EXHIBIT (4)
THIS PROCEEDS IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A
NOMINEE THEREOF. UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR
PROCEEDS IN CERTIFICATED FORM, THIS PROCEEDS MAY NOT BE TRANSFERRED EXCEPT AS A
WHOLE BY THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO A
NOMINEE OF DTC OR BY DTC OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A
NOMINEE OF SUCH SUCCESSOR DEPOSITORY. UNLESS THIS PROCEEDS IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC TO XXXXXXX XXXXX & CO., INC. OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY PROCEEDS ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
No. R-1 14,905,000 Units
CUSIP: o (each Unit representing $10 principal
amount of PROtected Covered Call
EnhancED Income NoteS(SM))
XXXXXXX XXXXX & CO., INC.
PROtected Covered Call EnhancED Income NoteS(SM)
Linked to the Select 30 PROCEEDS Index, Series 2
due February 4, 2010
(the "PROCEEDS")
Xxxxxxx Xxxxx & Co., Inc., a Delaware corporation (hereinafter referred
to as the "Company", which term includes any successor corporation under the
Indenture herein referred to), for value received, hereby promises to pay to
CEDE & CO., or its registered assigns, for each Unit the Interest Amount (as
defined below) on each Interest Payment Date (as defined below). On February 4,
2010 (the "Stated Maturity"), the Company hereby promises to pay to CEDE & CO.,
or its registered assigns, a sum for each Unit equal to the sum of the principal
amount of the PROCEEDS and the Supplemental Redemption Amount (as defined
below), if any.
Payment or delivery per Unit of the above-referenced principal amount
of the PROCEEDS and the Supplemental Redemption Amount, if any, and any interest
on any overdue amount thereof with respect to this PROCEEDS and the Interest
Amount, if any, shall be made at the office or agency of the Company maintained
for that purpose in the Borough of Manhattan, The City of New York, in such coin
or currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts.
This PROCEEDS is one of the series of PROtected Covered Call EnhancED
Income NoteS(SM) Linked to the Select 30 PROCEEDS Index, Series 2 due February
4, 2010.
Interest
The Company shall pay interest, if any, on each Unit of the PROCEEDS
equal to the Interest Amount on the third Business Day (as defined below)
following each Commencement Date (as defined below) (each, an "Interest Payment
Date"). A "Commencement Date" shall mean the next Business Day following the
third Friday of each February, May, August and November, beginning May 23, 2005.
The Company shall pay interest to the persons in whose names the PROCEEDS are
registered at the close of business on a "Regular Record Date", which shall be
the Business Day immediately succeeding the last day of the applicable Quarterly
Calculation Period (as defined below). If an Interest Payment Date falls on a
day that is not a Business Day, the Interest Amount payment, if any, to be made
on such day shall be made on the next succeeding Business Day with the same
force and effect as if made on such Interest Payment Date, and no additional
interest shall be paid as a result of such delayed payment.
The "Interest Amount" shall be the amount determined by the Calculation
Agent (as defined below) in a notice provided to the Trustee (as defined below)
on or before the second Business Day immediately following the last day of the
applicable Quarterly Calculation Period.
"Quarterly Calculation Period" means the period from and including a
Commencement Date to, but excluding, the next Commencement Date, provided that
the initial Quarterly Calculation Period shall commence on, and include,
February 4, 2005 and the final Quarterly Calculation Period shall extend to, and
include, the Valuation Date (as defined below).
Payment at Maturity
At maturity, a Holder shall receive a cash payment with respect to each
Unit of the PROCEEDS equal to the sum of:
(i) the principal amount of $10
and
(ii) the Supplemental Redemption Amount, if any.
The "Supplemental Redemption Amount" with respect to each Unit of this
PROCEEDS shall be determined by the Calculation Agent and shall equal:
Ending Value - Threshold Value
$10 X( -------------------------------)
Threshold Value
provided, however, that in no event shall the Supplemental
Redemption Amount be less than zero.
The "Ending Value" shall be determined by the Calculation Agent and
shall equal the closing level of the Reference Index (as defined below)
determined on the Valuation Date.
The "Threshold Value" equals 100.
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The "Reference Index" means the Select 30 PROCEEDS Index, Series 2
published as of 4:00 p.m. (New York City time) on each Business Day (as defined
below) on Reuters Page MEREDUS 13 (or any successor page as identified by the
Calculation Agent).
The "Valuation Date" shall be the seventh scheduled Index Business Day
before the Stated Maturity, or if that day is not an Index Business Day, the
next Business Day; provided, however, that if no Business Days occur between the
seventh scheduled Index Business Day before the Stated Maturity and the second
scheduled Business Day before the Stated Maturity, the Valuation Date shall be
the second scheduled Index Business Day prior to the State Maturity, regardless
of the occurrence of a Market Disruption Event (as defined below).
"Index Business Day" shall be a day, as determined by the Calculation
Agent, on which securities comprising more than 80% of the value of the Select
30 Basket on that day are capable of being traded on their relevant exchanges
during the one-half hour before the determination of the closing level of the
Reference Index for that day.
"Business Day" shall be any day other than a Saturday or Sunday that is
not a day on which banking institutions in The City of New York are authorized
or obligated by law to close.
"Calculation Agent" means Xxxxxxx Xxxxx International.
All determinations made by the Calculation Agent shall be made in good
faith and in a commercially reasonable manner by the Calculation Agent and,
absent a determination of a manifest error, shall be conclusive for all purposes
and binding on the Company, the Holders and the beneficial owners of this
PROCEEDS.
"Market Disruption Event" means either of the following events as
determined by the Calculation Agent:
(A) the suspension of or material limitation on trading for more
than two hours of trading, or during the one-half hour period
preceding the close of trading, on the applicable exchange
(without taking into account any extended or after-hours
trading session), in 20% or more of the stocks which then
comprise the Reference Index; or
(B) the suspension of or material limitation on trading, in each
case, for more than two hours of trading, or during the
one-half hour period preceding the close of trading, on the
applicable exchange (without taking into account any extended
or after-hours trading session), whether by reason of
movements in price otherwise exceeding levels permitted by the
relevant exchange or otherwise, in option contracts or futures
contracts related to 20% or more of the stocks which then
comprise the Reference Index.
For the purpose of the above definition:
(1) a limitation on the hours in a trading day and/or number of
days of trading shall not constitute a Market Disruption Event
if it results from an announced change in the regular business
hours of the relevant exchange;
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(2) a suspension in trading in a futures or option contract on a
stock which then comprises the Reference Index by a major
securities market by reason of (a) a price change violating
limits set by that securities market, (b) an imbalance of
orders relating to those contracts or (c) a disparity in bid
and ask quotes relating to those contracts will constitute a
suspension of or material limitation on trading in futures or
option contracts related to that stock;
(3) a suspension of or material limitation on trading on the
relevant exchange will not include any time when that exchange
is closed for trading under ordinary circumstances; and
(4) for the purpose of clause (A) above, any limitations on
trading during significant market fluctuations under NYSE Rule
80A, or any applicable rule or regulation enacted or
promulgated by the NYSE or any other self regulatory
organization or the Securities and Exchange Commission of
similar scope as determined by the Calculation Agent, shall be
considered "material".
General
This PROCEEDS is one of a duly authorized issue of Securities of the
Company, issued and to be issued under an Indenture, dated as of April 1, 1983,
as amended and restated (herein referred to as the "Indenture"), between the
Company and JPMorgan Chase Bank, N.A., as Trustee (herein referred to as the
"Trustee", which term includes any successor Trustee under the Indenture), to
which Indenture and all indentures supplemental thereto reference is hereby made
for a statement of the respective rights thereunder of the Company, the Trustee
and the Holders of this PROCEEDS, and the terms upon which this PROCEEDS is, and
is to be, authenticated and delivered.
The Company hereby covenants for the benefit of the Holders of this
PROCEEDS, to the extent permitted by applicable law, not to claim voluntarily
the benefits of any laws concerning usurious rates of interest against a Holder
of this PROCEEDS.
This PROCEEDS is not subject to redemption by the Company or at the
option of the Holder prior to the Stated Maturity.
In case an Event of Default with respect to this PROCEEDS shall have
occurred and be continuing, the amount payable to a Holder of a PROCEEDS upon
any acceleration permitted by this PROCEEDS, with respect to each Unit hereof,
shall be equal to the amount payable on the Stated Maturity with respect to such
Unit, calculated as though the date of acceleration were the Stated Maturity of
this PROCEEDS, provided, however, the Index Adjustment Factor (as defined in the
prospectus supplement relating to the PROCEEDS) shall be applied to the values
used to calculate the Supplemental Redemption Amount as if the PROCEEDS had not
been accelerated and had remained outstanding to the Stated Maturity.
In case of default in payment of this PROCEEDS (whether at any Interest
Payment Date, the Stated Maturity or upon acceleration), from and after such
date this PROCEEDS shall bear interest, payable upon demand of the Holders of
this PROCEEDS, at the rate of 2.25% per
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annum on the unpaid amount due and payable on such date in accordance with
the terms of this PROCEEDS to the date payment of such amount has been made or
duly provided for.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with the
consent of the Holders of not less than 66 2/3% in aggregate principal amount of
the Securities at the time Outstanding of each series affected thereby. Holders
of specified percentages in aggregate principal amount of the Securities of each
series at the time Outstanding, on behalf of the Holders of all Securities of
each series, are permitted to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this PROCEEDS
shall be conclusive and binding upon such Holder and upon all future Holders of
this PROCEEDS and of any PROCEEDS issued upon the registration of transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
consent or waiver is made upon this PROCEEDS.
No reference herein to the Indenture and no provision of this PROCEEDS
or of the Indenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay any amount payable with respect to this
PROCEEDS and any interest on any overdue amount thereof at the time, place and
rate, and in the coin or currency herein prescribed.
As provided in the Indenture and subject to certain limitations set
forth therein and on the first page hereof, the transfer of this PROCEEDS may be
registered on the Security Register of the Company, upon surrender of this
PROCEEDS for registration of transfer at the office or agency of the Company in
the Borough of Manhattan, The City of New York, duly endorsed by, or accompanied
by a written instrument of transfer in form satisfactory to the Company duly
executed by, the Holder hereof or by his attorney duly authorized in writing,
and thereupon one or more new PROCEEDS, of authorized denominations and for the
same aggregate principal amount, shall be issued to the designated transferee or
transferees.
The PROCEEDS are issuable only in registered form without coupons in
denominations of a single Unit and integral multiples thereof. This PROCEEDS
shall remain in the form of a global security held by a Depository.
Notwithstanding the foregoing, if (x) any Depository is at any time unwilling or
unable to continue as Depository and a successor depository is not appointed by
the Company within 60 days, (y) the Company executes and delivers to the Trustee
a Company Order to the effect that this PROCEEDS shall be exchangeable or (z) an
Event of Default has occurred and is continuing with respect to this PROCEEDS,
this PROCEEDS shall be exchangeable for PROCEEDS in definitive form of like
tenor and of an equal aggregate principal amount, in denominations of a single
Unit and integral multiples thereof. Such definitive PROCEEDS shall be
registered in such name or names as the Depository shall instruct the Trustee.
If definitive PROCEEDS are so delivered, the Company may make such changes to
the form of this PROCEEDS as are necessary or appropriate to allow for the
issuance of such definitive PROCEEDS.
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No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or governmental charge payable in connection therewith.
The Company and each Holder by acceptance hereof hereby agree to treat
this PROCEEDS for all tax purposes as a debt instrument that is subject to U.S.
Treasury Regulation section 1.1275-4(b) governing contingent payment debt
instruments, and, where required, the Company shall file information returns
with the Internal Revenue Service in accordance with this treatment, in the
absence of any change or clarification in the law, by regulation or otherwise,
requiring a different characterization of the PROCEEDS.
Prior to due presentment of this PROCEEDS for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name this PROCEEDS is registered as the owner hereof for all
purposes, whether or not this PROCEEDS be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
All terms used in this PROCEEDS which are defined in the Indenture but
not in this PROCEEDS shall have the meanings assigned to them in the Indenture.
Unless the certificate of authentication hereon has been executed by
JPMorgan Chase Bank, N.A., the Trustee under the Indenture, or its successor
thereunder, by the manual signature of one of its authorized officers, this
PROCEEDS shall not be entitled to any benefits under the Indenture or be valid
or obligatory for any purpose.
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IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated: February 4, 2005
CERTIFICATE OF AUTHENTICATION Xxxxxxx Xxxxx & Co., Inc.
This is one of the Securities of the series
designated therein referred to in the [Copy of Seal]
within-mentioned Indenture.
JPMorgan Chase Bank, N.A., as Trustee By:
Treasurer
By: Attest:
Authorized Officer Secretary
