 7.13 NO OBLIGATIONS OF PURCHASE CONTRACT AGENT.
Except to the extent otherwise 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 or any Purchase Contract in
respect of the obligations of the Holder of any Security thereunder. The Company
agrees, and each Holder of a Certificate, by his acceptance thereof, shall be
deemed to have agreed, that the 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, employees or agents be liable under
this Agreement to any third party for indirect, special, punitive, or
consequential loss or damage of any kind whatsoever, including lost profits,
whether or not the likelihood of such loss or damage was known to the Purchase
Contract Agent, incurred without any act or deed that is found to be
attributable to gross negligence or willful misconduct on the part of the
Purchase Contract Agent.
SECTION 7.14 TAX COMPLIANCE.
(a) The Company will comply with all applicable certification,
information reporting and withholding (including "backup" withholding)
requirements imposed by applicable tax laws, regulations or administrative
practice with respect to (i) any payments made with respect to the
Securities or (ii) the issuance, delivery, holding, transfer, redemption or
exercise of rights under the Securities. Such compliance shall include,
without limitation, the preparation and timely filing of required returns
and the timely payment of all amounts required to be withheld to the
appropriate taxing authority or its designated agent.
(b) The 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
rely on any such direction in accordance with the provisions of Section
7.1(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 VIII
SUPPLEMENTAL AGREEMENTS
SECTION 8.1 SUPPLEMENTAL AGREEMENTS WITHOUT CONSENT OF HOLDERS.
Without the consent of any Holders, the Company 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 5.6(b); or
(5) except as provided for in Section 5.6, 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 such action
shall not adversely affect the interests of the Holders.
SECTION 8.2 SUPPLEMENTAL AGREEMENTS WITH CONSENT OF HOLDERS.
With the consent of the Holders of not less than a majority of the
outstanding Purchase Contracts voting together as one class, by Act of said
Holders delivered to the Company and the 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 Securities; provided,
however, that, except as contemplated herein, no such supplemental agreement
shall, without the unanimous consent of the Holders of each Outstanding Purchase
Contract affected thereby,
(1) change any Payment Date;
(2) change the amount or the type of Collateral required to be Pledged
to secure a Holder's obligations under the Purchase Contract, impair the
right of the Holder of any Purchase Contract to receive distributions on
the related Collateral or otherwise adversely affect the Holder's rights in
or to such Collateral or adversely alter the rights in or to such
Collateral;
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(3) reduce any Purchase Contract Payments or change any place where,
or the coin or currency in which, any Purchase Contract Payment is payable;
(4) impair the right to institute suit for the enforcement of any
Purchase Contract;
(5) reduce the number of shares of Common Stock to be purchased
pursuant to any Purchase Contract, increase the price to purchase shares of
Common Stock upon settlement of any Purchase Contract, change the Purchase
Contract Settlement Date or otherwise adversely affect the Holder's rights
under any Purchase Contract; or
(6) reduce the percentage of the outstanding Purchase Contracts the
consent of whose Holders is required for any such supplemental agreement;
provided that if any amendment or proposal referred to above would
adversely affect only the SPC Units or the Treasury SPC 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 8.3 EXECUTION OF SUPPLEMENTAL AGREEMENTS.
In executing, or accepting the additional agencies created by, any
supplemental agreement permitted by this Article or the modifications thereby of
the agencies created by this Agreement, the Purchase Contract Agent shall be
entitled to receive, and (subject to Section 7.1) shall be fully protected in
relying upon, an Officer's Certificate and an Opinion of Counsel stating that
the execution of such supplemental agreement is authorized or permitted by this
Agreement. 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 8.4 EFFECT OF SUPPLEMENTAL AGREEMENTS.
Upon the execution of any supplemental agreement under this Article,
this Agreement shall be modified in accordance therewith, and such supplemental
agreement shall form a part of this Agreement for all purposes; and every Holder
of Certificates theretofore or thereafter authenticated, executed on behalf of
the Holders and delivered hereunder, shall be bound thereby.
56
SECTION 8.5 REFERENCE TO SUPPLEMENTAL AGREEMENTS.
Certificates authenticated, executed on behalf of the Holders and
delivered after the execution of any supplemental agreement pursuant to this
Article may, and shall if required by the 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 IX
MERGER, CONSOLIDATION, SALE OR CONVEYANCE
SECTION 9.1 COVENANT NOT TO MERGE, CONSOLIDATE, SELL OR CONVEY PROPERTY
EXCEPT UNDER CERTAIN CONDITIONS.
The Company covenants that it will not merge, consolidate or sell,
assign, transfer, lease or convey all or substantially all of its properties and
assets to any Person or group of affiliated Persons in one transaction or a
series of related transactions, unless:
(1) 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, the Notes,
this Agreement and the Pledge Agreement by one or more supplemental
agreements in form reasonably satisfactory to the Purchase Contract Agent
and the Collateral Agent, executed and delivered to the Purchase Contract
Agent and the Collateral Agent by such corporation; and
(2) the Company or such successor corporation, as the case may be,
shall not, immediately after such merger, consolidation, or sale,
assignment, transfer, lease or conveyance, be in default in the performance
of any covenant or condition hereunder, under any of the Securities or
under the Pledge Agreement.
SECTION 9.2 RIGHTS AND DUTIES OF SUCCESSOR CORPORATION.
In case of any such merger, consolidation, sale, assignment, transfer,
lease or conveyance and upon any such assumption by a successor corporation in
accordance with Section 9.1, such successor corporation shall succeed to and be
substituted for the Company with the same effect as if it had been named herein
as the Company. Such successor corporation thereupon may cause to be signed, and
may issue either in its own name or in the name of PP&L Resources, Inc., any or
all of the Certificates evidencing Securities issuable hereunder which
theretofore shall not have been signed by the Company and delivered to the
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
57
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 Securities 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, sale, assignment, transfer,
lease or conveyance such change in phraseology and form (but not in substance)
may be made in the Certificates evidencing Securities thereafter to be issued as
may be appropriate.
SECTION 9.3 OFFICER'S CERTIFICATE AND OPINION OF COUNSEL GIVEN TO PURCHASE
CONTRACT AGENT.
The Purchase Contract Agent, subject to Sections 7.1 and 7.3, shall
receive an Officer's Certificate and an Opinion of Counsel as conclusive
evidence that any such merger, consolidation, 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, sale, assignment, transfer, lease or conveyance have been
met.
ARTICLE X
COVENANTS
SECTION 10.1 PERFORMANCE UNDER PURCHASE CONTRACTS.
The Company covenants and agrees for the benefit of the Holders from
time to time of the Securities that it will duly and punctually perform its
obligations under the Purchase Contracts in accordance with the terms of the
Purchase Contracts and this Agreement.
SECTION 10.2 MAINTENANCE OF OFFICE OR AGENCY.
The Company will maintain in New York, New York, an office or agency
where Certificates may be presented or surrendered for acquisition of shares of
Common Stock upon settlement of the Purchase Contracts on the Purchase Contract
Settlement Date or Early Settlement and for transfer of Collateral upon
occurrence of a Termination Event, where Certificates may be surrendered for
registration of transfer or exchange, for a Collateral Substitution or
reestablishment of SPC Units and where notices and demands to or upon the
Company in respect of the Securities and this Agreement may be served. The
Company will give prompt written notice to the Purchase Contract Agent of the
location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Purchase Contract Agent with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
58
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, The City of New York 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
Securities the Corporate Trust Office and appoints the Purchase Contract Agent
at its Corporate Trust Office as paying agent in such city.
SECTION 10.3 COMPANY TO RESERVE COMMON STOCK.
The Company shall at all times prior to the Purchase Contract
Settlement Date reserve and keep available, free from preemptive rights, out of
its authorized but unissued Common Stock the full number of shares of Common
Stock issuable against tender of payment in respect of all Purchase Contracts
constituting a part of the Securities evidenced by Outstanding Certificates.
SECTION 10.4 COVENANTS AS TO COMMON STOCK.
The Company covenants that all shares of Common Stock which may be
issued against tender of payment in respect of any Purchase Contract
constituting a part of the Outstanding Securities will, upon issuance, be duly
authorized, validly issued, fully paid and nonassessable.
SECTION 10.5 ERISA.
Each Holder from time to time of the SPC Units which is a Plan hereby
represents that its acquisition of the SPC Units and the holding of the same
satisfies the applicable fiduciary requirements of ERISA and that it is entitled
to exemption relief from the prohibited transaction provisions of ERISA and the
Code in accordance with one or more prohibited transaction exemptions or
otherwise will not result in a nonexempt prohibited transaction.
ARTICLE XI
TRUST INDENTURE ACT
SECTION 11.1 TRUST INDENTURE ACT; APPLICATION.
(a) This Agreement is subject to the provisions of the TIA that are
required or deemed to be part of this Agreement and shall, to the extent
applicable, be governed by such provisions; and
59
(b) If and to the extent that any provision of this Agreement limits,
qualifies or conflicts with the duties imposed by Section 310 to 317,
inclusive, of the TIA, such imposed duties shall control.
SECTION 11.2 LISTS OF HOLDERS OF SECURITIES.
(a) The Company shall furnish or cause to be furnished to the Purchase
Contract Agent (a) semiannually, not later than June 1 and December 1 in
each year, commencing December 1, [1999], a list, in such form as the
Purchase Contract Agent may reasonably require, of the names and addresses
of the Holders ("List of Holders") as of a date not more than 15 days prior
to the delivery thereof, and (b) at such other times as the Purchase
Contract Agent may request in writing, within 30 days after the receipt by
the Company of any such request, a List of Holders as of a date not more
than 15 days prior to the time such list is furnished; provided that, the
Company shall 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 Purchase Contract Agent by the Company. The Purchase Contract
Agent may destroy any List of Holders previously given to it on receipt of
a new List of Holders
(b) The Purchase Contract Agent shall comply with its obligations
under Section 311(a) of the TIA, subject to the provisions of Section
311(b) and Section 312(b) of the TIA.
SECTION 11.3 REPORTS BY THE PURCHASE CONTRACT AGENT.
Not later than November 1 of each year, commencing November 1, [1999],
the Purchase Contract Agent shall provide to the Holders such reports, if any,
as are required by Section 313(a) of the TIA in the form and in the manner
provided by Section 313(a) of the TIA. Such reports shall be as of the preceding
September 15. The Purchase Contract Agent shall also comply with the
requirements of Sections 313(b), (c) and (d) of the TIA.
SECTION 11.4 PERIODIC REPORTS TO PURCHASE CONTRACT AGENT.
The Company shall provide to the Purchase Contract Agent such
documents, reports and information as required by Section 314 (if any) and the
compliance certificate required by Section 314 of the TIA in the form, in the
manner and at the times required by Section 314 of the TIA.
SECTION 11.5 EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT.
The Company shall provide to the Purchase Contract Agent such evidence
of compliance with any conditions precedent provided for in this Agreement as
and to the extent required by Section 314(c) of the TIA. Any certificate or
opinion required to be given by an officer pursuant to Section 314(c)(1) of the
TIA may be given in the form of an Officer's Certificate. Any opinion required
to be given pursuant to Section 314(c)(2) of the TIA may be given in the form of
an Opinion of Counsel.
60
SECTION 11.6 DEFAULTS; WAIVER.
The Holders of a majority of the Outstanding Purchase Contracts voting
together as one class may, by vote, on behalf of all of the Holders, waive any
past Default and its consequences, except a default
(a) in the payment on any Security, or
(b) in respect of a provision hereof which under Section 8.2 cannot be
modified or amended without the consent of the Holder of each Outstanding
Security affected.
Upon such waiver, any such Default shall cease to exist, and any
Default arising therefrom shall be deemed to have been cured, for every purpose
of this Agreement, but no such waiver shall extend to any subsequent or other
Default or impair any right consequent thereon.
SECTION 11.7 PURCHASE CONTRACT AGENT'S KNOWLEDGE OF DEFAULTS.
The Purchase Contract Agent shall not be deemed to have knowledge of
any Default unless a Responsible Officer charged with the administration of this
Agreement shall have obtained written notice of such Default.
SECTION 11.8 CONFLICTING INTERESTS.
The Indenture, the Indenture dated as of November 1, 1997 among PP&L
Capital Funding, Inc. as issuer, the Company as guarantor and the Chase
Manhattan Bank, as trustee, as supplemented and amended, [others] shall be
deemed to be specifically described in this Agreement for the purposes of clause
(i) of the first proviso contained in Section 310(b) of the TIA.
SECTION 11.9 DIRECTION OF PURCHASE CONTRACT AGENT.
Section 316(a)(1)(A) of the TIA is hereby expressly excluded from this
Agreement, as permitted by the TIA.
61
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and year first above written.
PP&L RESOURCES, INC.
By:
-----------------------------------
Name:
Title:
--------------------------------------
as Purchase Contract Agent and Trustee
By:
-----------------------------------
Name:
Title:
62
EXHIBIT A
FORM OF SPC UNITS CERTIFICATE
THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN THE
NAME OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE "DEPOSITARY"),
OR A NOMINEE OF THE DEPOSITARY. THIS CERTIFICATE IS EXCHANGEABLE FOR
CERTIFICATES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS
NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT
AGREEMENT AND NO TRANSFER OF THIS CERTIFICATE (OTHER THAN A TRANSFER OF THIS
CERTIFICATE AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A
NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY) MAY BE REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
No. _______ Cusip No. ________
Number of SPC Units ________
PP&L RESOURCES, INC.
SPC UNITS
This SPC Units Certificate certifies that _______________ is the
registered Holder of the number of SPC Units set forth above. Each SPC Unit
consists of (i) the beneficial ownership by the Holder of one Note (the "Note")
of PP&L Capital Funding, Inc., a Delaware corporation guaranteed by PP&L
Resources, Inc., a Pennsylvania corporation (the "Company"), having a principal
amount of $50, subject to the Pledge of such Note by such Holder pursuant to
the Pledge Agreement, and (ii) the rights and obligations of the Holder and
the Company under one Purchase Contract with the Company. All capitalized terms
used herein which are defined in the Purchase Contract Agreement (as defined
below) have the meaning set forth therein.
A-1
Pursuant to the Pledge Agreement, the Note constituting part of each
SPC Unit evidenced hereby has 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 SPC Unit.
Payments of interest on any Note forming part of a SPC Unit evidenced
hereby, shall, subject to receipt thereof by the Purchase Contract Agent from
the Securities Intermediary, be paid to the Person in whose name this SPC Units
Certificate (or a Predecessor SPC Units Certificate) is registered at the close
of business on the Record Date for such Payment Date. Interest is payable
quarterly in arrears on February 16, May 16, August 16 and November 16 of each
year, commencing ________________ (each, a "Payment Date"). The Company may, at
its option, defer payments of interest.
Each Purchase Contract evidenced hereby obligates the Holder of this
SPC Units Certificate to purchase, and the Company to sell, on the Purchase
Contract Settlement Date, at a price equal to $50 (the "Stated Amount"), a
number of shares of PP&L Resources, Inc. Common Stock, par value $.01 per share
("Common Stock"), equal to the Settlement Rate, unless prior to or on the
Purchase Contract Settlement Date there shall have occurred a Termination Event
or an Early Settlement with respect to the SPC Unit of which such Purchase
Contract is a part, all as provided in the Purchase Contract Agreement and more
fully described on the reverse hereof. The purchase price (the "Purchase Price")
for the shares of Common Stock purchased pursuant to each Purchase Contract
evidenced hereby, if not paid earlier, shall be paid on the Purchase Contract
Settlement Date by cash or by application of payment received in respect of the
principal amount with respect to each Pledged Note pursuant to the Remarketing
pledged to secure the obligations under such Purchase Contract of the Holder of
the SPC Unit of which such Purchase Contract is a part.
The Company shall pay, on each Payment Date, in respect of each
Purchase Contract forming part of a SPC Unit evidenced hereby, an amount (the
"Purchase Contract Payments") equal to ____% per annum of the Stated Amount.
Such Purchase Contract Payments shall be payable to the Person in whose name
this SPC Units Certificate (or a Predecessor SPC Units Certificate) is
registered at the close of business on the Record Date for such Payment Date.
The Company may, at its option, defer Purchase Contract Payments.
Interest payments on the Notes and Purchase Contract Payments will be
payable at the office of the Purchase Contract Agent in New York City or, at the
option of the Company, by check mailed to the address of the Person entitled
thereto as such address appears on the SPC Units Register.
Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of _________ (as may be supplemented from time to
time, the "Purchase Contract Agreement"), between the Company and _________, 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 SPC Units Certificates are, and are to be, executed and delivered.
A-2
Each Purchase Contract evidenced hereby obligates the Holder of this
SPC 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, prior to or on the Purchase Contract Settlement Date, there shall have
occurred a Termination Event with respect to the Security of which such Purchase
Contract is a part or an Early Settlement shall have occurred. The "Settlement
Rate" is equal to:
(1) if the Applicable Market Value (as defined below) is equals or
exceeds $. (the "Threshold Appreciation Price"), ____ shares of Common
Stock per Purchase Contract;
(2) if the Applicable Market Value is less than the Threshold
Appreciation Price but greater than $_____ (the "Reference Price"),
the number of shares of Common Stock per Purchase Contract having a
value, based on the Applicable Market Value, equal to the Stated
Amount; and
(3) if the Applicable Market Amount is less than or equal to the
Reference Price, _____ shares of Common Stock per Purchase Contract,
in each case subject to adjustment as provided in the Purchase Contract
Agreement.
No fractional shares of Common Stock will be issued upon settlement of
Purchase Contracts, as provided in Section 5.10 of the Purchase Contract
Agreement.
Each Purchase Contract evidenced hereby, which is settled either
through Early Settlement or Cash Settlement, shall obligate the Holder of the
related SPC Unit to purchase at the Purchase Price, and the Company to sell, a
number of shares of Common Stock equal to the Early Settlement Rate or the
Settlement Rate, as applicable.
The "Applicable Market Value" means the average of the Closing Price
per share of Common Stock on each of the 20 consecutive Trading Days ending on
the third Trading Day immediately preceding the Purchase Contract Settlement
Date.
The "Closing Price" per share of Common Stock on any date of
determination means:
(1) the closing sale price (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 per share as reported in the composite
transactions for the principal United States 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 closing sale price per share as reported
by The Nasdaq Stock Market, Inc.;
A-3
(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 average of the mid-point
of the last bid and ask prices of Common Stock on such date from at least
three nationally recognized independent investment banking firms retained
for this purpose by the Company.
A "Trading Day" means a day on which 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 SPC 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 or an Early Settlement or a Remarketing of the
related Pledged Notes. A Holder of SPC Units who does not effect, on or prior to
11:00 a.m. (New York City time) on the fifth Business Day immediately preceding
the Purchase Contract Settlement Date, an effective Cash Settlement or an 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. Such sale will be made
by the Remarketing Agent pursuant to the terms of the Remarketing Agreement on
the third Business Day prior to the Purchase Contract Settlement Date. If, as
provided in the Purchase Contract Agreement, upon the occurrence of a Failed
Remarketing, the Collateral Agent, for the benefit of the Company, exercises its
rights as a secured creditor with respect to the Pledged Notes related to this
SPC Units certificate, any accrued and unpaid or deferred interest payments on
such Pledged Notes will become payable by the Company to the holder of this SPC
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 payment of the aggregate purchase price for
the shares of Common Stock to be purchased thereunder in the manner herein set
forth.
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. 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 SPC Units Holders a notice:
(1) containing such information as is contained in the notice or
solicitation;
(2) stating that each SPC Unit 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
A-4
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 SPC Unit; and
(3) stating the manner in which such instructions may be given.
Upon the written request of the SPC Unit Holders on such record date, 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 to which any particular voting instructions are
received. In the absence of specific instructions from the Holder of a SPC Unit,
the Purchase Contract Agent shall abstain from voting the Notes evidenced by
such SPC Unit.
The SPC Certificates are issuable only in registered form and only in
denominations of a single SPC Unit and any integral multiple thereof. The
transfer of any SPC Units Certificate will be registered and SPC Units
Certificates may be exchanged as provided in the Purchase Contract Agreement.
The SPC Units 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 Notes, thereby creating Treasury SPC 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 SPC Unit remains in effect, such SPC Unit shall
not be separable into its constituent parts, and the rights and obligations of
the Holder of such SPC Unit in respect of the Note and Purchase Contract
constituting such SPC Unit may be transferred and exchanged only as a SPC Unit.
The Holder of SPC Units may substitute for the Pledged Notes securing
such Holder's obligations under the related Purchase Contracts Treasury
Securities in an aggregate principal amount 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 Security for which such Pledged Treasury Securities secures
the Holder's obligation under the Purchase Contract shall be referred to as a
"Treasury SPC Unit". A Holder may make such Collateral Substitution only in
integral multiples of 20 SPC Units for 20 Treasury SPC Units. Such Collateral
Substitution may cause the equivalent aggregate principal amount of this
Certificate to be increased or decreased; provided, however, this SPC Units
Certificate shall not represent more than [4,000,000] SPC Units. All such
adjustments to the equivalent aggregate principal amount of this SPC Units
Certificate shall be duly recorded by placing an appropriate notation on the
Schedule attached hereto.
A Holder of Treasury SPC Units may recreate SPC Units by delivering to
the Securities Intermediary with an aggregate principal amount, in the case of
such Notes equal to the aggregate principal amount of the Pledged Treasury
Securities in exchange for the release of such Pledged Treasury Securities in
accordance with the terms of the Purchase Contract Agreement and the Pledge
Agreement.
A-5
The Company shall pay, on each Payment Date, the Purchase Contract
Payments payable in respect of each Purchase Contract to the Person in whose
name the SPC Units Certificate evidencing such Purchase Contract is registered
at the close of business on the Record Date for such Payment Date. Purchase
Contract Payments will be payable at the office of the Purchase Contract Agent
in New York City or, at the option of the Company, by check mailed to the
address of the Person entitled thereto at such address as it appears on the SPC
Units Register.
The Company has the right to defer payment of all or part of the
Purchase Contract Payments in respect of each Purchase Contract until no later
than the Purchase Contract Settlement Date. If the Company so elects to defer
Purchase Contract Payments, the Company shall pay additional Purchase Contract
Payments on such deferred installments of Purchase Contract Payments at a rate
equal to ____% per annum, compounding quarterly, until such deferred
installments are paid. If a Holder effects an Early Settlement or if a
Termination Event shall occur, such Holder will have no right to receive any
accrued and unpaid or deferred Purchase Contract Payments.
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 Purchase
Contract 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 SPC Units
Register. Upon and after the occurrence of a Termination Event, the Collateral
Agent shall release the Notes from the Pledge in accordance with the provisions
of the Pledge Agreement. A SPC Unit shall thereafter represent the right to
receive the Note forming a part of such SPC 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 Securities may be settled early ("Early Settlement") as provided in
the Purchase Contract Agreement. In order to exercise the right to effect Early
Settlement with respect to any Purchase Contracts evidenced by this SPC Units
Certificate, the Holder of this SPC Units Certificate shall deliver this SPC
Units 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 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:
(1) the product of (A) the Stated Amount times (B) the number of
Purchase Contracts with respect to which the Holder has elected to effect
Early Settlement, plus
(2) if such delivery is made with respect to any Purchase Contracts
during the period from the close of business on any Record Date for any
Payment Date to the opening of business on such Payment Date, an amount
equal to the Purchase Contract Payments payable on such Payment Date with
respect to such Purchase Contracts.
A-6
Upon Early Settlement of Purchase Contracts by a Holder of the related
Securities, the Pledged Notes underlying such Securities shall be released from
the Pledge as provided in the Pledge Agreement and the Holder shall be entitled
to receive a number of shares of Common Stock on account of each Purchase
Contract forming part of a SPC Unit as to which Early Settlement is effected
equal to the Early Settlement Rate. The Early Settlement Rate shall initially be
equal to ____ shares of Common Stock and shall be adjusted in the same manner
and at the same time as the Settlement Rate is adjusted as provided in the
Purchase Contract Agreement.
Upon registration of transfer of this SPC 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 SPC 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 SPC Units Certificate, by its acceptance hereof,
authorizes the Purchase Contract Agent to enter into and perform the related
Purchase Contracts forming part of the SPC 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 his 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 underlying this SPC 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 Notes, on the Purchase Contract Settlement Date shall be
paid by the Collateral Agent to the Company in satisfaction of such Holder's
obligations under such Purchase Contract and such Holder shall acquire no right,
title or interest in such payments.
Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of a majority of the
Purchase Contracts.
The Purchase Contracts shall be governed by, and construed in
accordance with, the laws of the State of New York.
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 SPC Units Certificate is registered as the owner of the SPC
Units evidenced hereby for the purpose of receiving payments of interest payable
quarterly on the Notes, receiving payments of Purchase Contract Payments,
performance of the Purchase Contracts and for all other purposes whatsoever,
whether or not any payments in respect thereof be overdue and notwithstanding
A-7
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.
Unless the certificate of authentication hereon has been executed by
the Purchase Contract Agent by manual signature, this SPC 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-8
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
PP&L RESOURCES, INC.
By:
------------------------------------
Name:
Title:
By:
-----------------------------------
Name:
Title:
HOLDER SPECIFIED ABOVE (as to obligations
of such Holder under the Purchase
Contracts evidenced hereby)
By: _______________________________, not
individually but solely as Attorney-
in-Fact of such Holder
By:
------------------------------------
Name:
Title:
Dated:
A-9
CERTIFICATE OF AUTHENTICATION OF
PURCHASE CONTRACT AGENT
This is one of the SPC Units Certificates referred to in the within
mentioned Purchase Contract Agreement.
By: _______________________________, as
Purchase Contract Agent
By: __________________________________
Authorized Officer
Dated:
A-10
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 ____
-----------------------------------------
(State)
TEN ENT: as tenants by the entireties
JT TEN: as joint tenants with right of
survivorship and not as tenants in common
Additional abbreviations may also be used though not in the above list.
----------------------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
--------------------------------------------------------------------------------
(Please insert Social Security or Taxpayer I.D. or other Identifying Number of
Assignee)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Please Print or Type Name and Address Including Postal Zip Code of Assignee)
the within SPC Units Certificates and all rights thereunder, hereby irrevocably
constituting and appointing
--------------------------------------------------------------------------------
attorney to transfer said SPC Units Certificates on the books of PP&L Resources,
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 SPC Units Certificates
in every particular, without
alteration or enlargement or any
change whatsoever.
Signature Guarantee: _____________________
A-11
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 SPC Units evidenced by
this SPC 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)
[STAMP LEGEND]
If shares are to be registered in the REGISTERED HOLDER
name of and delivered to a Person other
than the Holder, please (i) print such
Person's name and address and (ii)
provide a guarantee of your signature: Please print name and address of
Registered Holder:
_______________________________________ ____________________________________
Name Name
_______________________________________ ____________________________________
Address Address
_______________________________________ ____________________________________
_______________________________________ ____________________________________
_______________________________________ ____________________________________
Social Security or other
Taxpayer Identification Number, if any ____________________________________
A-12
ELECTION TO SETTLE EARLY
The undersigned Holder of this SPC Units Certificate hereby
irrevocably exercises the option to effect Early Settlement in accordance with
the terms of the Purchase Contract Agreement with respect to the Purchase
Contracts underlying the number of SPC Units evidenced by this SPC Units
Certificate specified below. The undersigned Holder directs that a certificate
for shares of Common Stock deliverable upon such Early Settlement be registered
in the name of, and delivered, together with a check in payment for any
fractional share and any SPC Units Certificate representing any SPC Units
evidenced hereby as to which Early Settlement of the related Purchase Contracts
is not effected, to the undersigned at the address indicated below unless a
different name and address have been indicated below. Pledged Notes deliverable
upon such Early Settlement will be transferred in accordance with the transfer
instructions set forth below. If shares are to be registered in the name of a
Person other than the undersigned, the undersigned will pay any transfer tax
payable incident thereto.
Dated: ______________________________ ____________________________________
Signature
Signature Guarantee: ___________________________
[Stamp Legend]
A-13
Number of Securities evidenced hereby as to which Early Settlement of
the related Purchase Contracts is being elected:
If shares of Common Stock or SPC Units REGISTERED HOLDER
Certificates are to be registered in
the name of and delivered to and
Pledged Notes are to be transferred to
a Person other than the Holder, please
print such Person's name and address:
Please print name and address of
Registered Holder:
_______________________________________ ____________________________________
Name Name
_______________________________________ ____________________________________
Address Address
_______________________________________ ____________________________________
_______________________________________ ____________________________________
_______________________________________ ____________________________________
Social Security or other
Taxpayer Identification Number, if any ____________________________________
Transfer Instructions for Pledged Notes Transferable Upon Early Settlement or a
Termination Event:
________________________________________________________________________________
A-14
[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 SPC UNITS
AMOUNT OF DECREASE IN AMOUNT OF DECREASE IN EVIDENCED BY THIS SIGNATURE OF
NUMBER OF SPC UNITS NUMBER OF SPC UNITS GLOBAL CERTIFICATE AUTHORIZED OFFICER OF
EVIDENCED BY THE EVIDENCED BY THE GLOBAL FOLLOWING SUCH TRUSTEE OR SECURITIES
DATE GLOBAL CERTIFICATE CERTIFICATE DECREASE OR INCREASE CUSTODIAN
A-15
EXHIBIT B
FORM OF TREASURY SPC CERTIFICATE
THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN THE
NAME OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE "DEPOSITARY"),
OR A NOMINEE OF THE DEPOSITARY. THIS CERTIFICATE IS EXCHANGEABLE FOR
CERTIFICATES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS
NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT
AGREEMENT AND NO TRANSFER OF THIS CERTIFICATE (OTHER THAN A TRANSFER OF THIS
CERTIFICATE AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A
NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY) MAY BE REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
No. _____ Cusip No. _____
Number of Treasury SPC Units _________
PP&L RESOURCES, INC.
TREASURY SPC UNITS
This Treasury SPC Units Certificate certifies that _______________ is
the registered Holder of the number of Treasury SPC Units set forth above. Each
Treasury SPC Unit consists of (i) a 1/20 undivided beneficial ownership interest
of a Treasury Security having a principal amount at maturity equal to $1,000,
subject to the Pledge of such Treasury Security by such Holder pursuant to the
Pledge Agreement, and (ii) the rights and obligations of the Holder under one
Purchase Contract with PP&L Resources, Inc., a Pennsylvania corporation (the
"Company"). All capitalized terms used herein which are defined in the Purchase
Contract Agreement (as defined below) have the meaning set forth therein.
B-1
Pursuant to the Pledge Agreement, the Treasury Securities constituting
part of each Treasury SPC 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 SPC
Unit.
Each Purchase Contract evidenced hereby obligates the Holder of this
Treasury SPC Units Certificate to purchase, and the Company, to sell, on the
Purchase Contract Settlement Date, at a price equal to $50 (the "Stated
Amount"), a number of shares of PP&L Resources, Inc. Common Stock, par value
$.01 per share ("Common Stock"), equal to the Settlement Rate, unless prior to
or on the Purchase Contract Settlement Date there shall have occurred a
Termination Event or an Early Settlement with respect to the Treasury SPC Unit
of which such Purchase Contract is a part, all as provided in the Purchase
Contract Agreement and more fully described on the reverse hereof. The purchase
price (the "Purchase Price") for the shares of Common Stock purchased pursuant
to each Purchase Contract evidenced hereby, if not paid earlier, shall be paid
on the Purchase Contract Settlement Date by 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 SPC Unit of which such Purchase
Contract is a part.
The Company shall pay, quarterly in arrears on February 16, May 16,
August 16 and November 16, commencing ______________ (each, a "Payment Date"),
in respect of each Purchase Contract evidenced hereby an amount (the "Purchase
Contract Payments") equal to ____% per annum of the Stated Amount. Such Purchase
Contract Payments shall be payable to the Person in whose name this Treasury SPC
Units Certificate (or a Predecessor Treasury SPC Units Certificate) is
registered at the close of business on the Record Date for such Payment Date.
The Company may, at its option, defer Purchase Contract Payments.
Purchase Contract Payments will be payable at the office of the
Purchase Contract Agent in New York City or, at the option of the Company, by
check mailed to the address of the Person entitled thereto as such address
appears on the Treasury SPC Units Register.
Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of ______________ (as may be supplemented from
time to time, the "Purchase Contract Agreement") between the Company and
______________ , 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 SPC Units Certificates
are, and are to be, executed and delivered.
Each Purchase Contract evidenced hereby obligates the Holder of this
Treasury SPC 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 prior to the Purchase Contract Settlement Date, there shall have
occurred a Termination Event with respect to the Security of which such Purchase
Contract is a part or an Early Settlement shall have occurred. The "Settlement
Rate" is equal to:
B-2
(1) if the Applicable Market Value (as defined below) is equals or
exceeds $. (the "Threshold Appreciation Price"), shares of Common Stock per
Purchase Contract;
(2) if the Applicable Market Value is less than the Threshold
Appreciation Price but greater than $. (the "Reference Price"), the number
of shares of Common Stock per Purchase Contract having a value, based on
the Applicable Market Value, equal to the Stated Amount; and
(3) if the Applicable Market Amount is less than or equal to the
Reference Price, shares of Common Stock per Purchase Contract, in each case
subject to adjustment as provided in the Purchase Contract Agreement.
No fractional shares of Common Stock will be issued upon settlement of
Purchase Contracts, as provided in Section 5.10 of the Purchase Contract
Agreement.
Each Purchase Contract evidenced hereby, which is settled either
through Early Settlement or Cash Settlement, shall obligate the Holder of the
related Treasury SPC Unit to purchase at the Purchase Price for cash, and the
Company to sell, a number of shares of Common Stock equal to the Early
Settlement Rate or the Settlement Rate, as applicable.
The "Applicable Market Value" means the average of the Closing Prices
per share of Common Stock on each of the 20 consecutive Trading Days ending on
the third Trading Day immediately preceding the Purchase Contract Settlement
Date.
The "Closing Price" per share of Common Stock on any date of
determination means the:
(1) closing sale price (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 per share as reported in the composite
transactions for the principal United States 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 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 average of the mid-point
of the last bid and ask prices of Common Stock on such date from at least
three nationally recognized independent investment banking firms retained
for this purpose by the Company.
B-3
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 Treasury SPC Unit shall pay the Purchase Price for the shares of
Common Stock purchased pursuant to each Purchase Contract evidenced hereby
either by effecting a Cash Settlement or an Early Settlement of each such
Purchase Contract or by applying a principal amount of the Pledged Treasury
Securities underlying such Holder's Treasury SPC Unit equal to the Stated Amount
of such Purchase Contract to the purchase of the Common Stock. A Holder of
Treasury SPC Unit who does not effect, prior to or on 11:00 a.m. (New York City
time) on the Business Day immediately preceding the Purchase Contract Settlement
Date, an effective Cash Settlement or an Early Settlement, shall pay the
Purchase Price for the shares of Common Stock to be issued under the related
Purchase Contract from the proceeds of the Pledged Treasury Securities.
The Company shall not be obligated to issue any shares of Common Stock
in respect of a Purchase Contract or deliver any certificates therefor to the
Holder unless it shall have received payment of the aggregate purchase price for
the shares of Common Stock to be purchased thereunder in the manner herein set
forth.
The Treasury SPC Units Certificates are issuable only in registered
form and only in denominations of a single Treasury SPC and any integral
multiple thereof. The transfer of any Treasury SPC Certificate will be
registered and Treasury SPC Certificates may be exchanged as provided in the
Purchase Contract Agreement. The Treasury SPC 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 SPC
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 SPC Unit remains in effect, such
Treasury SPC Unit shall not be separable into its constituent parts, and the
rights and obligations of the Holder of such Treasury SPC Unit in respect of the
Treasury Security and the Purchase Contract constituting such Treasury SPC Unit
may be transferred and exchanged only as a Treasury SPC Unit.
A Holder of Treasury SPC Units may recreate SPC Units by delivering to
the Collateral Agent Notes with a principal amount, in the case of such Notes,
equal to the aggregate principal amount at maturity of the Pledged Treasury
Securities in exchange for the release of such Pledged Treasury Securities in
accordance with the terms of the Purchase Contract Agreement and the Pledge
Agreement. From and after such substitution, the Holder's Security shall be
referred to as a "SPC Unit". Such substitution may cause the equivalent
aggregate principal amount of this Certificate to be increased or decreased;
provided, however, this Treasury SPC Units Certificate shall not represent more
than [4,000,000] Treasury SPC Units. All such adjustments to the equivalent
aggregate principal amount of this Treasury SPC Units Certificate shall be duly
B-4
recorded by placing an appropriate notation on the Schedule attached hereto.
A Holder of SPC Units may recreate Treasury SPC Units by delivering to
the Collateral Agent Treasury Securities in an aggregate principal amount equal
to the aggregate principal amount at maturity of the Pledged Notes in exchange
for the release of such Pledged Notes in accordance with the terms of the
Purchase Contract Agreement and the Pledge Agreement. Any such recreation of
Treasury SPC Units may be effected only in multiples of 20 SPC Units for 20
Treasury SPC Units.
The Company shall pay, on each Payment Date, the Purchase Contract
Payments payable in respect of each Purchase Contract to the Person in whose
name the Treasury SPC 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 Company, by check
mailed to the address of the Person entitled thereto at such address as it
appears on the Treasury SPC Units Register.
The Company has the right to defer payment of all or part of the
Purchase Contract Payments in respect of each Purchase Contract until no later
than the Purchase Contract Settlement Date. If the Company so elects to defer
Purchase Contract Payments, the Company shall pay additional Purchase Contract
Payments on such deferred installments of Purchase Contract Payments at a rate
equal to ____% per annum, compounding quarterly, until such deferred
installments are paid. If a Holder effects an Early Settlement or if a
Termination Event shall occur, such Holder will have no right to receive any
accrued and unpaid or deferred Purchase Contract Payments.
The Purchase Contracts and all obligations and rights of the Company
and the Holders thereunder, including, without limitation, the rights of the
Holders to receive and the obligation of the Company to pay Contract Adjustment
Payments, shall immediately and automatically terminate, without the necessity
of any notice or action by any Holder, the 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 Treasury SPC Units Register.
Upon the occurrence of a Termination Event, the Collateral Agent shall release
the Treasury Securities from the Pledge in accordance with the provisions of the
Pledge Agreement. A Treasury SPC Unit shall thereafter represent the right to
receive the interest in the Treasury Security forming a part of such Treasury
SPC 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 Securities may be settled early ("Early Settlement") as provided in
the Purchase Contract Agreement. In order to exercise the right to effect Early
Settlement with respect to any Purchase Contracts evidenced by this Treasury SPC
Unit, the Holder of this Treasury SPC Units Certificate shall deliver this
Treasury SPC Units Certificate to the Purchase Contract Agent at the Corporate
B-5
Trust Office duly endorsed for transfer to the Company or in blank with the form
of Election to Settle Early set forth below duly completed and accompanied by
payment in the form of immediately available funds payable to the order of the
Company in an amount (the "Early Settlement Amount") equal to:
(1) the product of (A) $50 times (B) the number of Purchase Contracts
with respect to which the Holder has elected to effect Early Settlement,
plus
(2) if such delivery is made with respect to any Purchase Contracts
during the period from the close of business on any Record Date for any
Payment Date to the opening of business on such Payment Date, an amount
equal to the Contract Adjustment Payments payable, if any, on such Payment
Date with respect to such Purchase Contracts.
Upon Early Settlement of Purchase Contracts by a Holder of the related
Securities, the Pledged Treasury Securities underlying such Securities shall be
released from the Pledge as provided in the Pledge Agreement and the Holder
shall be entitled to receive a number of shares of Common Stock on account of
each Purchase Contract forming part of a Treasury SPC Unit as to which Early
Settlement is effected equal to shares of Common Stock per Purchase Contract
(the "Early Settlement Rate"). The Early Settlement Rate shall be adjusted in
the same manner and at the same time as the Settlement Rate is adjusted as
provided in the Purchase Contract Agreement.
Upon registration of transfer of this Treasury SPC 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 SPC 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 SPC 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 SPC 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 SPC
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.
B-6
Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of a majority of the
Purchase Contracts.
The Purchase Contracts shall for all purposes be governed by, and
construed in accordance with, the laws of the State of New York.
The Company, the 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 SPC Units Certificate is registered as the owner of the
Treasury SPC Units evidenced hereby for the purpose of receiving payments of
interest on the Treasury Securities, receiving payments of Purchase Contract
Payments, performance of the Purchase Contracts and for all other purposes
whatsoever, whether or not any payments in respect thereof be overdue and
notwithstanding any notice to the contrary, and neither the Company, the
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.
Unless the certificate of authentication hereon has been executed by
the Purchase Contract Agent by manual signature, this Treasury SPC 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.
B-7
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
PP&L RESOURCES, INC.
By:
------------------------------------
Name:
Title:
By:
------------------------------------
Name:
Title:
HOLDER SPECIFIED ABOVE (as to obligations
of such Holder under the Purchase
Contracts)
By: , not
------------------------------
individually but solely as Attorney-
in-Fact of such Holder
By:
------------------------------------
Name:
Title:
Dated:
B-8
CERTIFICATE OF AUTHENTICATION OF PURCHASE CONTRACT AGENT
This is one of the Treasury SPC Units referred to in the
within-mentioned Purchase Contract Agreement.
By: , as Purchase
---------------------------
Contract Agent
By:
---------------------------------------
Authorized Officer
Dated:
B-9
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM: as tenants in common
UNIF GIFT MIN ACT: Custodian
(cust) (minor)
Under Uniform Gifts to Minors Act of ____
-----------------------------------------
(State)
TEN ENT: as tenants by the entireties
JT TEN: as joint tenants with right of
survivorship and not as tenants in common
Additional abbreviations may also be used though not in the above list.
----------------------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
--------------------------------------------------------------------------------
(Please insert Social Security or Taxpayer I.D. or other Identifying Number of
Assignee)
--------------------------------------------------------------------------------
(Please Print or Type Name and Address Including Postal Zip Code of Assignee)
the within SPC Units Certificates and all rights thereunder, hereby irrevocably
constituting and appointing attorney to transfer said SPC Units Certificates on
the books of PP&L Resources, 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 SPC Units Certificates
in every particular, without
alteration or enlargement or any
change whatsoever.
Signature Guarantee: _____________________
B-10
SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for shares of Common
Stock deliverable upon settlement on or after the Purchase Contract Settlement
Date of the Purchase Contracts underlying the number of Treasury SPC Units
evidenced by this Treasury SPC 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 of Common Stock or SPC Units REGISTERED HOLDER
Certificates are to be registered in
the name of and delivered to and
Pledged Notes 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-11
ELECTION TO SETTLE EARLY
The undersigned Holder of this Treasury SPC Units Certificate
irrevocably exercises the option to effect Early Settlement in accordance with
the terms of the Purchase Contract Agreement with respect to the Purchase
Contracts underlying the number of Treasury SPC Units evidenced by this Treasury
SPC Units Certificate specified below. The option to effect Early Settlement may
be exercised only with respect to Purchase Contracts underlying Treasury SPC
with an aggregate Stated Amount equal to $1,000 or an integral multiple thereof.
The undersigned Holder directs that a certificate for shares of Common Stock
deliverable upon such Early Settlement be registered in the name of, and
delivered, together with a check in payment for any fractional share and any
Treasury SPC Units Certificate representing any Treasury SPC Units evidenced
hereby as to which Early Settlement of the related Purchase Contracts is not
effected, to the undersigned at the address indicated below unless a different
name and address have been indicated below. Pledged Treasury Securities
deliverable upon such Early Settlement will be transferred in accordance with
the transfer instructions set forth below. If shares are to be registered in the
name of a Person other than the undersigned, the undersigned will pay any
transfer tax payable incident thereto.
Dated: _____________________________ ____________________________________
Signature
Signature Guarantee: ____________________________
[Stamp Legend?]
B-12
Number of Securities evidenced hereby as to which Early Settlement of
the related Purchase Contracts is being elected:
If shares of Common Stock or SPC Units REGISTERED HOLDER
Certificates are to be registered in
the name of and delivered to and
Pledged Notes 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-13
[TO BE ATTACHED TO GLOBAL CERTIFICATES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The following increases or decreases in this Global Certificate have
been made:
NUMBER OF SPC UNITS
AMOUNT OF DECREASE IN AMOUNT OF DECREASE IN EVIDENCED BY THIS SIGNATURE OF
NUMBER OF SPC UNITS NUMBER OF SPC UNITS GLOBAL CERTIFICATE AUTHORIZED OFFICER OF
EVIDENCED BY THE EVIDENCED BY THE GLOBAL FOLLOWING SUCH TRUSTEE OR SECURITIES
DATE GLOBAL CERTIFICATE CERTIFICATE DECREASE OR INCREASE CUSTODIAN
B-14
EXHIBIT C
INSTRUCTION TO PURCHASE CONTRACT AGENT
___________________
___________________
___________________
___________________
Attention: ___________________
Re: [_______ SPC Units] [_______ Treasury SPC Units] of PP&L
Resources, Inc., a Pennsylvania corporation (the "Company")
The undersigned Holder hereby notifies you that it has delivered to
__________, 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 _____________ (the
"Pledge Agreement"; unless otherwise defined herein, terms defined in the Pledge
Agreement are used herein as defined therein), between you, the Company, the
Collateral Agent and the Securities Intermediary. The undersigned Holder has
paid all applicable fees relating to such exchange. The undersigned Holder
hereby instructs you to instruct the Collateral Agent to release to you on
behalf of the undersigned Holder the [Pledged Notes] [Pledged Treasury
Securities] related to such [SPC Units] [Treasury SPC Units].
Date: ___________________________ ____________________________________
Signature
Signature Guarantee: _______________
(if assigned to another person)
Please print name and address of Registered Holder:
_______________________________________ ____________________________________
Name Social Security or other
Taxpayer Identification Number,
if any
Address
______________________________________
______________________________________
______________________________________
C-1
EXHIBIT D
NOTICE FROM PURCHASE CONTRACT AGENT TO HOLDERS
(TRANSFER OF COLLATERAL UPON OCCURRENCE OF A TERMINATION EVENT)
[HOLDER]
______________________________________
______________________________________
Attention:
Telecopy: __________
Re: [__________ SPC Units] [______ Treasury SPC Units] of PP&L
Resources, Inc., a Pennsylvania corporation (the "Company")
Please refer to the Purchase Contract Agreement, dated as of ________
(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 SPC Units and Treasury SPC Units from time
to time.
We hereby notify you that a Termination Event has occurred and that
[the Notes][the Treasury Securities] underlying your ownership interest in _____
[SPC Units] [Treasury SPC 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 [SPC
Units][Treasury SPC Units] effected through book-entry or by delivery to us of
your [SPC Units Certificate][Treasury SPC 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 [SPC Units][Treasury SPC Units] are transferred or your [SPC Units
Certificate] [Treasury SPC Units Certificate] is surrendered or satisfactory
evidence is provided that such your [SPC Units Certificate][Treasury SPC Units
Certificate] has been destroyed, lost or stolen, together with any
indemnification that we or the Company may require.
Date: By:
----------------------------
----------------------------
Name:
Title: Authorized Officer
D-1
EXHIBIT E
NOTICE TO SETTLE BY CASH
___________________
___________________
___________________
Attention: ___________________
Re: [_______ SPC Units] [Treasury SPC Units] of PP&L Resources, Inc.,
a Pennsylvania corporation (the "Company")
The undersigned Holder hereby irrevocably notifies you in accordance
with Section 5.4 of the Purchase Contract Agreement, dated as of _________ (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 fifth Business Day immediately preceding
the Purchase Contract Settlement Date (in lawful money of the United States by
certified or cashiers' check or wire transfer, in immediately available funds),
$______ as the Purchase Price for the shares of Common Stock issuable to such
Holder by the Company under the related 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
[SPC Units] [Treasury SPC 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 AND INDENTURE TRUSTEE
(SETTLEMENT OF PURCHASE CONTRACT THROUGH REMARKETING)
___________________
___________________
___________________
Attention: ___________________
Telecopy: ___________________
_____________________________, as Indenture Trustee
______________________________________
______________________________________
Attention:
Telecopy:
Re: __________ SPC Units of PP&L Resources, Inc., a Pennsylvania
corporation (the "Company")
Please refer to the Purchase Contract Agreement, dated as of ________
(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 SPC Units from time to time.
In accordance with Section 5.4 of the Purchase Contract Agreement and,
based on instructions and Cash Settlements received from Holders of SPC Units as
of 11:00 a.m. (New York City time), the fifth Business Day preceding the
Purchase Contract Settlement Date, we hereby notify you that ______ Notes are to
be tendered for purchase in the Remarketing.
Date: By:
-------------------------------
-------------------------------
Name:
Title: Authorized Officer
F-1
