EXHIBIT 4(y)
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PROTECTIVE LIFE CORPORATION
AND
THE BANK OF NEW YORK,
AS PURCHASE CONTRACT AGENT
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FORM OF PURCHASE CONTRACT AGREEMENT
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DATED AS OF _______ __, 1997
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TABLE OF CONTENTS
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RECITALS 1
ARTICLE I
Definitions and Other Provisions
of General Applications
Section 1.1. Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.2. Compliance Certificates and Opinions . . . . . . . . . . . . . 13
Section 1.3. Form of Documents Delivered to Agent . . . . . . . . . . . . . 13
Section 1.4. Acts of Holders; Record Dates. . . . . . . . . . . . . . . . . 14
Section 1.5. Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Section 1.6. Notice to Holders; Waiver. . . . . . . . . . . . . . . . . . . 17
Section 1.7. Effect of Headings and Table of
Contents . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 1.8. Successors and Assigns . . . . . . . . . . . . . . . . . . . . 18
Section 1.9. Separability Clause. . . . . . . . . . . . . . . . . . . . . . 18
Section 1.10. Benefits of Agreement. . . . . . . . . . . . . . . . . . . . . 18
Section 1.11. Governing Law. . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 1.12. Legal Holidays . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 1.13. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 1.14. Inspection of Agreement. . . . . . . . . . . . . . . . . . . . 20
ARTICLE II
Certificate Forms
Section 2.1. Forms of Certificates Generally. . . . . . . . . . . . . . . . 20
Section 2.2. Form of Agent's Certificate of
Authentication . . . . . . . . . . . . . . . . . . . . . . . 21
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ARTICLE III
The Securities
Section 3.1. Title and Terms; Denominations . . . . . . . . . . . . . . . . 21
Section 3.2. Rights and Obligations Evidenced by
the Certificates . . . . . . . . . . . . . . . . . . . . . . 22
Section 3.3. Execution, Authentication, Delivery
and Dating . . . . . . . . . . . . . . . . . . . . . . . . . 23
Section 3.4. Temporary Certificates . . . . . . . . . . . . . . . . . . . . 24
Section 3.5. Registration; Registration of
Transfer and Exchange. . . . . . . . . . . . . . . . . . . . 25
Section 3.6. Book-Entry Interests . . . . . . . . . . . . . . . . . . . . . 27
Section 3.7. Notices to Holders . . . . . . . . . . . . . . . . . . . . . . 28
Section 3.8. Appointment of Successor Clearing
Agency . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 3.9. Definitive Certificates. . . . . . . . . . . . . . . . . . . . 28
Section 3.10. Mutilated, Destroyed, Lost and
Stolen Certificates. . . . . . . . . . . . . . . . . . . . . 29
Section 3.11. Persons Deemed Owners. . . . . . . . . . . . . . . . . . . . . 30
Section 3.12. Cancellation . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 3.13. Substitution of Securities . . . . . . . . . . . . . . . . . . 32
Section 3.14. Reestablishment of Income PRIDES . . . . . . . . . . . . . . . 34
Section 3.15. Transfer of Collateral upon
Occurrence of Termination Event. . . . . . . . . . . . . . . 35
Section 3.16. No Consent to Assumption . . . . . . . . . . . . . . . . . . . 35
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ARTICLE IV
The Preferred Securities
Section 4.1. Payment of Distributions; Rights to
Distributions Preserved;
Distribution Rate Reset; Notice. . . . . . . . . . . . . . . 36
Section 4.2. Notice and Voting. . . . . . . . . . . . . . . . . . . . . . . 38
Section 4.3. Liquidation of the Trust . . . . . . . . . . . . . . . . . . . 38
ARTICLE V
The Purchase Contracts . . . . . . . . . . . 39
Section 5.1. Purchase of Shares of Common Stock . . . . . . . . . . . . . . 39
Section 5.2. Contract Adjustment Payments . . . . . . . . . . . . . . . . . 41
Section 5.3. Deferral of Payment Dates for
Contract Adjustment Payments . . . . . . . . . . . . . . . . 43
Section 5.4. Payment of Purchase Price. . . . . . . . . . . . . . . . . . . 45
Section 5.5. Issuance of Shares of Common Stock . . . . . . . . . . . . . . 48
Section 5.6. Adjustment of Settlement Rate. . . . . . . . . . . . . . . . . 49
Section 5.7. Notice of Adjustments and Certain
Other Events . . . . . . . . . . . . . . . . . . . . . . . . 56
Section 5.8. Termination Event; Notice. . . . . . . . . . . . . . . . . . . 57
Section 5.9. Early Settlement . . . . . . . . . . . . . . . . . . . . . . . 57
Section 5.10. No Fractional Shares . . . . . . . . . . . . . . . . . . . . . 60
Section 5.11. Charges and Taxes. . . . . . . . . . . . . . . . . . . . . . . 60
ARTICLE VI
Remedies
Section 6.1. Unconditional Right of Holders to
Receive Contract Adjustment
Payments and to Purchase
Common Stock . . . . . . . . . . . . . . . . . . . . . . . . 61
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Section 6.2. Restoration of Rights and Remedies . . . . . . . . . . . . . . 61
Section 6.3. Rights and Remedies Cumulative . . . . . . . . . . . . . . . . 62
Section 6.4. Delay or Omission Not Waiver . . . . . . . . . . . . . . . . . 62
Section 6.5. Undertaking for Costs. . . . . . . . . . . . . . . . . . . . . 62
Section 6.6. Waiver of Stay or Extension Laws . . . . . . . . . . . . . . . 63
ARTICLE VII
The Agent
Section 7.1. Certain Duties and Responsibilities. . . . . . . . . . . . . . 63
Section 7.2. Notice of Default. . . . . . . . . . . . . . . . . . . . . . . 64
Section 7.3. Certain Rights of Agent. . . . . . . . . . . . . . . . . . . . 65
Section 7.4. Not Responsible for Recitals or
Issuance of Securities . . . . . . . . . . . . . . . . . . . 66
Section 7.5. May Hold Securities. . . . . . . . . . . . . . . . . . . . . . 66
Section 7.6. Money Held in Custody. . . . . . . . . . . . . . . . . . . . . 66
Section 7.7. Compensation and Reimbursement . . . . . . . . . . . . . . . . 66
Section 7.8. Corporate Agent Required;
Eligibility. . . . . . . . . . . . . . . . . . . . . . . . . 67
Section 7.9. Resignation and Removal; Appointment
of Successor . . . . . . . . . . . . . . . . . . . . . . . . 68
Section 7.10. Acceptance of Appointment by
Successor. . . . . . . . . . . . . . . . . . . . . . . . . . 69
Section 7.11. Merger, Conversion, Consolidation
or Succession to Business. . . . . . . . . . . . . . . . . . 70
Section 7.12. Preservation of Information;
Communications to Holders. . . . . . . . . . . . . . . . . . 70
Section 7.13. No Obligations of Agent. . . . . . . . . . . . . . . . . . . . 71
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Section 7.14. Tax Compliance . . . . . . . . . . . . . . . . . . . . . . . . 71
ARTICLE VIII
Supplemental Agreements
Section 8.1. Supplemental Agreements Without
Consent of Holders . . . . . . . . . . . . . . . . . . . . . 72
Section 8.2. Supplemental Agreements with Consent
of Holders . . . . . . . . . . . . . . . . . . . . . . . . . 73
Section 8.3. Execution of Supplemental Agreements . . . . . . . . . . . . . 74
Section 8.4. Effect of Supplemental Agreements. . . . . . . . . . . . . . . 74
Section 8.5. Reference to Supplemental Agreements . . . . . . . . . . . . . 75
ARTICLE IX
Consolidation, Merger, Sale or Conveyance
Section 9.1. Covenant Not to Merge, Consolidate,
Sell or Convey Property Except
Under Certain Conditions . . . . . . . . . . . . . . . . . . 75
Section 9.2. Rights and Duties of Successor
Corporation. . . . . . . . . . . . . . . . . . . . . . . . . 76
Section 9.3. Opinion of Counsel to Agent. . . . . . . . . . . . . . . . . . 76
ARTICLE X
Covenants
Section 10.1. Performance Under Purchase
Contracts. . . . . . . . . . . . . . . . . . . . . . . . . . 77
Section 10.2. Maintenance of Office or Agency. . . . . . . . . . . . . . . . 77
Section 10.3. Company to Reserve Common Stock. . . . . . . . . . . . . . . . 78
Section 10.4. Covenants as to Common Stock . . . . . . . . . . . . . . . . . 78
Section 10.5. Statements of Officers of the
Company as to Default. . . . . . . . . . . . . . . . . . . . 78
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EXHIBIT A Form of Income PRIDES Certificate . . . . . . . . . . . . A-1
EXHIBIT B Form of Growth PRIDES Certificate . . . . . . . . . . . . B-1
EXHIBIT C Instruction to Collateral Agent . . . . . . . . . . . . . C-1
EXHIBIT D Instruction to Purchase Contract Agent . . . . . . . . . D-1
FORM OF PURCHASE CONTRACT AGREEMENT, dated as of _______ __, 1997, between
Protective Life Corporation, a Delaware corporation (the "Company"), and The
Bank of New York, a national banking association, acting as purchase contract
agent for the Holders of Securities from time to time (the "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 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.
WITNESSETH:
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 Applications
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;
(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 or other subdivision;
(d) the following terms have the meanings given to them in the
Declaration: (i) Authorized Newspaper; (ii) Coupon Rate; (iii) Indenture, (iv)
Liquidation Distribution; (v) Reset Agent; (vi) Reset Announcement Date; (vii)
Reset Rate; (viii) Reset Spread; and (ix) Two-Year Benchmark Treasury; and
(e) the following terms have the meanings given to them in this Section
1.1(e).
"Act" when used with respect to any Holder, has the meaning specified 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" 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.
"Agent" means the Person named as the "Agent" in the first paragraph of
this instrument until a successor Agent shall have become such pursuant to the
applicable provisions of this Agreement, and thereafter "Agent" shall mean such
Person.
"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.
2
"Applicable Market Value" has the meaning specified in Section 5.1.
"Bankruptcy Code" means title 11 of the United States Code, or any other
law of the United States that from time to time provides a uniform system of
bankruptcy laws.
"Beneficial Owner" means, with respect to a Book-Entry Interest, a Person,
who is the beneficial owner of such Book-Entry Interest, as reflected on the
books of the 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
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 which is not a Saturday or Sunday or a day on
which banking institutions in Xxx Xxxx Xxxx (xx xxx Xxxxx xx Xxx Xxxx) are
permitted or required by any applicable law to close.
"Cash Settlement" has the meaning set forth in Section 5.4(a)(i).
"Certificate" means an Income PRIDES Certificate or a Growth PRIDES
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
3
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 specified in Section 3.13.
"Collateral" has the meaning specified in Section 2.1 of the Pledge
Agreement.
"Collateral Agent" means The Chase Manhattan Bank, 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 specified in Section 3.13.
"Common Stock" means the Common Stock, par value $.50 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.
"Contract Adjustment Payments" means the fee payable by the Company in
respect of each Purchase Contract, equal to ____% per annum of the Stated
Amount, (provided that if such percentage is 0%, then no such payment shall be
payable by the Company) computed on the basis of a 360 day year of twelve 30 day
months, plus any Deferred Contract Adjustment Payments accrued pursuant to
Section 5.2.
"Corporate Trust Office" means the principal corporate trust office of the
Agent at which, at any particular time, its corporate trust business shall be
adminis-
4
tered, which office at the date hereof is located at
, Attention:
_____________________________, except that for purposes of Section 10.2, such
term shall mean the office or agency of the Agent in the Borough of Manhattan,
the City of New York, which office at the date hereof is located at 000 Xxxxxxx
Xxxxxx, 00X, Xxx Xxxx, XX 00000.
"Current Market Price" has the meaning specified in Section 5.6(a)(8).
"Debentures" means the series of debentures of the Company designated the
____% Debentures due February 17, 2003, to be issued under the Indenture as of
the date hereof.
"Declaration" means the Amended and Restated Declaration of Trust of PLC
Capital Trust II, dated ______ __, 1997, among the Company, as the sponsor, the
trustees named therein and the holders from time to time of individual
beneficial interests in the assets of the Trust.
"Deferred Contract Adjustment Payments" has the meaning specified in
Section 5.3.
"Depositary" means, initially, DTC until another Clearing Agency becomes
its successor.
"DTC" means the Depository Trust Company, the initial Clearing Agency.
"Early Settlement" has the meaning specified in Section 5.9(a).
"Early Settlement Amount" has the meaning specified in Section 5.9(a).
"Early Settlement Date" has the meaning specified in Section 5.9(a).
"Early Settlement Rate" has the meaning specified in Section 5.9(b).
"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.
5
"Expiration Date" has the meaning specified in Section 1.4.
"Expiration Time" has the meaning specified in Section 5.6(a)(6).
"Global Certificate" means a Certificate that evidences all or part of the
Securities and is registered in the name of a Depositary or a nominee thereof.
"Global Preferred Security Certificate" means a certificate evidencing the
rights and obligations of a holder in respect of the number of Preferred
Securities specified on such certificate and which is registered in the name of
a Clearing Agency or a nominee thereof.
"Growth PRIDES" means, following the substitution of one or more Treasury
Securities for Preferred Securities as collateral to secure a Holder's
obligations under a Purchase Contract, the collective rights and obligations of
a Holder of a Growth PRIDES Certificate in respect of such Treasury Securities,
subject to the Pledge thereof, and the related Purchase Contract.
"Growth PRIDES Certificate" means a certificate evidencing the rights and
obligations of a Holder in respect of the number of Growth PRIDES specified on
such certificate.
"Growth PRIDES Register" and "Growth PRIDES Registrar" have the respective
meanings specified in Section 3.5.
"Holder," when used with respect to a Security, means the Person in whose
name the Security evidenced by an Income PRIDES Certificate and/or a Growth
PRIDES Certificate is registered in the related Income PRIDES Register and/or
the Growth PRIDES Register, as the case may be.
"Income PRIDES" means the collective rights and obligations of a Holder of
an Income PRIDES Certificate in respect of a Preferred Security, subject to the
Pledge thereof, and the related Purchase Contract.
"Income PRIDES Certificate" means a certificate evidencing the rights and
obligations of a Holder in
6
respect of the number of Income PRIDES specified on such certificate.
"Income PRIDES Register" and "Income PRIDES Registrar" have the respective
meanings specified in Section 3.5.
"Indenture" has the meaning set forth in Section 1.1 of the Declaration.
"Indenture Trustee" means AmSouth Bank (as successor by merger to AmSouth
Bank of Alabama, successor by conversion of Charter to AmSouth Bank N.A.), as
trustee under the Indenture, or any successor thereto.
"Institutional Trustee" means Wilmington Trust Company, as institutional
trustee under the Declaration, or any successor thereto that is a financial
institution unaffiliated with the Company.
"Issuer Order" or "Issuer Request" means a written order or request signed
in the name of the Company by its Chairman of the Board, any Vice Chairman, its
President or a Vice President and by its Treasurer, an Assistant Treasurer, its
Secretary or an Assistant Secretary, and delivered to the Agent.
"Liquidation Distribution" has the meaning set forth in Annex I of the
Declaration.
"NYSE" has the meaning specified in Section 5.1.
"Officer's Certificate" means a certificate signed by the Chairman of the
Board, any Vice Chairman of the Board, the President, any Vice President, the
Treasurer or the Secretary of the Company and delivered to the Agent.
"Opinion of Counsel" means an opinion in writing signed by legal counsel,
who may be an employee of or counsel to the Company and who shall be reasonably
acceptable to the Agent.
"Outstanding Securities," with respect to any Income PRIDES and/or Growth
PRIDES, means, as of the date of determination, all Income PRIDES and/or Growth
PRIDES
7
evidenced by Certificates theretofore authenticated, executed and delivered
under this Agreement, except:
(i) If a Termination Event has occurred, (A) Growth PRIDES and (B)
Income PRIDES for which the Stated Amount of the related Preferred Security
or a Liquidation Distribution in respect of such Preferred Security has
been theretofore deposited with the Agent in trust for the Holders of such
Income PRIDES;
(ii) Income PRIDES and Growth PRIDES evidenced by Certificates
theretofore cancelled by the Agent or delivered to the Agent for
cancellation or deemed cancelled pursuant to the provisions of this
Agreement; and
(iii) Income PRIDES and Growth PRIDES evidenced by Certificates
issued 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 Agent proof satisfactory to it that such
Certificate is held by a bona fide purchaser in whose hands the Income
PRIDES or Growth PRIDES evidenced by such Certificate are valid obligations
of the Company;
provided, however, that in determining whether the Holders of the requisite
number of the Income PRIDES or Growth PRIDES have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Income PRIDES or
Growth PRIDES owned by the Company or any Affiliate of the Company shall be
disregarded and deemed not to be outstanding, except that, in determining
whether the Agent shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Income PRIDES or
Growth PRIDES which a Responsible Officer of the Agent knows to be so owned
shall be so disregarded. Income PRIDES or Growth PRIDES so owned which have
been pledged in good faith may be regarded as Outstanding Securities if the
pledgee establishes to the satisfaction of the Agent the pledgee's right so to
act with respect to such Income PRIDES or Growth PRIDES and that the pledgee is
not the Company or any Affiliate of the Company.
8
"Payment Date" means each March 31, June 30, September 30, and December 31,
commencing __________ __, 199 .
"Person" means any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or other entity or government or any agency or
political subdivision thereof.
"Permitted Investments" has the meaning set forth in Section 1 of the
Pledge Agreement.
"Pledge" means the pledge under the Pledge Agreement of the Preferred
Securities (or the Debentures in the event of a Liquidation Distribution) or the
Treasury Securities, as the case may be, in each case constituting a part of the
Securities.
"Pledge Agreement" means the Pledge Agreement, dated as of the date hereof,
by and among the Company, the Collateral Agent and the Agent, on its own behalf
and as attorney-in-fact for the Holders from time to time of the Securities.
"Predecessor Certificate" means a Predecessor Income PRIDES Certificate or
a Predecessor Growth PRIDES Certificate.
"Predecessor Growth PRIDES Certificate" of any particular Growth PRIDES
Certificate means every previous Growth PRIDES Certificate evidencing all or a
portion of the rights and obligations of the Company and the Holder under the
Growth PRIDES evidenced thereby; and, for the purposes of this definition, any
Growth PRIDES Certificate authenticated and delivered under Section 3.10 in
exchange for or in lieu of a mutilated, destroyed, lost or stolen Growth PRIDES
Certificate shall be deemed to evidence the same rights and obligations of the
Company and the Holder as the mutilated, destroyed, lost or stolen Growth PRIDES
Certificate.
"Predecessor Income PRIDES Certificate" of any particular Income PRIDES
Certificate means every previous Income PRIDES Certificate evidencing all or a
portion of the rights and obligations of the Company and the Holder under the
Income PRIDES evidenced thereby; and, for the purposes of this definition, any
Income PRIDES Certifi-
9
cate authenticated and delivered under Section 3.10 in exchange for or in lieu
of a mutilated, destroyed, lost or stolen Income PRIDES Certificate shall be
deemed to evidence the same rights and obligations of the Company and the Holder
as the mutilated, destroyed, lost or stolen Income PRIDES Certificate.
"Preferred Securities" means the ____% Trust Originated Preferred
Securities of the Trust, each having a stated liquidation amount of $50,
representing preferred undivided beneficial interests in the assets of the
Trust.
"Proceeds" has the meaning set forth in Section 1 of the Pledge Agreement.
"Purchase Contract," when used with respect to any Security, means the
contract obligating the Company to (i) sell and the Holder of such Security to
purchase Common Stock and (ii) pay the Holder Contract Adjustment Payments, if
any, in each case, on the terms and subject to the conditions set forth in
Article Five hereof.
"Purchase Contract Settlement Date" means February 16, 2000.
"Purchase Contract Settlement Fund" has the meaning specified in Section
5.5.
"Purchase Price" has the meaning specified in Section 5.1.
"Purchased Shares" has the meaning specified in Section 5.6(a)(6).
"Record Date" for the distribution and Contract Adjustment Payments, if
any, 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,
the 15th day of the month in which such Payment Date occurs.
"Register" means the Income PRIDES Register and the Growth PRIDES Register.
"Registrar" means the Income PRIDES Registrar and the Growth PRIDES
Registrar.
10
"Reorganization Event" has the meaning specified in Section 5.6(b).
"Repayment Price" means, with respect to a Preferred Security, the
liquidation amount plus any accumulated and unpaid distributions thereon to the
date of repayment (subject to the rights of holders of record on the relevant
record date to receive distributions due on a Payment Date).
"Responsible Officer," when used with respect to the Agent, means any
officer of the Agent assigned by the Agent to administer its corporate trust
matters.
"Rights Agreement" has the meaning specified in Section 5.3.
"Security" means an Income PRIDES or a Growth PRIDES.
"Settlement Rate" has the meaning specified in Section 5.1.
"Stated Amount" means $50.
"Termination Date" means the date, if any, on which a Termination Event
occurs.
"Termination Event" means the occurrence of any of the following events:
(i) at any time on or prior to the Purchase Contract Settlement Date, a
judgment, decree or court order shall have been entered granting relief under
the Bankruptcy Code, adjudicating the Company to be insolvent, or approving as
properly filed a petition seeking reorganization or liquidation of the Company
or any other similar applicable Federal or State law, and, 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; or (ii) 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 winding
up 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
11
judgment, decree or order shall have continued undischarged and unstayed for a
period of 60 days; or (iii) at any time on or prior to the Purchase Contract
Settlement Date the Company shall file a petition for relief under the
Bankruptcy Code, or shall consent to the filing of a bankruptcy proceeding
against it, or shall file a petition or answer or consent seeking reorganization
or liquidation of the Company 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 specified in Section 5.1.
"TIA" means the Trust Indenture Act of 1939, as amended, or any successor
statute.
"Trading Day" has the meaning specified in Section 5.1.
"Treasury Security" means a zero-coupon U.S. Treasury Security due February
15, 2001 (Cusip Number ) which is the principal strip of the 8.50%
U.S. Treasury Security which matures on February 15, 2001.
"Trust" means PLC Capital Trust II, a statutory business trust formed under
the laws of the State of Delaware.
"Underwriting Agreement" means the Underwriting Agreement dated _______ __,
1997 between the Company and the Trust, on the one hand, and Xxxxxxx Lynch,
Pierce, Xxxxxx & Xxxxx Incorporated, Xxxxxxx, Sachs & Co., Xxx-Xxxx, Xxxxxx,
Inc., and The Xxxxxxxx-Xxxxxxxx Company, LLC, as representatives of the several
Underwriters named therein, on the other hand.
"Vice President" means any vice president, whether or not designated by a
number or a word or words added before or after the title "vice president."
12
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 Agent to take any action under any
provision of this Agreement, the Company shall furnish to the 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 an Opinion
of Counsel stating that, in the opinion of such counsel, all such conditions
precedent, if any, have been complied with, except that in the case of any such
application or request as to which the furnishing of such documents is
specifically required by any provision of this Agreement relating to such
particular application or request, no additional certificate or opinion need be
furnished.
Every certificate or opinion with respect to compliance with a condition or
covenant provided for in this Agreement 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 has
made such examination or investigation as is necessary to enable him 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 Agent.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified
13
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 agent duly appointed in writing;
and, except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments are delivered to the 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
14
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 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 Agent deems
sufficient.
(c) The ownership of Securities shall be proved by the Income PRIDES
Register or the Growth PRIDES 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 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 Outstanding Securities on such record date, and no other Holders,
shall be entitled to take the relevant action, whether or not such Holders
remain Holders after such record date; provided that no such action shall be
effective hereunder unless taken on or prior to the applicable Expiration Date
by Holders of the requisite number of Outstanding Securities on such record
date. Nothing 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 of no
effect), and nothing 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.
15
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 Agent in
writing and to each Holder of Securities in the manner set forth in Section 1.6.
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 Agent in writing, and to each Holder of Securities in the manner set forth
in Section 1.6, on or prior to 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.
Any request, demand, authorization, direction, notice, consent, waiver or
Act of Holders or other document provided or permitted by this Agreement to be
made upon, given or furnished to, or filed with,
(1) the Agent by any Holder or by the Company shall be sufficient for
every purpose hereunder (unless otherwise herein expressly provided) if
made, given, furnished or filed in writing and personally delivered or
mailed, first-class postage prepaid, to the Agent at ,
Attention: or at any other address previously
furnished in writing by the Agent to the Holders and the Company, or
(2) the Company by the Agent or by any Holder shall be sufficient for
every purpose hereunder (unless otherwise herein expressly provided) if
made, given, furnished or filed in writing and personally delivered or
mailed, first-class postage
16
prepaid, to the Company at 0000 Xxxxxxx 000 Xxxxx, Xxxxxxxxxx, Xxxxxxx
00000, Attention: , or at any other address
previously furnished in writing to the Agent by the Company.
(3) the Collateral Agent by the Agent, the Company or any Holder shall
be sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if made, given, furnished or filed in writing and
personally delivered or mailed, first-class postage prepaid, addressed to
the Collateral Agent at The Chase Manhattan Bank, 000 X. 00xx Xxxxxx, 00xx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Corporate Trust Trustee
Administration, or at any other address previously furnished in writing by
the Collateral Agent to the Agent, the Company and the Holders; or
(4) the Institutional Trustee by the Company shall be sufficient for
every purpose hereunder (unless otherwise herein expressly provided) if
made, given, furnished or filed in writing and personally delivered or
mailed, first-class postage prepaid, addressed to the Institutional Trustee
at 0000 X. Xxxxxx Xxxxxx, Xxxxxxxxx Financial Center, Xxxxxxxxxx, XX 00000,
Attention:___________________, or at any other address previously furnished
in writing by the Institutional Trustee to the Company; or
(5) the Indenture Trustee by the Company shall be sufficient for every
purpose hereunder (unless otherwise herein expressly provided) if made,
given, furnished or filed in writing and personally delivered or mailed,
first-class postage prepaid, addressed to the Indenture Trustee at
, Attention: , or at any other
address previously furnished in writing by the Indenture Trustee to the
Company.
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 ap-
17
pears 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 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 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.
Section 1.10. Benefits of Agreement.
Nothing in this Agreement or in the Securities, express or implied, shall
give to any Person, other than
18
the parties hereto and their successors hereunder and 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, then
(notwithstanding any other provision of this Agreement or the Income PRIDES
Certificates or the Growth PRIDES Certificates) payment of the Contract
Adjustment Payments, if any, shall not be made on such date, but such payments
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 the Purchase Contract Settlement Date shall not be a
Business Day, then (notwithstanding any other provision of this Agreement, the
Income PRIDES Certificates or the Growth PRIDES Certificates), the Purchase
Contracts shall not be performed on such date, but the Purchase Contracts shall
be performed on the next preceding 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.
19
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.
ARTICLE II
Certificate Forms
Section 2.1. Forms of Certificates Generally.
The Income PRIDES Certificates (including the form of Purchase Contract
forming part of the Income PRIDES 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 Income PRIDES are listed or any depositary
therefor, or as may, consistently herewith, be determined by the officers of the
Company executing such Income PRIDES Certificates, as evidenced by their
execution of the Income PRIDES Certificates.
The definitive Income PRIDES 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 Income PRIDES
evidenced by such Income PRIDES Certificates, consistent with the provisions of
this Agreement, as evidenced by their execution thereof.
The Growth PRIDES Certificates (including the form of Purchase Contract
forming part of the Growth PRIDES 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 Growth PRIDES may be listed or any depositary
therefor, or as may, consistently herewith, be determined by the officers of the
Company executing such Growth PRIDES Certificates, as evidenced by their
execution of the Growth PRIDES Certificates.
20
The definitive Growth PRIDES 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 Growth PRIDES
evidenced by such Growth PRIDES 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 (AS HEREINAFTER DEFINED) AND IS REGISTERED IN THE NAME
OF THE CLEARING AGENCY OR A NOMINEE THEREOF. THIS CERTIFICATE MAY NOT BE
EXCHANGED IN WHOLE OR IN PART FOR A CERTIFICATE REGISTERED, AND NO TRANSFER
OF THIS CERTIFICATE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF
ANY PERSON OTHER THAN SUCH CLEARING AGENCY OR A NOMINEE THEREOF, EXCEPT IN
THE LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT.
Section 2.2. Form of Agent's Certificate of Authentication.
The form of the Agent's certificate of authentication of the Income PRIDES
shall be in substantially the form set forth on the form of the Income PRIDES
Certificates.
The form of the Agent's certificate of authentication of the Growth PRIDES
shall be in substantially the form set forth on the form of the Growth PRIDES
Certificates.
ARTICLE III
The Securities
Section 3.1. Title and Terms; Denominations.
The aggregate number of Income PRIDES evidenced by Certificates
authenticated, executed on behalf of the
21
Holders and delivered hereunder is limited to 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, 3.13, 3.14, 5.9 or 8.5.
The Certificates shall be issuable only in registered form and only in
denominations of a single Income PRIDES or Growth PRIDES and any integral
multiple thereof.
Section 3.2. Rights and Obligations Evidenced by the Certificates.
Each Income PRIDES Certificate shall evidence the number of Income PRIDES
specified therein, with each such Income PRIDES representing the ownership by
the Holder thereof of a beneficial interest in a Preferred Security with a
stated liquidation amount equal to the Stated Amount, subject to the Pledge of
such Preferred Security by such Holder pursuant to the Pledge Agreement, and the
rights and obligations of the Holder thereof and the Company under one Purchase
Contract. The Agent as attorney-in-fact for, and on behalf of, each Holder of
Income PRIDES shall pledge, pursuant to the Pledge Agreement, each Preferred
Security relating to such Holder's Income PRIDES, to the Collateral Agent and
grant to the Collateral Agent a security interest in the right, title, and
interest of such Holder in such Preferred Security, for the benefit of the
Company, to secure the obligation of the Holder under the related Purchase
Contracts to purchase Common Stock. Prior to the purchase of shares of Common
Stock under a Purchase Contract, such Purchase Contract shall not entitle the
Holder of the related Income PRIDES 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
stockholders in respect of the meetings of stockholders or for the election of
directors of the Company or for any other matter, or any other rights whatsoever
as stockholders of the Company.
Each Growth PRIDES Certificate shall evidence the number of Growth PRIDES
specified therein, with each such Growth PRIDES representing the ownership by
the Holder thereof of a 1/20 undivided beneficial interest in a
22
Treasury Security with a principal amount equal to $1,000, subject to the Pledge
of such Treasury Security by such Holder pursuant to the Pledge Agreement, and
the rights and obligations of the Holder thereof and the Company under one
Purchase Contract. The Agent as attorney-in-fact for, and on behalf of, each
Holder of Growth PRIDES shall pledge, pursuant to the Pledge Agreement, each
Treasury Security related to such Holder's Growth PRIDES, 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 such Holder under the related Purchase
Contracts to purchase Common Stock. Prior to the purchase, if any, of shares of
Common Stock under Purchase Contract, such Purchase Contract shall not entitle
the Holder of the related Growth PRIDES 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 stockholders in respect of the meetings of stockholders or for the
election of directors of the Company or for any other matter, or any other
rights whatsoever as stockholders 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
Agent for authentication, execution on behalf of the Holders and delivery,
together with its Issuer Order for authentication of such Certificates, and the
Agent in accordance with such Issuer Order shall authenticate, execute on behalf
of the applicable Holders and deliver such Certificates.
The Certificates shall be executed on behalf of the Company by its Chairman
of the Board, its Vice Chairman of the Board, its President or one of its Vice
Presidents, under its corporate seal reproduced thereon attested by its
Secretary or one of its Assistant Secretaries. The signature of any of these
officers on the Certificates may be manual or facsimile.
23
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 Agent, as such Holder's attorney-in-fact. Such
signature by an authorized signatory of the 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 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 Agent, and the 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 Income PRIDES or Growth PRIDES 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.
24
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 Agent, and the Agent
shall authenticate, execute on behalf of the Holder, and deliver in exchange
therefor, one or more definitive Certificates of like tenor, in authorized
denominations and evidencing a like number of Income PRIDES or Growth PRIDES, 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 Income PRIDES or
Growth PRIDES, as the case may be, evidenced thereby as definitive Certificates.
Section 3.5. Registration; Registration of Transfer and Exchange.
The Agent shall keep at the Corporate Trust Office a register (the "Income
PRIDES Register") in which, subject to such reasonable regulations as it may
prescribe, the Agent shall provide for the registration of Income PRIDES
Certificates and of transfers of Income PRIDES Certificates (the Agent, in such
capacity, the "Income PRIDES Registrar") and a Register (the "Growth PRIDES
Register") in which, subject to such reasonable regulations as it may prescribe,
the Agent shall provide for the registration of the Growth PRIDES Certificates
following Collateral Substitutions and transfers of Growth PRIDES Certificates
(the Agent, in such capacity, the "Growth PRIDES Registrar").
Upon surrender for registration of transfer of any Certificate at the
Corporate Trust Office, the Company shall execute and deliver to the Agent, and
the 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 Income PRIDES or Growth PRIDES, as the
case may be.
25
At the option of the Holder, Certificates may be exchanged for other
Certificates, of any authorized denominations and evidencing a like number of
Income PRIDES or Growth PRIDES, 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 Agent, and the 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 Income PRIDES or
Growth PRIDES, as the case may be, and be entitled to the same benefits and
subject to the same obligations, under this Agreement as the Income PRIDES or
Growth PRIDES, 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
for exchange shall (if so required by the Agent) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Agent duly executed, by the Holder thereof or his 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 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, 5.9
and 8.5 not involving any transfer.
Notwithstanding the foregoing, the Company shall not be obligated to
execute and deliver to the Agent, and the Agent shall not be obligated to
authenticate, execute on behalf of the Holder and deliver any Certificate
presented or surrendered for registration of transfer or for exchange on or
after the Early Settlement Date, if any, with respect to the Securities
evidenced by such Certificate, the Business Day immediately preceding the
Purchase Contract Settlement Date or the Termination Date. In
26
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 Agent shall (i) if
the Early Settlement Date or the Purchase Contract Settlement Date, as
applicable, 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, (ii) in the case of Income PRIDES, if a Termination Event shall
have occurred prior to the Early Settlement Date or the Purchase Contract
Settlement Date, as applicable, transfer the stated liquidation amount of the
Preferred Securities relating thereto, or (iii) in the case of Growth PRIDES, if
a Termination Event shall have occurred prior to the Early Settlement Date or
the Purchase Contract Settlement Date, as applicable, transfer the Treasury
Securities relating thereto, 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 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:
(a) the provisions of this Section 3.6 shall be in full force and
effect;
(b) the Company shall be entitled to deal with the Clearing Agency
for all purposes of this Agreement (including the payment of Contract Adjustment
Payments, if any, and receiving approvals, votes or consents hereunder) as the
Holder of the Securities and the sole
27
holder of the Global Certificate(s) and shall have no obligation to the
Beneficial Owners;
(c) 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
(d) 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 and/or the
Clearing Agency Participants. The Clearing Agency will make book entry
transfers among Clearing Agency Participants and receive and transmit payments
of Contract Adjustment Payments to such 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.
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 (i) 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, (ii)
the Company elects to terminate the book-entry system through the Clearing
Agency with respect to the Securities, or (iii) there shall have occurred and be
continuing a default by the Company in
28
respect of its obligations under one or more Purchase Contracts, then upon
surrender of the Global Certificates representing the Book-Entry Interests with
respect to 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 Agent, the Company shall
execute and deliver to the Agent, and the Agent shall authenticate, execute on
behalf of the Holder, and deliver in exchange therefor, a new Certificate,
evidencing the same number of Income PRIDES or Growth PRIDES, as the case may
be, and bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company and the 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 Agent that such Certificate has been acquired by a bona fide
purchaser, the Company shall execute and deliver to the Agent, and the 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 Income PRIDES or Growth PRIDES, as the case may
be, and bearing a number not contemporaneously outstanding.
Notwithstanding the foregoing, the Company shall not be obligated to
execute and deliver to the Agent, and the Agent shall not be obligated to
authenticate, execute on behalf of the Holder, and deliver to the Holder, a
Certificate on or after the Early Settlement Date, if any, with respect to the
Securities evidenced by the applicable Certificate, the Business Day immediately
preceding the Purchase Contract Settlement Date or the Termination Date. In
lieu of delivery of a new Certificate, upon satisfaction of the applicable
conditions specified above
29
in this Section and receipt of appropriate registration or transfer instructions
from such Holder, the Agent shall (i) if the Early Settlement Date or the
Purchase Contract Settlement Date, as applicable, 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 (ii) if a Termination
Event shall have occurred prior to the Early Settlement Date or the Purchase
Contract Settlement Date, as applicable, transfer the Preferred Securities or
the Treasury Securities, as the case may be, relating thereto, 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 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 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 Agent, and any agent of the Company or the Agent, may treat the
Person in whose name such Certificate is registered as the owner of the Income
PRIDES or Growth PRIDES evidenced thereby, for the purpose of receiving
distributions on the related
30
Preferred Securities, receiving payments of Contract Adjustment Payments,
performance of the related Purchase Contracts and for all other purposes
whatsoever, whether or not any distributions on such Preferred Securities or the
Contract Adjustment Payments, if any, payable in respect of the Purchase
Contracts constituting a part of the Income PRIDES or Growth PRIDES evidenced
thereby shall be overdue and notwithstanding any notice to the contrary, and
neither the Company nor the Agent, nor any agent of the Company or the Agent,
shall be affected by notice to the contrary.
Notwithstanding the foregoing, with respect to any Global Certificate,
nothing herein shall prevent the Company, the Agent or any agent of the Company
or the Agent, 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 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 Preferred
Securities 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 a transfer or exchange of a Security, or a Collateral Substitution or the
re-establishment of an Income PRIDES shall, if surrendered to any Person other
than the Agent, be delivered to the Agent and, if not already cancelled, shall
be promptly cancelled by it. The Company may at any time deliver to the 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 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
31
Certificates held by the Agent shall be destroyed by the 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 Agent
cancelled or for cancellation.
Section 3.13. Substitution of Securities.
A Holder may separate Preferred Securities from the related Purchase
Contracts in respect of an Income PRIDES by substituting for such Preferred
Securities, Treasury Securities in an aggregate principal amount equal to the
aggregate stated liquidation amount of such Preferred Securities (a "Collateral
Substitution") at any time from and after the date of this Agreement and on or
prior to the second Business Day immediately preceding the Purchase Contract
Settlement Date by (a) depositing with the Collateral Agent Treasury Securities
having an aggregate principal amount equal to the aggregate stated liquidation
amount of the Preferred Securities relating to such Income PRIDES (and in any
event having an aggregate principal amount in an integral multiple of $1,000)
and (b) transferring the related Income PRIDES to the Agent accompanied by a
notice to the Agent, substantially in the form of Exhibit D hereto, stating that
the Holder has transferred the relevant amount of Treasury Securities to the
Collateral Agent and requesting that the Agent instruct the Collateral Agent to
release the Preferred Securities relating to such Income PRIDES, whereupon the
Agent shall promptly give such instruction to the Collateral Agent,
substantially in the form of Exhibit C hereto. Upon receipt of the Treasury
Securities described in clause (a) above and the instruction described in clause
(b) above, in accordance with the terms of the Pledge Agreement, the Collateral
Agent will release to the Agent, on behalf of the Holder, Preferred Securities
having a corresponding aggregate stated liquidation amount from the Pledge, free
and clear of the Company's security interest therein, and upon receipt thereof
the Agent shall promptly:
(i) cancel the related Income PRIDES;
32
(ii) transfer the Preferred Securities to the Holder; and
(iii) authenticate, execute on behalf of such Holder and deliver a
Growth PRIDES Certificate executed by the Company in accordance with
Section 3.3 evidencing the same number of Purchase Contracts as were
evidenced by the cancelled Income PRIDES Certificates.
Holders who elect to separate Preferred Securities from the related
Purchase Contracts and to substitute Treasury Securities for such Preferred
Securities 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
Income PRIDES.
In the event a Holder making a Collateral Substitution pursuant to this
Section 3.13 fails to effect a book-entry transfer of the applicable Income
PRIDES or fails to deliver the requisite number Income PRIDES Certificates to
the Agent after depositing Treasury Securities with the Collateral Agent, the
Preferred Securities relating to such Income PRIDES, and any distributions on
such Preferred Securities, shall be held in the name of the Agent or its nominee
in trust for the benefit of such Holder, until such Income PRIDES are so
transferred or such Income PRIDES Certificates are so delivered, as the case may
be, or, with respect to an Income PRIDES Certificate, such Holder provides
satisfactory evidence that such Income PRIDES Certificate has been destroyed,
lost or stolen, together with any indemnity that may be required by the Agent
and the Company.
Except as described in this Section 3.13, for so long as the Purchase
Contract underlying an Income PRIDES remains in effect, such Income PRIDES shall
not be separable into its constituent parts, and the rights and obligations of
the Holder of such Income PRIDES in respect of the related Preferred Security
and Purchase Contract comprising such Income PRIDES may be acquired, and may be
transferred and exchanged, only as an Income PRIDES.
33
Section 3.14. Reestablishment of Income PRIDES.
A Holder of a Growth PRIDES may at any time on or prior to the second
Business Day immediately preceding the Purchase Contract Settlement Date,
recreate Income PRIDES by (a) depositing with the Collateral Agent Preferred
Securities having an aggregate stated liquidation amount equal to the aggregate
principal amount of the Treasury Securities relating to the Growth PRIDES (and
in any event having an aggregate stated liquidation amount in an integral
multiple of $1,000) and (b) transferring the related Growth PRIDES to the Agent
accompanied by a notice to the Agent, substantially in the form of Exhibit D
hereto, stating that the Holder has transferred the relevant amount of Preferred
Securities to the Collateral Agent and requesting that the Agent instruct the
Collateral Agent to release the Treasury Securities relating to such Growth
PRIDES, whereupon the Agent shall promptly give such instruction to the
Collateral Agent, substantially in the form of Exhibit C hereto. Upon receipt
of the Preferred Securities described in clause (a) above and the instruction
described in clause (b) above, in accordance with the terms of the Pledge
Agreement, the Collateral Agent will effect the release of the Treasury
Securities having a corresponding aggregate principal amount from the Pledge to
the Agent free and clear of the Company's security interest therein, and upon
receipt thereof the Agent shall promptly:
(i) cancel the related Growth PRIDES;
(ii) transfer such Treasury Securities to the Holder; and
(iii) authenticate, execute on behalf of such Holder and deliver an
Income PRIDES Certificate executed by the Company in accordance with
Section 3.3 evidencing the same number of Purchase Contracts as were
evidenced by the cancelled Growth PRIDES.
Holders of Growth PRIDES may reestablish Income PRIDES only in integral
multiples of 20 Growth PRIDES for 20 Income PRIDES.
Except as provided in this Section 3.14, for so long as the Purchase
Contract underlying a Growth PRIDES remains in effect, such Growth PRIDES shall
not be sepa-
34
rable into its constituent parts and the rights and obligations of the Holder of
such Growth PRIDES in respect of the related Treasury Security and the Purchase
Contract comprising such Growth PRIDES may be acquired, and may be transferred
and exchanged only as a Growth PRIDES.
Section 3.15. Transfer of Collateral upon Occurrence of Termination Event.
Upon the occurrence of a Termination Event and the transfer to the Agent of
the Preferred Securities or the Treasury Securities, as the case may be,
underlying the Income PRIDES and the Growth PRIDES, respectively, pursuant to
the terms of the Pledge Agreement, the Agent shall request transfer instructions
with respect to such Preferred Securities and/or Treasury Securities, as the
case may be, from each Holder by written request mailed to such Holder at its
address as it appears in the Income PRIDES Register or the Growth PRIDES
Register, as the case may be. Upon book-entry transfer of the Income PRIDES or
Growth PRIDES or delivery of an Income PRIDES Certificate or Growth PRIDES
Certificate to the Agent with such transfer instructions, the Agent shall
transfer the Preferred Securities or Treasury Securities underlying such Income
PRIDES or Growth PRIDES, 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 Income PRIDES or Growth PRIDES fails to effect such
transfer or delivery, the Preferred Securities or Treasury Securities relating
to such Income PRIDES or Growth PRIDES, as the case may be, and any
distributions thereon, shall be held in the name of the Agent or its nominee in
trust for the benefit of such Holder, until such Income PRIDES or Growth PRIDES
are transferred or the Income PRIDES Certificate or Growth PRIDES Certificate is
surrendered or such Holder provides satisfactory evidence that such Income
PRIDES Certificate or Growth PRIDES Certificate has been destroyed, lost or
stolen, together with any indemnity that may be required by the Agent and the
Company.
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
35
or otherwise, of the Purchase Contract by the Company, receiver, liquidator or a
Person performing similar functions, its trustee 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 Preferred Securities
Section 4.1. Payment of Distributions; Rights to Distributions Preserved;
Distribution Rate Reset; Notice.
A distribution on any Preferred Security which is paid on any Payment Date
shall, subject to receipt thereof by the Agent from the Collateral Agent as
provided by the terms of the Pledge Agreement, be paid to the Person in whose
name the Income PRIDES Certificate (or one or more Predecessor Income PRIDES
Certificates) to which such Preferred Security relates is registered at the
close of business on the Record Date for such Payment Date.
Each Income PRIDES Certificate relating to Preferred Securities delivered
under this Agreement, upon registration of transfer of or in exchange for or in
lieu of any other Income PRIDES Certificate, shall carry the rights to
distributions accumulated and unpaid, and to accrue distributions, which were
carried by the Preferred Securities relating to such other Income PRIDES
Certificate.
In the case of any Income PRIDES with respect to which Cash Settlement of
the related Purchase Contract is effected on the Business Day immediately
preceding the Purchase Contract Settlement Date, or with respect to which Early
Settlement of the related Purchase Contract is effected on an Early Settlement
Date, or with respect to which a Collateral Substitution is effected on a date,
after any Record Date and on or prior to the next succeeding Payment Date,
distributions on the Preferred Securities relating to such Income PRIDES
otherwise payable on such Payment Date shall be payable on such Payment Date
notwithstanding such Cash Settlement or Early
36
Settlement or Collateral Substitution, and such distributions shall, subject to
receipt thereof by the Agent, be paid to the Person in whose name the Income
PRIDES Certificate (or one or more Predecessor Income PRIDES 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
Income PRIDES with respect to which Cash Settlement or Early Settlement of the
related Purchase Contract is effected on the 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,
distributions on the related Preferred Securities that would otherwise be
payable after the Purchase Contract Settlement Date, Early Settlement Date or
the date on which such Collateral Substitution is effected, as applicable shall
not be payable hereunder to the Holder of such Income PRIDES; PROVIDED, HOWEVER,
that to the extent that such Holder continues to hold the separated Preferred
Securities that formerly related to such Holder's Income PRIDES, such Holder
shall be entitled to receive the distributions on such separated Preferred
Securities.
The Coupon Rate on the Preferred Securities will be reset on the Purchase
Contract Settlement Date to the Reset Rate. On the Reset Announcement Date the
Reset Spread and the Two-Year Benchmark Treasury to be used to determine the
Reset Rate will be announced by the Company. On the Business Day immediately
following the Reset Announcement Date, the Preferred Securities Holders will be
notified of such Reset Spread and Two-Year Benchmark Treasury by the Company.
Such notice shall be sufficiently given to Holders of Preferred Securities if
published in an Authorized Newspaper in The City of New York.
Not later than 7 calendar days nor more than 15 calendar days prior to the
Reset Announcement Date, the Company will notify the DTC or its nominee (or any
successor Clearing Agency or its nominee) by first-class mail, postage prepaid,
to notify the Beneficial Owner or Clearing Agency Participants holding Income
PRIDES or Growth PRIDES, of such Reset Announcement Date and the procedures to
be followed by such Holders of Income PRIDES who intend to settle their
obligation under the
37
Purchase Contract with separate cash on the Purchase Contract Settlement Date.
Section 4.2. Notice and Voting.
Under the terms of the Pledge Agreement, the Agent will be entitled to
exercise the voting and any other consensual rights pertaining to the Preferred
Securities pledged with the Collateral Agent but only to the extent instructed
by the Holders as described below. Upon receipt of notice of any meeting at
which holders of Preferred Securities are entitled to vote or upon any
solicitation of consents, waivers or proxies of holders of Preferred Securities,
the Agent shall, as soon as practicable thereafter, mail to the Holders a notice
(a) containing such information as is contained in the notice or solicitation,
(b) stating that each Holder on the record date set by the Agent therefor
(which, to the extent possible, shall be the same date as the record date for
determining the holders of Preferred Securities entitled to vote) shall be
entitled to instruct the Agent as to the exercise of the voting rights
pertaining to the Preferred Securities relating to their Income PRIDES and (c)
stating the manner in which such instructions may be given. Upon the written
request of the Holders on such record date, the 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 Preferred Securities as to
which any particular voting instructions are received. In the absence of
specific instructions from the Holder of an Income PRIDES, the Agent shall
abstain from voting the Preferred Security relating to such Income PRIDES. The
Company hereby agrees, if applicable, to solicit Holders to timely instruct the
Agent in order to enable the Agent to vote such Preferred Securities or to cause
such Preferred Securities to be voted, and the Trust shall covenant in the
Declaration to take all action which may be deemed necessary by the Agent in
order to enable the Agent to vote such Preferred Securities or to cause such
Preferred Securities to be voted.
Section 4.3. Liquidation of the Trust.
Upon the occurrence of a liquidation of the Trust in accordance with the
Declaration, a principal amount of Debentures constituting the assets of the
Trust and
38
relating to the Preferred Securities equal to the aggregate stated liquidation
amount of the Pledged Preferred Securities shall be delivered to the Collateral
Agent in exchange for the Pledged Preferred Securities. Thereafter, the
Debentures will be held by the Collateral Agent in accordance with the terms of
the Pledge Agreement to secure the obligations of each Holder of an Income
PRIDES to purchase the Common Stock of the Company under the Purchase Contracts
constituting a part of such Income PRIDES. Following the occurrence of a
liquidation of the Trust, the Holders and the Collateral Agent shall have such
security interests, rights and obligations with respect to the Debentures as the
Holders and the Collateral Agent had in respect of the Preferred Securities
subject to the Pledge thereof as provided in Articles II, III, IV, V and VI of
the Pledge Agreement, and any reference herein to the Preferred Securities shall
be deemed to be a reference to the Debentures. The Company may cause to be made
in any Income PRIDES Certificates thereafter to be issued such change in
phraseology and form (but not in substance) as may be appropriate to reflect the
liquidation of the Trust and the substitution of Debentures for Preferred
Securities as Collateral.
ARTICLE V
The Purchase Contracts
Section 5.1. Purchase of Shares of Common Stock.
Each Purchase Contract shall obligate the Holder of the related Security 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 new shares
of Common Stock equal to the Settlement Rate unless, on or 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. The
"Settlement Rate" is equal to (a) if the Applicable Market Value (as defined
below) is equal to or greater than $____ (the "Threshold Appreciation Price"),
____ shares of Common Stock per Purchase Contract, (b) if the Applicable Market
Value is less than the Threshold Appreciation Price, but is greater than $____,
the number of shares of Common Stock equal to the
39
Stated Amount divided by the Applicable Market Value and (c) if the Applicable
Market Value is less than or equal to $____, ____ 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 Prices per
share of Common Stock on each of the 30 consecutive Trading Days ending on the
second Trading Day immediately preceding the Purchase Contract Settlement Date.
The "Closing Price" of the Common Stock on any date of determination means the
closing sale price (or, if no closing price is reported, the last reported sale
price) of the Common Stock on the New York Stock Exchange (the "NYSE") on such
date or, if the Common Stock is not listed for trading on the NYSE on any such
date, as reported in the composite transactions for the principal United States
securities exchange on which the Common Stock is so listed, or if the Common
Stock is not so listed on a United States national or regional securities
exchange, as reported by The Nasdaq Stock Market, or, if the Common Stock is not
so reported, the last quoted bid price for the Common Stock in the
over-the-counter market as reported by the National Quotation Bureau or similar
organization, or, if such bid price is not available, the market value of the
Common Stock on such date as determined by a nationally recognized independent
investment banking firm retained for this purpose by the Company. A "Trading
Day" means a day on which the Common Stock (A) 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 (B) has traded at least once on the national
or regional securities exchange or association or over-the-counter market that
is the primary market for the trading of the Common Stock.
Each Holder of an Income PRIDES or a Growth PRIDES, by its acceptance
thereof, irrevocably authorizes the Agent to enter into and perform the related
Purchase Contract on its behalf as its attorney-in-fact, agrees to be bound by
the terms and provisions thereof, covenants and agrees to perform its
obligations under such Purchase Contract, and consents to the provisions hereof,
irrevo-
40
cably authorizes the Agent as its attorney-in-fact to enter into and perform the
Pledge Agreement on its behalf as its attorney-in-fact, and consents to and
agrees to be bound by the Pledge of the related Preferred Securities or 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
an Income PRIDES or a Growth PRIDES, 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 stated liquidation amount of the related Preferred Securities or
the Proceeds of the related 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.
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), under 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 Certificates 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. Contract Adjustment Payments.
In the event that the Contract Adjustment Payments constitute a component
of Income PRIDES or Growth PRIDES, subject to Section 5.3 herein, the Company
shall pay, on each Payment Date, the Contract Adjustment Payments payable in
respect of each Purchase Contract to the Person in whose name a Certificate (or
one or more Predecessor Certificates) is registered at the close of business on
the Record Date next preceding such Payment Date. The Contract Adjustment
Payments will be payable at the office of the Agent in The City of New York
maintained for that purpose or, at the option of the Company, by
41
check mailed to the address of the Person entitled thereto at such Person's
address as it appears on the Income PRIDES Register or Growth PRIDES Register.
Upon the occurrence of a Termination Event, Contract Adjustment Payments,
if any, shall cease to accrue in respect of any period from and after the date
of such Termination Event (unless the Company defaults in the payment of accrued
Contract Adjustment Payments). The Company's obligations to pay any accrued
Contract Adjustment Payments shall be deemed to be fulfilled if the Company
deposits with the Agent funds necessary to pay accrued Contract Adjustment
Payments, in trust with irrevocable instructions and authorization that such
funds shall be delivered to the Holders.
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 re-establishment of an Income PRIDES) any other
Certificate shall carry the rights to Contract Adjustment Payments, if any,
accrued and unpaid, and to accrue Contract Adjustment Payments, if any, which
were carried by the Purchase Contracts underlying such other Certificates.
In the case of any Security with respect to which Early Settlement of the
underlying Purchase Contract is effected on an Early Settlement Date, after any
Record Date and on or prior to the next succeeding Payment Date, Contract
Adjustment Payments, if any, otherwise payable on such Payment Date shall be
payable on such Payment Date notwithstanding such Early Settlement, and such
Contract Adjustment 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, Contract Adjustment Payments,
if any, that would otherwise be payable after the Early Settlement Date with
respect to such Purchase Contract shall not be payable.
42
The Company's obligations with respect to Contract Adjustment Payments, if
any, generally will be (i) subordinate and junior in right of payment to all
Senior Indebtedness (as such terms are defined in the Indenture), (ii) PARI
PASSU with respect to PLC Capital's % Trust Originated Common Securities,
having an aggregate liquidation amount of $ , PLC Capital's % Subordinated
Debentures, due , Series , having an aggregate liquidation amount of $
, the Company's guarantee of PLC Capital L.L.C.'s 9% Cumulative Monthly Income
Preferred Securities, Series A, having an aggregate liquidation amount of $55
million, the Company's 9% Subordinated Debentures, due 2024, Series A, having an
aggregate liquidation amount of $69.6 million, the Company's guarantee of PLC
Capital Trust I's 81/4% Trust Originated Preferred Securities, having an
aggregate liquidation amount of $75 million, the Company's guarantee of PLC
Capital Trust I's 81/4% Trust Originated Common Securities, having an aggregate
liquidation amount of $2.3 million and the Company's 81/4% Subordinated
Debentures due 2027, Series B, having an aggregate liquidation amount of $77.3
million, all unsecured trade obligations of the Company and any other
liabilities or obligations that may be PARI PASSU by their terms and (iii)
senior to the Company's common stock, the most senior preferred or preference
stock now or hereafter issued by the Company and with any guarantee now or
hereafter entered into by the Company in respect of any preferred or preference
stock of any affiliate of the Company.
Section 5.3. Deferral of Payment Dates for Contract Adjustment Payments.
The Company shall have the right, at any time prior to the Purchase
Contract Settlement Date, to defer the payment of any or all of the Contract
Adjustment Payments otherwise payable on any Payment Date, but only if the
Company shall give the Holders and the Agent written notice of its election to
defer such payment (specifying the amount to be deferred) at least ten Business
Days prior to the earlier of (i) the next succeeding Payment Date or (ii) the
date the Company is required to give notice of the Record Date or Payment Date
with respect to payment of such Contract Adjustment Payments to the New York
Stock Exchange or other applicable self-regulatory organization or to Holders of
the Securities, but in any event not less than two Business Days prior to such
43
Record Date. Any Contract Adjustment Payments so deferred shall bear additional
Contract Adjustment Payments thereon at the rate of ____% per annum (computed
on the basis of 360 day year of twelve 30 day months), compounding on each
succeeding Payment Date, until paid in full (such deferred installments of
Contract Adjustment Payments together with the additional Contract Adjustment
Payments accrued thereon, being referred to herein as the "Deferred Contract
Adjustment Payments"). Deferred Contract Adjustment Payments shall be due on
the next succeeding Payment Date except to the extent that payment is deferred
pursuant to this Section. No Contract Adjustment Payments may be deferred to a
date that is after the Purchase Contract Settlement Date. If the Purchase
Contracts are terminated upon the occurrence of a Termination Event, the
Holder's right to receive Contract Adjustment Payments (other than any accrued
but unpaid Contract Adjustment Payments that have not been deferred) and
Deferred Contract Adjustment Payments, if any, will terminate.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments if any, on the Purchase Contracts until the Purchase
Contract Settlement Date, each Holder will receive on the Purchase Contract
Settlement Date in respect of Deferred Contract Adjustment Payments, in lieu of
a cash payment, a number of shares of Common Stock equal to (x) the aggregate
amount of Deferred Contract Adjustment Payments payable to a Holder divided by
(y) the Applicable Market Value.
No fractional shares of Common Stock will be issued by the Company with
respect to the payment of Deferred Contract Adjustment Payments on the Purchase
Contract Settlement Date. In lieu of fractional shares otherwise issuable with
respect to such payment of Deferred Contract Adjustment Payments, the Holder
will be entitled to receive an amount in cash as provided in Section 5.10.
In the event the Company exercises its option to defer the payment of
Contract Adjustment Payments, then, until the Deferred Contract Adjustment
Payments have been paid, the Company shall not declare or pay dividends on, or
make a distribution with respect to, or redeem, purchase or acquire, or make a
liquidation payment with respect to, any of its capital stock or make guarantee
payments with respect to the foregoing (other than (i)
44
purchases or acquisitions of shares of Protective Life's capital stock in
connection with the satisfaction by Protective Life of its obligations under any
employee benefit plans or the satisfaction by the Company of its obligations
pursuant to any contract or security requiring the Company to purchase shares of
its capital stock, (ii) as a result of a reclassification of Protective Life
capital stock or the exchange or conversion of one class or series of the
Company's capital stock for another class or series of Protective Life capital
stock, (iii) the purchase of fractional interests in shares of the Company's
capital stock pursuant to an acquisition or the conversion or exchange
provisions of such Protective Life capital stock or the securities being
converted or exchanged, and (iv) redemptions of purchases pursuant to Protective
Life's Rights Agreement, dated as of August 7, 1995, between the Company and
AmSouth Bank (as successor by merger to AmSouth Bank of Alabama, successor by
conversion of charter to Amsouth Bank N.A.) ("AmSouth Bank") as Rights Agent.)
Section 5.4. Payment of Purchase Price.
(a) Unless a Holder settles the related Purchase Contract either through
the early delivery of cash to the Purchase Contract Agent in the manner
described in Section 5.9 or otherwise, the Purchase Price for the shares of
Common Stock purchased pursuant to such Purchase Contract shall be paid by
application of payments received by the Company on the Purchase Contract
Settlement Date from the Collateral Agent pursuant to the Pledge Agreement,
payable at the office of the Collateral Agent in the City of New York maintained
for such purpose, as follows:
(i) A Holder may effect a "Cash Settlement" of a Purchase Contract by
(A) providing the Agent with notice of its election to effect a Cash
Settlement on or prior to 5:00 p.m., New York City time, on the Business
Day immediately preceding the Purchase Contract Settlement Date and (B)
concurrently making a payment of the Purchase Price to the Collateral Agent
prior to 5:00 p.m., New York City time, on the the Purchase Contract
Settlement Date in lawful money of the United States by certified or
cashiers' check or wire transfer in immediately available funds payable to
or upon the order of the Company.
45
Upon receipt of notice from a Holder electing a Cash Settlement, the Agent
promptly shall notify the Collateral Agent of such Holder's election. Any
cash received by the Collateral Agent will be invested promptly by the
Collateral Agent in overnight Permitted Investments and an amount equal to
the Purchase Price will be paid to the Company on the related Purchase
Contract Settlement Date in settlement of the Purchase Contract in
accordance with the terms of the Pledge Agreement. Any funds received by
the Collateral Agent in respect of the investment earnings from the
investment in such Permitted Investments, will be distributed to the Agent
when received for payment to the Holder.
(ii) A Holder of Income PRIDES who does not make an effective Cash
Settlement or an Early Settlement under Section 5.9 hereof shall be deemed
to have instructed the Purchase Contract Agent, without any further
instruction from the Holder of the Income PRIDES: (a) to the extent that
the Trust is still the holder of the Debentures, to direct the
Institutional Trustee to exercise the Trust's right as a holder to put the
Debentures to the Company on the Purchase Contract Settlement Date in
accordance with Section 2.8(b) of the Indenture or (b) to the extent that
the Purchase Contract Agent has become the holder of the Debentures (as a
result of the termination of the Trust or otherwise), to exercise the
Purchase Contract Agent's right as a holder to put the Debentures to the
Company on the Purchase Contract Settlement Date in accordance with Section
2.8(b) of the Indenture. The consideration received with respect to the
put of the Debentures shall be considered to be proceeds of the Preferred
Securities and as such will be paid to the Collateral Agent as secured
party with respect to the Preferred Securities and shall be automatically
applied by the Collateral Agent to pay the Purchase Price for the Purchase
Contract to the Company on the Purchase Contract Settlement Date as
provided in subparagraph (a)(i) above. After application of the proceeds
of the put of the Debentures to the Purchase Price, the Preferred
Securities will be returned to the Purchase Contract Agent for the benefit
of the Holders free of the lien created by the Pledge Agreement for
46
return to the Holder of the related Income PRIDES; and
(iii) A Holder of Growth PRIDES who does not make an effective Cash
Settlement or an Early Settlement under Section 5.9 hereof shall pay for
the shares of Common Stock to be issued under the Purchase Contract from
the Proceeds of the related Pledged Treasury Securities held by the
Collateral Agent, which will be applied automatically by the Collateral
Agent to pay the Purchase Price for the Purchase Contract to the Company on
the Purchase Contract Settlement Date without receiving any instruction
from the Holder. Upon the maturity of the Pledged Treasury Securities held
by the Collateral Agent on the Business Day immediately preceding the
Purchase Contract Settlement Date, the principal amount of such Treasury
Securities received by the Collateral Agent will be invested promptly in
overnight Permitted Investments. 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 will
distribute such excess to the Agent for the benefit of the Holder of the
related Growth PRIDES when received.
Any distribution to Holders of excess funds and interest described in
subparagraph (i), (ii) or (iii) above, shall be payable at the office of the
Agent in The City of New York 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.
(b) The Company shall not be obligated to issue any shares of Common
Stock in respect of a Purchase Contract or deliver any certificate therefor to
the Holder unless it shall have received payment in full of the Purchase Price
for the shares of Common Stock to be purchased thereunder in the manner herein
set forth.
(c) Upon Cash Settlement of any Purchase Contract, (i) the Collateral
Agent will in accordance with the terms of the Pledge Agreement cause the
Pledged Preferred Securities or the Pledged Treasury Securities
47
relating to the relevant Security to be released from the Pledge by the
Collateral Agent free and clear of any security interest of the Company and
transferred to the Agent for delivery to the Holder thereof or its designee as
soon as practicable and (ii) subject to the receipt thereof from the Collateral
Agent, the Agent shall, by book-entry transfer, or other appropriate procedures,
in accordance with instructions provided by the Holder thereof, transfer such
Pledged Preferred Security or such Pledged Treasury Securities (or, if no such
instructions are given to the Agent by the Holder, the Agent shall hold such
Pledged Preferred Securities or such Pledged Treasury Securities, and any
distributions thereon, in the name of the Agent or its nominee in trust for the
benefit of such Holder).
Section 5.5. Issuance of Shares of Common Stock.
Unless a Termination Event shall have occurred on or prior to the Purchase
Contract Settlement Date, on the Purchase Contract Settlement Date, upon its
receipt of payment in full of the Purchase Price for the shares of Common Stock
purchased by the Holders pursuant to the foregoing provisions of this Article,
and in payment of Deferred Contract Adjustment Payments, if any, owed by the
Company to the Holders and subject to Section 5.6(b), the Company shall issue
and deposit with the Agent, for the benefit of the Holders of the Outstanding
Securities, one or more certificates representing the new shares of Common Stock
registered in the name of the Agent (or its nominee) as custodian for the
Holders (such certificates for shares of Common Stock, together with any
dividends or distributions with respect thereto, 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
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
48
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 Agent. If any shares of Common Stock
issued in respect of a Purchase Contract and in payment of any Deferred Contract
Adjustment Payments 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 any class of Common Stock of the Company in Common Stock, the Settlement Rate
in effect at the opening of business on the day following the date fixed for the
determination of stockholders entitled to receive such dividend or other
distribution shall be increased by dividing such Settlement Rate by a fraction
of which 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 the
denominator shall be the sum of such number of shares and the total number of
shares constituting such dividend or other distribution, such increase to become
effective immediately 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 shares issuable in
respect of 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.
49
(2) In case the Company shall issue rights, options or warrants to all
holders of its Common Stock (not being available on an equivalent basis to
Holders of the Securities upon settlement of the related Purchase Contracts)
entitling them, for a period expiring within 45 days after the record date for
the determination of stockholders entitled to receive such rights, options or
warrants, to subscribe for or purchase shares of Common Stock at a price per
share less than the Current Market Price per share of the Common Stock on the
date fixed for the determination of stockholders entitled to receive such
rights, options or warrants (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 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 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
shares issuable in respect of scrip certificates issued in lieu of fractions of
shares of Common Stock. The Company shall not issue any such rights, options or
warrants 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
50
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
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 or warrants referred to in paragraph (2) of
this Section, any dividend or distribution paid exclusively in cash and any
dividend or distribution referred to in paragraph (1) of this Section), 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 stockholders
entitled to receive such distribution by a fraction of which the numerator shall
be the Current Market Price per share of the 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 filed with the Agent) of the portion of the assets or evidences of
indebtedness so distributed applicable to one share of Common Stock and the
denominator shall be such Current Market Price per share of the 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 stockholders
entitled to receive such distribution. In any case in which this paragraph (4)
is applicable, paragraph (2) of this Section 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) 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 has been made and (III) the aggregate of any
51
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 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 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 (I) a tender or exchange offer made by the Company or any
subsidiary of the Company for all or any portion of the Common Stock shall
expire and such tender or exchange offer (as amended upon the expiration
thereof) shall require the payment to stockholders (based on the acceptance (up
to any maximum specified in the terms of the tender or exchange offer) of
Purchased Shares) of 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 (II) 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
52
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 the 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 or this paragraph (6) has been made and (III) 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 or this paragraph (6) has been made, exceeds 15% of the
product of the Current Market Price per share of the 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 the 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 stockholders based on the transactions described in
clauses (I), (II) and (III) above (assuming in the case of clause (I) the
acceptance, up to any maximum specified in the terms of the tender or exchange
offer, of Purchased Shares), and (ii) the denominator of which shall be equal to
the product of (A) the Current Market Price per share of the Common Stock as of
the Expiration Time and (B) the number of shares of Common Stock outstanding
(including any tendered shares) as of the Expiration Time less the number of all
shares validly tendered and not withdrawn as of the Expiration Time (the shares
deemed so accepted, up to any such maximum, being referred to as the "Purchased
Shares").
(7) The reclassification of Common Stock into securities including
securities other than Common Stock
53
(other than any reclassification upon a Reorganization Event to which Section
5.6(b) applies) shall be deemed to involve (a) 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 stockholders entitled to receive such distribution" and the
"date fixed for such determination" within the meaning of paragraph (4) of this
Section), and (b) 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 5 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 the
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 therein; 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 Applica-
54
ble 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 before such adjustment.
(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 reasons.
(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 Common Stock outstanding immediately
prior to the merger or consolidation is 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 exchange of
securities of the Company with another Person (other than in connection with a
merger or acquisition) or (iv) any liquidation, dissolution or winding up 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 by a Holder of the number of shares of Common Stock
issuable on account of such 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
55
the Company merged or which merged into the Company or to which such sale or
transfer was made, as the case may be ("Constituent Person"), or an Affiliate of
a Constituent Person, and 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 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 or dissolution of the Company, the Company or a
liquidating trust created in connection therewith, shall execute and deliver to
the Agent an agreement supplemental hereto providing that the Holders of each
Outstanding Security shall have the rights provided by this Section 5.6. 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:
(i) forthwith compute the adjusted Settlement Rate in accordance with
Section 5.6 and prepare and transmit to the 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
56
(ii) within 10 Business Days following the occurrence of an event that
permits or 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 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 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 Agent makes no representation with
respect thereto. The Agent shall not be responsible for any failure of the
Company to issue, transfer or deliver any shares of Common Stock pursuant to a
Purchase Contract or to comply with any of the duties, responsibilities or
covenants of the Company contained in this Article.
Section 5.8. Termination Event; Notice.
The Purchase Contracts and the obligations and rights of the Company and
the Holders thereunder, including, without limitation, the rights of the Holders
to receive and the obligation of the Company to pay any Contract Adjustment
Payments, if the Company shall have such obligation, shall immediately and
automatically terminate, without the necessity of any notice or action by any
Holder, the Agent or the Company, if, on or prior to 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 Preferred Securities forming a part of such Securities in
the case of Income PRIDES, or Treasury Securities in the case of Growth PRIDES,
in accordance with the provisions of Section 4.3
57
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 Agent, the Collateral Agent and to 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, having an aggregate Stated Amount equal to $1,000 or an integral
multiple thereof, may be settled early ("Early Settlement") 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 such Purchase
Contracts shall deliver such Certificate to the 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 in the form of a certified or cashier's check payable to the order of
the Company in an amount (the "Early Settlement Amount") equal to (i) 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 (ii) 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 Contract Adjustment Payments, if any, payable on such Payment Date with
respect to such Purchase Contracts plus (y) in the case of an Income PRIDES
Certificate, the distributions on the related Preferred Securities payable on
such Payment Date. Except as provided in the immediately preceding sentence and
subject to the second to last paragraph of Section 5.2, no payment or adjustment
shall be made upon Early Settlement of any Purchase Contract on account of any
Contract Adjustment 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 at or prior to 5:00 p.m., New York City time, on a
Business Day, such day shall be the "Early Settlement Date" with respect to
58
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"); PROVIDED,
HOWEVER, that upon the Early Settlement of the Purchase Contracts, the Holder of
such related Securities will forfeit the right to receive any Deferred Contract
Adjustment Payments. The Early Settlement Rate shall be adjusted in the same
manner and at the same time as the Settlement Rate is adjusted. As promptly as
practicable after Early Settlement of Purchase Contracts in accordance with the
provisions of this Section 5.9, the Company shall issue and shall deliver to the
Agent at the Corporate Trust Office 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.
(c) The Company shall cause the shares of Common Stock issuable upon Early
Settlement of Purchase Contracts, and the related Preferred Securities, in the
case of Income PRIDES, or the related Treasury Securities, in the case of Growth
PRIDES, deliverable, to be issued and delivered, in the case of such shares of
Common Stock, and released from the Pledge by the Collateral Agent and
transferred, in the case of such Preferred Securities or Treasury Securities, to
the Agent, for delivery to the Holder thereof or its designee, no later than the
third Business Day after the applicable Early Settlement Date.
(d) Upon Early Settlement of any Purchase Contracts, and subject to
receipt of shares of Common Stock from the Company and the related Preferred
Securities or Treasury Securities, as the case may be, from the Collateral
Agent, as applicable, the 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, (i)
transfer to the Holder such Preferred Secu-
59
rities or Treasury Securities, as the case may be, forming a part of such
Securities, and (ii) deliver to the Holder a certificate or certificates for the
full number of shares of Common Stock issuable upon such Early Settlement
together with payment in lieu of any fraction of a share, as provided in Section
5.10.
(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 Agent
shall authenticate, countersign and deliver to the Holder thereof, at the
expense of the Company, a Certificate evidencing the Securities as to which
Early Settlement was not effected.
(f) Holders may settle Securities early only in integral multiples of 20
Income PRIDES or 20 Growth PRIDES.
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 or with
respect to the payment of Deferred Contract Adjustment Payments, if any, on the
Purchase Contract Settlement Date. If Certificates evidencing more than one
Purchase Contract shall be surrendered for settlement at one time by the same
Holder, the number of full shares of Common Stock which shall be delivered upon
settlement shall be computed on the basis of the aggregate number of Purchase
Contracts evidenced by the Certificates so surrendered. Instead of any
fractional share of Common Stock which would otherwise be deliverable upon
settlement of any Purchase Contracts on the Purchase Contract Settlement Date or
upon Early Settlement or with respect to the payment of any Deferred Contract
Adjustment Payments, if any, the Company, through the 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 Agent from time to time with sufficient funds to permit the Agent to
make all cash payments required by this Section 5.10 in a timely manner.
60
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 and in payment of any Deferred Contract Adjustment Payments;
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 Purchase Contract 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 Purchase Contracts evidenced thereby, other than
in the name of the 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.
ARTICLE VI
Remedies
Section 6.1. Unconditional Right of Holders to Receive Contract Adjustment
Payments and to Purchase Common Stock.
In the event that Contract Adjustment Payments shall constitute a component
of Income PRIDES or Growth PRIDES, the Holder of any Income PRIDES or Growth
PRIDES shall have the right, which is absolute and unconditional (subject to the
right of the Company to defer payment thereof pursuant to Section 5.3 and
subject to the forfeiture of any Deferred Contract Adjustment Payments upon
Early Settlement pursuant to Section 5.9(b) or upon the occurrence of a
Termination Event), to receive payment of each installment of the Contract
Adjustment Payments with respect to the Purchase Contract constituting a part of
such Security on the respective Payment Date for such Security and to purchase
Common Stock pursuant to such Purchase Contract and, in each such case, to
institute suit for the enforcement of any such payment and right to
61
purchase 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.
Section 6.5. Undertaking for Costs.
All parties to this Agreement agree, and each Holder of Income PRIDES or
Growth PRIDES, by its acceptance of such Income PRIDES or Growth PRIDES shall be
deemed to have agreed, that any court may in its discretion re-
62
quire, in any suit for the enforcement of any right or remedy under this
Agreement, or in any suit against the Agent for any action taken, suffered or
omitted by it as 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 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 Preferred Securities or Contract Adjustment
Payments, if any, 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 Agent or the Holders, but will suffer and permit
the execution of every such power as though no such law had been enacted.
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ARTICLE VII
The Agent
Section 7.1. Certain Duties and Responsibilities.
(a)(1) The Agent 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 against the Agent; and
(2) in the absence of bad faith or negligence on its part, the Agent
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 Agent and conforming to the
requirements of this Agreement, but in the case of any certificates or
opinions which by any provision hereof are specifically required to be
furnished to the Agent, the Agent shall be under a duty to examine the same
to determine whether or not they conform to the requirements of this
Agreement.
(b) No provision of this Agreement shall be construed to relieve the Agent
from liability for its own negligent action, its own negligent failure to act,
or its own wilful misconduct, except that
(1) this Subsection shall not be construed to limit the effect of
Subsection (a) of this Section;
(2) the 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
Agent was negligent in ascertaining the pertinent facts; and
(3) no provision of this Agreement shall require the 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.
64
(c) Whether or not therein expressly so provided, every provision of this
Agreement relating to the conduct or affecting the liability of or affording
protection to the Agent shall be subject to the provisions of this Section.
(d) The Agent is authorized to execute and deliver the Pledge Agreement in
its capacity as Agent.
Section 7.2. Notice of Default.
Within 30 days after the occurrence of any default by the Company
hereunder, of which a Responsible Officer of the Agent has actual knowledge, the
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 been cured or waived.
Section 7.3. Certain Rights of Agent.
Subject to the provisions of Section 7.1:
(a) the 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;
(b) 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;
(c) whenever in the administration of this Agreement the Agent shall deem
it desirable that a matter be proved or established prior to taking, suffering
or omitting any action hereunder, the 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;
65
(d) the 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;
(e) the 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 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 Agent shall determine to make
such further inquiry or investigation, it shall be entitled to examine the
books, records and premises of the Company, personally or by agent or attorney;
and
(f) the 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 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.
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 Agent assumes no responsibility for their
accuracy. The 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 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 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
66
it would have if it were not Registrar or such other agent, or the Agent.
Section 7.6. Money Held in Custody.
Money held by the Agent in custody hereunder need not be segregated from
the other funds except to the extent required by law. The 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 Agent from time to time reasonable compensation for
all services rendered by it hereunder;
(2) except as otherwise expressly provided herein, to reimburse the
Agent upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Agent in accordance with any provision of
this 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 Agent and any predecessor 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.
Section 7.8. Corporate Agent Required; Eligibility.
There shall at all times be an 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
67
being a member of a bank holding company having) a combined capital and surplus
of at least $50,000,000, subject to supervision or examination by Federal or
State authority and having a Corporate Trust Office in the Borough of Manhattan,
The City of New York, if there be such a corporation in the Borough of
Manhattan, The City of 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 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 Agent and no appointment of a
successor Agent pursuant to this Article shall become effective until the
acceptance of appointment by the successor Agent in accordance with the
applicable requirements of Section 7.10.
(b) The 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 Agent required by Section 7.10 shall not
have been delivered to the Agent within 30 days after the giving of such notice
of resignation, the resigning Agent may petition any court of competent
jurisdiction for the appointment of a successor Agent.
(c) The Agent may be removed at any time by Act of the Holders of a
majority in number of the Outstanding Securities delivered to the Agent and the
Company.
(d) if at any time
(1) the Agent fails to comply with Section 310(b) of the TIA, as if
the Agent were an indenture trustee under an indenture qualified under the
TIA,
68
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, or
(2) the 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
(3) the Agent shall become incapable of acting or shall be adjudged a
bankrupt or insolvent or a receiver of the Agent or of its property shall
be appointed or any public officer shall take charge or control of the
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
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 Agent and
the appointment of a successor Agent.
(e) If the Agent shall resign, be removed or become incapable of acting,
or if a vacancy shall occur in the office of Agent for any cause, the Company,
by a Board Resolution, shall promptly appoint a successor Agent and shall comply
with the applicable requirements of Section 7.10. If no successor 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 himself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Agent.
(f) The Company shall give, or shall cause such successor Agent to give,
notice of each resignation and each removal of the Agent and each appointment of
a successor 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 Agent
and the address of its Corporate Trust Office.
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Section 7.10. Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor Agent, every such
successor Agent so appointed shall execute, acknowledge and deliver to the
Company and to the retiring Agent an instrument accepting such appointment, and
thereupon the resignation or removal of the retiring Agent shall become
effective and such successor Agent, without any further act, deed or conveyance,
shall become vested with all the rights, powers, agencies and duties of the
retiring Agent; but, on the request of the Company or the successor Agent, such
retiring Agent shall, upon payment of its charges, execute and deliver an
instrument transferring to such successor Agent all the rights, powers and
trusts of the retiring Agent and shall duly assign, transfer and deliver to such
successor Agent all property and money held by such retiring Agent hereunder.
(b) Upon request of any such successor Agent, the Company shall execute
any and all instruments for more fully and certainly vesting in and confirming
to such successor Agent all such rights, powers and agencies referred to in
paragraph (a) of this Section.
(c) No successor Agent shall accept its appointment unless at the time of
such acceptance such successor Agent shall be qualified and eligible under this
Article.
Section 7.11. Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Agent may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Agent shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Agent, shall be the successor of the Agent hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Certificates shall have been
authenticated and executed on behalf of the Holders, but not delivered, by the
Agent then in office, any successor by merger, conversion or consolidation to
such Agent may adopt such authentication and execution and deliver the
Certificates
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so authenticated and executed with the same effect as if such successor Agent
had itself authenticated and executed such Securities.
Section 7.12. Preservation of Information; Communications to Holders.
(a) The Agent shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders received by the Agent in its
capacity as Registrar.
(b) If three or more Holders (herein referred to as "applicants") apply in
writing to the Agent, and furnish to the 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
Agent shall, within five Business Days after the receipt of such application,
afford such applicants access to the information preserved at the time by the
Agent in accordance with Section 7.12(a).
(c) Every Holder agrees with the Company and the Agent that none of the
Company, the Agent nor any agent of any of them shall be held accountable by
reason of the disclosure of any such information as to the names and addresses
of the Holders in accordance with Section 7.12(b), regardless of the source from
which such information was derived.
Section 7.13. No Obligations of Agent.
Except to the extent otherwise provided in this Agreement, the 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 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
Agent
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shall have no obligation to perform such Purchase Contracts on behalf of the
Holders, except to the extent expressly provided in Article Five hereof.
Section 7.14. Tax Compliance.
(a) The Agent, on its own behalf and on behalf of the Company, will comply
with all applicable certification, information reporting and withholding
(including "backup" withholding) requirements imposed by applicable tax laws,
regulations or administrative practice with respect to (i) any payments made
with respect to the 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 Agent shall comply with any written direction received from the
Company with respect to 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 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.
ARTICLE VIII
Supplemental Agreements
Section 8.1. Supplemental Agreements Without Consent of Holders.
Without the consent of any Holders, the Company and the Agent, at any time
and from time to time, may enter into one or more agreements supplemental
hereto, in form
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satisfactory to the Company and the Agent, for any of the following purposes:
(1) to 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; or
(2) to add to the covenants of the Company for the benefit of the
Holders, or to surrender any right or power herein conferred upon the
Company; or
(3) to evidence and provide for the acceptance of appointment
hereunder by a successor Agent; or
(4) to 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, to cure any ambiguity, to
correct or supplement any provisions herein which may be inconsistent with
any other provisions herein, or to 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 66 2/3% of the outstanding
Purchase Contracts voting together as one class, by Act of said Holders
delivered to the Company and the Agent, the Company when authorized by a Board
Resolution, and the 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 Pledge Agent provisions of this Agreement or the rights of the
Holders in respect of the Securities; provided, however, that no such
supplemental agreement shall, without the consent of the Holder of each
Outstanding Security affected thereby,
(1) change any Payment Date;
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(2) change the amount or the type of Collateral required to be
Pledged to secure a Holder's obligations under the applicable Purchase
Contract, impair the right of the Holder of any Security to receive
distributions on the related Collateral (except for the rights of Holders
of Income PRIDES to substitute Treasury Securities for the Pledged
Preferred Securities or the rights of holders of Growth PRIDES to
substitute Preferred Securities for the Pledged Treasury Securities) or
otherwise adversely affect the Holder's rights in or to such Collateral or
adversely alter the rights in or to such Collateral;
(3) reduce any Contract Adjustment Payments or any Deferred Contract
Adjustment Payments, or change any place where, or the coin or currency in
which, any Contract Adjustment 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 Income PRIDES or the Growth PRIDES, then only the affected class
of Holder 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 66 2/3% of such class.
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.
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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 Agent shall be entitled to receive
and (subject to Section 7.1) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental agreement is
authorized or permitted by this Agreement. The Agent may, but shall not be
obligated to, enter into any such supplemental agreement which affects the
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.
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 Agent, bear a notation in form approved by the
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 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 Agent in exchange for Outstanding Certificates.
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ARTICLE IX
Consolidation, Merger, 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 or consolidate with any other
Person 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 (i) either the Company
shall be the continuing corporation, or the successor (if other than the
Company) shall be a corporation organized and existing under the laws of the
United States of America or a State thereof or the District of Columbia and such
corporation shall expressly assume all the obligations of the Company under the
Purchase Contracts, this Agreement and the Pledge Agreement by one or more
supplemental agreements in form satisfactory to the Agent and the Collateral
Agent, executed and delivered to the Agent and the Collateral Agent by such
corporation, and (ii) the Company or such successor corporation, as the case may
be, shall not, immediately after such merger or consolidation, or such 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 consolidation, merger, sale, assignment, transfer,
lease or conveyance and upon any such assumption by the 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 Protective Life
Corporation, any or all of the Certificates evidencing Securities issuable
hereunder which theretofore shall not have been signed by the Company and
delivered to the Agent; and, upon the order
76
of such successor corporation, instead of the Company, and subject to all the
terms, conditions and limitations in this Agreement prescribed, the Agent shall
authenticate and execute on behalf of the Holders and deliver any Certificates
which previously shall have been signed and delivered by the officers of the
Company to the Agent for authentication and execution, and any Certificate
evidencing Securities which such successor corporation thereafter shall cause to
be signed and delivered to the Agent for that purpose. All the Certificates so
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 consolidation, merger, 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. Opinion of Counsel to Agent.
The Agent, subject to Sections 7.1 and 7.3, shall receive an Opinion of
Counsel as conclusive evidence that any such consolidation, merger, 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 consolidation, merger, 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.
77
Section 10.2. Maintenance of Office or Agency.
The Company will maintain in the Borough of Manhattan, The City of 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
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 re-establishment of an
Income PRIDES 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 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 Agent with the
address thereof, such presentations, surrenders, notices and demands may be made
or served at the Corporate Trust Office, and the Company hereby appoints the
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 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 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 (x) against tender of payment in respect of all Purchase Contracts
constituting a part of the Securities evidenced by Outstanding Certificates and
(y)
78
in payment of Deferred Contract Adjustment Payments, if any, owed by the Company
to the Holders.
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 and in payment of any Deferred Contract
Adjustment Payments will, upon issuance, be duly authorized, validly issued,
fully paid and nonassessable.
Section 10.5. Statements of Officers of the Company as to Default.
The Company will deliver to the Agent, within 120 days after the end of
each fiscal year of the Company ending after the date hereof, an Officer's
Certificate, stating whether or not to the best knowledge of the signers thereof
the Company is in default in the performance and observance of any of the terms,
provisions and conditions hereof, and if the Company shall be in default,
specifying all such defaults and the nature and status thereof of which they may
have knowledge.
79
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and year first above written.
PROTECTIVE LIFE CORPORATION
Attested by
By:
-------------------- ----------------------------
Name:
Title:
THE BANK OF NEW YORK
Attested by
By:
-------------------- ----------------------------
Name:
Title:
EXHIBIT A
THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE PURCHASE
CONTRACT AGREEMENT (AS HEREINAFTER DEFINED) AND IS REGISTERED IN THE NAME OF THE
CLEARING AGENCY OR A NOMINEE THEREOF. THIS CERTIFICATE MAY NOT BE EXCHANGED IN
WHOLE OR IN PART FOR A CERTIFICATE REGISTERED, AND NO TRANSFER OF THIS
CERTIFICATE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON
OTHER THAN SUCH CLEARING AGENCY OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company (55 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx) to the Company or
its agent for registration of transfer, exchange or payment, any Certificate
issued is registered in the name of Cede & Co., or such other name as requested
by an authorized representative of The Depository Trust Company, and any payment
hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE
OR OTHERWISE BY A PERSON IS WRONGFUL since the registered owner hereof, Cede &
Co., has an interest herein.
No. _____ Number of Income PRIDES ___ Cusip No. ______
Form of Face of Income PRIDES Certificate
____% Income PRIDES
This Income PRIDES Certificate certifies that ___________ is the registered
Holder of the number of Income PRIDES set forth above. Each Income PRIDES
represents (i) beneficial ownership by the Holder of one _____% Trust Originated
Preferred Security (the "Preferred Security") of PLC Capital Trust II, a
Delaware statutory business trust (the "Trust"), having a liquidation amount of
$50, subject to the Pledge of such Preferred Security by such Holder pursuant to
the Pledge Agreement, and (ii) the rights and obligations of the Holder under
one Purchase Contract with Protective Life Corporation, a New Jersey corporation
(the "Company"). All capitalized terms used herein which are defined in the
Purchase Contract Agreement have the meaning set forth therein.
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Pursuant to the Pledge Agreement, the Preferred Securities relating to each
Income PRIDES 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 a portion of such Income PRIDES.
The Pledge Agreement provides that all payments of the liquidation amount
of, or cash distributions on, any Pledged Preferred Securities (as defined in
the Pledge Agreement) relating to an Income PRIDES received by the Collateral
Agent shall be paid by the Collateral Agent by wire transfer in same day funds
(i) in the case of (A) cash distributions with respect to Pledged Preferred
Securities and (B) any payments of the liquidation amount with respect to any
Preferred Securities that have been released from the Pledge pursuant to the
Pledge Agreement, to the Agent, for the benefit of the Holders of the related
Income PRIDES, to the account designated by the Agent, no later than 2:00 p.m.,
New York City time, on the Business Day such payment is received by the
Collateral Agent (provided that in the event such payment is received by the
Collateral Agent on a day that is not a Business Day or after 12:30 p.m., New
York City time, on a Business Day, then such payment shall be made no later than
10:30 a.m., New York City time, on the next succeeding Business Day) and (ii) in
the case of payments of the liquidation amount of any Pledged Preferred
Securities that have not been released from the Pledge pursuant to the Pledge
Agreement, to the Company on the Purchase Contract Settlement Date (as defined
herein) in accordance with the terms of the Pledge Agreement, in full
satisfaction of the respective obligations of the Holders of the Income PRIDES
to which such Pledged Preferred Securities relate under the Purchase Contracts
forming a part of such Income PRIDES. Distributions on any Preferred Security
relating to an Income PRIDES evidenced hereby which are payable quarterly in
arrears on March 31, June 30, September 30 and December 31 each year, commencing
_______, 199_ (a "Payment Date"), shall, subject to receipt thereof by the Agent
from the Collateral Agent, be paid to the Person in whose name this Income
PRIDES Certificate (or a Predecessor Income PRIDES Certificate) is registered at
the close of business on the Record Date for such Payment Date.
A-2
Each Purchase Contract evidenced hereby obligates the Holder of this Income
PRIDES Certificate to purchase, and the Company to sell, on February 16, 2001
(the "Purchase Contract Settlement Date"), at a price equal to $50 (the "Stated
Amount"), a number of shares of Common Stock, par value $.10 per share ("Common
Stock"), of the Company, equal to the Settlement Rate unless on or prior to the
Purchase Contract Settlement Date there shall have occurred a Termination Event
with respect to the Income PRIDES 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 payment received in respect of the liquidation amount of the
Pledged Preferred Securities pledged to secure the obligations under such
Purchase Contract of the Holder of the Income PRIDES of which such Purchase
Contract is a part. A Holder may cause the Preferred Security pledged to secure
the obligations under the Purchase Contract of the Holder of the Income PRIDES
of which such Purchase Contract is a part to be repaid and the proceeds
therefrom to be used to pay the Purchase Price for shares of Common Stock under
such Purchase Contract.
The Company shall pay, on each Payment Date, in respect of each Purchase
Contract forming part of an Income PRIDES evidenced hereby an amount (the
"Contract Adjustment Payments") equal to _____% per annum of the Stated Amount
(provided that if such percentage is 0%, then no Contract Adjustment Payments
will be payable by the Company), computed on the basis of a 360 day year of
twelve 30 day months, subject to deferral at the option of the Company as
provided in the Purchase Contract Agreement and more fully described on the
reverse hereof. Such Contract Adjustment Payments, if any, shall be payable to
the Person in whose name this Income PRIDES Certificate (or a Predecessor Income
PRIDES Certificate) is registered at the close of business on the Record Date
for such Payment Date.
Distributions on the Preferred Securities and Contract Adjustment Payments,
if any, will be payable at the office of the Agent in The City of New York or,
at the option of the Company, by check mailed to the address of
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the Person entitled thereto as such address appears on the Income PRIDES
Register.
Reference is hereby made to the further provisions set forth on the reverse
hereof, which further provisions shall for all purposes have the same effect as
if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Agent by manual signature, this Income PRIDES Certificate shall not be entitled
to any benefit under the Pledge Agreement or the Purchase Contract Agreement or
be valid or obligatory for any purpose.
A-4
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
PROTECTIVE LIFE CORPORATION
By:
----------------------------------
Name:
Title:
By:
----------------------------------
Name:
Title:
Attest:
---------------------
Name:
Title:
HOLDER SPECIFIED ABOVE (as to
obligations of such Holder under the
Purchase Contracts evidenced hereby)
By: THE BANK OF NEW YORK, not individually but solely as
Attorney-in-Fact of such Holder
By:
----------------------------------
Name:
Title:
Dated:
AGENT'S CERTIFICATE OF AUTHENTICATION
This is one of the Income PRIDES Certificates referred to in the within
mentioned Purchase Contract Agreement.
By: THE BANK OF NEW YORK as Agent
By:
----------------------------------
Authorized Officer
A-5
(Form of Reverse of Income PRIDES Certificate)
Each Purchase Contract evidenced hereby is governed by a Purchase Contract
Agreement, dated as of _____, 1997 (as supplemented from time to time, the
"Purchase Contract Agreement"), between the Company and The Bank of New York, as
Purchase Contract Agent (herein called the "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 Agent, the Company, and the Holders and of the
terms upon which the Income PRIDES Certificates are, and are to be, executed and
delivered.
Each Purchase Contract evidenced hereby obligates the Holder of this Income
PRIDES 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 of the Company equal to the
Settlement Rate unless, on or prior to the Purchase Contract Settlement Date,
there shall have occurred a Termination Event with respect to the Security of
which such Purchase Contract is a part. The "Settlement Rate" is equal to (a)
if the Applicable Market Value (as defined below) is equal to or greater than
$_____ (the "Threshold Appreciation Price"), ______ shares of Common Stock per
Purchase Contract, (b) if the Applicable Market Value is less than the Threshold
Appreciation Price but is greater than $_____, the number of shares of Common
Stock per Purchase Contract equal to the Stated Amount divided by the Applicable
Market Value and (c) if the Applicable Market Amount is less than or equal to
$____, ____ 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 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
Income PRIDES to purchase at the Purchase Price, and the Company to sell, a
number of new shares of Common Stock equal to
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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 30 consecutive Trading Days ending on the
second Trading Day immediately preceding the Purchase Contract Settlement Date.
The "Closing Price" of the Common Stock on any date of determination means the
closing sale price (or, if no closing price is reported, the last reported sale
price) of the Common Stock on the New York Stock Exchange (the "NYSE") on such
date or, if the Common Stock is not listed for trading on the NYSE on any such
date, as reported in the composite transactions for the principal United States
securities exchange on which the Common Stock is so listed, or if the Common
Stock is not so listed on a United States national or regional securities
exchange, as reported by The Nasdaq Stock Market, or, if the Common Stock is not
so reported, the last quoted bid price for the Common Stock in the
over-the-counter market as reported by the National Quotation Bureau or similar
organization, or, if such bid price is not available, the market value of the
Common Stock on such date as determined by a nationally recognized independent
investment banking firm retained for this purpose by the Company. A "Trading
Day" means a day on which the Common Stock (A) 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 (B) has traded at least once on the national
or regional securities exchange or association or over-the-counter market that
is the primary market for the trading of the Common Stock.
In accordance with the terms of the Purchase Contract Agreement, the Holder
of this Income PRIDES Certificate shall 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. A Holder of an Income
PRIDES who fails to make an effective Cash Settlement or an Early Settlement in
respect of a Purchase Contract prior to the Purchase Contract Settlement Date
will be deemed to have elected to have requested the Trust to deliver to the
Company a principal amount of the Debenture underlying the Preferred Security
equal to the Stated Amount of the Purchase Contract, for application to the
Purchase Price of the Common Stock.
A-7
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 in full of the aggregate purchase
price for the shares of Common Stock to be purchased thereunder in the manner
herein set forth.
Each Purchase Contract evidenced hereby and the obligations and rights of
the Company and the Holder thereunder shall terminate if a Termination Event
shall have occurred. Upon the occurrence of a Termination Event, the Company
shall give written notice to the Agent and to the Holders, at their addresses as
they appear in the Income PRIDES Register. Upon and after the occurrence of a
Termination Event, the Collateral Agent shall release the Pledged Preferred
Security (as defined in the Pledge Agreement) relating to each Income PRIDES, or
the Liquidation Distribution received in respect of such Pledged Preferred
Security, from the Pledge in accordance with the provisions of the Pledge
Agreement. An Income PRIDES shall thereafter represent the right to receive the
Preferred Security forming a part of such Income PRIDES, or the Liquidation
Distribution received in respect of such Preferred Security, and any accrued
Contract Adjustment Payments on the Purchase Contract forming a part of such
Income PRIDES in accordance with the terms of the Purchase Contract Agreement
and the Pledge Agreement. Contract Adjustment Payments shall cease to accrue in
respect of any period from and after the date of a Termination Event.
Under the terms of the Pledge Agreement, the Agent will be entitled to
exercise the voting and any other consensual rights pertaining to the Pledged
Preferred Securities. Upon receipt of notice of any meeting at which holders of
Preferred Securities are entitled to vote or solicitation of consents, waivers
or proxies of holders of Preferred Securities, the Agent shall, as soon as
practicable thereafter, mail to the Income PRIDES Holders a notice (a)
containing such information as is contained in the notice or solicitation, (b)
stating that each Income PRIDES Holder on the record date set by the Agent
therefor (which, to the extent possible, shall be the same date as the record
date for determining the holders of Preferred Securities entitled to vote) shall
be entitled to instruct the Agent as to the exercise of the voting rights
pertaining to the Preferred Securities
A-8
relating to such holder's Income PRIDES and (c) stating the manner in which such
instructions may be given. Upon the written request of the Income PRIDES
holders on such record date, the 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 Preferred Securities as to which any particular
voting instructions are received. In the absence of specific instructions from
the Holder of an Income PRIDES, the Agent shall abstain from voting the
Preferred Security relating to such Income PRIDES.
Upon the liquidation of the Trust, a principal amount of the Debentures
constituting the assets of the Trust and underlying the Preferred Securities
equal to the aggregate liquidation amount of the Pledged Preferred Securities
shall be delivered to the Collateral Agent in exchange for Pledged Preferred
Securities. Thereafter, the Debentures shall be held by the Collateral Agent to
secure the obligations of each Holder of Income PRIDES to purchase shares of
Common Stock under the Purchase Contracts constituting a part of such Income
PRIDES. Following the liquidation of the Trust, the Holders and the Collateral
Agent shall have such security interests, rights and obligations with respect to
the Debentures as the Holders and the Collateral Agent had in respect of the
Pledged Preferred Securities, and any reference in the Purchase Contract
Agreement or Pledge Agreement to the Preferred Securities shall be deemed to be
a reference to the Debentures.
The Income PRIDES Certificates are issuable only in registered form and
only in denominations of a single Income PRIDES and any integral multiple
thereof. The transfer of any Income PRIDES Certificate will be registered and
Income PRIDES Certificates may be exchanged as provided in the Purchase Contract
Agreement. The Income PRIDES 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 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 Preferred Securities, thereby creating Growth PRIDES,
shall be responsible for any fees
A-9
or expenses payable in connection therewith. Except as provided in the Purchase
Contract Agreement, for so long as the Purchase Contract underlying an Income
PRIDES remains in effect, such Income PRIDES shall not be separable into its
constituent parts, and the rights and obligations of the Holder of such Income
PRIDES in respect of the related Preferred Security and Purchase Contract
constituting such Income PRIDES may be transferred and exchanged only as an
Income PRIDES. The holder of an Income PRIDES may substitute for the Pledged
Preferred Securities securing its obligation under the related Purchase Contract
Treasury Securities in an aggregate principal amount equal to the aggregate
liquidation amount of the Pledged Preferred Securities in accordance with the
terms of the Purchase Contract Agreement and the Pledge Agreement. From and
after such Collateral Substitution, the Security for which such Pledged Treasury
Securities secures the holder's obligation under the related Purchase Contract
shall be referred to as a "Growth PRIDES." A Holder may make such Collateral
Substitution only in integral multiples of 20 Income PRIDES for 20 Growth
PRIDES. Such Collateral Substitution may cause the Stated Amount of this
Certificate to be increased or decreased; PROVIDED, HOWEVER, the aggregate
Stated Amount outstanding under this Income PRIDES Certificate shall not exceed
$_____. All such adjustments to the aggregate Stated Amount of this Income
PRIDES Certificate shall be duly recorded by placing an appropriate notation on
the Schedule attached hereto.
A Holder of Growth PRIDES may recreate Income PRIDES by delivering to the
Collateral Agent Preferred Securities with an aggregate liquidation amount equal
to the aggregate principal amount of the related 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.
Subject to the next succeeding paragraph, the Company shall pay, on each
Payment Date, the Contract Adjustment Payments, if any, payable in respect of
each Purchase Contract to the Person in whose name the Income PRIDES Certificate
evidencing such Purchase Contract is registered at the close of business on the
Record Date for such Payment Date. Contract Adjustment Payments, if any, will
be payable at the office of the Agent in The
A-10
City of New York 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
Income PRIDES Register.
The Company shall have the right, at any time prior to the Purchase
Contract Settlement Date, to defer the payment of any or all of the Contract
Adjustment Payments otherwise payable on any Payment Date, but only if the
Company shall give the Holders and the Agent written notice of its election to
defer such payment (specifying the amount to be deferred) as provided in the
Purchase Contract Agreement. Any Contract Adjustment Payments so deferred shall
bear additional Contract Adjustment Payments thereon at the rate of ___% per
annum (computed on the basis of a 360 day year of twelve 30 day months),
compounding on each succeeding Payment Date, until paid in full (such deferred
installments of Contract Adjustment Payments, if any, together with the
additional Contract Adjustment Payments, if any, accrued thereon, are referred
to herein as the "Deferred Contract Adjustment Payments"). Deferred Contract
Adjustment Payments, if any, shall be due on the next succeeding Payment Date
except to the extent that payment is deferred pursuant to the Purchase Contract
Agreement. No Contract Adjustment Payments may be deferred to a date that is
after the Purchase Contract Settlement Date.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments, if any, on the Purchase Contracts until the Purchase
Contract Settlement Date, the Holder of this Income PRIDES Certificate will
receive on the Purchase Contract Settlement Date in respect of the Deferred
Contract Adjustment Payments, in lieu of a cash payment, a number of shares of
Common Stock equal to (x) the aggregate amount of Deferred Contract Adjustment
Payments payable to the Holder of this Income PRIDES Certificate divided by (y)
the Applicable Market Value. No fractional shares of Common Stock will be
issued with respect to the payment of Deferred Contract Adjustment Payments on
the Purchase Contract Settlement Date, as provided in the Purchase Contract
Agreement.
In the event the Company exercises its option to defer the payment of any
Contract Adjustment Payments, then, until the Deferred Contract Adjustment
Payments
A-11
have been paid, the Company shall not declare or pay dividends on, or make a
distribution with respect to, or redeem, purchase or acquire, or make a
liquidation payment with respect to, any of its capital stock or make guarantee
payments with respect to the foregoing (other than (i) purchases or acquisitions
of shares of Protective Life's capital stock in connection with the satisfaction
by Protective Life of its obligations under any employee benefit plans or the
satisfaction by the Company of its obligations pursuant to any contract or
security requiring the Company to purchase shares of its capital stock, (ii) as
a result of a reclassification of Protective Life capital stock or the exchange
or conversion of one class or series of the Company's capital stock for another
class or series of Protective Life capital stock, (iii) the purchase of
fractional interests in shares of the Company's capital stock pursuant to an
acquisition or the conversion or exchange provisions of such Protective Life
capital stock or the securities being converted or exchanged, and (iv)
redemptions of purchases pursuant to Protective Life's Rights Agreement, dated
as of August 7, 1995, between Protective Life and AmSouth Bank (as successor by
merger to AmSouth Bank of Alabama, successor by conversion of charter to Amsouth
Bank N.A.) ("AmSouth Bank") as Rights Agent).
The Purchase Contracts and the obligations and rights of the Company and
the Holders thereunder, including, without limitation, the rights of the Holders
to receive and the obligation of the Company to pay any Contract Adjustment
Payments or any Deferred Contract Adjustment Payments, shall immediately and
automatically terminate, without the necessity of any notice or action by any
Holder, the 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 Agent, the Collateral
Agent and to the Holders, at their addresses as they appear in the Income PRIDES
Register. Upon and after the occurrence of a Termination Event, the Collateral
Agent shall release the Preferred Securities from the Pledge in accordance with
the provisions of the Pledge Agreement.
A-12
Subject to and upon compliance with the provisions of the Purchase Contract
Agreement at the option of the Holder thereof, Purchase Contracts underlying
Securities having an aggregate Stated Amount equal to $1,000 or an integral
multiple thereof 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 Income
PRIDES Certificate, the Holder of this Income PRIDES Certificate shall deliver
this Income PRIDES Certificate to the 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 a certified or cashier's check payable to the order of the Company in an
amount (the "Early Settlement Amount") equal to (i) 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 (ii) 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 Contract
Adjustment Payments, if any, payable on such Payment Date with respect to such
Purchase Contracts plus (y) the distributions with respect to the related
Pledged Preferred Securities payable on such Payment Date. Upon Early
Settlement of Purchase Contracts by a Holder of the related Securities, the
Pledged Preferred 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 an Income PRIDES as to which Early Settlement is
effected equal to the Early Settlement Rate; provided however, that upon the
Early Settlement of the Purchase Contracts, the Holder thereof will forfeit the
right to receive any Deferred Contract Adjustment Payments, if any, on such
Purchase Contracts. 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 Income PRIDES Certificate, the
transferee shall be bound (without the
A-13
necessity of any other action on the part of such transferee, except as may be
required by the 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 Income PRIDES Certificate. The Company
covenants and agrees, and the Holder, by his acceptance hereof, likewise
covenants and agrees, to be bound by the provisions of this paragraph.
The Holder of this Income PRIDES Certificate, by his acceptance hereof,
authorizes the Agent to enter into and perform the related Purchase Contracts
forming part of the Income PRIDES evidenced hereby on his behalf as his
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 Agent to enter into and perform the
Pledge Agreement on his behalf as his attorney-in-fact, and consents to the
Pledge of the Preferred Securities underlying this Income PRIDES 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 Stated Amount of the related Pledged Preferred 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
Contracts 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 at least 66 2/3% 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.
A-14
The Company, the Agent and its Affiliates and any agent of the Company or
the Agent may treat the Person in whose name this Income PRIDES Certificate is
registered as the owner of the Income PRIDES evidenced hereby for the purpose of
receiving payments of distributions payable quarterly on the Preferred
Securities, receiving payments of Contract Adjustment Payments, if any, and any
Deferred Contract Adjustment 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 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 Agent.
A-15
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
---------------------------------
(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 Income PRIDES Certificates and all rights
----------------------------------------------------------------------
thereunder, hereby irrevocably constituting and appointing
----------------------------------------------------------------------
attorney to transfer said Income PRIDES Certificates on the books of Protective
Life Corporation 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 Income PRIDES
Certificate in every particular, without
alteration or enlargement or any change
whatsoever.
A-16
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 Income PRIDES evidenced
by this Income PRIDES 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
If shares are to be registered
in the name of and delivered to REGISTERED HOLDER
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 ---------------------------
A-17
ELECTION TO SETTLE EARLY
The undersigned Holder of this Income PRIDES 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 Income PRIDES evidenced by this Income PRIDES
Certificate specified below. The option to effect Early Settlement may be
exercised only with respect to Purchase Contracts underlying Income PRIDES 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
Income PRIDES Certificate representing any Income PRIDES 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 Preferred 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
A-18
Number of Securities evidenced hereby as to which Early Settlement of the
related Purchase Contracts is being elected:
If shares of Common Stock REGISTERED HOLDER
or Income PRIDES Certificates
are to be registered in the name
of and delivered to and Pledged
Preferred Securities are to be
transferred to a Person other than
the Holder, please print such Person's
name and address:
Please print name and address of
Registered Holder:
----------------------------- ---------------------------
Name Name
----------------------------- ---------------------------
Address Address
----------------------------- ---------------------------
----------------------------- ---------------------------
Social Security or other
Taxpayer Identification
Number, if any ---------------------------
Transfer Instructions for Pledged Preferred Securities Transferable Upon Early
Settlement or a Termination Event:
-------------------------------------------------
-------------------------------------------------
-------------------------------------------------
A-19
[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:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Principal
Amount of Amount of Amount of Signature of
decrease in increase in this Global authorized
Principal Principal Certificate officer of
Amount of Amount of following Trustee or
the Global the Global such decrease Securities
Date Certificate Certificate or increase Custodian
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
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A-20
EXHIBIT B
THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE PURCHASE
CONTRACT AGREEMENT (AS HEREINAFTER DEFINED) AND IS REGISTERED IN THE NAME OF A
DEPOSITARY OR A NOMINEE THEREOF. THIS CERTIFICATE MAY NOT BE EXCHANGED IN WHOLE
OR IN PART FOR A CERTIFICATE REGISTERED, AND NO TRANSFER OF THIS CERTIFICATE IN
WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH
DEPOSITARY OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED
IN THE PURCHASE CONTRACT AGREEMENT.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company (55 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx) to the Company or
its agent 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 Depository Trust Company, and any payment
hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE
OR OTHERWISE BY A PERSON IS WRONGFUL since the registered owner hereof, Cede &
Co., has an interest herein.
No. ____ Number of Growth PRIDES _____ Cusip No. ________
Form of Face of Growth PRIDES Certificate
This Growth PRIDES Certificate certifies that __________ is the registered
Holder of the number of Growth PRIDES set forth above. Each Growth PRIDES
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 of such Treasury Security by such Holder pursuant to the Pledge
Agreement, and (ii) the rights and obligations of the Holder under 20 Purchase
Contracts with Protective Life Corporation, a Delaware Corporation (the
"Company"). All capitalized terms used herein which are defined in the Purchase
Contract Agreement have the meaning set forth therein.
Pursuant to the Pledge Agreement, the Treasury Securities relating to each
Growth PRIDES evidenced hereby have been pledged to the Collateral Agent, for
the
B-1
benefit of the Company, to secure the obligations of the Holder under the
Purchase Contract comprising a portion of such Growth PRIDES.
Each Purchase Contract evidenced hereby obligates the Holder of this Growth
PRIDES Certificate to purchase, and the Company, to sell, on , 2000
(the "Purchase Contract Settlement Date"), at a price equal to $50 (the "Stated
Amount"), a number of shares of Common stock, par value $.50 per share ("Common
Stock"), of the Company equal to the Settlement Rate unless on or prior to the
Purchase Contract Settlement Date there shall have occurred a Termination Event
with respect to the Growth PRIDES 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 for the shares of Common Stock purchased
pursuant to each Purchase Contract evidenced hereby will be paid by application
of the Proceeds from the Treasury Securities pledged to secure the obligations
under such Purchase Contract in accordance with the terms of the Pledge
Agreement.
The Company shall pay on each Payment Date in respect of each Purchase
Contract evidenced hereby an amount (the "Contract Adjustment Payments") equal
to ____% per annum of the Stated Amount (provided, that, if such percentage is
0%, then no Contract Adjustment payments will be payable by the Company),
computed on the basis of the actual number of days elapsed in a year of 360 day
year of twelve 30 day months, as the case may be, subject to deferral at the
option of the Company as provided in the Purchase Contract Agreement and more
fully described on the reverse hereof. Such Contract Adjustment Payments, if
any, shall be payable to the Person in whose name this Growth PRIDES Certificate
(or a Predecessor Growth PRIDES Certificate) is registered at the close of
business on the Record Date for such Payment Date.
Contract Adjustment Payments, if any, will be payable at the office of the
Agent in The City of New York or, at the option of the Company, by check mailed
to the address of the Person entitled thereto as such address appears on the
Growth PRIDES Register.
Reference is hereby made to the further provisions set forth on the reverse
hereof, which further provisions
B-2
shall for all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Agent by manual signature, this Growth PRIDES 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-3
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
PROTECTIVE LIFE CORPORATION
By:
-------------------------------
Name:
Title:
By:
-------------------------------
Name:
Title:
Attest:
---------------------
Name:
Title:
HOLDER SPECIFIED ABOVE (as to
obligations of such Holder under the Purchase
Contracts evidenced hereby)
--------------------------------
By: THE BANK OF NEW YORK not individually
but solely as Attorney-in-Fact of such
Holder
By:
-----------------------------
Name:
Title:
Dated:
AGENT'S CERTIFICATE OF AUTHENTICATION
This is one of the Growth PRIDES referred to in the within-mentioned
Purchase Contract Agreement.
By: THE BANK OF NEW YORK, as Agent
By:
--------------------------------
Authorized Officer
B-4
(Form of Reverse of
Growth PRIDES Certificate)
Each Purchase Contract evidenced hereby is governed by the Purchase
Contract Agreement, dated as of _______, 1997 (as supplemented from time to
time, the "Purchase Contract Agreement") between the Company and
, as Purchase Contract Agent (including its successors thereunder,
herein called the "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 Agent, the Company and the Holders and of the terms upon which
the Growth PRIDES Certificates are, and are to be, executed and delivered.
Each Purchase Contract evidenced hereby obligates the Holder of this Growth
PRIDES 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 of the Company equal to the
Settlement Rate unless, on or prior to the Purchase Contract Settlement Date,
there shall have occurred a Termination Event or an Early Settlement with
respect to the Security of which such Purchase Contract is a part. The
"Settlement Rate" is equal to (a) if the Applicable Market Value (as defined
below) is equal to or greater than $____ (the "Threshold Appreciation Price"),
____ shares of Common Stock per Purchase Contract, (b) if the Applicable Market
Value is less than the Threshold Appreciation Price but is greater than $____,
the number of shares of Common Stock per Purchase Contract equal to the Stated
Amount divided by the Applicable Market Value and (c) if the Applicable Market
Amount is less than or equal to $____, _____ 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 the Purchase Contract
Agreement.
The "Applicable Market Value" means the average of the Closing Prices per
share of Common Stock on each of the thirty consecutive Trading Days ending on
the second Trading Day immediately preceding the Purchase Contract Settlement
Date. The "Closing Price" of the Common Stock on any date of determination
means the closing sale price (or, if no closing price is reported, the last
reported sale price) of the Common Stock on the New York Stock Exchange (the
"NYSE") on such date or, if the Common Stock is not listed for trading on the
NYSE on any such date, as reported in the composite transactions for
B-5
the principal United States securities exchange on which the Common Stock is so
listed, or if the Common Stock is not so listed on a United States national or
regional securities exchange, as reported by The Nasdaq Stock Market, or, if the
Common Stock is not so reported, the last quoted bid price for the Common Stock
in the over-the-counter market as reported by the National Quotation Bureau or
similar organization, or, if such bid price is not available, the market value
of the Common Stock on such date as determined by a nationally recognized
independent investment banking firm retained for this purpose by the Company. A
"Trading Day" means a day on which the Common Stock (A) 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 (B) has traded at least
once on the national or regional securities exchange or association or
over-the-counter market that is the primary market for the trading of the Common
Stock.
In accordance with the terms of the Purchase Contract Agreement, the Holder
of this Growth PRIDES Certificate shall pay the Purchase Price for the shares of
Common Stock purchased pursuant to each Purchase Contract evidenced hereby by
effecting either an Early Settlement of each such Purchase Contract or by
applying a principal amount of the Pledged Treasury Securities underlying such
Holder's Growth PRIDES equal to the Stated Amount of such Purchase Contract to
the purchase of the Common Stock.
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 in full of the aggregate purchase
price for the shares of Common Stock to be purchased thereunder in the manner
herein set forth.
Each Purchase Contract evidenced hereby and the obligations and rights of
the Company and the Holder thereunder shall terminate if a Termination Event
shall have occurred. Upon the occurrence of a Termination Event, the Company
shall give written notice to the Agent and to the Holders, at their addresses as
they appear in the Growth PRIDES Register. Upon and after the occurrence of a
Termination Event, the Collateral Agent shall release the Pledged Treasury
Securities (as defined in the Pledge Agreement) relating to each Growth PRIDES
in accordance with the provisions of the Pledge Agreement. A Growth PRIDES
shall thereafter represent the right to receive any accrued Contract Adjustment
Payments on the Purchase Contract relating to such Growth PRIDES in accordance
with the terms of the Purchase Contract Agreement and the
B-6
Pledge Agreement. Contract Adjustment Payments, if any, shall cease to accrue
in respect of any period from and after the date of a Termination Event.
The Growth PRIDES Certificates are issuable only in registered form and
only in denominations of a single Growth PRIDES and any integral multiple
thereof. The transfer of any Growth PRIDES Certificate will be registered and
Growth PRIDES Certificates may be exchanged as provided in the Purchase Contract
Agreement. The Growth PRIDES 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 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
Preferred Securities for a Treasury Security, thereby creating Income PRIDES,
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 Growth PRIDES remains in effect, such Growth PRIDES shall
not be separable into its constituent parts, and the rights and obligations of
the Holder of such Growth PRIDES in respect of the related Treasury Security and
the Purchase Contract constituting such Growth PRIDES may be transferred and
exchanged only as a Growth PRIDES. The holder of a Growth PRIDES may substitute
for the Pledged Treasury Securities securing its obligations under the related
Purchase Contract Preferred Securities with an aggregate liquidation amount
equal to the aggregate principal amount 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 an "Income PRIDES." Such substitution may cause the aggregate
Stated Amount of this Certificate to be increased or decreased; PROVIDED,
HOWEVER, the aggregate Stated Amount outstanding under this Growth PRIDES
Certificate shall not exceed $______. All such adjustments to the aggregate
Stated Amount of this Growth PRIDES Certificate shall be duly recorded by
placing an appropriate notation on the Schedule attached hereto.
A Holder of an Income PRIDES may recreate a Growth PRIDES by delivering to
the Collateral Agent Treasury Securities in an aggregate principal amount equal
to the aggregate liquidation amount of the Pledged Preferred Securities in
exchange for the release of such Pledged Preferred Securities in accordance with
the terms of the Purchase Contract Agreement and the Pledge Agreement. Any such
recreation of a Growth PRIDES
B-7
may be effected only in multiples of 20 Income PRIDES for 20 Growth PRIDES.
Subject to the next succeeding paragraph, the Company shall pay, on each
Payment Date, the Contract Adjustment Payments, if any, payable in respect of
each Purchase Contract to the Person in whose name the Growth PRIDES 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 Agent in The City of New York 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 Growth PRIDES Register.
The Company shall have the right, at any time prior to the Purchase
Contract Settlement Date, to defer the payment of any or all of the Contract
Adjustment Payments otherwise payable on any Payment Date, but only if the
Company shall give the Holders and the Agent written notice of its election to
defer such payment (specifying the amount to be deferred) as provided in the
Purchase Contract Agreement. Any Contract Adjustment Payments so deferred shall
bear additional Contract Adjustment Payments thereon at the rate of ____% per
annum (computed on the basis of a 360 day year of twelve 30 day months),
compounding on each succeeding Payment Date, until paid in full (such deferred
installments of Contract Adjustment Payments together with the additional
Contract Adjustment Payments accrued thereon, are referred to herein as the
"Deferred Contract Adjustment Payments"). Deferred Contract Adjustment
Payments, if any, shall be due on the next succeeding Payment Date except to the
extent that payment is deferred pursuant to the Purchase Contract Agreement. No
Contract Adjustment Payments may be deferred to a date that is after the
Purchase Contract Settlement Date.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments on the Purchase Contracts until the Purchase Contract
Settlement Date, the Holder of this Growth PRIDES Certificate will receive on
the Purchase Contract Settlement Date in respect of any Deferred Contract
Adjustment payments, in lieu of a cash payment, a number of shares of Common
Stock equal to (x) the aggregate amount of Deferred Contract Adjustment Payments
payable to the Holder of the Growth PRIDES Certificate of Securities divided by
(y) the Applicable Market Value. No fractional shares of Common Stock will be
issued with respect to the payment of Deferred Contract Adjustment Payments, if
any, on the Purchase Contract Settlement Date, as provided in the Purchase
Contract Agreement.
B-8
In the event the Company exercises its option to defer the payment of
any Contract Adjustment Payments, then, until the Deferred Contract Adjustment
Payments have been paid, the Company shall not declare or pay dividends on, make
distributions with respect to, or redeem, purchase or acquire, or make a
liquidation payment with respect to, any of its capital stock or make guarantee
payments with respect to the foregoing (other than (i) purchases or acquisitions
of shares capital stock of the Company in connection with the satisfaction by
the Company of its obligations under any employee benefit plans or the
satisfaction by the Company of its obligations pursuant to any contract or
security outstanding on the date of such event requiring the Company to purchase
capital stock of the Company, (ii) as a result of a reclassification of the
Company's capital stock or the exchange or conversion of one class or series of
the Company's capital stock for another class or series of the Company's capital
stock, (iii) the purchase of fractional interests in shares of the Company's
capital stock pursuant to the conversion or exchange provisions of the Company's
capital stock or the security being converted or exchanged, (iv) dividends or
distributions in capital stock of the Company or (v) redemptions or purchases of
any rights pursuant to the Rights Agreement, or any successor to the Rights
Agreement, and the declaration thereunder of a dividend of rights in the
future).
The Purchase Contracts and the obligations and rights of the Company and
the Holders thereunder, including, without limitation, the rights of the Holders
to receive and the obligation of the Company to pay any Contract Adjustment
Payments or any Deferred Contract Adjustment Payments, shall immediately and
automatically terminate, without the necessity of any notice or action by any
Holder, the 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 Agent, the Collateral
Agent and to the Holders, at their addresses as they appear in the Growth PRIDES
Register. Upon and after the occurrence of a Termination Event, the Collateral
Agent shall release the Treasury Securities from the Pledge in accordance with
the provisions of the Pledge Agreement.
B-9
Subject to and upon compliance with the provisions of the Purchase
Contract Agreement, at the option of the Holder thereof, Purchase Contracts
underlying Securities having an aggregate Stated Amount equal to $1,000 or an
integral multiple thereof 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 Growth PRIDES Certificate, the Holder of this Growth PRIDES
Certificate shall deliver this Growth PRIDES Certificate to the 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 a certified or cashier's check payable
to the order of the Company in an amount (the "Early Settlement Amount")
equal to (i) 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 (ii) if such delivery is made with respect to any
Purchase Contracts during the period from the close of business on any Record
Date next preceding any Payment Date to the opening of business on such
Payment Date, an amount equal to the Contract Adjustment Payments, if any,
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 Growth
PRIDES as to which Early Settlement is effected equal to _____ shares of
Common Stock per Purchase Contract (the "Early Settlement Rate"); provided
however, that upon the Early Settlement of the Purchase Contracts, the Holder
thereof will forfeit the right to receive any Deferred Contract Adjustment
Payments on such Purchase Contracts. The Early Settlement Rate shall
initially be equal to _______ shares of Common Stock per Growth PRIDES 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 Growth PRIDES 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 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 Growth PRIDES
B-10
Certificate. The Company covenants and agrees, and the Holder, by his
acceptance hereof, likewise covenants and agrees, to be bound by the
provisions of this paragraph.
The Holder of this Growth PRIDES Certificate, by his acceptance hereof,
authorizes the Agent to enter into and perform the related Purchase Contracts
forming part of the Growth PRIDES evidenced hereby on his behalf as his
attorney-in-fact, expressly withholds any consent to the assumption (i.e.,
affirmance) of such 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 Agent to
enter into and perform the Pledge Agreement on his behalf as his
attorney-in-fact, and consents to the Pledge of the Treasury Securities
underlying this Growth PRIDES 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 of the Stated Amount of
the related 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 Contracts 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 at least 66 2/3%
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 Agent and its Affiliates and any agent of the Company or
the Agent may treat the Person in whose name this Growth PRIDES Certificate
is registered as the owner of the Growth PRIDES evidenced hereby for the
purpose of receiving payments of interest on the Treasury Securities,
receiving payments of Contract Adjustment Payments, if any, and any Deferred
Contract Adjustment 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 Agent nor any such agent shall be affected by notice to the
contrary.
B-11
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 Agent.
B-12
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
---------------------------------
(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 Growth PRIDES Certificates and all rights
--------------------------------------------------------------------------
thereunder, hereby irrevocably constituting and appointing
--------------------------------------------------------------------------
attorney to transfer said Growth PRIDES Certificates on the books of Protective
Life Corporation 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 Growth PRIDES Certificate in
every particular, without alteration or
enlargement or any change whatsoever.
B-13
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 Growth PRIDES evidenced
by this Growth PRIDES 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
If shares are to be registered
in the name of and delivered to REGISTERED HOLDER
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-14
ELECTION TO SETTLE EARLY
The undersigned Holder of this Growth PRIDES 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 Growth PRIDES evidenced by this Growth PRIDES
Certificate specified below. The option to effect Early Settlement may be
exercised only with respect to Purchase Contracts underlying Growth PRIDES 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
Growth PRIDES Certificate representing any Growth PRIDES 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
B-15
Number of Securities evidenced hereby as to which Early Settlement of the
related Purchase Contracts is being elected:
If shares of Common Stock REGISTERED HOLDER
or Growth PRIDES Certifi-
xxxxx are to be registered
in the name of and delivered
to and Pledged Treasury
Securities are to be
transferred to a Person
other than the Holder, please
print such Person's name and address:
Please print name and address of
Registered Holder:
------------------------ --------------------------
Name Name
------------------------ --------------------------
Address Address
------------------------ --------------------------
------------------------ --------------------------
------------------------ --------------------------
Social Security or other
Taxpayer Identification
Number, if any --------------------------
Transfer Instructions for Pledged Treasury Securities Transferable Upon Early
Settlement or a Termination Event:
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--------------------------------------------------------------------
--------------------------------------------------------------------
B-16
[TO BE ATTACHED TO GLOBAL CERTIFICATES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The following increases or decreases in this Global Certificate have
been made:
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Principal
Amount of Amount of Amount of Signature of
decrease in increase in this Global authorized
Principal Principal Certificate officer of
Amount of Amount of following such Trustee or
the Global the Global decrease Securities
Date Certificate Certificate or increase Custodian
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B-17
EXHIBIT C
INSTRUCTION FROM PURCHASE CONTRACT AGENT TO COLLATERAL AGENT
Attention:
Re: FELINE PRIDES of Protective Life Corporation (the
"Company"), and PLC Capital Trust II
We hereby notify you in accordance with Section 4.1 of the
Pledge Agreement, dated as of ________ __, 1997, among the Company,
yourselves, as Collateral Agent, and ourselves, as Purchase Contract
Agent and as attorney-in-fact for the holders of [Income PRIDES]
[Growth PRIDES] from time to time, that the holder of securities
listed below (the "Holder") has elected to substitute [$_____
aggregate principal amount of Treasury Securities] [$_______Stated
Amount of Preferred Securities] in exchange for the [Pledged Preferred
Securities] [Pledged Treasury Securities] held by you in accordance
with the Pledge Agreement and has delivered to us a notice stating
that the Holder has Transferred [Treasury Securities] [Preferred
Securities] to you, as Collateral Agent. We hereby instruct you, upon
receipt of such [Pledged Treasury Securities] [Pledged Preferred
Securities], to release the Preferred Securities] [Treasury
Securities] related to such [Income PRIDES] [Growth PRIDES] to us in
accordance with the Holder's instructions.
Date:
-----------------
By:
------------------------
Name:
Title:
Please print name and address of Registered Holder electing to
substitute [Treasury Securities] [Preferred Securities] for the
[Pledged Preferred Securities] [Pledged Treasury Securities]:
--------------------------- -------------------------
Name Social Security or other Taxpayer
Identification
--------------------------- Number, if any
Address
---------------------------
---------------------------
C-1
EXHIBIT D
INSTRUCTION TO PURCHASE CONTRACT AGENT
Attention:
Re: FELINE PRIDES of PROTECTIVE LIFE CORPORATION (the
"Company"), and PLC Capital Trust II
The undersigned Holder hereby notifies you that it has
delivered to , as Collateral Agent,
$_______ aggregate principal amount of [Treasury Securities]
[Preferred Securities] in exchange for the [Pledged Preferred
Securities] [Pledged Treasury Securities] held by the Collateral
Agent, in accordance with Section 4.1 of the Pledge Agreement, dated
__________ __, 1997, between you, the Company and the Collateral
Agent. The undersigned Holder hereby instructs you to instruct the
Collateral Agent to release to you on behalf of the undersigned Holder
the [Pledged Preferred Securities] [Pledged Treasury Securities]
related to such [Income PRIDES] [Growth PRIDES].
Dated:
--------------- -----------------------------
Signature
Please print name and address of Registered Holder:
------------------------- -------------------------
Name Social Security or other
Taxpayer Identification
------------------------- Number, if any
Address
-------------------------
-------------------------
-------------------------
D-1
